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Monday
Feb062012

Huge 5% Tax Increase Avoided - Working To Fix Yesterday's Problems

Tonight's meeting was filled with high stakes decisions.  The biggest - TIF #6 began as an exciting hotel development and wound up stuck in a legal and financial mess for years.  One of the first moves we made three years ago was to refinance the bond debt of ~$10MM to buy us some time.  Since then, we went out for an RFP to find a developer who could turn this liability into an asset for the city.  Put in simple terms, if we did nothing...we would be forced to increase taxes by 5% next year or cut deep into city services (ballpark: $220k revenue per 1% property tax increase) in order to find the $1,125,000 in debt payments.  This pain would ratchet up annually, making future budgets bleak.  The time for action was now.  

If we did nothing, we'd be $19MM in the hole by 2025.  Conservative estimates suggest the approved project and it's 5 revenue sources (property, sales, parking, hotel, & food/bev tax) will produce something between $14-21MM by 2025...that's potentially a +$40MM swing.  This is a huge win for taxpayers.  

I'm excited to be a part of this positive momentum that's changing the way DP does business.   More to come...

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