By John Dobberstein, Editor
Nobody from the public asked to speak or ask questions Tuesday during a public hearing about a tax increment financing district proposed for the $71.5 million Sunset Amphitheater in Broken Arrow.
The city plans to use a TIF to capture new sales tax revenue in a specific area to pay for more than $28 million in infrastructure improvements needed to accommodate the development, to be located just north of the Broken Arrow Events Park.
Another public hearing on the TIF proposal is slated for Jan. 16, and the City Council is expected to vote on an ordinance to formally create the district unless unanticipated questions or challenges come up.
Meanwhile, a public forum about the amphitheater project is scheduled for 6:30 p.m. on Jan. 9 at Northeastern State University’s Broken Arrow campus to give the public a chance to ask questions about the development by Colorado Springs-based entertainment company Notes Live.
The city sent about 300 letters to the residents who live near Events Park to invite them to attend the forum. Robert Mudd, senior vice president of real estate and development for Notes Live, will give a presentation at the forum to go over the project and address any questions or concerns nearby residents may have.
TIF could bring significant revenue
TIF districts are ultimately created after a plan is reviewed by a TIF review committee and the Planning Commission.
After the completion of two public hearings, the City Council can then vote on a proposed ordinance that formally creates the special district.
A TIF district review committee was created last fall, comprised of representatives of the City Council, the Planning Commission and any impacted taxing jurisdictions, plus three at-large representatives selected from the community by the balance of the committee.
The committee reviewed the project plan to make findings of eligibility and financial impacts and recommended approval of the TIF plan, as did the Planning Commission last month.
This specific TIF district does not capture any ad valorem taxes, so local schools and colleges should not be impacted. The only taxing entities affected are the city of Broken Arrow and Wagoner County, which is a sales tax entity participating in the district.
The TIF would capture 100% of the new sales tax generated from amphitheater, including ticket sales, concessions and merchandise. The district would capture 50% of the city sales tax from any additional development, and the other 50% would go to the city.
The special district would capture 100% of any new hotel tax revenue and 100% Wagoner County sales tax revenue for the first 4 years. From there it would be 75% for the next 2 years, 50% for the following 2 years and 25% for the last 2 years – and the district wouldn’t capture any Wagoner County tax revenue after 2033.
In the economic development agreement the city approved with Notes Live, Ellis noted the entertainment company agreed to assess a 1% surcharge on all ticket sales and concessions and merchandising, “that is also a part of this revenue stream that would be utilized to pay for the project costs.”
Because the amphitheater is expected to be a destination experience that draws visitors from out of state, additional development along the major arterial roads and interchanges with Creek Turnpike is possible.
“We we’ve projected a very modest amount of development, but it could be really significant,” Ellis said.
Economic impact estimated at $211M
At this point, the Sunet Amphitheater is projected to create $85.5 million in annual retail sales, 459 construction jobs, 393 indirect jobs and 240 permanent jobs and a $211 million in annual economic impact.
About $258 million in total sales tax revenue will be raised from the project over the TIF’s 25-year lifespan, and $125 million in total TIFF revenue.
Some $124 million in taxes would be allocated to the state, $97 million allocated for project costs and $7 million allocated to the city. The city of Broken Arrow hotel tax could generate about $4.3 million, and the 1% purchase fee agreement alone could generate about $23.6 million over the TIF period. Reimbursement through the state’s Leverage Act could bring in another $124 million, Ellis said.
Ellis also estimated about $23 million would be generated in ad valorem property tax revenue, although none of that is being collected by the TIF. About $15 million of that would go to Broken Arrow Public Schools.
Gary Gerber says
This seems like a well thought out plan for Broken Arrow. It will permit the City to begin to realize some of the potential of its city boundaries in Wagoner County. The amphitheater should bring concert goers from a much wider regional area and provide for a tourist dollar boost. Well Done!