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Adelanto hears plan for tax‑exempt financing to build Steelwave industrial park
Summary
A public‑finance consultant outlined a three‑program plan (CFD, EIFD, impact‑fee) to fund roads, sewer, water and other infrastructure for a phased Steelwave Industrial Park in northeast Adelanto; staff and council pressed for CEQA, timelines and protections for taxpayers and residents.
David Taussig, a public‑finance consultant engaged by developer Steelwave LLC, told the Adelanto City Council on Aug. 14 that the company plans a multi‑phase industrial park covering hundreds of acres and up to 6,000,000 square feet of buildings, and proposed three financing tools to build off‑site and on‑site infrastructure without using the city’s general fund.
Taussig described the three tools as: (1) a developer‑supported community facilities district (CFD, commonly called Mello‑Roos) in which the developer agrees to an additional tax (he cited roughly $0.60 per square foot) on its own property to support a 30‑year bond issue; (2) an enhanced infrastructure financing district (EIFD) that captures a share of increased ad valorem tax revenue as properties are developed; and (3) a development‑impact fee/benefit‑area reimbursement program to reimburse early builders for oversizing roads and utilities.
“CFDs are tax‑exempt bonds that are not recourse to the city,” Taussig said. “The bonds are secured by the special taxes on the property; if the developer doesn’t pay, bondholders foreclose on the property — the city is not on the hook.”
City Manager Jesse Flores and council members pressed Taussig on several practical points: the sequencing of phases, the plan’s sensitivity to market and interest‑rate risk, the appraiser requirements that limit bond sales (Taussig said land value must support roughly four times the bonds sold), and whether CEQA clearance is in place. Taussig said phase‑1 infrastructure construction could start in early 2025 and that the developer would front roughly $32 million for the first phase. He also said EIFDs typically run 45 years and the program would be publicly governed by a public‑financing authority with council representation.
Council members raised concerns about public transparency, how much of the city’s tax increment would be used to repay developers (Taussig said typical EIFD splits range 25–50%), and protections for neighboring property owners. City staff noted the CFD petition and a resolution of intention could come to council as soon as September, followed by the statutory public hearing and election processes.
The council did not take a final action at the Aug. 14 meeting; staff and the consultant were directed to return with further details, including draft boundary maps, proposed governance structure for the public financing authority, and clarifications on CEQA status and timelines.
Taussig’s presentation and the council’s questions mark the start of a multi‑month review process that will require additional public hearings before any district formation or bond sale occurs.
