Developers of the proposed hope to answer any questions that TIF commission members might have on Thursday as the group considers the Desco Group's request for a $9.6 million TIF for the project.
The TIF commission comprises representatives from the various taxing authorities. The commission met for the first time Sept. 15 to organize and hear the Desco Group's initial presentation about the project.
The group will meet again at 6:30 p.m. Oct. 20 at to ask more questions of the developer and the city.
"We'll have at the next meeting open and free dialogue," TIF Commission Chairman Edward Katchter said in September. "It'll be a good time--we're all friends, it's a good cause but it's not a simple cause. We need to open up and talk about what we need to talk about. "
On Nov. 3, the commission is expected to hold a public meeting and invite feedback from community members before voting on proposed TIF.
Scott Sachtleben, senior vice president of the DESCO Group, said he hoped to make sure all of the TIF commission member's questions were answered before they voted.
In the first meeting, the Desco Group representatives explained their plan for developing the 30-acre site located across from . The mixed-use development is expected to include a Schnucks, a pharmacy, a restaurant, U.S. Post Office and retail space.
The Desco Group is asking for a $9.6 million incentive package.
One portion is a self-imposed 1 percent sales tax on the site, which shoppers would pay, which is expected to generate $3.36 million over 23 years. A second portion would be $3.2 million in St. Charles sales tax revenues expected to be generated. The third portion is the $2.98 million in real estate tax that would be diverted.
"We are proposing we capture the new increased real estate taxes from this project," Sachtleben said.
The developer stressed the importance of this TIF for both the city of St. Charles and .
"The most important portion of this project isn't the retail development," Sachtleben said. "It may well involve the post office which currently sits downtown and is in the way of desired expansion of the hospital."
SSM St. Joseph Health Center President Gaspare Calvaruso spoke to the commission about the need for the hospital to expand. Calvaruso said the success of the TIF affects the hospital's ability to purchase the post office property.
"The post office is key for our future success," he said. "We are landlocked. We need that area for parking. Parking is very, very instrumental for our growth. It’s also instrumental to any future development."
Calvoruso said it would be difficult for the SSM St. Joseph Health Center to change locations at this point. Bruce Evans, St. Charles Director of Community Development, said negotiations between the city, the DESCO Group and SSM have been going on for years.
Lindenwood University will donate the ground on which the post office will be built at the Lindenwood Town Center. SSM will purchase the current property on Fifth Street and will roll that money into the cost of building a new post office at the Lindenwood Town Center. The DESCO Group will pay any additional funds needed to build the post office.
Qualifying for Tax Increment Financing
For a project to qualify for Tax Increment Financing, the TIF commission must find that the redevelopment area on the whole is blighted, a conservation area or an economic development area that would not be anticipated to be developed without the adoption of tax increment financing.
Larry Marks, of Development Strategies, the city's planning consultant, said that the homes in the redevelopment area are old. He said typically homes built before 1978 and 1980 have issues with lead-based paint. Marks said after evaluating the homes in the area, 20 percent are in poor condition, 55 percent are in moderate condition. He said 95 percent of the homes are at least 35 years old.
Over the last ten years the assessed value of homes in the area has decreased by 68 percent, primarily because the homes were acquired by Lindenwood University, he said.
The city's comprehensive plan and strategic plan identified the area as a key location for redevelopment, Marks said.