Capital Mall eyes $36 million renovation
Tax financing district would help fund mall improvement project
Sunday, October 27, 2013
The Capital Mall is hoping to get a $36 million renovation to become a “regional shopping center” with help from two taxing districts.
The Tax Increment Financing, or TIF, Commission will meet Monday to hear a proposed plan for a TIF at the Capital Mall, which would be used for repairs and renovations to both the exterior and interior of the mall.
A TIF district often is used as an economic development tool that allows for a portion of property and sales taxes generated by a development to be used to repay the costs of the redevelopment itself. A TIF district does not impose an additional sales tax, and is created through approval by the City Council after an area is shown to be blighted.
The Jefferson City Council acts upon the recommendation of the TIF Commission, which is made up of community members appointed by the city, county, school district and library board. Any TIF commission has to be made up of representatives from all taxing districts in the proposed TIF area.
Jefferson City has two existing TIF districts, according to the state auditor’s office: the Southside TIF, which consists of an eight-square-block area including the 100 blocks of East and West Dunklin Street and the 600 and 700 blocks of Jefferson and Madison streets; and the High Street TIF, which is for O’Donoghue’s on East High Street.
But the proposed Capital Mall taxing district would be on top of a community improvement district, or CID, which would levy an additional one cent sales tax in the district.
Last month, the City Council approved a development agreement with the Capital Mall ownership, the Farmer Holding Company, to create the CID.
A CID is an area, also created by approval of the City Council, where an additional tax may be levied to pay for public improvements as defined by the state. Missouri state statutes include shopping malls as appropriate public improvements for a CID.
According to the TIF plan submitted to the city by Capital Mall JC, LLC, the redevelopment area is 78.26 acres containing the Capital Mall, the anchor stores, such as Dillards and JC Penney, and the outer lots within the mall complex, such as Wendy’s or Red Lobster restaurants.
The proposed renovations at the Capital Mall would include:
• Repaving the parking lot along with installing new lighting and repairing existing lighting;
• Repairing and replacing the roof;
• Installing and improving the exterior facade with “cultured stone and masonry;”
• Installing solar paneling;
• Repairing and replacing the HVAC units; and
• Upgrading interior lighting, furniture, signs, flooring and paint.
The proposed TIF would last for 23 years and raise $10.6 million to help fund the renovation plan. The CID would last for 40 years and raise roughly $5 million. Central Bank has agreed to finance $10.1 million, while the Farmer Holding Company itself has committed the remaining $11 million for the project.
The plan lays out a four-year timeline for redevelopment beginning in February 2014 with the rehabilitation of the Capital Mall building, common areas and infrastructure to be completed by August 2014. Starting in 2015, the mall would continue to be redeveloped, focusing on vacant units within the mall with the goal of leasing the spaces. That would continue through August 2018, according to the submitted development schedule.
The TIF plan states the area currently has annual sales of $72 million, resulting in $5.5 million in annual sales tax revenues. The plan states completion of the renovations would increase total annual sales to $75 million.
Rob Kingsbury, with Farmer Development, declined to comment for this article, stating he would wait until after the TIF commission hearing Monday.
The TIF Commission will meet at 5:30 p.m. Monday in the City Council chambers of City Hall. The meeting will include a public hearing on the TIF plan and the projects included, as well as presentations on the plan by mall representatives, city staff and legal consultants.
A report outlining a proposed tax increment financing district for the Capital Mall details the extent of the structural and financial decay of the shopping center under its previous owners. See "Report details decay at Capital Mall under previous owners" to read about and access the report.
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