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Lawyer seeks TAD funds for office building
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The Gainesville City Council will soon be faced with its first request for money meant to redevelop blighted properties in the city’s downtown and Midtown areas.

But it won’t be from the developers of a planned high-rise hotel and office complex in Midtown as was originally expected.

Instead, local attorney Mike Weaver was the first to make an official request for the tax dollars set aside for redevelopment projects in Midtown and downtown’s tax allocation district.

Weaver has asked for about $275,000 of the special funds to demolish an unsightly car wash on the corner of Jesse Jewell and E.E. Butler parkways.

He plans to build an 11,000-square-foot office building in its place, according to a city official involved with the project.

The council will hear the proposal at its work session today and will likely make a decision Tuesday.

A recommending board made up of business leaders and officials from the city schools, the city and the county governments — the Tax Allocation District advisory committee — agreed unanimously Wednesday to recommend that the City Council grant $71,000 to Weaver for the project, according to Gainesville’s Community Development director, Rusty Ligon.

The recommendation for funding is about 25 percent of the amount Weaver originally requested.

Ligon said the $71,000 recommendation covers the demolition of the current car wash, sidewalks, landscaping and lighting on the site. Financing guidelines for the tax allocation district allow public funding to be used on those improvements.

Other parts of Weaver’s request did not fall under those guidelines, which only allow the public funds to be used on infrastructure needs and site preparation, Ligon said.

Portions of the request that the committee recommended denial for include reimbursement for the cost of the land purchase and stabilization of poor soils, Ligon said.

If the council backs the recommendation, Weaver will be the first to receive public funds under the tax allocation district.

The tax allocation district was established in 2006 as a tool to spur redevelopment on unsightly properties in the city’s most prominent areas.

The financing tool requires the local governments to forgo increases in property tax revenues in the district, which comprises 270 acres of downtown and Midtown real estate, and then use that money, the tax increment, to repay bonds they will issue to developers for improvements in the area.

In Weaver’s case, the city would not issue a bond. The $71,000 has already accrued in the city’s account for the TAD, Ligon said.

If the City Council backs the recommendation with a vote of approval, an agreement attached to the application mandates that Weaver would receive the money once he completes the redevelopment project and obtains a certificate of occupancy, Ligon said.

Weaver has not yet signed that agreement. He did not return a call seeking comment from The Times on Wednesday.

Since its creation, the Gainesville TAD has faced a few road bumps.

For much of the past decade, local governments across the state used tax allocation districts to fund redevelopment. TADs lost power in February 2008, however, when the state Supreme Court ruled that using school tax money — the main funding source for tax allocation districts — for noneducational purposes was unconstitutional.

The ruling came after a lawyer took Atlanta officials to court for using school funds on Atlanta’s BeltLine project. Officials had used the same kind of financing to construct Atlantic Station.

That November, voters in Georgia approved a constitutional amendment that would allow the use of school tax dollars for the districts.

But as the measure again became legal, city school officials were hesitant to become involved. The Gainesville school board voted to withdraw participation in the district in April 2009.

After renegotiating a greater presence on the TAD advisory committee for the city school system and a promise from the city to limit the district’s new residential developments, the school board signed back on in August.

The developers of a planned high-rise hotel and office complex in Midtown were always assumed to be the inaugural applicants for some of the public funding.

In August 2009, Ligon said the developers were waiting on the city and the school system to come to an agreement on the district’s funding before filing an application.

But on Wednesday, eight months after the new TAD agreement was finalized, Ligon said that no such application has been filed by Gainesville City Center LLC.

“We did anticipate that being the first TAD application that we received, but due to the current economic conditions, they have not yet submitted an application,” Ligon said.

Gainesville City Center first acquired land disturbance and building permits for the first phase of its redevelopment project in February 2009.

The permits gave the developers permission to start construction on a 10-story office building and a three-story parking deck across Jesse Jewell Parkway from the Georgia Mountains Center.

Since February 2009, the developers have asked for two extensions, with the most recent extension on the permit expiring in August, Ligon said.