As part of a compromise intended to make the project palatable both to financiers and the city, the developer of the proposed Mission Trails project and the city of Mission have agreed in principle to a deal that would set a 20-year TIF period for the project while allowing the city to charge $200,000 in fees up front that would be used for downtown infrastructure improvement.
Representatives of EPC Real Estate had indicated to city financial advisors and staff that without a full 20-year tax increment finance window attached to the project, they would have a difficult time finalizing financing for the project, which will bring approximately 200 apartment units as well as new ground-level retail and restaurants to a parcel of land near Johnson Drive and Lamar.
An analysis by Mission financial consultant Bruce Kimmel, however, indicated that for EPC to achieve a “market appropriate rate of return” without overburdening the city, the TIF period should be closer to 15 years.
“So were kind of at loggerheads if you will about 15 years versus 20 years, and could we find a way to reach a win-win for both the city and the developer,” Kimmel told the city council at a committee meeting last week.
As a way to balance the tax revenue that would be diverted away from the city’s tax rolls in the final five years of a 20-year TIF term, EPC proposed attaching $200,000 worth of fees it would pay the city at the outset of the project that would be used for downtown improvements, particularly to parking infrastructure.
Additionally, the parking structure that will be part of the project will include 50 spaces that will be open to members of the public, and can be used as overflow parking for the nearby Sylvester Powell, Jr. Community Center. The city is currently renting a parking lot on Beverly at a cost of approximately $10,000 per year that it would no longer need access to if the Mission Trails parking structure is completed.
The city is expected to take up final consideration of the development plan on the public finance incentives request in the coming months.