Two projects in midtown Gainesville could receive some tax incentives from a city program designed for such purposes.
The Enclave, a neighborhood of townhomes on Wills Street, will be adding seven new units. A sales and marketing company will relocate from the Limestone Parkway area to midtown on Main Street. Developers for the two projects hope to join the Midtown Tax Allocation District, a city program that allows property owners and developers to use extra dollars from higher property tax rates toward developing the property itself.
Properties that are approved for the TAD are taxed at the rate established in the TAD’s base year, which is 2006 for the midtown district. When a property is developed, its value will go up, and so will its taxes. The increased amount paid in property taxes instead goes into the TAD fund for the agreed time. Developers or property owners can use money from the TAD fund to pay for improvements to the property.
The city’s midtown TAD fund has about $600,000.
The city’s TAD advisory committee approved both developments at a meeting Thursday, and the Gainesville City Council will have the final vote at a future meeting.
The Enclave, which was first completed in 2017, includes 45 townhomes. Developer Steve McKibbon hopes to add an additional seven homes for a second phase of the development on Wills Street.
McKibbon said he hoped to expand the project to contribute to midtown redevelopment.
“(The Enclave) has really kind of changed the character of that corner of midtown, and I think it has stopped the blight and turned that area around,” he said. “Some of the houses in the area are already being improved, and I think it’ll spur on some more of a halo effect.”
The second phase of The Enclave will be a $1.1 million project, and McKibbon has requested about $93,000 in TAD funding. The funds will offset costs for several portions of the project, including demolition and grading, fencing and sidewalks.
City staff agreed with McKibbon’s proposal and recommended that $25,000 of the funding be given upfront for demolition and grading. The remaining $68,000 would be paid in increments annually over a maximum of 15 years.
The committee approved the staff recommendation, and the proposal will go to the Council for a final vote.
Midtown office building
Lamb, Britt Gilmer and Associates, a local sales and marketing company, wants more space and has plans to renovate a brick building at 743 Main St.
The company has other offices in Alabama and North Carolina but employs 20 people at the Gainesville office.
Tim Gilmer, the applicant for the project, said the office space will preserve much of the character of the existing building.
“This is going to be our home. We want this to be something that the community, the midtown area and our company can be very proud of,” Gilmer said.
Gilmer requested about $284,000 in TAD funding to pay for several parts of the project, including demolition, grading, paving, lighting and relocating power lines. The total project cost is almost $1.5 million.
Gilmer said the adjacent building at 722 Bradford St. will house a hair salon operated by one of his family members. He requested about $120,000 for that property because the office space and hair salon would share parking.
However, while Gilmer requested about $284,000 in TAD funding, the properties on Main and Bradford streets are not estimated to generate that amount over 15 years. The properties are estimated to generate about $150,000, and staff recommended that $75,000 be paid upfront. Once that $75,000 has been replenished by the TAD increments generated, the applicant can then keep the extra funds generated above the base value. The properties can only be in the TAD for a maximum of 15 years.
The TAD committee approved the staff recommendation Thursday, and the Council will now have the final vote.