FLOWERY BRANCH — Flowery Branch City Council voted this morning to approve a tax allocation district reimbursement request for the developer of a planned $15 million downtown project.

Hortman & Dobbs in Buford is seeking $361,000 following completion of the project’s first phase, which includes extension of Pine Street from Church Street to Railroad Avenue and the construction of two commercial buildings.

City officials plan to make one lump-sum payment to Hortman & Dobbs using a loan from United Community Bank, then repay the loan over five years, spending about $500,000, including interest and other charges.

By that action, the council, in effect, dismissed a “pay as you go” financing option.

“So long as ... the citizens of Flowery Branch aren’t going to have to pay a penny out of their pockets, other than what the TAD agreement is, I have no problem with (the reimbursement),” said Councilman Chris Fetterman.

Under state law, local governments can create tax allocation districts as a tool to lure developers to blighted areas, using property taxes from developments to pay for certain public-use projects within the district.

Flowery Branch is expected to collect $113,000 annually — more as developments are built and start producing tax revenue — from the TAD.

Gary Mongeon of Atlanta-based Bleakly Advisory Group, the city’s TAD consultant, said the tax increments should more than cover the city's costs in the project.

Phase one could begin in June, Kellin Dobbs, a partner in the firm, has said.

The executive summary for the request states that phase one is expected to be finished by February 2011.