Wheeler District

[Jake]

[Jake]

Whoops! ^ Didn't mean for it to post sideways, but they're working on the Wind Wall now!

[UnFrSaKn]

http://www.oklahoman.com/login?refer...o_redirect=yes

[Pete]

The Oklahoman keeps using this definition of TIF and it is completely incorrect:

What is 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. Part or all of the increase in property taxes resulting from new development after a district is formed is invested back into the area for a term usually set at 25 years. The project budgets usually include allocations for local schools, libraries, the county and the city-county health department.

[HangryHippo]

The Oklahoman keeps using this definition of TIF and it is completely incorrect:

What definition do you think they should be using?

[Pete]

Let me break it down...

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.

TIF's establish a base year and then take ALL incremental new property tax (and sometimes sales tax) from that point forward.
- and -
The huge majority of the funds are used for PRIVATE development, not public.



Part or all of the increase in property taxes resulting from new development after a district is formed is invested back into the area for a term usually set at 25 years. The project budgets usually include allocations for local schools, libraries, the county and the city-county health department.

MOST of the TIF funds are used for private development and SOMETIMES money goes back to schools, libraries, county and city-county health department, but those are the taxing jurisdictions from which the TIF dollars are redirected in the first place. In any event, at most they receive back a small fraction of what is taken away.

[HangryHippo]

Let me break it down...

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.

TIF's establish a base year and then take ALL incremental new property tax (and sometimes sales tax) from that point forward.
- and -
The huge majority of the funds are used for PRIVATE development, not public.



Part or all of the increase in property taxes resulting from new development after a district is formed is invested back into the area for a term usually set at 25 years. The project budgets usually include allocations for local schools, libraries, the county and the city-county health department.

MOST of the TIF funds are used for private development and SOMETIMES money goes back to schools, libraries, county and city-county health department, but those are the taxing jurisdictions from which the TIF dollars are redirected in the first place. In any event, at most they receive back a small fraction of what is taken away.

Thanks for the reply. That's quite the difference.

[Pete]

Thanks for the reply. That's quite the difference.

It's not just a difference, it's blatantly misleading and completely incorrect.

And they keep using this as the default definition in almost every article on TIF.


Pretty important since we are talking about $1 billion in local tax dollars being largely being redirected from schools and given largely to private developers.

[onthestrip]

$60 million in TIF money for the development of Wheeler? Thats insane! Are they getting every bit of road and utilities paid for by the taxpayers?

[sooner88]

$60 million in TIF money for the development of Wheeler? Thats insane! Are they getting every bit of road and utilities paid for by the taxpayers?

The TIF district would include a budget allocation of $120mm with $60mm for development financing for infrastructure improvements.

[onthestrip]

The TIF district would include a budget allocation of $120mm with $60mm for development financing for infrastructure improvements.

Ya, this just seems like an insane amount. Are they having to pay for any of the development costs or they getting it all for free?

[baralheia]

Last I heard, the Humphreys will be responsible for building all of the roads and infrastructure, which will be turned over to the city upon completion. I'm not sure how accurate this was, however.

[Anonymous.]

Remember the Wheeler district is basically non-existent infrastructure-wise. $120MM for basically a giant field that needs utilities and roads.

For reference, Clayco was wanting $140MM+ for the stage center block, which is already built infrastructure-wise. Now it can be argued that Clayco's demands were over-the-top and extremely unreasonable, hence why the project was also annexed.

Therefore, I am not so sure the Wheeler TIF is unreasonable. Although I also can't see the article, so I am not sure the specifics.

[TexanOkie]

Remember the Wheeler district is basically non-existent infrastructure-wise. $120MM for basically a giant field that needs utilities and roads.

For reference, Clayco was wanting $140MM+ for the stage center block, which is already built infrastructure-wise. Now it can be argued that Clayco's demands were over-the-top and extremely unreasonable, hence why the project was also annexed.

Therefore, I am not so sure the Wheeler TIF is unreasonable. Although I also can't see the article, so I am not sure the specifics.

Disclosure--my firm represents Humphreys with their TIF; however, everything that follows is in the article and documents that have been made public. The proposed TIF allows up up to $60 million for infrastructure reimbursements (which is nowhere near the total projected costs of the infrastructure) on the back end. Humphreys will still be responsible for financing and building the infrastructure upfront. Because the payment would come on the back end from collected increment funds, if the development is not as successful as anticipated, Humphreys stands to not have as much infrastructure costs reimbursed. The other $60 million is proposed to be paid to Oklahoma City Public Schools to build a new elementary school to serve the area and surrounding neighborhoods, and for improvements/expansion of middle/high school capacity.

[onthestrip]

Remember the Wheeler district is basically non-existent infrastructure-wise. $120MM for basically a giant field that needs utilities and roads.

For reference, Clayco was wanting $140MM+ for the stage center block, which is already built infrastructure-wise. Now it can be argued that Clayco's demands were over-the-top and extremely unreasonable, hence why the project was also annexed.

Therefore, I am not so sure the Wheeler TIF is unreasonable. Although I also can't see the article, so I am not sure the specifics.

Non exsistent? Maybe directly on their property there isnt much but there are definitely utility mains that are adjacent to this property. You do realize that pretty much all other developers, whether a new neighborhood in NW OKC or a new large shopping center along I40 pays for all the new roads and utility extensions that are necessary, right?

[Bellaboo]

Non exsistent? Maybe directly on their property there isnt much but there are definitely utility mains that are adjacent to this property. You do realize that pretty much all other developers, whether a new neighborhood in NW OKC or a new large shopping center along I40 pays for all the new roads and utility extensions that are necessary, right?

Not necessarily in all cases. There are instances where the City will bring main utilities up to and into a parcel. What they will not do is structure hookups.

[Teo9969]

Let me break it down...

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.

TIF's establish a base year and then take ALL incremental new property tax (and sometimes sales tax) from that point forward. [Up to a budgeted amount. However, that budgeted amount can be increased by the council, as has been the case with TIF #2 at least once.]
- and -
The huge majority of the funds are used for PRIVATE development, not public.



Part or all of the increase in property taxes resulting from new development after a district is formed is invested back into the area for a term usually set at 25 years. The project budgets usually include allocations for local schools, libraries, the county and the city-county health department.

MOST of the TIF funds are used for private development and SOMETIMES money goes back to schools, libraries, county and city-county health department, but those are the taxing jurisdictions from which the TIF dollars are redirected in the first place. In any event, at most they receive back a small fraction of what is taken away.

I placed in red one clarification that I think is important to understand.

[Teo9969]

I can't read the article. Assuming that it's as TexanOkie says ($60M for infrastructure reimbursement and $60M to OKCPS for construction projects), then I have 2 questions and 1 thought.

Question #1: What counts as infrastructure? No doubt electric, gas, water and roads. But is there anything else that can be counted as "infrastructure" such as sculptures or trees or any sort of building? Sidewalks (which should be a substantial element in this neighborhood)? It sounds reasonable in theory, but if there's a way to manipulate a $10M building to be defined as "infrastructure" it would be nice to know that such a "loop-hole" gets closed, or at least more transparent. If they want $10M to build a community facility, fine...but be upfront about it.

Thought #1: Regarding the $60M for schools. I'm certainly okay with it, and especially if they go the route of a bilingual elementary. However, these sorts of projects are typically reserved for bond-issues. I would hope we don't see language that is overly self-congratulatory for "doing good for the schools". It's a sensible investment, but it's still forcing the districts' hands in regards to their budget. With the increase in population that should occur because of this district, I think that's a laudable thing to do...but by no means is this a "paying it forward" type gesture.

Question #2: Is there priority language in the makeup of the TIF? Specifically, does OKCPS get first priority on the money created through the TIF, does the infrastructure reimbursement see first fruits, some % split, or is there no clarification in this regards? I'm not 100% sure, but I don't believe that TIF works exactly as MAPS (i.e. pays-out when it funds), but I also would hope the city is not going to launch $60M into OKCPS, and reimburse another $60M in infrastructure if it turns out that the TIF never meets the $120M target (that shouldn't be a problem, but it will be if the neighborhood doesn't mostly fill out within the first third of the TIF's lifespan --- I'd guess they'd achieve the $120M if there is a $400M increase in taxable market value by year 10).

[TexanOkie]

I can't read the article. Assuming that it's as TexanOkie says ($60M for infrastructure reimbursement and $60M to OKCPS for construction projects), then I have 2 questions and 1 thought.

Question #1: What counts as infrastructure? No doubt electric, gas, water and roads. But is there anything else that can be counted as "infrastructure" such as sculptures or trees or any sort of building? Sidewalks (which should be a substantial element in this neighborhood)? It sounds reasonable in theory, but if there's a way to manipulate a $10M building to be defined as "infrastructure" it would be nice to know that such a "loop-hole" gets closed, or at least more transparent. If they want $10M to build a community facility, fine...but be upfront about it.

Thought #1: Regarding the $60M for schools. I'm certainly okay with it, and especially if they go the route of a bilingual elementary. However, these sorts of projects are typically reserved for bond-issues. I would hope we don't see language that is overly self-congratulatory for "doing good for the schools". It's a sensible investment, but it's still forcing the districts' hands in regards to their budget. With the increase in population that should occur because of this district, I think that's a laudable thing to do...but by no means is this a "paying it forward" type gesture.

Question #2: Is there priority language in the makeup of the TIF? Specifically, does OKCPS get first priority on the money created through the TIF, does the infrastructure reimbursement see first fruits, some % split, or is there no clarification in this regards? I'm not 100% sure, but I don't believe that TIF works exactly as MAPS (i.e. pays-out when it funds), but I also would hope the city is not going to launch $60M into OKCPS, and reimburse another $60M in infrastructure if it turns out that the TIF never meets the $120M target (that shouldn't be a problem, but it will be if the neighborhood doesn't mostly fill out within the first third of the TIF's lifespan --- I'd guess they'd achieve the $120M if there is a $400M increase in taxable market value by year 10).

I can't speak as to Question 1, but on Question 2, the way it has been presented to the Review Committee is that the increment would come in 2 "tiers"--the first a 75-25 split between the infrastructure reimbursement set-aside and the money allocated for the elementary school, and the second (basically, once the infrastructure and elementary school money has been collected) going 100% to the school district.

[jbrown84]

You do realize that pretty much all other developers, whether a new neighborhood in NW OKC or a new large shopping center along I40 pays for all the new roads and utility extensions that are necessary, right?

The point of TIF in this case is to incentivize a developer to take a huge risk on development that will provide a much needed jumpstart to a forgotten, depressed area. I think this project is more than deserving.

[catcherinthewry]

The point of TIF in this case is to incentivize a developer to take a huge risk on development that will provide a much needed jumpstart to a forgotten, depressed area. I think this project is more than deserving.

It may have been forgotten and depressed, but it is very close to the new Central Park so it will be a very desirable location in the near future. If Blair doesn't want to develop it w/o a boat load of corporate welfare I'm sure someone else will.

[Spartan]

Ya, this just seems like an insane amount. Are they having to pay for any of the development costs or they getting it all for free?

Wow. Do you not realize that all of Western has to be rebuilt. Even as a street it is a terrifying speedway that the city has to address. I think Western's speedway nature has really damaged the south side, among other things. Way too many commuters cutting through to avoid the freeways.

They are calling for a streetscape, a traffic circle, and other traffic calming measures. To pull this off, they are capturing some of the taxes created by their own development, which won't happen without every penny of this. I wish they would ask for more TIF to connect the streetcar early.

This project is basically the original Stapleton.

[Teo9969]

I can't speak as to Question 1, but on Question 2, the way it has been presented to the Review Committee is that the increment would come in 2 "tiers"--the first a 75-25 split between the infrastructure reimbursement set-aside and the money allocated for the elementary school, and the second (basically, once the infrastructure and elementary school money has been collected) going 100% to the school district.

The city really ought to change up the terms: 80/20 for the first $40M of Increment, and 45/55 after that. If need be, allow around $5M to go toward private property. This current setup does not incentivize urgency in the least, because the developers are pretty well guaranteed to get what they need, and if they don't move quick enough, OKCPS is who loses out the most.

Basically, OKCPS isn't going to see a bunch of that money until half this board is in retirement.

[HangryHippo]

The city really ought to change up the terms: 80/20 for the first $40M of Increment, and 45/55 after that. If need be, allow around $5M to go toward private property. This current setup does not incentivize urgency in the least, because the developers are pretty well guaranteed to get what they need, and if they don't move quick enough, OKCPS is who loses out the most.

Basically, OKCPS isn't going to see a bunch of that money until half this board is in retirement.

That's a great idea, Teo - incentivizing urgency.

[catcherinthewry]

Wow. Do you not realize that all of Western has to be rebuilt. Even as a street it is a terrifying speedway that the city has to address. I think Western's speedway nature has really damaged the south side, among other things. Way too many commuters cutting through to avoid the freeways.

That is just a ridiculous statement. Are Penn and Walker terrifying speedways as well? Western does not HAVE to be rebuilt. Blair WANTS it to be rebuilt for the benefit of his development. I get that, he's a businessman. He's looking out for himself. But be doesn't seem to care that Western is a major north/south artery for the south side. A TIF should benefit, or at very least, not cause harm to the entire city, not just a developer and a small number of residents.