COLUMBIA — City leaders started exploring alternative funding solutions for downtown projects and infrastructure renovations after City Council rejected the proposed tax-increment-financing plan Monday night.
The council voted 5-2 against moving ahead with a plan that would use a tax-increment financing district to pay for the $19.75 million in sewer and electric upgrades needed to accommodate new development downtown, along with $50 million for other projects.
The decision eliminated the only proposed solution to address the city's infrastructure problems and could halt any new downtown development for months. But some council members are ready to propose other funding options.
Fifth Ward Councilwoman Laura Nauser said the $10 million needed for electric infrastructure improvements could come from a scheduled bond to be voted on in November, and the estimated $1 million in water projects could possibly be covered by Columbia Water and Light's reserve funds.
"Our city isn't going to cease to exist if we pull this process back some," Nauser said. "I'm quite confident that we can come up with a plan B."
During Monday's meeting, many members of the public criticized tax-increment financing and the speed and transparency of the plan, which was supported by City Manager Mike Matthes and Assistant City Manager Tony St. Romaine.
Fourth Ward Councilman Ian Thomas said that while he appreciated Matthes and city staff for coming up with an infrastructure solution for downtown, he didn't think a TIF district was the right choice.
Thomas said he would propose that the City Council create a task force to oversee changes in downtown development and review all alternative funding options.
Thomas said that residents should form neighborhood planning groups to provide input and that development fees and zoning rules would need to be changed before any development could occur.
Thomas said that developing the task force and neighborhood planning groups could take six to nine months and that council's funding solution should include public input at every stage.
Those months could halt development in the district, however. Matthes told the council Monday night that the city would not issue any additional building permits downtown without a way to finance the needed infrastructure improvements.
Several firms have expressed interest in high-density residential development downtown, but a number told city officials that they would pull their building plans if the council did not find a way to fund the needed infrastructure soon.
Without a solution, developers would not move forward, Robert Hollis, an attorney representing three of the companies, said during the council meeting.
Second Ward Councilman Michael Trapp said he was concerned the council's decision would hurt Columbia, not only because downtown development would be stymied but also because sewer overflows and urban sprawl would continue. But Trapp said he was open to hearing other people's solutions to downtown's infrastructure problems.
Only Trapp and Mayor Bob McDavid voted for the proposed projects Monday.
Nauser said that while she was initially on the fence, the lack of information provided by city staff at the council meeting and her constituents' opposition to a district-wide TIF led her to vote against the plan. Of many Columbia residents who contacted her, Nauser said, only one supported the proposed downtown tax district.
"There were too many questions that I needed answered," she said.
Nauser said she considered supporting the use of the tax district to separately fund the $19.75 million in sewer and electric upgrades, as McDavid offered in an amendment that was later voted down. But she said she could not support funding all of the projects with the tax district.
"I was not surprised by the issue's defeat," Nauser said Tuesday. "There was no way I was going to support something worth $70 million."
Trapp said he was disappointed that his fellow council members did not voice their opposition to the TIF earlier.
In the future, Trapp said, he would recommend that council members communicate more openly and make their concerns known before the city spends money and staff time on a long-term project.
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