Council approves tax-incentive plan for new community development area downtown

People gather for the inaugural George Streetfest during the 2015 Fourth of July weekend on Main Street in St. George. The St. George City Council a community development area, or CDA, in the downtown area Thursday that will enable businesses within the zone to apply for tax intensives as a means to promoting continued economic development in the area, photo taken in St. George Utah, July 4, 2015 | Photo by Sheldon Demke, St. George News

ST. GEORGE – As a part of a continuing effort to spur the revitalization of the downtown area, the St George City Council approved a tax incentive plan aimed at bringing new development to the area.

In a unanimous vote Thursday, members of the City Council approved the designation of a Community Development Area, commonly called a CDA, covering 45 acres located between 200 North, Tabernacle Street, 300 West and 200 South. The area is hoped to be the possible future site of mixed-use developments catering to commercial, office and residential use.

We want people down there,” Councilman Jimmie Hughes said. “There’s a lot of potential in those CDAs.”

Frame from overhead projection offered at St. George City Council meeting regarding new Community Development Area, St. George City Council Chamber, St. George, Utah, March 3, 2016 | Photo by Mori Kessler, St. George News
Frame from overhead projection offered at St. George City Council meeting regarding new Community Development Area, St. George City Council Chamber, St. George, Utah, March 3, 2016 | Photo by Mori Kessler, St. George News

Currently the taxes generated from the selected area are around $27 million but are starting to erode, said Jason Burningham of the financial consulting firm Lewis Young Robertson & Burningham. In order to combat the loss of revenue, city officials are hoping the newly approved CDA will help bring people and money back into the heart of the city.

The tax-incentive plan projects $55 million in incremental tax-assessed value in 15 years to be brought by probable developments in the CDA.

Tax increment financing, a common and popular tool municipalities employ to promote economic development within a specific zone, is being applied to the CDA. The increment includes property tax revenues that are generally collected by not only the City of St. George, but also other taxing entities, such as the Washington County School District and Washington County.

Those entities will have to agree, through interlocal agreements, to allow monies that would go to them to remain within the CDA. Thus far, it appears they are on board with the idea.

I think they see the vision of this project,” Burningham said.

Approved projects with the CDA would provide their property taxes are frozen in their first year. Property tax revenues generated in excess of the first year’s rate would go to the redevelopment agency overseeing the CDA, in this case the city. The monies directed to the agency would then be used for various infrastructure improvements.

Artist rendition of Joule Plaza as seen from Tabernacle Street | Image courtesy of Ben Rogers, CRSA, St. George News
Artist rendition of Joule Plaza as seen from Tabernacle Street | Image courtesy of Ben Rogers, CRSA, St. George News

The types of projects that could benefit from the tax incentives would be multilevel, mixed-use developments like the proposed Joule Plaza: a 235,000-square foot project spread over 4 acres acres located at 200 West and Tabernacle Street. The Joule Plaza was projected to include three four-story buildings that would host commercial space on the bottom floor and up to 129 high-end residential apartments on the upper floors.

The project was cleared to move forward last year but was curtailed due to construction costs being higher than expected.

Randy Wilkinson, owner of the property Joule Plaza would be built on, said he was grateful the city was looking at creating a CDA, as it would help projects like his own and others.

There’s a good possibility the CDA can help the Joule project move forward,” Wilkinson said.

City Manager Gary Esplin said the downtown needs projects like the Joule Plaza because the rising generation of millennials favor living and working in a city’s downtown area. It is millennials, particularly those who work in tech-based industries, city officials want to attract as the city’s tech base grows.

The creation of the downtown CDA also continues the city’s efforts to keep the heart of the city alive and attractive to residents and businesses. Other examples of these efforts include the creation of the Town Square, the renovation of the Electric Theater and the promotion of the downtown arts district.

The city also approved the creation of a CDA in the Millcreek Industrial Park. Esplin said companies in the area have approached the city with a desire to expand their operations in St. George and the CDA is seen as a way to help accomplish that.

Other business

St. George Mayor Jon Pike stands with members of the Elks Lodge as the city recognized their service and donations to the All Abilities Park. The Elks national president, Ron Hicks (third in from the right) was also in St. George for the day as a part of the Utah Elks' state convention, St. George, Utah, March 3, 2016 | Photo by Mori Kessler, St. George News
St. George Mayor Jon Pike stands with members of the Dixie Elks Lodge as the city recognizes their service and donations to the All Abilities Park. The Elks national president, Ron Hicks, (third in from the right) was also in St. George participating in the Utah Elks state convention, St. George, Utah, March 3, 2016 | Photo by Mori Kessler, St. George News

The City Council recognized a delegation from the Elks Lodge. The Elks’ national president and grand exalted ruler, Ron Hicks, was visiting St. George for the day for the Utah Elks’ state convention. St. George Mayor Jon Pike also publicly thanked the Elks for their donations to the All Abilities Park, thus far accounted for $8,000 in donations.

The City Council approved a number of bids largely related to road projects and parks:

  • A $288,100 contract for a new roof for the city’s bio-solids facility at its wastewater treatment facility was approved; the original roof collapsed last November
  • A $130,244 project involving the upgrading of a covert crossing in the area of Commerce Drive and Fort Pearce Wash; the crossing is considered a critical part of the transportation system connecting River Road and the Little Valley area
  • A $106,922  contract for installation of a new traffic signal at 1600 South and Dixie Drive
  • A $2.9 million contract for the River Road widening project; the project also includes removal and replacement of the bridge over the Fort Pearce Wash, include curb and gutter work, sidewalks, drainage infrastructure and a new traffic signal at River Road and Horseman Park Drive
  • A $609,081 construction contract for Millcreek Park
  • A $229,975 contract for building a treehouse and fort-like structures in the All Abilities Park

Email: mkessler@stgnews.com

Twitter: @MoriKessler

Copyright St. George News, SaintGeorgeUtah.com LLC, 2016, all rights reserved.

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