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Thursday, July 31, 2014

Boone County Commission threatens to sue Columbia over TIF proposal

The county commission worries the financing plan could threaten resources.

A new tax increment financing district will not be put into effect if the Boone County Commission has a say.

The Boone County Commission has threatened to sue Columbia if it continues to pursue the idea of a TIF district.

“In the past, I think we’ve enjoyed a very successful working relationship with the county,” Assistant City Manager Tony St. Romaine said. “So when we received a letter (two weeks) ago from the county commission that was basically threatening to sue us if we moved forward with the TIF proposal, needless to say, I was quite shocked.”

The letter says Boone County Commission will sue the city if the city has not revealed plans to disregard the TIF proposal by Jan. 31. Northern district Commissioner Janet Thompson said the commission had a meeting with the city Feb. 2, but she said the result of the meeting is not yet known to her.

The TIF works by freezing a certain amount of taxes currently given to certain taxing jurisdictions within the city. Excess taxes created by the new businesses moving in to the jurisdiction would go toward a fund to upgrade the infrastructure downtown, St. Romaine said.

The proposed district would include the areas between College Avenue on the east side, Providence Road on the west, Elm Street on the southern edge and Interstate 70 to the north.

St. Romaine said the TIF would not harm any taxing jurisdictions, but Thompson disagreed.

“Saying a TIF won’t affect one’s taxes earned is a fantasy unless you say that you will decrease services instead of raising taxes,” Thompson said. “The reality of the TIF is it does adversely affect the taxing entities. It will take about $10 million out of the library fund. People that want to use a public library may find that we may not have the services.”

The letter sent to the city outlines the reasons the Boone County Commission will oppose the TIF. It says the TIF will redirect “millions of dollars in general revenue,” which will adversely affect governmental entities. It also argues that the upgrade of infrastructure should be funded by ratepayers, not general taxpayers, and says the city “has failed to engage any stakeholders.” It also says that sewer bonds would address the issue.

Thompson said she supports financing upgrades through sewer bonds.

“(Sewer bonds are) how these things are normally done, and in fact, the city did it last November,” Thompson said. “That’s how we normally do things as a society. Put stuff like that on the ballot and let people choose.”

The TIF is classified as a “but for” TIF, which means the problems could not be fixed “but for” the implementation of a TIF district.

“Do we (the Boone County Commission) believe ‘but for’ a TIF the infrastructure won’t be fixed? No,” Thompson said. “If you talk to the director of Water and Light, these projects are on their radar.”

The TIF is being proposed to help student housing developments come to Columbia and build in the downtown area.

“They’re saying if we don’t fix the infrastructure, these businesses won’t come to Columbia,” Thompson said. “If you talk to people in the economic development sphere, they say (businesses) are coming, and they will continue to come, and we need to go about upgrading our infrastructure in a focused deliberate fashion.”

St. Romaine condemned the commission for opposing the plan before its public release.

“To be opposed to a plan that has not even been publicly released yet and to basically make up all sorts of facts designed to create fear amongst the various taxing jurisdictions … to me, is preposterous,” St. Romaine said.

The first TIF commission meeting will be held Feb. 11.

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