Rapid City committee approves creation of two large TIF districts and moves $5M vision-fund allocation toward proposed sports complex

The Rapid City Legal and Finance Committee on July 2 approved resolutions to create two tax increment financing districts tied to the proposed Liberty Land/Libertyland development, advanced a $5 million Vision Fund reallocation for civic improvements and moved forward a proposal for an additional hotel-occupancy fee intended to help finance a proposed indoor sports field house.

Committee members approved a resolution of intent and project plan for the Rapid City Destination District and also approved creation of a separate Catalyst District, both of which city staff and the applicant say are intended to help fund infrastructure and private development that together would support a larger entertainment, lodging and residential project near East Mall Drive and 140th Avenue.

The measures matter because the combined public and private proposals are the principal near-term financing strategy the city council is using to assemble public infrastructure and capital for a proposed indoor field house, hotel support and an entertainment/resort cluster that proponents say will expand tourism during winter months and create long-term incremental tax revenue.

City finance staff said the Destination District project plan requests $125 million in TIF support for public and discretionary grant components of an approximately $171 million sources-and-uses plan for the “commercial entertainment zone.” Mike Dugan, the city’s TIF planner, said of the request: “This TIF request of 125,000,000” and described a 20‑year amortization schedule under the current development assumptions.

Daniel Ainsley, the city’s finance director, told the committee that reallocating $5 million of excess Vision Fund receipts would not affect prior allocations and was recommended because collections in the last round exceeded the amounts originally budgeted. “The recommendation is to proceed with allocating an additional $5,000,000,” Ainsley said. Committee members approved that resolution after discussion; one member voiced ongoing opposition to diverting vision funds to the project.

The committee also approved advancing a resolution of intent to establish a second hotel-occupancy assessment (a business improvement district-style fee) that would add up to $2 per occupied night on hotels with 55 rooms or more. Ainsley said hotel owners are proposing that the additional fee be used only to retire debt on the field house, support operations of the field house, or for marketing and tournament support — not for general Visit Rapid City operations or other city programs. Staff estimated the hotel fee could generate roughly $15 million for the project’s capital stack if approved by the council and by hotel owners.

Proponents emphasized economic development and tourism. D'Amico Rodriguez, representing the Rapid City Sports Commission, said the package — a second hotel assessment, a Catalyst District TIF and the Vision Fund reallocation — would together “get us to our 4 to about $40,000,000 of our $55,000,000 project” (referring to the sport complex portion of the funding plan) and asked for committee support. Ellie Formanek, chief executive officer of Visit Rapid City, said: “This project is not just about tourism. It's really about investing in a shared community asset that will serve both our visitors and our residents as well.”

City staff and several council members also described the larger Liberty Land proposal as mixed-use rather than a single “amusement park.” Vicki Fisher, community development director, said the applicants have amended plans to include a resort village, cultural components and a convention-style facility and that the design “really wanna[s] capture the essence of what makes Rapid City special.”

Mike Dugan walked the committee through the project plan details the applicant submitted: a roughly 38.6-acre commercial entertainment zone (with future expansion areas not included in repayment assumptions), a 130-acre mixed residential component, and public infrastructure the city would either construct or reimburse (road extensions such as a Tisch Boulevard connection, sewer, the potential widening of Seager Drive and traffic signals). Dugan said the project’s certified baseline assessed valuation would be roughly $8.0 million and that, under the conservative pro forma on file with staff, the TIF repayment is estimated at about 20 years under current assumptions. He warned that additional undeveloped parcels within the district — if developed later — would accelerate repayment but were not counted in the initial payback plan.

Committee members pressed the applicant and staff on fiscal and policy questions. Alderman Bill Evans repeatedly said he opposed redirecting Vision Fund money and asked whether the investment was appropriately “holistic” for visitors who come for cultural or natural attractions. Council President Kevin Maher and Alderman Josh Biberdorf argued the incremental revenue and donated land make the project feasible; Maher noted the developer’s donation of land for the sport complex (the Lien family) and that the donation’s appraisal is in process and estimated at several million dollars.

Staff noted statutory constraints on TIF use and the city’s remaining allotment of allowable TIF valuation under state law. Dugan said Rapid City’s total TIF valuation would remain well below the state limit (city staff cited a 10% statutory cap on taxable valuation used for TIFs and showed Rapid City at about 1.6%–2.6% under the proposed additions, well under the cap).

Actions and votes at the committee level

- Resolution 2025-077 (Vision Fund reallocation, +$5,000,000 to civic improvements): motion to approve made on the record; committee approved the resolution (motion carries). One member expressed opposition during debate. - Resolution of intent to establish Business Improvement District 2 (hotel assessment): motion to approve the resolution of intent; committee approved (motion carries). The public hearing date was set for Aug. 18. - Resolution 2025-069 (creation of Rapid City Destination District TIF): motion to approve the creation of the district; committee approved (motion carries). - Resolution 2025-070 (project plan for the Destination District TIF): motion to approve the project plan; committee approved (motion carries). - Resolution 2025-071 (creation of the Rapid City Catalyst District TIF): motion to approve the district boundary; committee approved (motion carries).

What’s next

Each of the TIF items and the hotel assessment requires additional public hearings and administrative steps before financing proceeds. The hotel-assessment proposal will be sent to hotel owners and is subject to a formal public hearing in August; the TIF project plan also requires county and state certification of baseline valuation and stepwise invoice certification before any developer reimbursement occurs. City staff said project reimbursements will require inspection, temporary certificates of occupancy and itemized invoice review before any increment is released.

Committee members and staff said the final design, phased construction schedule and future council reviews (including planning commission conditional-use and building-permit steps) will provide further opportunities for public scrutiny and revision.