Consultant urges ‘Yes’ vote on redevelopment referendum Nov. 6
Fayetteville voters in November will be faced with a question about the proposed redevelopment of a handful of failing commercial areas.
The question is this: Does the city wait to see if a developer comes along with the idea of developing an area like the old 692 Shopping Center on North Glynn Street or should a qualified developer receive an incentive to upgrade the site by having the site’s property taxes frozen until the redevelopment is complete and without posing any liability to the city?
Called a TIF (tax incentive financing) project in other states, the Redevelopment Authority Powers referendum on the November ballot aims to use a tool Georgia calls a TAD (tax allocation district) to have the property taxes on a piece of property frozen until the redevelopment is complete. Under the plan, the property taxes continue to be collected at the frozen rate.
Specific to the referendum vote, there will be only two voting locations for Fayetteville residents to cast their ballots on the issue. Even if residents vote in other polling locations, the vote on the referendum will only be held at the Fayetteville Library near the county complex downtown and at the Lafayette Education Center on Lafayette Avenue.
Fayetteville Director of Community Development Brian Wismer at previous meetings and Bleakly Advisory Group president Kenneth Bleakly at the Oct. 4 town hall meeting said a TAD is a tool to create bond financing for infrastructure and other redevelopment costs related to the deteriorating commercial areas.
It works by freezing property taxes on the targeted redevelopment site through the bond term that typically runs from 10-15 years. The bonds are paid off through the increased property tax revenues that are generated by the completed redevelopment project in the TAD site. Once the bond is paid, the higher property taxes generated will flow to the city, county and board of education.
If ultimately approved by voters, those redevelopment efforts will not create a new tax, will not increase property taxes to city residents and will not create new debt for the city, Wismer said.
An example of one of the parcels identified for redevelopment is the 692 Shopping Center on North Glynn Street, former home of the Longbranch Restaurant and other businesses.
Situated on 3.9 acres with a building totaling 41,975 square feet, the parcel sold in 2001 for $1.8 million. In 2006 the fair market value had dropped to $1.747 million. In 2007 and continuing through 2011 the fair market value was $1.308 million. Now largely unoccupied, current fair market value today has decreased to $1.166 million.
Though not stated at the town hall meeting, there is a further consideration about redevelopment, if and when it occurs. That consideration deals with jobs, or the lack thereof. Older shopping centers such as the 692 center currently house few businesses or employees. Redevelopment brings new commercial ventures, increased tax revenue and a significant increase in jobs, officials contend.
Conducting the town hall session, Bleakly said similar redevelopment initiatives have been used in all states beginning in 1985. Sixty such projects have been put in place in Georgia over the past dozen years with none defaulting, said Bleakly.
Of that number, approximately 20 occurred since the beginning of the recession, Bleakly added, noting that Georgia’s TAD track record in redevelopment successes is bolstered by its very conservative redevelopment regulations.
Slated for potential redevelopment are older and significantly vacant commercial areas such as the 692 Shopping Center, the old Walmart and Banks Station shopping centers on Ga. Highway 85 or the undeveloped commercial property at The Villages on Ga. Highway 54 West.
Bleakly said TAD projects have been approved in cities such as Savannah, Marietta, Gainesville, Flowery Branch, Augusta and Duluth. Georgia’s best known example of a TAD is Atlantic Station, where an old steel mill was converted into a mixed use development that brought a wealth of new jobs and increased property tax.
Going under the name TAD (Tax Allocation District) when on the ballot in 2008, there was little surprise that the initiative failed since the word “tax” was included on the ballot. Wismer said the wording was misleading since it gave the impression that it would be a tax the applied across the city. The reality, in the case of Fayetteville, is that it pertains only to specific parcels identified as benefitting from redevelopment, said Wismer.