Other financing options for Bull Street on council’s agenda

The controversial idea of creating a special taxing district for the emerging Bull Street neighborhood might be back on Columbia City Council’s plate.

The council is to get another round of recommendations Tuesday from Columbia’s chief financial officer on ways to pay for the city’s $67.2 million commitment to the sprawling, 181-acre tract in the city center.

This time, the proposals from CFO Jeff Palen focus more on “tax increment financing,” commonly called a TIF, as well as on a series of small general obligation bonds. Streamlined bonds would keep the city from having to ask voters to approve a large bond, he said Monday.

Council will discuss the alternatives. It’s unclear if any long-awaited decisions will be made on choosing which of 17 financing options might be selected to meet the city’s commitment to the Bull Street property. The project is one of the largest residential and retail development projects in the city’s history. The centerpiece of the development is a minor league baseball stadium scheduled to open this year.

Palen said that the suggestions he will make Tuesday de-emphasize but don’t eliminate council’s previous inclination to finance utilities through “installment purchase revenue” bonds, which carry higher, long-term costs.

City Hall staff is recommending a tax district to pay only for the two garages the city is committed to build – which together are projected to cost $36 million – and for a small portion of the the water and sewer lines on the property.

City staffers expect that Bull Street master developer Bob Hughes will request the first parking garage sometime during the fiscal year that begins July 1, Palen said.

Mayor Steve Benjamin said Monday he supports a parking garage tax district.

Tax districts capture property taxes generated within the district and use that money to pay for public utilities in the designated area to spur further private development.

Palen said the suggestion he’s presenting differs substantially from a much more ambitious tax district that the council has twice considered in the past six years.

“Just keep it simple,” he said of a narrowly drawn tax district. “Focus on the parking.”

For utilities needed more immediately on the Bull Street property such as roads, street lighting, stormwater and other infrastructure, council could approve a series of three general obligation bonds totaling $19 million, according to the latest funding proposal.

The bonds could be issued in June each of the next three years in amounts of $9.6 million, $6.5 million and $2.7 million, respectively, Palen said. Those kinds of bonds are repaid through property taxes and other city cash.

General obligation bonds are repaid largely from property tax revenue. Last summer, the estimate was that installment bonds would cost $26 million more than general obligation bonds over 33 years, the financial official said.

Council already has approved paying for the $37 million minor league baseball stadium with revenue from its meal tax income, a 30-year commitment that will slice about $1.2 million yearly in repayment cost. That money will come from the roughly $10 million the city rakes in annually from the tax paid largely by patrons of restaurants and bars. The city issued a $29 million bond to pay for the year-round ballpark in October 2014.