The Exponent Telegram
Friday, December 2, 2005
By Jim Fisher - METRO EDITOR
CLARKSBURG – Harrison County commissioners on Thursday approved the state-modified tax increment financing district for Charles Pointe as well as the project plan.
The state trimmed about $50-$60 million out of the TIF proposal dropping the total from $150-$160 million to nearly $97 million for the planned community project in Bridgeport.
The cuts involved taking out infrastructure for retail and residential purposes, said Vince Collins, bond counsel for Charles Pointe developer Genesis Partners.
Essentially, the state wants to limit TIF projects to things that will create jobs, Collins said. There was some fear that TIF could be overused in some parts of the state, he said. Although TIF rules do allow for retail and residential infrastructure, the state is planning to change that, Collins said.
TIF was enacted when Commissioner Frank "Chunki" Angotti was serving in the Legislature.
"Initially it was for blighted areas – old areas of downtown, for commercial projects to bring jobs," Angotti said. "No one ever ran to us and said they’d use it for housing."
The cuts don’t jeopardize the project at all, Collins said. In fact, many of the things that were cut are projects slated for the later stages of the overall plan. Nothing in the beginning will be affected, he said.
Of the $97 million, $16 million is earmarked for interest payments until the TIF fund generates enough money to make the payments, Collins said. Because of the nature of TIF, which sets aside a portion of increased property taxes after development to pay back the bonds, it takes a while for the fund to realize revenue.
Also, $8 million is set aside as a reserve, or cushion, to protect the bondholders, Collins said. That is a normal condition of issuing bonds, he said. The assessed value of the property is locked in as of July 1, 2004. That means any subsequent increase in value from development is what is put into the TIF fund.
"The idea is that these projects wouldn’t exist except for TIF," Collins said. "Without this, Charles Pointe would be a shadow of the plan."
The next step is to actually issue the bonds, which should happen sometime next year, Collins said.
Also Thursday, commissioners conditionally approved the sale of bonds to finance the new recreational complex at the 4-H Center on U.S. 19.
The sale may be subject to a public hearing because a question about what kind of bonds to issue has been raised. Since there are a number of non-profit entities that will use the center, Collins (in this case bond counsel for the issuing bank) questioned whether government or 501 (c) 3 bonds should be issued.
If the nonprofit bonds are to be issued, the hearing is neccessary, said Jim Christie of Comvest, the Bridgeport-based financial firm handling the sale.