The state on Thursday gave approval for final negotiations to start on making infrastructure improvements at a proposed development on Angliana Avenue in Lexington.
The Kentucky Economic Development Finance Authority in Frankfort gave the nod to allow the state to work with city employees to finalize what's called tax-increment financing.
The idea behind TIF projects is for governments to invest in improving infrastructure and then pay for those improvements using new tax revenue, which developments are expected to generate when the projects are completed and areas are revitalized.
The proposed $91 million development on Angliana would include an upscale movie theater complex, bowling alley, restaurants, shops and apartments.
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Developer George Krikorian, who owns a farm in Woodford County where he breeds and trains racehorses, had requested $36 million in tax-increment financing for the project. Krikorian has previously built several theater complexes in Southern California.
The state will contribute up to $17.5 million while the city will provide the remaining $19 million, said Bruce Simpson, an attorney for Krikorian.
Improvements include $1 million for a pedestrian bridge over the railroad tracks on South Broadway, $3.5 million to bury a utility transmission line and $14 million for a five-story parking garage.
The tax-increment financing will be discussed again at KEDFA's August meeting, at which point it is expected to be given final approval.
Afterward, the developer will begin doing feasibility studies on the utility work on the 30-acre development, Simpson said, and that process may begin along with construction as early as next spring.
"The city's been very supportive of the project," Simpson said. "They want to see it happen because of what it will bring to the South Broadway corridor."