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Morgantown council approves TIF application to extend riverfront redevelopment district
Summary
City Council voted 5-1 to authorize submission of a tax-increment financing (TIF) application to the West Virginia Department of Economic Development to extend and amend the Riverfront Redevelopment District No. 2 so the city can restructure subordinate bonds tied to the waterfront project.
MORGANTOWN, W.Va. — The Morgantown City Council voted 5-1 on May 20 to approve a resolution authorizing submission of a tax-increment financing application to the West Virginia Department of Economic Development that would amend the City of Morgantown Riverfront Development Redevelopment District No. 2 and extend the district’s life to enable a restructuring of outstanding debt.
Council action followed a multi-party presentation from city counsel and bond advisers explaining that a subordinate series of bonds issued for the riverfront development has fallen short of expected revenues; the proposed amendment would extend the district term and allow the city and bondholders to issue a new series of bonds and adjust repayment terms. The vote was called after public explanation and a council discussion of the financial mechanics.
The move matters because the subordinate bonds — described in the presentation as issued to reimburse development costs tied to an event center and portions of the parking garage — are not being paid down by current increment revenues in the district. Council heard that the senior bonds remain current but that shrinking coverage and an impending term end make restructuring more difficult as time passes. Extending the TIF term is intended to lengthen amortization and create a feasible path to repay more of the investment.
City Attorney Bridal Simonton introduced the resolution and explained the filing process with the state agency. Bond counsel described the background: the district did not generate the anticipated development revenue needed to cover all obligations from a subordinate bond series, and bondholders have agreed to forgive some unpaid principal to enable a restructured financing that shares future excess revenue with the city. Officials said the district was created in 2003 and that the current term would end in 2033 without amendment; the request includes an additional 15-year extension.
Council members asked for clarification of district boundaries and the mechanics of the refinancing. Officials said the application includes a map and legal description filed with the state and that portions of the district would be held out of the pledge for restructured debt so future development there could provide revenue for the city.
The resolution passed on a roll call: Bill Kolecki—yes; Wheezy Michael—yes; Deputy Mayor Celine—yes; Danielle Trumbull—no; Dave Harshbarger—yes; Brian Butcher—yes. The ordinance to submit the application will now go to the West Virginia Department of Economic Development for review under the state’s TIF process.
Officials emphasized that TIF debt is not an obligation of the city’s general fund, but that unresolved district debt presents financial uncertainty and potential credit implications if not addressed. The council vote directs staff and bond counsel to proceed with the formal application and related closing steps with the bondholders and state agency.
