Boardwalk at Bricktown / Dream Hotel

[BDP]

The point I was trying to make was that no TIF hinders large hotel development in the immediate area.

In theory, TIF is used in the hopes that the TIF assisted development will improve the market overall. In a sense, if TIF has to be used to get new developments in perpetuity, then they aren't working.

[Pete]

In theory, TIF is used in the hopes that the TIF assisted development will improve the market overall. In a sense, if TIF has to be used to get new developments in perpetuity, then they aren't working.

Yep.

TIF was conceived as a way to jump-start development in blighted areas. The Oklahoma statute specifically contains that wording.

It's been bastardized into a multi-billion dollar giveaway that has already spanned decades and with agreements that stretch out decades into the future, with the numbers only increasing.

I am NOT against all public subsidies. But given the enormous sums involved, people need to have a better understanding of how all this works and how it can work against those who are investing heavily in our community and then have to directly compete against those subsidized businesses.

[David]

Do you think it's a good use of public funds to subsidize the sale of expensive private homes?

I'm going to be the odd man out and say I actually do. The more rich people who live in the heart of the city the better the amenities will continue to develop there not just for them but for everyone else who spends time in downtown and Bricktown. And also, better in Bricktown than more of the far out countryside getting converted from farms to housing where we still subsidize the housing just with a forever commitment to roads and utilities.

[Urbanized]

Do you think it's a good use of public funds to subsidize the sale of expensive private homes?

The short answer - assuming you are talking only about TIF when you say "public funds" - is absolutely. But I fundamentally disagree with the inflammatory phrasing of the question.

The longer answer is that TIF is specifically designed to encourage development that benefits the TIF district, and by extension, the rest of the community. It is intended to be used when a quality, desired and beneficial development wouldn't happen but for the incentive. What is abundantly clear at this point is that high rise condominium development is not currently happening in OKC, despite a boom in such development nationwide over the past couple of decades. It is a missing component, and a new, upscale residential high rise will hopefully help prove the concept and encourage even more of the same.

What are the other benefits? Well, among other things downtown desperately needs more rooftops in desirable demographics to have any chance at the things people who post here covet, such as a CVS or Walgreens, or perhaps even a downtown grocery or other retail.

Simply put, TIF was designed, not to benefit developers or some other group, but instead to encourage desired but challenged projects that have benefit to the TIF district and the wider community. Sometimes it requires a deeper dive to understand what those benefits might be. This is a very nuanced topic, and this should be acknowledged when discussing it.

[Pete]

Simply put, TIF was designed, not to benefit developers or some other group, but instead to encourage desired but challenged projects that have benefit to the TIF district and the wider community. Sometimes it requires a deeper dive to understand what those benefits might be. This is a very nuanced topic, and this should be acknowledged when discussing it.

As you well know, I have personally spent months researching and documenting TIF. Absolutely nobody in OKC has done a 'deeper dive'.

We don't need to get into this yet again on this thread, but you're the one that raised a specific point about the housing component on this project.

[onthestrip]

What is abundantly clear at this point is that high rise condominium development is not currently happening in OKC, despite a boom in such development nationwide over the past couple of decades. It is a missing component, and a new, upscale residential high rise will hopefully help prove the concept and encourage even more of the same.

It could be that most oklahoma city people arent big fans of condos. We do have some existing condo buildings and any realtor will tell you those are tougher to sell and always sell cheaper than single family houses. Look at the Bower, built as condos and couldnt sell them. Why would we subsidize something that simply isnt that desired in this market?

[ABryant]

I assume the few condos built in lower Bricktown are still valuable properties.

[shawnw]

Could OCURA acquiring land and then putting out an RFP for development on that land be considered sort of a back door incentive?

[Pete]

Could OCURA acquiring land and then putting out an RFP for development on that land be considered sort of a back door incentive?

Yes, very much so.

It's exactly what happened with this property when it ended up in the hands of the current owner.

[Urbanized]

Yep.

TIF was conceived as a way to jump-start development in blighted areas. The Oklahoma statute specifically contains that wording.

It's been bastardized into a multi-billion dollar giveaway that has already spanned decades and with agreements that stretch out decades into the future, with the numbers only increasing.

I am NOT against all public subsidies. But given the enormous sums involved, people need to have a better understanding of how all this works and how it can work against those who are investing heavily in our community and then have to directly compete against those subsidized businesses.

Multi-BILLION? This is unhinged. Pete.

[Pete]

Multi-BILLION? This is unhinged. Pete.

Our TIF programs are well over a billion and there is much more to be spent.

Stop with the insults, please.

[Rover]

Our TIF programs are well over a billion and there is much more to be spent.

Stop with the insults, please.

Is there a site, or do you have a list of existing TIFs in OKC and the amounts? It would be good to see who these billions benefit and what if any results have occurred. Like any investment, it is not in context without evaluating the actual results, both tangible and intangible. It seems like you must have that info or know where it is.

[Teo9969]

Is there a site, or do you have a list of existing TIFs in OKC and the amounts? It would be good to see who these billions benefit and what if any results have occurred. Like any investment, it is not in context without evaluating the actual results, both tangible and intangible. It seems like you must have that info or know where it is.

There was a thread about it awhile back and I think that it accounts for the majority of the TIF out there and surely some stuff that has aged. I think with soaring values of Real Estate and inflation, we're going to find that some of these are going to end up being more costly than anyone was ever anticipating, especially since our TIF does not have caps on the amount of savings developers can receive.

[Teo9969]

It's in the Summary Reference Forum:

https://www.okctalk.com/showthread.php?t=39599

[Rover]

It's in the Summary Reference Forum:

https://www.okctalk.com/showthread.php?t=39599

Not really. I’m talking about a spreadsheet of Tifs, recipients, amounts, years in affect, projects funded, and economic and other results.

Seeing only one part is totally out of context when trying to figure out whether they were awarded judiciously. It’s like looking only at someone’s debt and claiming that’s their net worth.

[king183]

Is there a site, or do you have a list of existing TIFs in OKC and the amounts? It would be good to see who these billions benefit and what if any results have occurred. Like any investment, it is not in context without evaluating the actual results, both tangible and intangible. It seems like you must have that info or know where it is.

This city has a site that details each of the TIF districts and the spending/investments related to them. I’d post it here, but I’m on my phone and my browser is being difficult. A quick glance at the figures in that site confirm Pete is correct and the amount is well over a billion, and likely multi billion (I didn’t do the math on my quick glance).

[Teo9969]

https://www.okc.gov/departments/econ...nt-finance-tif

https://www.okc.gov/home/showpublish...07759272370000

As of June 2021 we're right around a billion of expenditures, and it looks like between $75M and $125M of funds available. TIFs 2 & 3 (CBD & Skirvin) and TIF 8 (Devon are presently the 2 largest districts and have expenditures in the multiple hundreds of millions. TIF #2 ends in 2025, TIF #3 ends in 2029, and TIF #8 ends in 2033. The TIF #2 will probably generate another $50M before it's done and TIF #8 will probably generate well in excess of $125M. Wheeler and Core to Shore are just getting kicked off and now that First National is complete, you can imagine that the 2023 assessment which will show up in June 2024 reports will be a huge increase in valuation and therefore tax income. Before that's all said and done in 2041, I'd be shocked if it doesn't produce $250M.

So spent multiple billions, no, but multiple billions are definitely allocated here.

[G.Walker]

If downtown Memphis can support a 20 story Grand Hyatt, so can Oklahoma City. But Memphis is having some difficulty getting some TIF passed for the project. The local developer stated he will cancel the project if the TIF isn't passed. These articles are interesting and in line to what we have been discussing.

https://www.commercialappeal.com/sto...e/10065258002/

https://www.commercialappeal.com/sto...g/10140377002/

[Laramie]

If downtown Memphis can support a 20 story Grand Hyatt, so can Oklahoma City. But Memphis is having some difficulty getting some TIF passed for the project. The local developer stated he will cancel the project if the TIF isn't passed. These articles are interesting and in line to what we have been discussing.

https://www.commercialappeal.com/sto...e/10065258002/

https://www.commercialappeal.com/sto...g/10140377002/

+1

and the Dream Hotels development.

[BDP]

Simply put, TIF was designed, not to benefit developers or some other group, but instead to encourage desired but challenged projects that have benefit to the TIF district and the wider community.

So if, 30 years after using TIF to encourage downtown development this project is still a challenge, was the decision at that time to use government to manipulate the downtown development market justified? At the time, it was argued that, by this time, it would no longer be needed because those developments receiving the competitive assist would elevate the market to the point where such assistance would no longer be needed. Now that we're at the end of that term, maybe it's time to see if it worked. I'm just saying that if that if this project needs it then, obviously, the initial arguments for TIF were erroneous.

Also, if the initial term of the TIFs awarded didn't equate to billions of dollars saved in risk mitigation over 30 years by those developers (collectively) that received them, why were they needed in the first place? That would mean that the potential ROI against risk was justified at the time without the government assistance.

Why continue the cycle of government granting advantages to investors who have the capital to begin with?

And, if it is prudent to continue that cycle, is there an actual end game and what is it?

I agree with you that TIF was not designed to benefit developers or "some other group", but is that how it is functioning today and how would giving TIF to this project be within the initial spirit of TIF, as you see it?

[HOT ROD]

it'd be interesting once these TIFs expire, the influx of $$ into the Oklahoma City Public Schools and County venues - should be a HUGE winfall.

[onthestrip]

it'd be interesting once these TIFs expire, the influx of $$ into the Oklahoma City Public Schools and County venues - should be a HUGE winfall.

I wouldnt get your hopes up too much. When these TIFs expire and property owners dont get their ad valorem taxes returned back to them, they will protest property valuations and get them lowered to a much lower amount. Yes, schools will get some more money when TIFs expire but not as much as you'd think after owners protest valuations at county assessor offices. This has played out on Oklahoma wind farms and will play out on Devon tower as well. That tif was like $750 million? When that TIF expires you can be sure Devon will protest and get the value of their tower lowered to nothing near $750 million.

[Richard at Remax]

it'd be interesting once these TIFs expire, the influx of $$ into the Oklahoma City Public Schools and County venues - should be a HUGE winfall.

This has been my big beef with TIF this whole time, esp with Okana and Devon. Schools for the most part are funded by property taxes. That's tons of money not going to our schools and other services. Chickasaws esp don't need any money.

[BDP]

it'd be interesting once these TIFs expire, the influx of $$ into the Oklahoma City Public Schools and County venues - should be a HUGE winfall.

Well, after all, that is what we were promised.

Let's see if it happens, right?

[Teo9969]

I wouldnt get your hopes up too much. When these TIFs expire and property owners dont get their ad valorem taxes returned back to them, they will protest property valuations and get them lowered to a much lower amount. Yes, schools will get some more money when TIFs expire but not as much as you'd think after owners protest valuations at county assessor offices. This has played out on Oklahoma wind farms and will play out on Devon tower as well. That tif was like $750 million? When that TIF expires you can be sure Devon will protest and get the value of their tower lowered to nothing near $750 million.

Property owners are already paying the full value of their taxes. It's just that the money goes in a separate fund owned and managed by Oklahoma City that tends to get spent on capital projects rather than to Oklahoma County who would route those funds to budget line items. No property owners who have received TIF will see an increase on their property taxes at the end of the TIF periods.