Council to begin discussions on proposed development standards for downtown Lexington

The Urban County Council will begin discussions on new design standards for downtown Lexington redevelopment and construction Tuesday, nearly five years after new standards were proposed.

Vice Mayor Steve Kay, chairman of the Design Excellence Task Force, told council members during a briefing last week that the recommendations to be discussed by the council's Planning and Public Safety Committee also would also include incentives to help lure more downtown development.

Kay, who is the second chairman of the task force that began meeting in May 2010, said those incentives were developed after hearing from developers who were concerned that the new standards would slow development instead of spur it.

"The goal is to provide a lot of information for developers who want to develop downtown," Kay said of the standards. The discussion about the standards started in part after disagreements about designs for Centre Pointe, a downtown development that includes an entire city block, and other proposed downtown developments.

For those who want to develop downtown, there will be standards — which the task force kept to a minimum — and guidelines, which are suggestions, Kay said. The city now has a design district — the Courthouse Area Design — but it applies only to a small area of downtown. If the new design standards are approved, the Courthouse Area Design Review Board will be dissolved and a new board will take its place, Kay said.

The design standards and guidelines are for an area that goes from Midland Avenue to Oliver Lewis Way and as far north as Third Street in some areas and as far south as High Street. The standards and guidelines include oversight of elements including building heights, building design, awnings and signs.

Not all new development and renovations would have to go before the new design board for approval. Some projects would have to be reviewed only by staff — called a desk review.

Kay said the design standards were tailored to the street the proposed redevelopment or new construction was on. A developer could look up a street and determine the guidelines and standards before construction begins.

The incentives proposed by the council include creation of two city positions to help builders navigate bureaucracy. One position would be an infill and development coordinator who could shepherd a new building or renovation through the various parts of the planning process — from zoning to building permits to building inspection. The second position is design officer. That person would help staff the new downtown design standards board and help with design efforts throughout the city, said Chris King, director of the Division of Planning.

"We previously had an infill and development coordinator, and it was a very popular and successful program," King said. "During the recession we had to shelve it. This is not a new position. We are simply bringing it back."

Mayor Jim Gray is expected to include money in his proposed budget in April for the two positions. King said he still was working with the city's human resources department to determine how much the two positions would cost. Both probably will be more senior positions — which likely means each position would start with salaries of more than $50,000.

The city also could help pay for the costs for applications for tax increment financing, or TIF, districts. Tax increment financing is a state-run program that allows a developer to use new taxes generated from a development to pay for infrastructure costs such as street upgrades.

Those fees can be as much as $20,000 to $40,000, Kay said.

He said Gray probably would propose setting aside money in his proposed budget for TIF applications.

In addition, Kay said that LexPark — Lexington's public parking authority — was set to build a parking garage at East Main and Vine streets for a development there.

"It is also developing a comprehensive plan for future parking needs," Kay said.

Several issues have delayed bringing the design standards before the council. The makeup of the task force and its mission changed during its early years.

Then developers voiced concerns about the lack of incentives for downtown development during a hearing about the proposed new standards in November 2013. After that hearing, the task force had to revisit the idea of incentives.

The city's Planning Commission also had to approve a change to the zoning text as part of the design standards. The Planning Commission passed those changes last March.

The council took its summer break in July, which left little time before the November general election to get the new design standards through the committee process and before the full council for a vote. Because of the complexity of the standards, Kay said, he decided to wait until after the election to bring the issue before the council.

Bill Lear, a lawyer and a developer, said the design standards and incentives must be approved together.

"If the council follows through on the incentives, I think it will spur development," Lear said. "With the right incentives for downtown development, the kinds of projects that want to be there won't suffer."

Because most of downtown is redevelopment rather than green space development, Lear said. construction costs are generally much higher than in outlying areas. Parking is mostly structure parking, which can costs thousands and thousands of dollars more than surface lots.

"It is important to look at it as an entire package," Lear said. " It's a holistic approach. The standards are intended to allow great development and prohibit things that we don't want to see in the downtown."

Phil Holoubek, who has done several downtown developments and is working on a development in the area of East Main and Vine and Midland Avenue, said he backed the new design standards for several reasons.

"Good design is not necessarily more expensive," Holoubek said. "Sometimes, added regulations can be more expensive."

Holoubek's proposed development on Midland Avenue is slated to include affordable housing, which is difficult to do downtown, where the cost of land and construction is higher than it is in the suburbs, he said.

"It's going to take incentives to make that happen," Holoubek said. "Land costs are far more expensive than in the suburbs. Construction costs are far more expensive."

Kay said he would ask the Planning and Public Safety Committee on Tuesday to pass the standards out of committee and bring it to the full council for a vote. But Kay cautioned that the council might have more questions, and it might be discussed in committee for some time.

Council member Jake Gibbs, whose district includes almost the entire new design area, said he thought the new design standards were long overdue.

"I haven't heard any negative comments about it from anyone, really," Gibbs said. "I think it's long been needed ... ."

But some council members have concerns.

Ed Lane, who represents rural Fayette County but works downtown, said he supported the design standards but had questions about some of the incentives. Lane said that didn't mean he would oppose the incentives; he needs to know more about the rationale behind them.

"In general, I'm in favor of less bureaucracy," Lane said of the two new positions. "Will there be enough work for these two people?"

Lane said having the city pay for applications for TIFs might not be a good idea. Most redevelopment in downtown involves smaller projects that wouldn't qualify for state tax increment financing, he said.

"I think the developers need to have some skin in the game," Lane said.

This story was originally published February 8, 2015 at 8:06 PM with the headline "Council to begin discussions on proposed development standards for downtown Lexington."