When last we left the city of Richmond, Virginia, it was bailing on a plan to spend $300 million on a downtown arena after determining that doing so could have left the city raiding its schools budget and general fund if things went south. But never fear, the same developers are back with a new plan out in Henrico County that would cost even more money:
A group including Michael Hallmark and Susan Eastridge are planning a massive $2.3 billion arena-anchored development on the Henrico-owned 93-acre former Best Products site, according to an announcement made by the county this morning….
The $250 million multi-purpose arena would be comparable in size to what Hallmark and Eastridge had proposed as part of their involvement in the unsuccessful Navy Hill development which would have replaced the Richmond Coliseum. That project was killed by Richmond City Council in a heap of controversy earlier this year.
County Manager John Vithoulkis alluded to Navy Hill’s fate in explaining at today’s press conference how Henrico expects to handle things differently than the city.
“This is what we do in Henrico: Smart economic partnerships with no risk and significant benefit to the tax payer,” he said.
Yeah, about that “no risk” to the taxpayer, how would the Henrico County project be funded?
GreenCity would be financed in part through the creation of a community development authority, which would allow for the sale of private bonds that would be repaid with taxes produced by the development.
A community development authority is basically a tax-increment financing district, where tax payments from a development are kicked back to developers to pay down their construction debt. In other words, pretty much the exact same plan that was considered by the city and rejected, because TIFs way too often turn into money pits if the projected tax revenue doesn’t come in. (And even if it does come in, if siphoning off tax revenues turns your local budget into Swiss cheese.) This is what we do in Henrico: Copy off of other jurisdictions’ dumb ideas, then declare them to be smart, because we’re the ones doing them! Oh, and call it GreenCity, all the kids will like the sound of that.
UPDATE: A reader points me to the Henrico Citizen’s reporting on the county plan, which says the main difference from the city plan is that the tax kickbacks would be limited to taxes paid by the project itself, not any surrounding properties. Which is a nice idea in theory, but if those taxes were enough to pay off construction costs, then why would the city have needed to make the TIF district bigger? And there’s nothing stopping the county from making its district bigger if its money runs short. So while not exactly the same as the city’s plan, it’s awfully close, and Henrico really needs to come up with more details than “Different acronym! And the green thing!” to show that it would be any better for taxpayers.