New tax incentives will help with rejuvenation of 100 small towns

One hundred small towns throughout the Republic have been included in a new tax incentive-based town renewal scheme announced by the Minister of State for the Environment, Mr Robert Molloy, yesterday.

The scheme, which is similar to that operating in major towns and cities, is intended to address the problems of dereliction and neglect and the shift in population from small towns to the surrounding countryside. Included are five categories of tax incentive: commercial office development, commercial retail development, industrial, residential owner-occupier and residential investor. In each category the tax incentives will apply to new buildings and the refurbishment or conversion of existing buildings.

Residential tax incentives within the designated areas will apply from yesterday but the incentives for commercial and industrial development cannot be brought into effect without EU approval, which the Government is seeking.

The residential development incentives are 50 per cent of the construction cost of new buildings, spread over 10 years, and 100 per cent of the costs of refurbishing or converting old buildings, again spread over 10 years. The small towns were chosen by an expert advisory panel on an investment need basis. No towns in Co Dublin or in the greater Dublin area have been included as these have been deemed self-supporting in terms of investment. The list of 100 small towns was eagerly awaited by county councils throughout the State, which had been asked to draw up Town Renewal Plans (TRPs) in line with recommendations of an expert advisory panel. When they were introduced in the mid-1980s, urban renewal schemes for major urban towns and cities drew criticism over the fact that the minister of the day had the power to decide which streets or neighbourhoods would receive tax incentives. This latest scheme, like more recent additions to the existing scheme, avoids that controversy by devolving the selection process to an expert advisory panel, which in this instance was chaired by Mr Dom Hegarty, a principal planning adviser at the Department of the Environment.

The designation applies only to individual parts of the 100 towns selected by county councils in their TRPs, and approved by the expert advisory panel. Officially the scheme runs until 2003 but, according to a spokesman for the Department, it may be extended. Most of the small towns designated yesterday have suffered from the problems of depopulation brought about by emigration and increasingly by migration to larger towns and cities within the State.

Another aspect of dereliction that the scheme aims to tackle is the drift of population in small towns from town houses or over-the-shop apartments to the surrounding countryside. Such a drift also leads to over-dependence on car ownership, while the towns themselves serve as "daytime service centres" according to Mr Molloy.

Describing the scheme as the "broadest-based renewal scheme ever introduced" and "an unprecedented opportunity for Ireland's small towns," Mr Molloy said it would be pivotal in addressing decay. He added that he was confident the tax incentives would "inject new life into the towns targeted, discourage the trend of moving to the countryside and stem the haemorrhage of shopping and other commercial activities to the larger urban centres. "We need to build sustainable, commercially thriving centres while enhancing their environment and amenities and I believe the new scheme will achieve major progress towards this goal", the Minister of State said.

However, the scheme came under attack within hours of being announced yesterday. The Fine Gael spokesman on Housing, Mr Billy Timmins, claimed that local authorities were not given sufficient time to publicise the scheme, a factor which he maintained would result in some property owners losing out.

Mr Timmins also referred to plans for Strandhill, Co Sligo, and Ashbourne, Co Meath, that were not approved for tax incentives and he asked whether the Minister had asked the relevant councils to submit redrafted plans for these towns.