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Posted on November 7, 2017
The Community Redevelopment Agency (CRA) staff is set to recommend that the Board approve a $6.6 million tax rebate for a downtown project amid controversy about the future of the Downtown District.
The Washington Square project was added to a list of potential projects even though the CRA Board had previously agreed not to pursue any more projects over $2 million. However, CRA staff argued that the project was in the pipeline and was overlooked.
Between 2009 and early 2011 the developer (Washington Square Partnership and then Fairmont Investment, LLC) submitted several proposals for consideration by CRA staff and/or the CRA Board, all focused around financial assistance to help with the cost of structured parking.
On February 7, 2011, CRA staff provided the CRA Board with a memo outlining the most recent Washington Square proposal which requested the CRA purchase the property for $5.5 million with public parking to be constructed at a future date when DT District funding would be sufficient to support construction of a parking garage.
A review of the initial proposals by the DT District’s Downtown Redevelopment Commission (DRC) acknowledged the development potential of the site but indicated the proposals were beyond the current financial capacity of the DT District.
Following several exploratory meetings with staff, on August 4, 2017, the developer submitted a project update outlining changes from the original office space development proposal into the current mixed-use development proposal that includes a hotel, 24 residential condominiums, offices, meeting space, retail/restaurant uses and structured parking. The update also included a request for $9.6 million from the CRA to assist in the development of the project.
On October 20, 2017, the developer submitted an updated financial assistance request with additional supporting documentation. The developer is requesting 100 percent reimbursement of the tax increment generated once the project is completed and added to the tax rolls. The request is for up to $9.6 million in tax increment reimbursement, although the developer recognizes the anticipated tax increment refund will be closer to $6.6 million over the remaining life of the DT District.
There is no request for up-front financial assistance. The August proposal included 24 residential condominiums but that portion of the development has been determined to be financial infeasible, and has been eliminated from the proposal.
The CRA staff writes that the Washington Square project is consistent with the Downtown Community Redevelopment Plan, which recommends redevelopment of vacant and/or underutilized lots within the downtown core, providing financial incentives to attract private investment in the downtown core and supports the development of mixed-use projects in the downtown core.
The CRA will take up the project on November 9th.