HomeMy WebLinkAbout2021 10_Amendment to the Policy Guide for the TIF DistrictCITY OF OWASSO
RESOLUTION 2021.10
A RESOLUTION OF THE CITY OF OWASSO, OKLAHOMA, APPROVING AN
AMENDMENT TO THE POLICY GUIDE FOR IMPLEMENTATION OF THE OWASSO REDBUD
DISTRICT PROJECT PLAN AND INCREMENT DISTRICT NO. 1, CITY OF OWASSO
WHEREAS, the City of Owasso, Oklahoma ( "City "), pursuant to the Oklahoma Local
Development Act, 62 O.S. §850, et seq. ( "Act "), adopted Ordinance 1093, effective December
20, 2016, approving the Owasso Redbud District Project Plan ( "Project Plan ") and establishing
Increment District No. 1, City of Owasso, a sales tax and ad valorem increment district
( "Increment Dist(ct "); and
WHEREAS, the purpose of the Project Plan is to help the City achieve its development
objectives by authorizing the appropriate and necessary public support and assistance for the
development and enhancement of the area surrounding Main Street, known as the Redbud
District ( "Project Area "), as a special and unique place within Owasso, a place to live, work,
shop, and play; and
WHEREAS, the Project Plan supports the City's efforts to achieve its development
objectives, improve the quality of life for its citizens, stimulate private investment, and enhance
the tax base, thereby making possible investment that would be difficult without the adoption of
the Project Plan and the apportionment of incremental ad valorem and sales tax revenues; and
WHEREAS, the Project Plan authorizes the allocation of incremental revenues to an
apportionment fund to be used to pay authorized Project Costs, including public infrastructure,
facilities, and improvements, and assistance in development financing; and
WHEREAS, in order to provide guidance regarding the allocation of assistance in
development financing authorized by the Project Plan, the City approved Resolution 2017 -01 on
April 4, 2017, adopting the Policy Guide for the implementation of the Project Plan and
Increment District No. 1; and
WHEREAS, the Policy Guide details the procedures and requirements for providing
assistance in development financing through three categories of such assistance, including
Development Project Assistance, Small Business Enhancements, and Employment generation
Assistance (all as defined in the Policy Guide); and
WHEREAS, the Policy Guide explains that financial assistance under the Development
Project Assistance category may be available at varying levels for projects, depending on the
amount of construction costs, based on the date of completion of such projects; and
WHEREAS, the Policy Guide in Section III(A) (5) specifically states the following:
1. For projects completed by June 30, 2021, the maximum amount of assistance
in development financing that a developer may receive is 12% of hard costs
of construction of improvements on such developer's property.
2. For projects completed between July 1, 2021 and June 30, 2025, the
maximum amount of assistance in development financing that a developer
may receive is 10% of hard costs of construction of improvements on such
developer's property.
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3. For projects completed between July 1, 2025 and June 30, 2029, the amount
of assistance in development financing that a developer may receive is 8% of
hard costs of construction of improvements on such developer's property.
4. For projects completed after June 30, 2029 through the end of the life of
Increment District No. 1, the amount of assistance in development financing
that a developer may receive is 6% of hard costs of construction of
improvements on such developer's property.
WHEREAS, many developers within the Project Area have experienced delays due to the
public health emergency posed by the spread of COVID -19 throughout Oklahoma and the
countermeasures and restrictions put in place in order to manage that emergency; and
WHEREAS, the construction of Redbud Festival Park within the Project Area has also
contributed to delays in development projects immediately surrounding it; and
WHEREAS, it is appropriate to extend the dates of completion of construction relevant to
Development Project Assistance in Section III(A)(5) of the Policy Guide to account for these
delays and to promote the continued implementation of the Project Plan and development
within the Project Area.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF OWASSO, THAT:
Section One: Section III (A) (5) of the Policy Guide is hereby amended to read as follows:
For projects completed by June 30, 2023, the maximum amount of assistance in
development financing that the developer may receive is 12% of hard costs of
the construction of improvements on the developer's property. For projects
completed between July 1, 2021 and June 30, 2025, the maximum amount of
assistance in development financing that the developer may receive is 10% of
hard costs of the construction of improvements on the developer's property. For
projects completed between July 1, 2025 and June 30, 2029, the maximum
amount of assistance in development financing that the developer may receive
is 8% of hard costs of the construction of improvements on the developer's
property. For projects completed after June 30, 2029 through the end of the life
of the Increment District, the maximum amount of assistance in development
financing that the developer may receive is 6% of hard costs of the construction
of improvements on the developer's property. The issuance of a Certificate of
Occupancy by the City shall determine project completion.
Project
June 30, 2023
June 30, 2025
June 30, 2029
End of
Completion
Increment District
Percentage of
12%
10%
8%
67o
Construction
Costs
Section Two: City staff is further directed to utilize the Policy Guide as hereby amended for the
implementation of the Project Plan and Increment District No. 1.
Section Three: Except as amended by this Resolution, the Policy Guide and the authorizations
and directions made by Resolution 2017 -01 are ratified and confirmed.
Section Four: City staff is hereby authorized to take such actions as may be necessary or
appropriate, including making minor amendments and revisions to the Policy
Guide, as amended by this Resolution, applications, and forms for administrative
purposes, to implement this approval and the provisions of the Policy Guide, as
amended.
APPROVED AS TO FORM:
bardi, City Attorney
PASSED AND APPROVED this 15th day of June, 2021.
Bill Bush, Mayor
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TO: The Honorable Mayor and City Council
FROM: Chelsea Levo Feary, CEcD
Director of Economic Development
APPROVED BY COUNCIL
JUN 15 2021
SUBJECT: Resolution 2021 -10, Amendment to Owasso Tax Increment Financing District No. 1
Policy Guide
DATE: June 11, 2021
BACKGROUND:
On April 4, 2017, the Owasso City Council approved Resolution 2017 -01, approving the Policy
Guide for the implementation of the Owasso Redbud District Project Plan and District No. 1 and
the formula for determining the sales tax increments generated from the Increment District. The
purpose of the Project Plan is to help the City achieve development objectives by authorizing
the appropriate and necessary public support and assistance for development while enhancing
the area.
Development areas qualified to utilize TIF are by definition, "unproductive, undeveloped,
underdeveloped, or blighted." Owasso's downtown area met this definition. City Council's
action to implement the Redbud District Project Plan and Increment District No. 1 was
instrumental in launching the area toward redeveloping and revitalizing Owasso's downtown.
Since approval of the Tax Increment Finance (TIF), two local developers have invested over $16
million, existing businesses have experienced increased revenues, and the City constructed a
$2.3 million festival park creating a space for events, gatherings, recreation, and more.
In the past eighteen (18) months, interest in development in the Redbud District has
decelerated. Due to the public health emergency posed by the spread of COVID -19
throughout Oklahoma and the countermeasures and restrictions put in place to manage that
emergency, developers, and development projects have experienced delays. Additionally, the
construction of Redbud Festival Park has also contributed to those delays in development
projects.
PROPOSED RESOLUTION FOR AMENDING THE PROJECT PLAN:
In the interest of continuing to attract development projects in Owasso's Redbud District, it
would be consistent with the purpose and objectives of the Owasso Redbud District Project Plan
to extend the dates of completion of construction relevant to Development Project Assistance in
Section III(A)(5) of the Policy Guide by a period of two (2) years to account for these delays and
to promote the continued implementation of the Project Plan and development within the
Project Area. Section Four of Resolution 2017 -01, approving the project plan, granted City staff
authority to take necessary or appropriate actions, including minor amendments and revisions to
the Policy Guide for City Council approval.
The two -year extensions are proposed in the attached Resolution. For projects completed by
June 30, 2023, (currently June 30, 2021,) the maximum amount of assistance in development
financing that the developer may receive is 12% of hard costs of the construction of
improvements on the developer's property. For projects completed between July 1, 2023
(currently July 1, 2021) and June 30, 2027, (currently June 30, 2025) the maximum amount of
Amendment TIF
Page 2
assistance in development financing that the developer may receive is 10% of hard costs of the
construction of improvements on the developer's property. For projects completed between
July 1, 2027, (currently July 1, 2025) and June 30, 2031, (currently June 30, 2029) the maximum
amount of assistance in development financing that the developer may receive is 8% of hard
costs of the construction of improvements on the developer's property. For projects completed
after June 30, 2031, (currently June 30, 2029) through the end of the life of the Increment District,
the maximum amount of assistance in development financing that the developer may receive is
6% of hard costs of the construction of improvements on the developer's property. The issuance
of a Certificate of Occupancy by the City shall determine project completion.
Project
Completion
30L 202o 21
i,in 30L 2025
June 30, 2027
30L 2929
End of
Increment District
June 30, 2023
June 30, 2031
Percentage of
Construction Costs
12%
10%
8%
6%
CENTER FOR ECONOMIC DEVELOPMENT LAW (CEDL):
This amendment was presented to the City Council for discussion during the June Worksession.
Based on Councilor inquiry, staff consulted with CEDL, the firm who worked with City staff to draft
the legal documentation to establish Owasso's Increment District No. 1. Their recommendation
for the most positive impact on development following hardships incurred by the COVID -19
pandemic is to advance all project completion dates by two years.
ATTACHMENTS:
Resolution 2021 -10
Resolution 2017 -01
Owasso Redbud District and Increment District No. 1 Policy Guide