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TIF proposal goes down
Developers of a proposed upscale 900-acre residential subdivision near a golf course want tax increment financing to pay for approximately $9 million in water, sewer, electric and road improvements.
The scaled-down plan for tax-funded improvements includes widening of a section of Bloomfield Road from Stonebridge subdivision to Highway 74 at a cost of $4.8 million, several 12-inch water lines, hydrants, a sewer lift station, two main sewer lines including one through the development and approximately half a million dollars in electrical distribution improvements.
The plan is scaled back from last year when developers requested $30 million in financing for improvements of the proposed 700-home subdivision near the Dalhousie Golf Club, located off Bloomfield Road on the western edge of Cape Girardeau. The original plan included $4 million payment for the Cape Girardeau School District in lieu of taxes on the development.
The Prestwick Plantation development plan presented to the city's Tax Increment Financing Commission on Thursday doesn't offer any payments to the Cape Girardeau School District in lieu of taxes.
Public hearing set
The commission will hold a public hearing on Aug. 14 at 7:30 p.m. at the Osage Community Centre, a step required by state law before the commission can make a recommendation to the city council. Under state law, 45 days notice had to be given before the public hearing, commissioners said.
Chauncy Buchheit of the Southeast Missouri Regional Planning Commission, a consultant hired by the city, said he needed time to crunch the numbers in the latest proposal.
Tax-increment financing is an economic tool used to encourage development. The increased taxes generated from growth within the TIF district would go to fund infrastructure in the subdivision area over a period of years.
TIF commissioner Rob Huff, chief financial officer of the school district, objected to the plan. "You are going to take taxpayers money from the school district to make city improvements. I don't think that's the purpose of a TIF," he said.
Said Huff, "It's a sweet deal for the city."
Without such payments, Prestwick Plantation developers said bonds that would be issued to fund the infrastructure improvements could be retired within 10 years.
During that time, increased tax revenue resulting from the development would go to retire the bonds. After retirement of the bonds, all of the property taxes resulting from the new development would go to local governments including the school district. Most of the property tax revenue would go to the school district.
But Huff said a TIF could cause the school district to lose $5 million in added property tax revenue it would have gained from routine development.
The proposed subdivision plan would burden the district with more students and necessitate construction of another elementary school, he said.
But Al Spradling III, TIF Commission chairman and former mayor of Cape Girardeau, said the financing plan provides a way for the city to improve the infrastructure and allow for future city expansion.
The city currently doesn't have the money to pay for improvements, Spradling said.
Adding in payments in lieu of taxes would result in a larger bond issue and require more years to pay off, Spradling said.
Thursday's meeting at the Osage Community Centre was the first gathering of the TIF Commission in eight months and the first public meeting dealing with the proposed development since the Cape Girardeau Board of Education rejected the financing plan on March 17.
In January, the developers sought to move the project forward by offering the school district land and $8 million to pay for construction of a new school.
But in the end, Cape Girardeau schools superintendent Mark Bowles and the school board concluded that the district would lose out on needed tax revenue while the TIF was in effect. The district depends on local property taxes for 65 percent of its annual budget.
Developer Cord Dombrowski said after Thursday's meeting that he and his partners are still looking at the possibility of securing private funding for the project.
The school district's Huff said after the meeting that the homes could be built without any tax increment financing. "A lot of people think it will," he said.
335-6611, extension 123