UW researcher Kaba Bah used city funds to renovate his North Hancock duplex, which included replacing the roof, windows, siding and doors.
Kaba Bah has done a lot of work on his new duplex on North Hancock Street, just a few blocks from Capitol Square.
The UW-Madison researcher has replaced the house's roof, windows, siding and doors. He's also put in a new bathtub and granite kitchen in the upstairs unit.
Bah wouldn't have been able to do all of this without help from the city.
Madison is famous for battles over whether to give developers subsidies through tax incremental financing. But everyday homeowners in some downtown neighborhoods can also qualify for TIF funds.
Known as "small-cap TIF," the program has been around for years but is getting a fresh push from the city, which increased the amount of money people can get.
"It's really free money," says Joe Lusson, immediate past president of the Tenney-Lapham Neighborhood Association. "Loan is in the title, but if you live there for 10 years, you don't have to pay it back. That's pretty amazing."
Under the program, people who buy or own a single unit home can get up to $80,000. Owners of duplexes qualify for $90,000 and owners of three-unit properties can get $100,000. Ten percent of the money has to be spent on exterior renovations. The grants can be used for renovation costs and up to 10% of the purchase price of the home. So if you buy a $70,000 home, you can use $7,000 of the city grant toward the purchase.
However, only current rental properties that are not owner-occupied, but will become owner-occupied, qualify for the grants.
If the homeowner lives there for 10 years, the loan is forgiven. The city has also revised the program making it possible for the grant to be transferred, if someone sells the property before the 10 years are up -- provided it is sold to someone who will live in the property.
The program is currently available within a half mile of TIF district 32, which includes State Street, Mansion Hill, James Madison Park and Tenney-Lapham neighborhoods. There's a similar small-cap TIF program in the Greenbush neighborhood.
Lusson says that unlike the large development TIF grants, which can go towards projects that can sometimes be disruptive to neighborhoods, the small-cap TIF is restorative, helping to stabilize older neighborhoods.
"It's a small step toward balancing things out by giving something to the little guy and restoring our historic properties in the process," he says.
Lusson has renovated two homes in his neighborhood, James Madison Park, which is dominated by rental properties. He says his neighborhood is currently in flux and he's not sure which way it will turn.
"This is so heavily rental that we're at a crossroads," he says. "Either these houses will be collected up by developers and torn down, or they're going to be renovated."
Lusson adds that the program is great for current renters who want to buy a home, but cannot afford property in the downtown area.
Such was the case with Bah, who loves being downtown. "It's a very beautiful neighborhood, it's very close to everything," he says. "It's a quick bus ride to work, and close to the Capitol and all the things that happen downtown. It's also on a one-way street and very quiet for downtown."
Owning a duplex where he can rent one unit also helps him pay for his investment. "That's probably one of the best ways to afford a property downtown. Having a rental unit helps a lot with the expenses."
The neighborhood's alder, Ledell Zellers, and Lusson are holding a meeting on the program Saturday, Oct. 25 from 2 to 5 p.m. at the Mendota Lake House Bed and Breakfast, 704 E. Gorham St.
Attendees will get information on the program and then tour some renovated homes nearby.
[Editor's note: Editor's note: This story was corrected to note that Joe Lusson is the immediate past president of the Tenney-Lapham Neighborhood Association, and updated to note that in order to qualify for a small-cap TIF loan, a house must currently be a rental property that is not owner occupied.]