Aldermen approve waiver to let non-sales business relocate into 110 Smithville TIF

A majority of the Smithville Board of Aldermen voted to approve a letter granting a waiver of redevelopment-agreement provisions so that a non–sales-tax business may relocate into the 110 Smithville tax-increment financing (TIF) district.

The waiver, presented by Megan Miller, an attorney with Gilmore and Bell serving as the city’s economic development counsel, was approved by voice vote after a brief discussion and a public comment expressing concern. "I see on the agenda tonight that you're talking about it, and I'm just hoping that you're not voting on it because to me, it sounds like $1,454,000... is a lot of money," said Christine Bunch, who identified herself during public comment. Bunch said petitioners had been told earlier that major changes to the TIF would return to the aldermen for approval.

Miller told the aldermen the redevelopment agreement contains two provisions that generally bar (1) leasing retail space to non–sales-tax-generating businesses and (2) relocating an existing business from elsewhere in the city into the redevelopment area. The development team asked the city to waive those provisions after a reconfiguration of first-floor space left roughly 4,500 square feet proposed for a restaurant and about 4,100 square feet available as office space, Miller said.

Miller also said the developer’s maximum reimbursable amount under the redevelopment agreement remains unchanged. "The maximum reimbursement that the developer is allowed under the redevelopment agreement is not changing," she said. She added the development team has updated its projections and now expects the TIF to capture approximately $321,690 in economic-activity taxes over the life of the TIF, which Miller said could accelerate the TIF payoff if realized.

Aldermen approved the letter and the requested waiver by voice vote. The motion and second were made on the floor; no roll-call tally was recorded in the public portion of the transcript. The mayor then asked for any other new business and moved to adjourn.

Why it matters: Waiving the redevelopment-agreement restrictions permits a business that does not itself generate local sales tax to occupy commercial space inside the TIF area. According to the city’s counsel, the waiver does not increase the capped reimbursement amount in the redevelopment agreement; if the developer’s higher revenue projections materialize, the TIF could be retired sooner and taxing jurisdictions could see full collections earlier.