The City Council created the Expanded N. 27th Street Urban Renewal Area in 2005.  The Urban Renewal Plan indicated that public parking would be needed to promote revitalization and that tax increment finance (TIF) would be used to finance projects in part or in whole.  Earlier this year the Council agreed to purchase property on Montana Avenue for constructing a new parking garage.  In order to use tax increment finance bonds for the garage, the City's bond counsel advises that the project be specifically named as an urban renewal project and that tax increment finance may be used for the bond debt.  The Council should conduct a public hearing on the proposal and consider adopting the ordinance on first reading.

The City Council may conduct the public hearing and:

• Approve the ordinance naming the Empire Parking Garage as an Expanded N. 27th Street Urban Renewal Area project and authorizing tax increment finance be used for the garage debt, or
• Not approve the ordinance.  If the ordinance is not approved, bond counsel may refuse to give an unqualified opinion on the authority for and taxability of bonds issued for this purpose.  That will make bonds almost impossible to sell.

There is no direct financial impact from adopting the ordinance.  If the project proceeds to full funding, the City may issue $10 million - $15 million of tax increment bonds.

Staff recommends that the City Council conduct a public hearing and adopt the ordinance on first reading.