LEXINGTON HERALD-LEADER
Friday, Dec. 05, 2008
By Beverly Fortune – bfortune@herald-leader.com
The Urban County Council gave final approval to plans to help revitalize two areas of downtown, one around the old Fayette County courthouse and the CentrePointe development, the other along a stretch of Manchester Street. Improvements, which would include renovation of the historic courthouse and the James E. Pepper distillery water tower, a bourbon museum, new sidewalks and lighting, would be paid for using new tax revenue that the districts areas are expected to generate when the projects are completed.
This type of funding, called tax increment financing, is a first for Lexington and still needs state approval.
Tuesday’s approval was the last local hurdle for the projects before they are forwarded to Frankfort for more scrutiny by the state as it decides whether to pledge revenues. Council members gave unanimous approval to support the Lexington Distillery District. On the Phoenix Park/Courthouse Development Area, they split 10-5.
After the vote, Centre Pointe developer Dudley Webb said his team was pleased “because we think it is the right decision for the city and for downtown.” Barry McNees, developer of the Distillery District, said he was “ecstatic” at getting approval. “We are excited to go to the next level.” Probably next week the city’s tax increment consultant, Jim Parsons, will finish assembling data and documents and deliver the two applications to the Department of Financial Incentives in the state Economic Development Cabinet. A review of each application might require meetings with city officials and the developers to get additional questions answered, Parsons said. The department staff will determine whether each project meets eligibility criteria for state support, and if so, how much that should be. The department makes a recommendation to the Kentucky Economic Development Finance Authority Board.
If the KEDFA board gives a preliminary green light, the state will hire an independent firm to do a financial analysis on both applications. “What the state will be looking for is whether the projects will be a net positive financial gain for the state,” Parsons said. “If you are just moving jobs from one part of the state to another, there is not a positive economic impact.” Following the state’s financial scrutiny, the KEDFA board will vote on whether to commit future state tax revenues to CentrePointe and the Distillery District.
These are the first projects to need a financial analysis by the state since the requirement for independent scrutiny was passed by the General Assembly earlier this year. Five districts were approved last year and didn’t need the investigation. “Assuming there are no hiccups, I would think no later than March or April we should get final approvals from the state,” Parsons said. The city must ultimately make the decision whether to issue bonds or to pay for public improvements after the two projects are completed and start generating money.
“That’s still a possibility. The agreements tonight don’t preclude that,” Parsons added.
Reach Beverly Fortune at (859) 231-3251 or 1-800-950-6397, Ext. 3251.
LEXINGTON HERALD-LEADER
Friday, Dec. 05, 2008
By Beverly Fortune – bfortune@herald-leader.com