Rep. Pennartz files bill to encourage downtown development

Rep. Tracy Pennartz, D-Fort Smith, filed a bill — HB 1060 — Monday (Jan. 12) that would establish an investment tax credit for renovation and development in Fort Smith’s Central Business Improvement District.

The district, which includes downtown Fort Smith and portions of Towson Avenue up to Sparks Regional Medical Center, is governed by an autonomous board that has the power to issues bonds, tax and the power of eminent domain. Pennartz’s bill is written to cover similar business districts in Arkansas.

The investment tax credit would be equal to 20% of up to the first $2 million of qualified rehabilitation or development expenditures incurred for a qualified project.

Tax credits would be eligible for new construction and renovation of existing structures that exceed $75,000. The project would also have to meet development criteria established by the governing business improvement district.

Also, the projects must be completed within two years for a “single-phase project” and five years for a “multiple-phase project,” according to the bill.

The bill would also put an annual cap of $20 million on investment tax credits awarded by the state, with $10 million reserved for eligible business districts in a city of less than 50,000 population, and $10 million for eligible districts in cities with populations above 50,000.

The bill was referred to the House Revenue & Taxation committee.

Deputy Fort Smith City Administrator Ray Gosack said the CBID members were instrumental in working with Pennartz to get the legislation ready. He said the bill was written to improve the opportunity for downtown investments.

“The bill gives considerable flexibility in attaining the credit, so it should provide a meaningful incentive for downtown reinvestment,” Gosack said.