You could sense the hopefulness in Mission City Councilman Tom Geraghty’s voice.
“Is there an end in sight?” he asked as the council received an update from staff about progress on negotiations on the Mission Gateway project.
City Administrator Laura Smith and financial advisor Bruce Kimmel told the council at their finance and administration committee meeting Wednesday that they anticipated having the package of public finance incentives that would be part of a development agreement negotiated with the Cameron Group by next week.
Based on the parties’ most recent discussions, Cameron and Mission are hashing out what portions of a 9 percent transient guest tax at the proposed hotels and the city’s 1 percent general sales tax at the development’s retail locations would be allocated to project costs. Cameron had initially requested that 100 percent of the proceeds from both sources go to the project. Smith said the city had communicated that request was not feasible.
“We weren’t spending any time arguing about putting that 100 percent request back on the table,” Smith said of a recent negotiating session. “They’re really going to go back and do some hard looking at the areas we discussed with them. That gets us back to that common goal.”
Smith and Kimmel suggested that the parties appeared to have reached a consensus that the project would get access to 100 percent of the proceeds from its requested community improvement district, which would impose an additional 1 percent sales tax on the new development. Factoring the city’s current city, county and state sales taxes into account, the CID would bring the total sales tax at the centers up to 10.6 percent — the same rate charged at the Mission Square and Cornerstone Commons developments, which also have CIDs.
Cameron would also get 100 percent of the proceeds from tax increment finance revenue over a 20 year term starting in 2019, and would qualify for industrial revenue bonds that would exempt the company from paying sales tax on construction materials.
Smith said she hoped to be able to present a fully negotiated development agreement to the council ahead of its Oct. 18 meeting, but, failing that, the city may call a special council meeting in early November for consideration of the agreement.
As presently envisioned, the development would include two hotels, a 58,000 square foot office building, 168-units of apartments above ground-level retail space, a multi-level parking structure and around 100,000 square feet of retail/entertainment space in stand-alone buildings.
The city’s presentation summarizing the current state of the development agreement negotiations is embedded below: