Tax breaks proposed for elderly housing projects | Guam News | postguam.com – The Guam Daily Post
New legislation from Sen. Telo Taitague would create a new qualifying certificate program that incentivizes companies to build residential community developments specifically for senior citizens.
Bill 259-36, also called “Åkton GUMA Incentive Act,” finds that with the rising cost of housing and a growing population of seniors on fixed incomes, the need to plan for housing opportunities has become “vitally necessary.” The legislation’s GUMA stands for Group Use Manåmko Accommodations.
“Currently, Guam has no assisted-care housing opportunities that fill the void between elderly independent living facilities and nursing home facilities,” the bill states. “There is a recognition for developing privately owned and operated elderly residential living communities both locally and nationally.”
But high costs can deter these projects from happening.
According to the measure, senior living development costs on average about $256,000 per unit, or $283 per square foot. The island’s higher cost of goods and labor could drive up budgets for projects of this kind by as much as 40%, the bill contends.
If enacted as introduced, companies will be able to qualify for tax rebates, exemptions or abatements through the Guam Economic Development Authority in exchange for building the developments.
A company’s program benefits will equal 25% of total construction costs for new projects, or for properties that were substantially renovated or improved. Developments that are deemed “affordable” housing projects due to rent caps will be able to claim 30% of its construction costs.
The developer will have the discretion to choose which possible incentives it will apply the new government financial benefit to:
• 100% credit of business privilege taxes or 20 years.
• 75% rebate on income taxes for 20 years.
• 100% abatement on real property taxes for 20 years.
• 100% exemption on use taxes for property used to construct, furnish and equip the development, claimed no later than one year after an occupancy permit is issued.
A 10-year window to apply for the incentive will be the initial timeframe, though GEDA’s board, alongside input from other government agencies and senators, will have an option to extend the program’s life by an additional five years.
The bill is co-sponsored by Sens. Amanda Shelton, Sabina Perez, Joanne Brown, Frank Blas and Pedo Terlaje.
“With Bill 259, we will no longer ignore the urgency of finding a solution for an issue we all know exists but don’t want to talk about. For those of us who are blessed to have our parents and grandparents around, I understand how challenging it is for them and us to make things work. But, for working families, taking care of our children while caring for our elderly parents can be difficult particularly when the price of food, medicine, fuel, and a myriad of supports that are needed continues to rise,” Taitague stated.
