Retirement community TIF OK’d

Nov. 21--Bartlesville city councilors unanimously approved the creation of Tax Increment Finance District 12 to fund public infrastructure improvements for a new retirement community during a meeting Monday night at Bartlesville City Hall, 401 S. Johnstone Avenue.

The TIF District, which will encompass 20 acres of land on the south side of Nowata Road just east of Wesleyan Christian School, is the same site where a developer will build The Wellington at Hillcrest Village. According to the project plan, the new development will bring up to 126 independent living apartments, 31 assisted care apartments, 51 memory care apartments and 42 free standing executive homes for seniors.

Vice Mayor John Kane recused himself from the vote and the discussion for a potential conflict of interest, as members of his family own land near the development.

Dallas-based architect Dr. Frank Rees is the developer of the project, that is expected to be completed in two phases.

The TIF District will use increased property tax revenue generated by the completed retirement community to reimburse Rees and his investors up to $2 million in street, water and utility improvements for the area during the first phase of the project. According to Mike Bailey, the city of Bartlesville's chief financial officer and acting city manager, TIF District 12 will reimburse those costs over a maximum of nine years, but is expected to be paid off in seven years.

The TIF District would only reimburse the costs of the public infrastructure improvements if construction commences within 12 months. Additionally, the first phase of the retirement community must be completed within three years of the formation of the TIF District in order for it to reimburse.

With the formation of the TIF District, Rees and his developers must have a minimum of 47 memory care in the project to fill an unmet need in the city of Bartlesville, or the TIF reimbursement would be reduced. Rees would also be required to use local labor and resources, when practical and possible, to provide the supplies and manpower necessary to build the retirement community.

"This agreement eliminates most of the concerns from the city's perspective," Bailey said. "The terms of the resolution are probably the most advantageous TIF we have ever agreed to. There is little risk to the city, and the responsibility is placed all on the developer to get it done. If the terms of the agreement are not met, we are at no financial risk for reimbursing the investment. This is basically a rebate-type program."

Oklahoma's Local Development Act, allows for the creation of Tax Increment Finance Districts to attract economic development. Under the guidelines, cities and towns can establish a district where property taxes within the boundary are held at a certain level, called a baseline. Any improvements within that boundary would increase property tax value above the baseline.

That increase in property value would then be used to secure a loan or bond to fund public infrastructure improvements within the TIF District. Once the loan or bond is paid off, the TIF District expires and the gain in property tax would then go to different entities that benefit from increased property value.

Rees said he is pleased with the City Council's decision and has already began the redesign of the project to fit the needs of the surrounding area. As part of the redesign, Rees plans to install an emergency gate for first responders where Lincoln Road would intersect the new development. That feature would eliminate through-traffic, a concern of residents who live on Lincoln Road.

Additionally, the redesign will move the main four-story structure 60 feet north. Rees said construction will begin in March 2018 and hopes the first phase will be completed in time for Christmas 2019, but may be closer to February 2020.

Rees said two local banks are interested in financing the initial loan for the public infrastructure improvements that would then be reimbursed by the TIF revenue.

"We intend to be a good corporate citizen, as good as a company with 80 to 100 people can be," Rees said."I am very pleased to be able to continue to invest in the city of Bartlesville... This is a great city with a great spirit, wonderful cultural opportunities and a great cost of living."

After approving the creation of the TIF District, the Bartlesville City Council recessed and moved the meeting to a conference room to continue discussions on projects for an upcoming general obligation bond election.

The City Council will meet again at 7 p.m. Monday for a special workshop on the proposed bond projects.

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