2014-29 APPROVING THE 4TH AMENDMENT TO THE REDEVELOPMENT PLAN AND PROJECTS

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DEVELOPMENT SERVICES DEPARTMENT MEMORANDUM No. 14-20 July 7, 2014 TO: Honorable Mayor Michael T. McElroy and City Council FROM: Ryan McCrady, City Manager Billy Tyus,Assistant City Manager Patrick Hoban, Economic Development Officer SUBJECT: Amendment to the Southeast Plaza TIF Redevelopment Pla and Redevelopment Agreement SUMMARY RECOMMENDATION: Staff recommends approval of the 21th Southeast Plaza Redevelopment Plan Amendment to increase the maximum eligible reimbursable project costs and an amendment to the redevelopment agreement providing for sharing of future sales taxes with the City from new dev lopment within the Southeast Plaza TIF. BACKGROUND: The next two items are related to a proposed amendment to the Southeast Plaza Redevelopment plan and associated redevelopment Ogreement.The Southeast Plaza Redevelopment Plan was approved in May of 1997 in order to create a Tax Increment Finance District to spur the development of what, at the time,was a vacant,wooded and blighted area. The TIF District was created to facilitate new retail development including what is now the Hawthorne Suites hotel, The Strand Theater and a number of area restaurants,with reimbursement provided to the developer for eligible costs as work is performed and tax increment generated. A list of estimated eligible reimbursable expenses was included in the 1997 Redevelopment Plan.The plan has been amended on three separate c ccasions since the TIF was created sixteen years ago both to add property to the development area and to increase the amount of eligible costs in various categories (water main and sewer construction, engineering, signalization, etc.) to cover inflationary cost increases.This amendment would increase the estimated eligible rei bursable expenses to complete all projects provided for in the redevelopment plan- including a residential component and additional commercial development- and allow the developer to continue receiving reimbursements for eligible costs for the remaining life of the TIF.The City has taken all of the statutory steps required to make such an amendment, including publication notices and mailings to impacted parties,public hearings and informational postings. The original TIF agreement called for the developer to receive 100% of all incremental sales taxes for the life of the TIF. The next item would all w the city to receive 100% of all new sales taxes generated on undeveloped parcels,which allows the city to begin to share in the success of this development earlier than otherwise would have occurred.