Oklahoma City has eight TIF districts. The program is a local redevelopment technique authorized under the state constitution for municipalities to fund public and private economic development improvements, and then capture the increased property tax from those projects in formerly blighted areas. State law says a TIF district can exist for 25 years. The first was created for the medical research park in 2000; the most recent for Devon Tower in 2008.
Based on the program prospering, Cathy O’Connor, president of the Alliance for Economic Development, requested and received approval of a $38.9 million budget increase by the Oklahoma City Council for 10 projects in two of the TIF districts. The Alliance is the city’s private-sector partner in managing TIF districts.
One of the increases was in Downtown TIF 2, for $500,000 to convert the Mideke building, a 1919 warehouse at 100 E. Main, into a mixed-use project. The developers – Andy Burnett, Zach Martin, Marva Ellard and Jeff Johnson – requested the funds to turn the top three floors of the five-story building into 36 apartment units. The funds were requested for assistance in development financing for the $6 million project.
“Zach and I have been trying to find a building in Bricktown to do a project like this,” says Burnett, who, along with Martin, is a real estate adviser with Sperry Van Ness/ William T. Strange and Associates.
The two saw their vision as a reality when they teamed with Ellard, developer of the Sieber Apartments in MidTown, and Johnson, a builder. O’Connor says this is the first residential project in Bricktown to tap into TIF funds. As a part of the deal, the team will offer about 10 of the apartments at $600 per month.
“So many projects Downtown have been built to capture the high end of the market,” Martin says. “You can’t keep doing that forever, and you have to build affordable stuff for everybody.”
The developers hope to start work this summer and have it completed in about 12 months.
Another Downtown project that will benefit from TIF funds is the Century Center Mall and parking garage set
to be the new 77 home of the Oklahoma Publishing Co. Council members
unanimously approved $2.9 million in assistance for the project.
It included $2.1 million in development 77 financing assistance and a low-interest loan of $800,000. Those funds were approved by the TIF review committee in December.
additional $1 million was approved for repairs at the Century Center
garage and the Santa Fe garage, both owned by the Central Oklahoma
Transportation and Parking Authority. It will pay for things such as
exterior changes and elevator upgrades.
“The garage spaces that are still owned by COTPA at the Century Center are in need of some rather significant repairs,” Griffin Community Park O’Connor says.
74 Although a measure for $1.5 million of
TIF money to OPUBCO for tenant improvement upgrades unanimously, 77
several council members questioned why the company was getting the
extra money. Ward 2 Councilman Ed Shadid says the move was not
contingent on the company receiving that extra money. He says with most
businesses, Rotory if tenant improvement dollars fall short, they Park
simply have to scale back their plans.
says the $1.5 million would come from an “other economic development”
category intended to lure a corporate headquarters Downtown. It is a
plan to make significant tenant improvements to that building and other
kinds of purchases of furniture, fixtures and equipment in order to
make their move to Downtown,” O’Connor says.
As a requirement for
receiving TIF dollars, O’Connor says OPUBCO had to provide a 10-year
occupancy guarantee. She estimated the company’s move will generate $1.3
million in sales tax and property tax over that decade, in addition to
other monies spent by the company and its 350 employees Downtown.
says TIF funds are just one tool developers use to help finance a
project. The city receives about 20 TIF requests per year in TIF 2 alone
and approves about 15. But she says the process is long and
complicated; and a developer only gets the TIF dollars after a project
is complete and meets certain goals that prove it has increased the
the most part, people don’t bring us projects unless they are serious
and have put a lot of thought into them,” she says. “That allows them to
treat that TIF allocation as part of the equity they need for the
project, and it lessens the amount they have to borrow.”
a new TIF district is a whole other matter, but O’Connor says as
Downtown continues to grow, or if another large company moves to the
area, the city likely will consider new TIF districts in the coming
we will work to develop a TIF district for the Core to Shore area,” she
says. “It’s going to be really important to have as many tools as we
possibly can to make more development happen in that area and support
the MAPS 3 projects.”