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Originally Posted by deja vu
Somewhat related to the previous points, the City is making an effort to increase the cash flow to support downtown improvements. Or at least experimenting with different ideas. At Monday night's monthly meeting, the Commission voted to approve the creation of a new Downtown Economic Growth Authority (DEGA) to replace the former DDA. This new authority will oversee the allocation of funds that will be captured from a new, larger TIF (Tax Increment Financing) overlay district. In short, the funds grabbed with the old TIF district have dwindled from millions to a few hundred thousand dollars since 2008. Under this new plan, more businesses will fall within the boundaries of the district, but business owners won't pay a cent more, meaning more local tax revenue will be allocated directly to downtown improvements.
I think it is a good move, and we'll see if it pays off.
Also somewhat related, I noticed from other news sources covering this story that Downtown Kalamazoo Inc. seems to be in the process of quietly rebranding itself as Kalamazoo Downtown Partnership. At least, I think they are...it's the same people involved, but a new website. The old website seems to have dissapeared in the past few days...I don't really know why they had a name change, although it does sound more like a non-profit now. The new website has some additional info on the proposed (now adopted) DEGA. Scroll to the bottom of the webpage, if interested.
https://www.downtownkalamazoo.org/about-dki |
This whole thing confuses me the more I read. Most articles done on this seem to imply that this is more than an expansion of the DDA boundaries; that there is a change on the mechanism of funding that allows for more state dollars to be leveraged. In fact, the
DEGA FAQ says this:
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The new Downtown Economic Growth Authority is an innovative update to the DDA TIF funding model, with an ability to leverage additional state matching dollars for investments in downtown. The new authority will reset the funding base according to today’s downtown landscape, allowing for continued investment in locally determined economic development priorities that will keep the positive momentum growing.
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The Downtown Economic Growth Authority is a continuation of the DDA TIF funding model, with an ability to leverage additional state dollars for investments in downtown. The new authority will realign the funding model for future investments in locally deter mined economic development priorities.
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It may just be development-ese/development jargon, but it sures does seem to imply that the state legislation to create the DEGAs are different from the legislation that creates DDAs. What I'm not clear on is what the benefit of the DEGA is over the DDA. More than that, and even more confusingly, the DDA isn't going to disappear:
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The DDA will work in partnership with the new Downtown Economic Growth Authority, coordinating strategic investments in Downtown. The DDA TIF district will be dissolved, but the DDA will continue its current responsibilities, which include management of the City’s Downtown parking system and oversight of investments through an existing levy Downtown.
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Seems really complicated or rather they just didn't explain it how they needed to. I'm also still a bit unsure why the old Upjohn/Pfizer lands (Zoetis) were carved out of the district, unless Zoetis lobbied to be taken out. It seems to me that this would be a major contributor to the TIF as that land continues to be developed. I just looked up 333 Portage; the taxable value of the property is something like $25 million. Looking at the taxes they've paid in 2017, it was nearly $1.7 million. Why Zoetis isn't in this new district is beyond me.