While the Grandview Yard project has developed more slowly than expected due to the poor economy, the project's bond debt is much lower than projected and the city has had more time to secure grants and zero-interest loans for infrastructure projects, Mayor Ray DeGraw reported Monday, Aug. 19, to City Council's finance committee.
DeGraw, Director of Finance Bob Dvoraczky and financial consultant Brian Cooper gave an overview of Yard-related finances during the committee meeting held prior to a special council meeting. The committee meeting recessed, then resumed after the council meeting.
The mayor reported that the current outstanding bonds total $11.8 million with unpaid interest of about $2.1 million. The original projection was that the outstanding bonds would total nearly $90 million.
To date, the city has received or been awarded $5,891,778 in grants and a $1.5 million loan from the Ohio Public Works Commission.
Council held its first reading Aug. 19 of a resolution authorizing the city to apply for more OPWC funds. The money would be used to complete Yard Street and Bobcat Avenue north to Burrell Avenue, and connect Burrell and Williams Street into Northwest Boulevard.
Although the Yard's development has been slower than expected, PILOT (Payments in Lieu of Taxes) revenue has exceeded projections by $622,224.
The Grandview Heights City School District, the city, the Grandview Heights Public Library and Franklin County all have benefited through the distribution of PILOT funds, DeGraw said.
So far in 2013, the 10 first-phase businesses in the Yard have generated $865,180 in income tax, Dvoraczky said.
The city has paid about 48 percent of those revenues for tax incentives and in payments to the debt trustee, he said. The city's net income-tax proceeds through July total $445,578.
It is expected the income-tax collections for the year will meet the projected total of $1.094 million, DeGraw said.
As of July 31, the bed tax generated by the Hyatt Place Hotel totals $612,332, Dvoraczky said. Half of that money goes to the city's park and recreation improvement fund. The rest is split equally between the Destination Grandview convention and visitors bureau and the city's general fund.
In his update on market conditions, Cooper reported that while banks remain cautious, credit is easing.
There is increased activity in apartment and student housing development, but the retail market remains sluggish, he said.
The office, retail, hotel and apartment units that have been developed in Phase 1 at the Yard have an assessed value of $38.9 million, Cooper said.
The Phase 1 development was projected to have a $43.4 million value, he said.
The expected value of future development at the Yard, including office, a hotel and residential units, is expected to have an assessed value of about $51 million, Cooper said.
One way to support future development is to focus on office use as income tax drives city services, he said.
The hotel tax is strong and will continue to be important, Cooper said. Retail development also should be supported as an additional community amenity and destination place.