Farmington considers TIF reimbursement to development firm

By DOUG SMITH
Daily Journal Staff Writer

Published: Friday, October 09, 2009
Updated: Friday, October 9, 2009 9:45 AM CDT

FARMINGTON — On a night when water was in no short supply outside the building, the Farmington City Council stopped for a moment during Thursday evening’s work session to note an achievement by a city employee who has made water his career.

Water department head Eddie Hull was given an Award of Merit from the Missouri Water and Wastewater Conference. Mayor Stuart “Mit” Landrum delivered the award to Hull during the work session. The recognition, however, was bestowed on Hull from the professional organization.

Following the work session Hull said it was nice to be recognized by his peers, even though he was simply doing his job for the city. Hull has been in a management role in the city’s water and sewer department for the past several years.

Also during the meeting, it was announced that work is continuing on radionuclide treatment at another city well. The council had discussed the water treatment system at length during the September council session. Councilman Larry Forsythe added that a part had been ordered to repair a problem with a new filtration system being installed in coming days. He said the part should arrive by next week and the filtration system could be put in operation.

Switching talk to finances, City Administrator Greg Beavers announced that Gundaker Development had approached the city about being reimbursed for $6.92 million in expenses covered under an existing Tax Increment Financing (TIF) agreement.

Under a TIF, a development can be reimbursed for infrastructure improvements to the area within the TIF district. In this case, Gundaker’s development near U.S. 67 and Maple Street falls within an existing TIF district which encompasses both sides of U.S. 67, portions north and south of Maple Street.

Gundaker had made improvements to the shopping development in the past couple years, and is now asking for an allowable portion of those expenses to be reimbursed. Beavers said the receipts would be reviewed and approved, and then an ordinance would be drafted and put before the council to allow for payment of the bills from TIF funds.

TIF funds are derived from a portion of new sales tax revenue collected within the confines of a designated district. A “base” line is established by the tax collections at the inception of the TIF. From that point on during the life of the TIF agreement — usually between 20 and 30 years — a portion of tax revenues exceeding that base amount can be returned to developers within the district to be used for improvements ... which are generally done to foster additional retail growth within the confines of the district.

The reimbursement will come from collected tax revenue set aside in the TIF fund and will not come from the general fund of the city.

The council concluded the monthly work session by learning of two new bills up for a vote later this month. The first allowed for eliminating “through traffic” of heavy trucks on Columbia Street and Ste. Genevieve Avenue. The city recently took over ownership and control of Columbia Street and Ste. Genevieve Avenue from the Missouri Department of Transportation.

With the transfer the city must now assume maintenance, snow clearing and other responsibilities of the stretch of roadway. But the allowance of large trucks utilizing the two streets to travel between U.S. 67 and State Route 32 can also be squelched by city ordinance. The city will allow truck use for local delivery, but enforce “through” traffic by larger trucks to use the U.S. 67 to Business 32/Karsch Boulevard route instead of passing through downtown.

The second ordinance considered by the group would allow for purchase of battery backup systems for five street lights in the city limits.

The council will take up the ordinance and other topics when it meets on Oct. 26 at 6:30 p.m.

Doug Smith is a reporter for the Daily Journal. You can reach him at 573-756-8927, or at dsmith@dailyjournalonline.com.

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