The city manager will enter into a consulting contract with Kane, McKenna and Associates, Inc. to complete an eligibility study and redevelopment plan for the creation of a new tax increment financing district in the 5th Ward.

City Council authorized the resolution Monday. In TIF districts, property tax revenues above a certain baseline are reallocated for public works or economic development improvements in the area.

Some criticize TIFs for aiding gentrification and diverting revenue away from public services. City officials said a new TIF district in the 5th Ward would generate money for affordable housing and provide funding for other public projects.

Economic Development Manager Paul Zalmezak said the contracted company will conduct a housing impact study to assess the effect of the TIF district on residents and to determine if it will displace any residents. If the new district is implemented, Zalmezak said the city will use the TIF increment to fund affordable housing developments and housing repairs, and that the goal is not to “demolish housing.”

Ald. Robin Rue Simmons (5th) said the creation of a new TIF district would provide the area with a financial opportunity.

“It is a very useful tool that has been used on other places in our city, and one that I hope we can use here in the west end,” Rue Simmons said. “It is a goal, over the last few years, that we could get to this place of re-TIF’ing this area so that we can have more economic opportunity.”

The economic development committee approved a contract with Kane, McKenna and Associates last October to prepare a preliminary analysis of the study area.

The company found the area likely to qualify as a TIF conservation area, which Zalmezak said is an opportunity to conserve the area from “potential future blight.” Zalmezak said this project is an opportunity to create redevelopment opportunities in a historically Black area and invest in Black business districts.

“It reflects the fact that there are portions of that district that could slip into blighted status if active economic development is happening,” Zalmezak said.

An integral component of the success of the new TIF district is the selling of the Lorraine H. Morton Civic Center. Because the Center is city-owned, it is tax exempt. Zalmezak said selling the Civic Center to a private company would generate taxes, creating an “economic engine” that would channel money in the district toward affordable housing and infrastructure improvements. While the new TIF district could function without the sale of the center, Zalmezak said it would not be as “robust.”

Some residents expressed concerns about the proposal and the lack of public involvement in the process of selling the Civic Center.

“Rather than approve this expenditure at this time, I would urge the Council to hold this item to give staff time to, one, develop a comparison of cost benefits of retrofitting versus relocating the Civic Center, and two, hold public meetings regarding the future of the Civic Center,” resident Jamie Robin-Collier said.

Mayoral candidate Sebastian Nalls expressed opposition to the plan, saying TIFs are detrimental to the city’s revenue stream, and selling the Civic Center should take place after a community referendum.

Mayoral candidate Lori Keenan also said she opposed the new TIF district, and said the city should not make any decisions until public meetings are held.

“You should be having the community’s best interest at heart and we shouldn’t be trying to guarantee a profit to the developers,” Keenan said.

The review is expected to take up to six months to execute. Zalmezak and City Manager Erika Storlie said no decisions will be made before the study is complete.

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Twitter: @delaneygnelson

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