Park City revises homebuyer incentive to combine upfront grant with five-year partial property tax rebate

Park City council on April 9 approved revisions to the city's homebuyer incentive program designed to spur new-home construction and first-occupant purchases.

Staff proposed combining an up-front incentive (baseline $2,500 for lower-priced homes) with a five-year partial reimbursement of the city's portion of ad valorem property tax (75% rebate) for eligible buyers. "The city currently renewed the offer of the homebuyer incentive program, which is $2,500 for new home purchases where the developer or the builder participates by also offering $3,000 towards closing cost," staff told council and then discussed a proposal that would remove the builder as a required partner while pairing the upfront grant with the tax rebate.

Under the measure as presented, eligibility is limited to new construction and first occupants (the program does not apply to special-assessment relief and excludes other taxing entities). Staff described administrative requirements: applicants must complete an application, contract with a licensed builder or realtor, provide an IRS W-9, and supply a HUD-1 settlement statement and certificate of occupancy before payment is issued. For the annual tax rebate, staff described a homeowner-driven process: once the homeowner pays their property taxes for the year and provides proof, the city would issue the 75% reimbursement of the city's portion of ad valorem taxes.

Staff advised the council that the homeowner-incentive budget for 2024 is $125,000 across multiple programs, with $50,000 allocated to new homebuyer incentives; nine applications had been received to date totaling $22,250. Council members asked clarifying questions about what ad valorem covers (property tax), whether the incentive applied to special assessments (it does not), and how the rebate would be administered (homeowner must submit proof of payment to receive reimbursement).

After discussion, a motion to approve the proposed homebuyer incentive plan passed (motion by Ben Salceda, second by Brandy Bailey). Councilmembers framed the program as a proactive step to attract housing investment given higher interest rates and regional development pressures, and staff said future budget adjustments could be considered as demand evolves.

The council's approval directs staff to implement the revised incentive and manage rebates according to the program guidelines presented.