TIF projects are first downtown.
Columbia Daily Tribune
By Sara Semelka Monday, February 23, 2009
Two local developers are testing the waters as Columbia explores public financing for private developments downtown. Tiger Columns LLC and 10th & Locust LLC have applied for millions of dollars of “tax increment financing,” or TIF, for projects in the heart of Columbia.
TIF financing provides developers an incentive to take on projects in locations that qualify as “blighted” or “conservation” areas, as defined by Missouri law. It allows developers to cash in on the increased property and sales taxes generated by the economic activity their developments create. The money can be given to developers in different ways, and municipal bonds are one of the more common methods. Tiger Columns LLC is proposing bond financing to renovate the historic Tiger Hotel on Eighth Street. With this method, the money is given upfront and the increment between the taxes generated before and after the development is used to pay off the bonds.
The developers of a project at Tenth and Locust streets are going another route, asking to be reimbursed as the project goes along. “They are willing to base the financing on how they perform,” architect and project spokesman Bright Wright said. “They will pay taxes as they go, and at the end of the fiscal period, if they performed according to projections, they will get reimbursed accordingly.”
Tiger Hotel owners John Ott, Dave Baugher and Al Germond are asking for TIF to pay $1.785 million of their $8.9 million project to transform the building into a boutique hotel. “It’s one that has character, not like a chain where all the rooms look alike,” Ott said of his plans for the 68- to 70-room hotel. “It’s one where people will come” for the building “in and of itself, something that people would travel to.” Ott said he is still working out the specific style the hotel would take on but the “same quality of improvements we’ve done in the lobby with the flooring, the quality that’s gone into the building” already “will run through the rest of the building.” Guest rooms would occupy floors two through eight, Ott said, and possibly part of the ninth. The first floor would have retail shops, but potential investors are waiting for the financing, including the TIF portion, to be worked out first.
The second TIF application comes from 10th & Locust LLC, owned in part by the Odle family, which aims build an eight-story, mixed-used building. The project budget estimates total costs at about $17.1 million and requests $3.286 million in TIF funding. Retail will be housed in the first level, and the developers would like to see a grocery store such as Trader Joe’s or Whole Foods locate there. The second floor will be office space, and floors three through eight will be residential units. Wright said the residential floors would be set back from the retail and office spaces, exposing the roof of the second floor to create a space for a swimming pool and recreation area. “We’re trying to do something that’s good for the community,” Wright said. “We’re going to make this investment for the long term.”
The next stop for the applications is the city’s TIF Commission, which meets March 5. Members will evaluate the projects and make recommendations to the Columbia City Council, which has final authority on all TIF financing.
D2 assisted the Tiger Hotel project with the preparation of the redevelopment plan and cost benefit analysis.
< Back |
