The Agenda for this week’s Apopka City Commission meeting is again jam-packed. The one that should raise some concerns is the 2nd reading of Ordinance #2446, regarding the creation of a synthetic tax incremental financing district near Marsden Road and SR 414. Appropriately, the acronym for this is STIF. Government entities use these STIFs as a public/private partnership tool to advance economic and development goals. STIF’s create funding for public/private projects by borrowing against the future increase in property tax revenues of the businesses and other projects expected to come to the area because of the specific project. A district can be drawn around an area hundreds or thousands of acres beyond the project site to provide the needed borrowing capacity and revenues. Originally designed to revive blighted or depressed areas, more and more STIF’s are used where development would happen anyway, such as development areas at the edges of cities.
The specific STIF on our agenda is being requested for the construction of a “half interchange” from SR 414 to connect with Marden Road. A very complicated cost sharing agreement between the City and the developer, MMI Development was drafted and it is this agreement that will be considered and voted on by the City Commission this Wednesday. The agreement is a 10 page document full of legalize, complicated cost formulas and other matters that cannot be read and understood in one reading. It appears that initial funding would come from the City’s Transportation Impact Fee Fund and then a complicated series of credits. Per the accompanying greensheet with the Agenda packet, “other development within the newly created STIF paying transportation Impact fees would be transferred to MMI Development to be credited toward the City’s shared portion of the interchange”. All of this money will be deposited into a separate trust fund. In exchange for all this money, the Developer will make the permit and other arrangements for construction of the interchange. The District is to last 10 years with the City assuming an administrative role.
Getting back to one of the criticisms, it seems this particular district has been drawn up where development would already be occurring, thanks to separate construction of the new Florida Hospital. In fact, MMI Development, in conjunction with Emerson-MMI, already has received approvals for various housing and apartment projects in this same area. It is only a matter of time before other medical offices, clinics and perhaps some retail also spring up in that area. I wonder who the largest beneficiary of this Tax District will be, the citizens of Apopka or MMI Development.
STIFs are touted as a new tool Cities can use to promote development and promises of no new taxes, but side effects can include increased road, sewer, schools and other public costs due to the new developments that Taxpayers will be paying for many years down the road. The gamble could pay off in the long run, but it may not. And if all the development near the new Hospital would be taking place anyway, I have to wonder if this Tax Financing District is really necessary, or if Apopka taxpayers are being asked to take a gamble on a very risky house of cards and end up instead, holding a very costly bag. I hope STIF does not end up STIFfing Apopka taxpayers.