Stephen Ellis filed an appeal in a lawsuit he lost to four previous serving mayors regarding a tax increment district Thursday.
If the appeal is successful in the Oklahoma Supreme Court, a petition to rescind a council approved amended agreement to a 13-year-old TIF district will be overturned. The city renegotiated with developers in the University North Park TIF district to end the diversion of sales tax revenue retroactively as of June 30.
About $300,000 a month from July 1, 2019, would then go to city coffers and help fill a $5 million budget shortfall in the current and next fiscal year, which begins June 30. The city has based its fiscal year budget on the hope that the petition appeal will fail, but if it succeeds, the city will enforce budget cuts. Those cuts include tapping into the emergency and rainy day funds and cutting everything from fireworks to mosquito and weed control.
Ellis and more than 4,000 residents signed a petition Jan. 3 to rescind the agreement. Four previous serving mayors challenged the petition's authenticity in district court and won in February. Ellis filed an appeal and the outcome could be made a top priority for a speedy ruling if the city gets its way.
TIF Oversight Committee discusses appeal
Despite the fact that the city is not a party in the lawsuit challenging the petition's authenticity, it did file an affidavit for a speedy decision.
The appeal was the dominant topic of discussion Tuesday afternoon during the TIF Oversight Committee meeting.
"As the city's finance director I filed an affidavit to ask the court to act as quickly as possible," Anthony Francisco told the committee. "For the sake of the city's finances and getting some certainty about whether we would have access to those (TIF) funds that we budgeted to be available in the capital fund and general fund, but I have no idea when the court will actually hear the case."
City Attorney Kathryn Walker said the court could "farm it out" to an appeals panel but that would take longer.
"What we're hoping is the court will retain jurisdiction and then on the basis of this affidavit, move it to the top of the pile, so to speak, and act on it more quickly. Obviously we want to know this information before we, ideally, adopt our budget. But as soon as we can, whether we adopt our budget, we need to know so we can make the adjustments one way or another."
To make matters more complicated, some of the projects in the voter-approved Norman Forward Sales Tax Fund are tied to the UNP agreement and time is ticking to act within the requirements of the plan. More than $2 million in TIF funds has been set aside to purchase land in the TIF district and another $2 million construction supplement, provided the city promises to spend $22.5 million to construct the indoor aquatics and sports complex and that construction begin by Jan. 1, 2021.
While the latest design for the complex has ballooned to $58 million, the city is contractually obligated to spend $22.5 in Norman Forward funds on the project, according to the TIF agreement. In the meantime, the city plans to seek an $85 million general obligation bond to supplement the half-cent Norman Forward sales tax shortfall to help finish the aquatics and sports complex in addition to several other quality of life projects promised in the sales tax initiative.
The petition lawsuit and appeal is likely to slow down the project, but Walker believes developers would likely grant an extension.
"If we aren't able to complete the design or we don't know whether it's a $22 million dollar project or $58 million dollar project, we may need some more time to start construction," Walker said. "And I think the concern from the developer's standpoint was more, 'we don't want to just sit on this land forever and wait for the city to make a decision. We want the project to move forward or we want to do something else with the land. As we're moving forward, one way or another, they're probably going to work with us."
In other news, the committee received an update on an assisted living center under construction at 24th and Radius Way, called Med Corps will be 206,000 and has a permit value of $27.8 million. A Hudiburg Subaru dealership will be located at I-35 Frontage Road and Corporate Center drive and the permit value is $8 million. A permit value amount is the value of construction costs.
Mindy Ragan Wood416email@example.com