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Urban Renewal Agency maps options for three downtown parcels; staff flags $2M boutique‑hotel incentive possibility
Summary
Urban Renewal Agency staff outlined redevelopment options for Site B, Woodfold and the theater building, presented financial metrics (URA maximum indebtedness $15M; annual revenue ~ $1M; ~$1.5M in unappropriated funds) and posed scenarios including a boutique hotel that could require about $2,000,000 in incentives; staff will return in August with feasibility studies and draft marketing materials.
At a work session, Urban Renewal Agency (URA) staff briefed the board on redevelopment pathways for three URA‑owned properties in the downtown town‑center area: Site B (approx. 1 acre), the larger Woodfold parcel (nearly 2 acres), and the historic theater building. Staff framed the discussion around URA plan goals, case studies from other cities, zoning constraints, and financial capacity.
Kim Ezell, Assistant City Manager, summarized zoning and constraints: the theater building sits in 'town center core' (which requires ground‑floor retail), Site B and Woodfold are 'town center transition' with broader permitted uses, Site B is gravel and sloped, and the theater will require roof and HVAC replacement and possibly seismic upgrades before redevelopment. Initial concept work for the theater suggested a possible 14–31 room boutique hotel but noted significant retrofit needs.
Staff presented URA finance figures: the URA plan authorizes maximum indebtedness of $15,000,000; $7.27 million has been issued to date with about $7.73 million remaining, annual tax‑increment revenue is roughly $1,000,000, debt service is about $577,000 per year, approximately $370,000 is budgeted annually for grant programs, and the URA currently holds about $1,500,000 in unappropriated fund balance. Kim Ezell said projections show revenues will generally match or exceed expenses by FY28–29.
Jesse Vanderzanden, City Manager, presented two hypothetical scenarios for board consideration. On the boutique‑hotel scenario, he said, “Let's just make an assumption that the boutique hotel study says it's gonna require $2,000,000 in incentives to attract the development of a boutique hotel.” Staff asked the board to weigh that incentive against potential impacts on the other two properties and the annual grant programs.
On Site B, councilors questioned whether the city should fund site preparation or require proposers to provide a level site. Jesse Vanderzanden confirmed, “URA funds can be used for site preparation,” and noted that this can be packaged as a pre‑RFP incentive or left as a proposer responsibility. Councilors and staff agreed to return in August after feasibility studies and to start preparing marketing materials and offering memoranda; staff sought direction to begin marketing assistance focused on the time‑sensitive theater/boutique hotel feasibility.
Why it matters: The URA controls incentive levers and a limited debt capacity. Committing $2 million or more to a single project would materially reduce the URA’s remaining capacity and could require pausing annual grant programs or otherwise adjusting the budget.
Next steps: Staff will finalize feasibility studies, draft marketing materials (RFQ/RFP/notice of site availability), and return to the board in August with analysis and recommended procurement pathways.
