Council approves TIF-backed agreement to support Seminary Street affordable housing project

The Barre City Council on June 3 approved a development agreement with a Downstreet/EverNorth partnership and authorized city staff to submit a substantial-change application to the Vermont Economic Progress Council to use Tax Increment Financing (TIF) for infrastructure supporting a Seminary Street affordable-housing project.

Stephanie Clark, a consultant with White and Burke, told the council the request pairs public infrastructure with private development to enable construction of 31 leasable units on a city-owned Seminary Street parcel. "This is the project. This is the goal," Clark said, explaining the TIF package would fund new sidewalks, undergrounded utilities, upgrades to a nearby parking lot and brownfield remediation that the developer said the project needs to be viable.

The council’s action approves three pieces: a development agreement that sets terms and contingencies, an extension of the option on the parcel, and a letter authorizing staff to file the district substantial-change application. Carol Doss, identified in the presentation as the TIF administrator, reviewed the financial model and told the council the packet showed a bond request of $2,400,000 and an upper borrowing limit of $2,600,000 in case contingencies require it. Clark said the plan is to place a bond question on the November ballot, begin construction in spring 2026 and open units for rent in summer 2027.

Nut graf: The measure lets the city use existing TIF district increment — not a property-tax-rate increase — to support infrastructure changes developers say are necessary to build affordable units on a city-owned site. Supporters argued the package unlocks housing that would not otherwise "pencil," while at least one councilor noted the project uses a portion of the TIF district’s remaining capacity.

Council members asked for details about the assumptions behind the revenue model and how the statutory assessment for affordable housing could affect the project’s increment. Clark said the team used the current statutory formula and projected the completed building would be assessed at about 1.3 (the consultants earlier projected 1.3 under the statute), and that the financial workbook includes stress tests showing the district would still cover debt service if the assessed value were lower than expected. Clark told the council the district is mature and already generates increment that helps absorb risk.

The development agreement lists the infrastructure items the city would finance: sidewalk replacement and streetscape work on Seminary Street, undergrounding of power to allow adequate emergency access and fire truck turning clearance, upgrades to an existing parking lot that will be reconfigured, and a city contribution toward remediation of contaminated parcels on and near the site. Clark said the TIF approach retains local and state tax increment to pay debt service so the local tax rate would not rise as a result.

Council action and next steps: Councilors voted to approve the development agreement and the financials and to allow staff to file the substantial-change request to the Vermont Economic Progress Council. If VEPC approves the substantial change, the city expects a public hearing by VEPC in July and a bond question on the November ballot. If voters approve the bond, the developer plans to bid and start construction in spring 2026 with an opening target of summer 2027.

Ending: The council’s vote allows the city to pursue the TIF-financed infrastructure package for the Seminary Street project. The decision moves the proposal to the next step — state review by VEPC and a local bond vote later this year — and the council asked staff and consultants to keep members informed of any material changes to the financials or schedule.