Cincinnati officials have settled a lawsuit filed by a group of Black residents who alleged the city intentionally favored white homeowners for residential tax breaks, per the Enquirer.
The lawsuit, which was filed in July 2020, claimed the Cincinnati Tax Abatement Program operated in a “racially discriminatory way” that worsened the city’s racially segregated residency pattern.
According to the lawsuit, the tax abatement program allowed homeowners to apply “to pay property taxes on the pre-improvement value of their property for 10-15 years.” However, the program required a $5000 minimum in renovation costs to be eligible for the tax reduction, disqualifying lower-income homeowners who made renovations of lesser value, according to the suit.
“Nowhere in the application or approval process is there any consideration by the City of Cincinnati of the degree to which the granting of tax abatements will have a racially segregative effect on the residency pattern” in the city, the lawsuit said.
The lawsuit also accused the program of making Black residents poorer by favoring white homeowners applying for tax breaks.
According to city records, 2,640 residential tax abatements were granted for $183 million at the time the lawsuit was filed. Attorney Robert Newman said more than $53 million went to one of the city’s wealthiest neighborhoods, which is predominantly white. Data between 2014 and 2018 shows that two of the city’s majority-Black neighborhoods received less than $1 million in tax abatements.
The city agreed to pay $110,000 to the homeowners to settle the lawsuit. Officials must also expand the outreach of the tax abatement program.
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