Highland Bridge update: HRA staff propose amendments to minimum assessed values, reallocate TIF interest to affordable housing and public improvements

Deputy Director Melanie McMahon briefed the HRA on a package of proposed changes to Highland Bridge redevelopment agreements and the Ford site TIF plan during the May 7 meeting, saying amendments are intended to reduce holding costs for parcels and stimulate vertical construction while keeping the overall TIF budget unchanged.

McMahon reviewed the timeline: a TIF plan for the site was adopted in 2016, a master plan in 2017 and a redevelopment agreement with Ryan Companies was signed in 2019. She said those earlier decisions included minimum assessed values for parcels intended to encourage development by guaranteeing a floor for tax increment, but that those minimums have created holding cost burdens that make financing vertical development more difficult in the current market. To address that, the package would amend minimum assessed values for 15 of 44 parcels to reduce near-term holding costs and then allow them to rise so the parcels’ minimums end up about 20% higher than the original agreement by the TIF district’s term end.

McMahon said the city’s county assessor still determines annual assessed values; the minimum assessed values operate as a floor only. She explained the amendment also reallocates previously budgeted TIF interest expenses—money the city no longer expects to need for interest—into two categories without increasing the overall TIF budget: about $28 million for affordable housing and roughly $42 million for other public improvements, including funding proposed for Block 2 to stimulate vertical construction on the site.

On public infrastructure and green-infrastructure funding, McMahon described a central stormwater system built to serve multiple parcels and noted that stalled development has reduced expected connection charges. As part of the package, Ryan Companies and Widener Apartments would prepay green-infrastructure connection charges for certain parcels they own, and Ryan Companies would be prohibited from receiving city or HRA subsidies for parcels they own at Highland Bridge (with a separate set of terms for Block 2). Widener would also agree to build two multifamily residential buildings at the site (170 and 180 units) without city subsidy and prepay its connection charges.

Staff described a Block 2 development agreement that would use reallocated TIF dollars for public redevelopment costs totaling about $23.9 million (reallocated from interest) to unlock vertical construction this year. McMahon said structure parking in the Block 2 plan would include 77 public stalls (free), 15 retail-specific stalls and 109 residential stalls; public parking would include two EV-ready stalls and three car-share stalls.

Several commissioners praised the effort to find creative solutions and requested additional comparative material before formal action. Commissioner Jost asked the staff to provide a clear accounting of how the amended package changes what will be built and how public and private contributions compare with the original agreement; McMahon and Jenny Wolf (debt manager) said staff will provide more detailed figures by next week. Commissioner Yang expressed concern about perceived linkage between these negotiations and a separate rent-stabilization amendment pending before the City Council; staff and other commissioners said timing pressures (including county deadlines for pay-2026 assessed values and financing timelines) influenced the schedule for bringing amendments forward.

Ending

Staff said the package will be before the HRA and the City Council on Wednesday, May 14, for formal action and that they will provide follow-up materials responding to commissioners’ requests ahead of that meeting.