2020-05-20 Deannexation and New Union District Plan Background Memo from Community DevelopmentCommunity Development Dept.
Meridian City Hall, Suite 102
33 E. Broadway Avenue
Meridian, Idaho 83642
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33 E. Broadway Ave, Meridian, ID 83642 * Phone 208-884-5533 * Fax 208-888-6854 * www.meridiancity.org
Community Development
Department
MEMORANDUM
DATE: May 20, 2020
TO: Mayor Simison and Meridian City Council Members
FROM: Cameron Arial, Community Development Director
RE: Urban Renewal Deannexation and New Union District Plan Background
Dear Mayor and Members of the City Council,
In partnership, the City and Meridian Development Corporation (MDC) continue to advance downtown
revitalization efforts according to the City’s Strategic and Comprehensive Plans and MDC’s Destination Downtown
plan. Below is a brief summary of this significant step in accomplishing these plans: the First Amendment to the
Meridian Revitalization Plan (“Amendment”) providing for the de-annexation of 15 parcels from the original
downtown urban renewal plan; and the new Union District Urban Renewal Plan (“Plan”). We felt this would be
helpful to bring you up to speed and aid in your evaluation of the proposal.
The May 26th, 2020 meeting and this memo is to inform the Council of past context, communicate pertinent
information, and to aid the Council in its preparation for the official public hearing scheduled for June 2, 2020.
Final City Council action is to be taken on June 9, 2020 after the public hearing.
History
The City and MDC are pursuing the creation of a new 16-acre urban renewal district in downtown Meridian to
generate needed economic opportunities for the entire community and upgrade critical infrastructure.
The City and MDC have been working to accomplish key initiatives of the City’s Strategic and Comprehensive Plans
and MDC’s Destination Downtown revitalization plan for quite some time. Last year an RFP for a downtown
development concept was broadly distributed in an effort to redevelop City- and MDC-owned properties between
Idaho and Broadway and 2nd and 3rd Streets, known as the Civic Block. A third party developer (Galena
Opportunity Fund) was unanimously selected and approved by both the City Council and MDC Board to assist in
the redevelopment of the properties in a true Public Private Partnership . The developer proposed to harness the
tax increment financing (TIF) revenues of urban renewal from their conceptual project on the Union Pacific
properties to the south and channel those revenues to public improvements to accomplish many of the City’s and
MDC’s strategic goals. This was the genesis of the proposal before you.
Current Advancements
Since then, the City and MDC have been moving forward to make the proposal a reality. A major part of the
process is the deannexation of the proposed properties from the existing urban renewal district and the creation
of a new district encompassing those properties.
Urban renewal districts are designed to help alleviate blight, encourage economic vibrancy, spur private
investment, and fund important public infrastructure improvements. The Civic Block area being considered is the
most underdeveloped part of downtown Meridian. The area could greatly benefit from upgrades to the sidewalks,
community lighting, water and sewer lines and roads to name just a few needs. Currently, it sits within the existing
urban renewal district. However, with only six years left until the existing distric t expires, more time is needed to
generate the necessary TIF revenues to fully redevelop and tackle needed public infrastructure improvements.
33 E. Broadway Ave, Meridian, ID 83642 * Phone 208-884-5533 * Fax 208-888-6854 * www.meridiancity.org
Third party consultants funded at the expense of the developer have conducted an eligibility assessment of the
properties and have found that they meet the requirements for inclusion in a new district. Their report was
reviewed and accepted by the MDC Board. The City Council approved the Eligibility Report on March 10, 2020. The
City Council reviewed the draft Amendment and proposed new Union District Plan at its March 17, 2020 meeting,
referring the documents to the Planning and Zoning Commission as required.
The Planning and Zoning Commission adopted Resolution No. 20-01, validating conformity of the Amendment and
Resolution No. 20-02, validating conformity of the Union District Plan with the City’s Comprehensive Plan. The staff
analysis presented to the Commission is attached.
This is the first of three required readings of Ordinance No. 20-1881 approving the Plan Amendment and
Ordinance No. 20-1882 approving the Union District Plan.
STAFF ANALYSIS
Legal staff has reviewed State Code and confirms that the process has followed statute s, including the required
distribution of both documents to all affected taxing entities.
Amendment
The Amendment is required to de-annex the 15 properties first identified in the Eligibility Report. The annual
revenue loss TIF is estimated at $12,000. The annual revenue gain from any future redevelopment will greatly
exceed this base amount.
Union District Plan
The economic feasibility study estimates total tax increment revenue of $16,286,436 to be generated over
the life of the Plan (Plan will sunset on December 31, 2040). This figure was determined using the following
assumptions:
Total private investment of $125,737,000 in the first five years of the Plan, occurring in
2023 and 2025
Annual land value increase of 1%
Annual improvement value increase of 2%
A 10% reduction in the current tax rate, held constant through the life of the Plan
The projected revenue is sufficient to fund the proposed $15,040,000 public improvements outlined in the
Plan. That figure would likely be reduced to $12,040,000 based on an anticipated $3,000,000 impact fee City
contribution for the Community Center (Attachment 5.1).
REFERENCE
See the attached URD FAQ document and the Urban Renewal 101 from the consulants for further background on
Urban Renewal and how it works.
Sincerely,
Cameron Arial, MPA, Ph.D.
Community Development, Director