Millions of new dollars likely will flow into an account set up for downtown development once Devon Tower opens in 2012. Tax increment financing, which recaptures increased property taxes downtown, will be the recipient of all property taxes generated by the 54-story tower because it is an Urban Renewal project. And if it appraises at the estimated $750 million, that would translate into $7.5 million a year. "It's a big deal,” said Brett Hamm, president of Downtown Oklahoma City Inc. "Limited TIF funding has been one of our biggest challenges. We've had to be almost too selective in the projects we could commit funding to.” When designs for the tower were unveiled Wednesday, Devon Chief Executive Officer Larry Nichols indicated his company will seek only a portion of the TIF funds it generates toward creation of a park along Sheridan Avenue. Nichols said he would like to see much of the TIF used to overhaul the Myriad Gardens and improve the immediate neighborhood.Comments
Appraisal remainsBoth goals are shared by Assistant City Manager Cathy O'Connor, who has tracked the TIF program since it was established in 2001. She said the city is preparing to work with Devon on planning TIF projects for the area, but she cautions against assuming the tower will be appraised at $750 million. "First it will need to get built and put on tax rolls,” O'Connor said. "But if it really gets assessed at $750 million, then yes, it will provide $7.5 million a year into the TIF district.” And that might not be all. O'Connor said the county's collection of personal property taxes on furniture, fixtures and equipment in the new tower also will be entirely directed into the TIF. Add to that the potential for 50 percent of any increase in property values at the former Kerr-McGee Tower being renovated by SandRidge Energy, and the downtown TIF budget plan is widely expected to see a bonanza in the next few years. Brent Bryant, economic development program manager at the city, reports the fund is already growing thanks to the opening of the Skirvin Hilton hotel, Legacy at Arts Quarter apartments and The Centennial — all Urban Renewal projects. Collections between 2001 and 2006 totaled $6.8 million. The amount for last year totaled $2.7 million. Bryant estimates it will jump to $3.5 million next year.
Plenty of takersO'Connor sees no shortage of takers for any increase in TIF funding — and she said she strongly believes Devon's project will be followed by more high-rises in the immediate neighborhood. "There is an element of spin-off here,” O'Connor said. O'Connor, who was one of the key team members credited with putting together financing for the Skirvin renovation, said the TIF has been a critical component of downtown's resurgence. "Just think about what we put into the Skirvin — we couldn't have done it without the TIF,” O'Connor said. "And I think that's true with every project we've participated in. They wouldn't have been completed in the time they were done, or to the quality we've seen, without it.”
What is a tax increment finance district?A tax increment finance district, also known as a TIF, allows a city, town or county to use tax money generated by a new development to pay for public improvements in the development area. Improvements associated with redevelopment projects can be supported by bonds, with the debt to be repaid by money generated within the TIF district. The downtown TIF is set to expire in 17 years.
Allocations from the fund•The Skirvin Hilton hotel: $14.65 million •Legacy at Arts Quarter: $2.5 million •The Triangle (phase I) $3.6 million •Block 42: $990,000 •The Hill: $2.65 million •St. Anthony Hospital: $600,000
Approved, but not spent•Overholser Greens: $1.75 million •MidTown Renaissance: $1 million •Film District: $605,000 •Triangle (Phase II): $3.75 million
Projects pending approval•Canal extension between Reno Avenue and the end of the north segment: $1.05 million •Harding and Shelton Reno Avenue garage: $3 million