Should TAD funds be used for a north Columbus project? Proposal raises concerns.

A Tax Allocation District, usually reserved for blighted areas, is being considered for a site in north Columbus.

Kenneth Bleakly, of the Bleakly Advisory Group, recently appeared before council with a proposal to redevelop 292 acres at the intersection of J.R. Allen Parkway and Manchester Expressway. The property contains five parcels, which include the former Swift Denim Mill that has been vacant for more than 10 years.

Bleakly said he was speaking on behalf of Flournoy & Calhoun Realty, which plans to transform the site into Midland Commons with 533,000 square feet of retail space and 250 senior housing units.

“The potential here is to redevelop that site into a mixed-use project, put it back on the tax rolls, but increase the value of the property,” said Bleakly, speaking on the public agenda. He said the project would also include traffic improvements and enhancements at Flat Rock Park. A road would be developed to ease traffic from the Wal-Mart Supercenter on Talokas Lane all the way to Flat Rock Road. The improvements were requested by city planners.

If approved by Council, it would be the city’s seventh TAD since voters passed a 2014 referendum, after rejecting a similar one in 2007. TADS already have been approved for Midtown East and Midtown West, Fort Benning Technology Park and the River District Development Plan, which includes Sixth Avenue; the Liberty District, Uptown, and 2nd Avenue and City Village.

When a TAD is approved, the city can issue revenue bonds to remedy infrastructure and environmental problems, as well as other issues that might hinder development. The extra tax revenue created by the project is then used to repay the revenue bonds over the life of the TAD, usually 20-30 years. The extra revenue goes into city and school district coffers.

Mayor Teresa Tomlinson immediately raised concerns about the proposal, stating she was unaware the plans existed until they appeared on the council agenda.

“Usually, almost always, TADS are in distressed properties, that’s the point,” she said. “It’s not the public’s role to subsidize private development.

“Now, we do do some things, obviously, when we have like the tech parks and things like that, where we have partnerships,” she continued. “But we don’t build roads for developers; we don’t do things like that.”

Tomlinson said there’s a four-point test, which includes utilizing TADS for brownfield areas, but the funds aren’t being proposed for that purpose.

She said a Texas Bass Pro Shop almost brought down TADs nationally when funds were used for private development, resulting in public outrage. She believes the first TAD referendum failed in 2007 because voters feared the funds would benefit private developers instead of distressed communities.

“How’s what’s going on here different from that Bass Pro Shop example?” Tomlinson asked Bleakly and the developers at Tuesday’s council meeting. “Because I think the citizens are going to be asking questions. Why are we doing a TAD in Midland, which is one of our hottest growth areas?

“In fact, we have to fight every day the overdevelopment of Midland,” she said, “because it’s such a hot commodity from a development standpoint, when we have Cusseta Road, South Lumpkin Road and some other areas. ... That’s clearly a concern.”

Mayor Pro Tem Evelyn Turner-Pugh asked why Council was just receiving the proposal, which the developers said they hoped would be approved by the end of the year. Both Turner-Pugh and Tomlinson said it was their understanding that TAD applications had to be submitted by Aug. 1 in order to be approved by Dec. 31.

But City Planning Director Rick Jones said that policy was never adopted. He said his department received plans for the project around Nov. 1 and had already published an ad for the first public hearing scheduled for Dec. 5. He said a second hearing would be held Dec. 12.

Councilor Judy Thomas said councilors received a 42-page PDF file about the project the Tuesday before Thanksgiving, which didn’t give them much time to review the document. Councilor Glenn Davis said developers should consider other funding mechanisms.

Marty Flournoy and Chris Wightman, of Flournoy & Calhoun, said the project would be developed in partnership with Jack Wright, of Ray M. Wright Inc. Flournoy said the Swift textile plant once employed 600 people. It closed in 2006, and numerous redevelopment efforts failed over the years.

Flournoy said there was a chemical spill of about 3,500 gallons at the site some years ago, and he believes that’s one of the reasons it has remained vacant. He said there’s also more than 570,000 feet of concrete on the site, including underground concrete structures where the ventilation shafts existed for the mill’s spinning operation.

“In terms of qualifying as a TAD, the site has particular characteristics that make it sort of a classic brownfield or underdeveloped piece of property,” said Bleakly. “So using the TAD to make the economics of the deal work, and the result is they can get a new investment in the property, would be very consistent with what’s being done around the state.”

The project would create $22.9 million in new taxable value for the property, according to information provided by the developers. It would generate $19.5. in incremental TAD value once the project is completed.

“We think this will be good for the city and we think that we’re able to pull it off,” Flournoy said. “But we also recognize that people have looked at this site for years and it’s been a real quandary. It’s like, what do you do with it?”

This story was originally published November 30, 2017 at 3:13 PM with the headline "Should TAD funds be used for a north Columbus project? Proposal raises concerns.."