A plan to trim several streets and sidewalks from improvements planned in the Project 180 makeover of downtown won a first round of approval Thursday from the committee that oversees the initiative.
The Devon Implementation Committee, which includes Devon Energy Corp. Executive Chairman Larry Nichols, banker William Bell and property owner Mark Beffort, were told by city staff that streets being trimmed from Project 180 could be added back in at a future date — pending available revenues in the tax increment finance district that funds the improvements.
Streets cut from Project 180 include Broadway, with the exception of the block between Main Street and Sheridan Avenue; all of E.K. Gaylord Boulevard; and sections of Main Street, Robert S. Kerr Avenue and NW 5 — between E.K. Gaylord and Broadway.
Other streets are likely to be delayed for years beyond the original 2014 completion target, including Park Avenue between Broadway and Walker Avenue.
“It's been a comprehensive and complicated project,” public works director Eric Wenger said. “There are a lot of moving parts.”
As previously reported, the city is expecting a $10 million shortfall in sales taxes being collected as part of the tax increment financing district, and has seen cost increases on street and sidewalk reconstruction after to unexpected complications, including old building basements that extend under public easements.
City Manager Jim Couch, who oversaw a turnaround of the city's original Metropolitan Area Projects program in the late 1990s, said a series of uncertainties have led to Project 180's being cut back. Those uncertainties, he said, include long-term bond financing to be obtained once the new Devon Energy Center is assessed and the reaction by lenders to a tax increment finance district based on just one taxpayer, Devon Energy.
“We cannot do all the improvements that are out there,” Couch said. “This is two-thirds the size of the original MAPS program. It's a very, very large program with a lot of variables still in place.”
Brent Bryant, the city's economic development coordinator, reported 13 firms have responded to a request for proposals by the city for a consultant to help guide the effort to obtain long-term financing for Project 180. Devon Energy loaned the city $95 million to get the work started, and that agreement calls for the city to obtain financing by 2015. Bryant and Couch said they are hoping to secure financing much earlier.
With unanimous approval from the Devon Implementation Committee, the Project 180 revisions will still require a vote by the Oklahoma City Economic Development Trust and the Oklahoma City Council.
Beffort, who represents a partnership that owns Leadership Square, City Place, the Oklahoma and Corporate Towers, welcomed news that road and sidewalk construction will be put on hold after the next phase of work is completed in 2012.
“It will be good,” Beffort said. “People can sit back and relax for a while.”
CITY IS OVERHAULING PROJECT 180
The scope of Project 180 is being cut and will take longer than originally scheduled because of cost overruns and revenue shortfalls. A city staff overhaul of the Project 180 budget is under way as these numbers emerge:
• Revised sales/use tax, match estimate: $10 million
• Original estimated ad valorem taxes from Project 180 increment district, including $115 million for public improvements, $40 million for economic development, $20 million for other taxing entities: $224 million
WHAT'S A TIF?
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 TIF for the new Devon tower will last for 25 years and projects are being paid through a $95 million loan from the company to the city that will be paid back from assessments and longer-term financing once the headquarters is completed.