Farris called the plan a “public-private” partnership, and a “win” for all parties involved.
“Basically, it’s a redirection of tax funds, mostly sales taxes,” said Farris. “The new tax revenues that result from the development are used to create the development.”
Farris noted that downtown redevelopments typically feature high-cost public infrastructure and can have a hard to recouping costs, because of the nature of older buildings and other factors.
“If you wanted to put modern utilities or broadband or other infrastructure type services into the Virginia theater, that’s going to have a high cost, maybe prohibitively high for a private developer,” said Farris. “By using the TIF, the reimbursement of the TIF dollars feasible when it wouldn’t otherwise be feasible.”
DSDC Executive Director Gib Gosser said that the idea to look into a TIF grew out of a Chamber of Commerce visit to Bowling Green, Ky., last summer, where some $200 million is being spent on major improvements.
Similar TIF projects have been initiated in the Kentucky cities Louisville, Lexington, Dayton, Georgetown, and Versailles, according to the DSDC. Farris specifically noted the Red Mile redevelopment plan in Lexington and the KFC Yum! Center in Louisville as examples of TIF success stories.
Gosser specifically had the Virginia Cinema in mind when the idea of TIF funding first came on the radar — he said it’s a plan the city has been working on since last June — but has seen wider potential for how the plan could help downtown Somerset.
“If successful, this (plan) could touch every building in the downtown area,” said Gosser. “It’s got some great potential. Everything has some stumbling blocks along the way ... but it’s much, much broader than a single project. It’s an entire community project.”
Still, the Virginia Cinema may be the centerpiece of the plan. Since the DSDC has struggled for years to find the money to redevelop the theater, using the Virginia Cinema along with a growing number of restaurants and clubs could bring people back to the central business district where they would help produce the spending to pay for the revitalization itself.