A city task force said Thursday it will partner with the developers of the controversial CentrePointe hotel project in hopes of using a state tax plan to make improvements to downtown Lexington.
The group also revealed six projects, totaling $32 million in investment, that it hopes to accomplish through the Tax Increment Financing.
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■ Restoration of the old Fayette County Courthouse at a cost of $16 million. The group did not elaborate on what improvements would be made.
■ Redesign of Cheapside Park to include a permanent market house for the Farmers Market ($1.5 million).
■ Construction of a 210-space parking structure underneath Phoenix Park ($6.3 million).
■ Redesign of Phoenix Park after the structure is built($5 million).
■ Downtown public art ($2 million).
■ Streetscape improvements such as new sidewalks ($1.5 million).
Mentions of these projects had been made initially when The Webb Companies unveiled the design earlier this year of its $250 million, 35-story hotel, condominium, retail and office complex.
The company, headed by Dudley and Woodford Webb, initially sought TIF funding for construction of an underground parking garage. The company has since said CentrePointe will be built without the TIF money.
But they are willing to let CentrePointe be included in a TIF district, so the city could receive tax increment revenue.
That revenue is a way of borrowing against future tax revenues to help pay for infrastructure improvements on redevelopment projects.
The city's new TIF consultant, Northern Kentucky attorney Jim Parsons, attended Thursday's meeting and was directed to contact the state Cabinet for Economic Development to formally note an application will be coming and to solicit feedback.
Parsons will also talk to investment bankers to learn how much the city can expect to receive in TIF bond sales, based on the projected stream of tax increment revenue from CentrePointe.
The task force also directed Parsons to explore bond markets, which have been in turmoil lately, about the likelihood of selling the TIF bonds.
Parsons estimated it will take 60 days to assemble necessary financial data, hold a public meeting and pass an ordinance setting up a local TIF district.
A meeting to receive public comment is set for 6 p.m. Aug. 5 in the council chambers at the Government Center at 200 East Main Street.
On the state level, the review process to get TIF money will likely take even longer.
And time is critical, said Darby Turner, The Webb Companies' attorney. Project costs are expected to rise 10 to 12 percent a year. “That's $25 million a year,” Turner said. “Time is extremely important.”
However, there's no reason why CentrePointe can't move forward while the TIF application is being prepared, he said.
The Webb Companies have begun demolishing the block despite pleas by preservationists and a formal appeal by one group to the city's Planning Commission, which has a tentative hearing on the issue in September.
A circuit judge earlier this week denied a request for a temporary injunction to prevent destruction of some of the buildings that are the subject of the appeal. The developers tore down one of those, formerly a Rite Aid pharmacy, on Wednesday night.
Councilman Tom Blues, who has been a vocal critic of the way CentrePointe was planned behind closed doors without public input, said, “We can't give up and say downtown is over. We have to be realistic and say this (TIF financing) could be an opportunity to help the whole community.”
Parsons said there's no good reason Lexington should not pursue a TIF project with CentrePointe.
“This is a great opportunity to access state revenues to re-build downtown,” he said.
The more the city can tie public projects together with CentrePointe, the better chance of getting state TIF funding.
“The state doesn't want a string of unrelated projects,” Parsons said.