Archive for Thursday, March 22, 2007

Financing district cut to size

March 22, 2007

The final layout for the first phase of a proposed tax increment financing district has apparently been cut down to size.

The city outlined a much larger district as part of a blight study prepared by Bucher Willis & Ratliff, but the city's bonding attorney rejected the plan because it included land not annexed within the city limits, Eudora City Administrator Cheryl Beatty said.

The agency, Gilmore & Bell, approved the streamlined district.

"I think we've progressed quite nicely," Beatty said. "We're ready to move forward with it and if the developers are guaranteeing the bond payment, this should be a very good project for Eudora," Beatty said.

The city will use the district to help pay for infrastructural improvements -- including sewers and road improvements -- to spark commercial growth.

Any property tax generated in the district in excess of its valuation in the first year goes toward retiring the bond.

The revised district would encompass all of Intech Business Park and the planned Deer Valley subdivision as well as 30 acres on the northeast side of 1400 Road.

"It all fits into the master plan," Beatty said.

Deer Valley developers Wilson and Hoover LLC delayed construction of the subdivision to coincide with the formation of the district.

The group has also agreed to take over bond payments if the district doesn't generate tax revenue, Beatty said.

"That would eliminate some of the fear some of the people have on TIFs if they haven't been set up properly," Beatty said.

The district originally included land east of the city limits from Seventh Street to Kansas Highway 10.

"It will be the first one in quite awhile for the county," Beatty said in a March 14 report to the Eudora Planning Commission.

With the bonding company's blessing, the TIF district will move on to the Eudora City Council.

Before the council moves forward with the issue, it will have to decide if and in what manner TIF funds will be put into residential purposes.

Because Deer Valley's residential phases will be built first and will use some of the same pipes and streets as the commercial district it would make sense to pay for those improvements in the residential construction phases, Beatty said.

"The commercial can't happen until residential starts," Beatty said.

The council would still have to decide how much tax revenue it would take from the residential zone within the district, Beatty said.

The use of tax dollars from the residential portion also adds in an additional consideration given the 20-year TIF bond, Beatty said.

"The revenue off of the residential can get the project started. The problem is it starts the time ticking for the 20 years," Beatty said.

The council is scheduled to see a final draft of the blight study at its April 9 meeting. The following month, the study and formation of the district will be subject to a public hearing.

"This expedites commercial growth, which we desperately need in Eudora," Beatty said.

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