TIF Commission holds its first meeting in 12 years

Cape Girardeau's Tax Increment Financing Commission gathered Thursday at the Osage Centre to hold its first meeting in about 12 years.

The 11-person group features a few of the members originally appointed in 2002, but many were appointed within the past five years.

The city council recently moved to reconvene the commission as interest has developed in forming a downtown TIF district.

Establishing a TIF district was one of the plans proposed in the current downtown strategic plan, which was adopted by the council in 2009.

Appointees include six city appointments, two appointments by the local school district, two county appointments and one appointment approved by the other taxing entities collecting within the district, as required by state law.

Tax-increment financing is a method of encouraging redevelopment in a blighted or conservation area, as defined by Missouri law.

Establishing a TIF district would give the city another tool to help developers with rehabilitation costs and breathe new life into some of downtown's vacant or deteriorating buildings, supporters have said.

TIF allows the master developer -- in this case, the city -- to collect the increment gained in property taxes between the current value and the improved value, as well as 50 percent of the economic activity taxes, including sales taxes and taxes on utilities.

The city takes the revenue and invests it in approved developments such as parking, lighting or other infrastructure.

Mark Grimm, a lawyer from public-finance law firm Gilmore & Bell, led the meeting with a brief explanation of TIF and the role of the commission moving forward. The plan specifies five project areas within the district's boundaries, which cover 305 acres. It's roughly outlined by Mason Street and Highway 74 on the north and south and Sprigg Street to the Mississippi River on the east and west.

Each project area is activated individually as a project is approved within its boundaries, Grimm explained.

"Once the clock is started, it's up to 23 years where TIF" could continue capturing the increment within that project area, he said.

State statute also requires each project included in a TIF plan be activated within 10 years of the plan's approval.

Deputy city manager Molly Hood said the city has not received any formal proposals, although it has had discussions with individuals who have expressed interest in submitting a project.

Projects are determined to be eligible if they pass the "but for" test, meaning they would not be possible but for the assistance of TIF.

Among the commission's primary goals is to hold a public hearing and make a recommendation to the council regarding a redevelopment plan, the redevelopment projects and the designation of the redevelopment area.

Chauncy Buchheit, executive director of the Southeast Missouri Regional Planning Commission, has begun working with a team to prepare a redevelopment plan and said he hopes to get a "solid draft" to the commission by early September.

State law requires redevelopment areas be classified into certain categories, such as a "blighted area" or a "conservation area." Cape Girardeau's TIF district is aiming for the latter.

Buchheit and team "walked the area, and we don't feel it's blighted, but we feel it could be if something doesn't happen," he said.

To be considered a conservation area, 50 percent or more of the structures must be 35 years old or older.

The area also must be in danger of becoming blighted because of dilapidation, deterioration, excessive vacancies, abandonment or other factors.

Research so far has shown at least 65 percent of the properties in the area were built before 1980, although Buchheit expects that number could be higher once construction dates for more properties are confirmed.

Buchheit also said there are 60 vacant lots in the area, 19 properties the team felt were dilapidated beyond reasonable repair and should be demolished and 173 properties that had exterior issues and were considered deteriorated.

They also found 197 structures in "good and sound" condition, he said, but the number of vacancies and buildings in need of some attention seems to be strong enough to make a case for the designation of a conservation area.

Among the commission's final actions was the designation of officers.

Al Spradling was voted chairman, and Adrienne Henry was chosen as vice chairwoman.

The commission did not set a date for its next meeting, but a September meeting would be necessary to set a public hearing for the tentative October deadline.

srinehart@semissourian.com

(573) 388-3641

Pertinent address:

1625 N. Kingshighway, Cape Girardeau, Mo.