New option for financing high school with TIF well-received
A new plan for how the city can help
fund a proposed Whitefish High School renovation project without
dipping too deep into their TIF reserves was well-received by city
council at the Nov. 7 meeting. The council has directed city staff
to move forward with the necessary steps to get the funding option
in order before a bond request next spring.
City Manager Chuck Stearns presented
council with four options for using funds generated through the TIF
district to help finance a new school, estimated to cost up to
$19.5 million. The district is aiming to get a bond request down to
about $15 million.
Three of the city’s funding options
were discussed at a previous work session, but Stearns has since
conceived a new option to help with the project. In his scheme, if
the high school bond is approved by the school district voters, a
property tax levy will go up by about 20 mills. That increase
multiplied by the TIF value of a mill equals $124,491 per year,
solely from the increased school district mill levy. Over eight
years — the remaining time before the TIF district sunsets in 2020
— those funds add up to about $1 million.
With this idea, the city would
reimburse on an up-front basis the $1 million of increased TIF
revenue from the increased high school mill levy.
The city would also take $750,000 out
of the existing TIF funds to be used as a challenge grant that
could be matched dollar for dollar. Steeplechase Development, the
firm heading the renovation project, says they are confident they
could find the matching funds.
“We’ll figure out a way to make it
work,” Bayard Dominick, of Steeplechase, said at the meeting. “So
far we’ve applied for six grants and we’ve won six grants.”
He said private donors have said they
will chip in if the city shows leadership with financing the
project.
The advantage to this new plan, Stearns
notes, is that the city is only giving up $750,000 of actual tax
increment money for the high school project, leaving most of the
un-earmarked $10 million for future TIF projects, including a new
City Hall or possible improvements at the vacant Idaho Timber or
hospital sites.
“It provides significant funding for
the high school project without greatly jeopardizing the other
important tax increment and urban renewal projects which will come
up during the next eight years,” Stearns said.
This plan would require an amendment to
the Urban Renewal Plan to include the high school within the TIF
district boundaries.
Members of the school district packed
the council chambers Monday evening as they waited to hear the
council’s suggestions for helping fund a new school.
Councilor Ryan Friel said that while
they haven’t had time to study the entire option, Stearns’ idea
seems to “strike the best balance with helping the school and not
jeopardizing the TIF funds.”
Councilor Bill Kahle said it is
critical for the city to get behind the effort.
“This is the true legacy project we are
facing,” he said.
A quick straw poll of each councilor
showed they all support Stearns’ new option and city staff was
directed to start the process of including the school in the TIF
district.