Public hearings are scheduled for Tuesday on two projects that, if carried out, would significantly alter the face of downtown.
The Distillery District and the Phoenix Park/Courthouse Development District, driven by the CentrePointe hotel and condominium complex, are each seeking local and state tax increment financing districts to pay for public improvements.
The idea behind tax increment financing is that new development in a district will generate more tax revenue than if development did not occur. In TIF districts, that additional new tax revenue pays for public amenities.
If the proposals are approved, the Lexington-Fayette Urban County Government is prepared to pledge 80 percent of new revenues from real estate and payroll taxes generated by each district to pay off revenue bonds that help finance the TIF project.
Here are the basics of the two projects:
The $190 million Distillery District plans to convert 28 acres along a blighted stretch of Manchester Street, including the James E. Pepper Distillery and the Old Tarr Distillery, into an arts and entertainment district with nightclubs, art galleries, retail and restaurants, a boutique hotel and residential units. Developer Barry McNees is requesting $80 million in incremental tax revenues from the city and state.
The Distillery District area currently generates local and state revenues of $122,714 annually, according to a financial report by C.H. Johnson Consulting. But developed into a destination for arts and entertainment venues, the district is expected to produce $154 million over a 20-year period.
Phoenix Park/Courthouse Development District
In an area around the $250 million CentrePointe complex, the city seeks to make a range of improvements that would include restoration of the historic Fayette County Courthouse, a new park, a permanent home for the Lexington Farmers Market and an underground parking structure. Together these and other public enhancements in the district would cost about $48 million.
CentrePointe developers Dudley and Woodford Webb say they can build the J.W. Marriott hotel plus a tower with 77 luxury residential units with the financing they have already lined up. But new tax revenue generated by the complex could pay for public amenities that would enhance the west end of downtown.
In 2007, the city collected $306,987 in tax revenue from businesses on the CentrePointe block. It is projected to produce $314 million in local and state revenues over 30 years, according to a report by C.H. Johnson Consulting.
If you go
The hearings will be in the second floor Council Chambers of the Government Center. The Distillery District hearing will be 6 p.m. Immediately following will be a public hearing for the Phoenix Park/Courthouse Development Area.
After the public hearings, the Urban County Council must pass two ordinances to create each of the TIF districts, spelling out boundary lines, proposed improvements and the local government's pledge of revenues.