City Council approves new downtown tax increment district
(December 16, 2008) - City Council approved a plan today to create a new tax increment financing (TIF) district to fund approximately $175 million in public improvements and economic development efforts in downtown Oklahoma City. The new TIF district was spurred by Devon Energy’s planned development of a new world headquarters building in downtown Oklahoma City.
The Devon development was contingent on two conditions: the City improving the infrastructure such as utilities, streetscapes and enhancements of Myriad Gardens; and committing to economic development policies and incentives to attract other quality investments, businesses and employers in the surrounding area.
Ad valorem and construction sales tax revenues generated by the Devon development will fund approximately $115 million in public improvements, which will occur in an area that includes NW 13 to SE 27 and Western to Eastern/Martin Luther King Jr. Ave and approximately $40 million for economic development efforts to be invested in the area adjacent to the Devon building.
In addition, the new TIF will fund $20 million in projects for other public entities such as the Oklahoma City Public Schools, Oklahoma County, Metro Tech, City-County Health and the Metropolitan Library System.
It is estimated that Devon will pay at least $11 million per year in ad valorem tax and $20 million in city sales tax during construction. The building will be completed in 2012 and the first TIF revenues are expected to be received in 2014.
The proposed development on a site located east of Hudson and north of Sheridan Ave. alone is estimated to stimulate $750 million in direct new investment in Oklahoma City’s downtown area and will generate an annual economic impact of over $900 million increasing to $1.9 billion.
“The City Council’s approval of this new downtown TIF district is yet another step towards ensuring a bright future for Oklahoma City. The long term economic vitality of the downtown area with improved aesthetics and amenities will enhance the quality of life for Oklahoma City residents for decades,” City Manager Jim Couch said.
The Downtown/MAPS Tax Increment District Review Committee that includes representatives from each taxing jurisdictions in TIF districts 2 and 8 as well as representatives of the public reviewed and recommended approval of the plan.