The proposed University North Park Entertainment District Project Statutory Review Committee met Thursday to discuss how the project would be financed and how it would affect the city.
The proposed plan introduced as Rock Creek Entertainment District Project Plan, which first came to the attention of the Statutory Review Committee on Monday. City Attorney Kathryn Walker explained that the proposed plan is to split the district into two tax increment districts (TIFs).
TIFs are used to support redevelopment, infrastructure, and community improvement projects within specific areas with the goal of encouraging private investment in areas in need of economic revitalization.
Under the proposed plan, one TIF would be a sales or use tax increment district, scheduled to go into effect on May 1, 2025. Minutes of Monday’s meeting. The other is an ad valorem increment district that will take effect on Dec. 31, 2026, to collect property taxes that begin when first-year properties in the project area are developed.
City, OU and Team Norman leaders first proposed the red-light district on Sept. 6. team normanA group of leaders focused on preparing the city for OU’s transition to the Southeastern Conference said the district would be 80 percent privately funded and the rest public funds.
The Norman City Council adopted a resolution at its Nov. 14 meeting to establish a study committee on the possibility of establishing a TIF district within the entertainment district.
Walker said at Monday’s meeting that neither the city nor the Norman Revenue Revenue Authority has proposed funding for the project. Instead, the risk lies with the OU Foundation. The city and officials do not intend to use public debt of any kind to finance the project.
At Thursday’s meeting, it was revealed that the proposed amount of development funding for the project cost would be capped at $600 million. With the cost of the arena being approximately $200 million, he estimates the construction cost of the project to be $600 million. However, the company’s CEO rainier companiesDanny Lovell, a national commercial real estate firm hired by the OU Foundation, said $540 million is probably what is actually needed.
Proposed 25-year impact of the University North Park entertainment district project.
“The interest rate on the debt we are borrowing is assumed to be 6%,” Lovell said. “The reason there is a difference between 540 million and he 600 million is because the rate cannot be fixed until this project is approved.”
A proposed private development within the project would provide up to $230 million in development funding and would help finance a public arena and parking garage. Lovell said this would give developers an incentive to quickly build out private developments, including the residential portion.
The committee also discussed the project’s impact on other entities, including the city, the state and Norman Public Schools.
For example, Norman Public Schools could increase enrollment due to the project’s creation of opportunities for jobs, new housing, and other economic benefits.
During the meeting, NPS Superintendent Nick Migliorino said this could require restructuring the district or building new schools.
“Norman has neighborhood schools. I think that’s one of the things people like about Norman,” Migliorino said. “This is a new neighborhood. We want to put something in the neighborhood.”
The feasibility study revealed the impact the project would have on local businesses and the economy. The city’s sales tax projections indicate more than $32 million in city sales taxes will be generated over the life of one of the project TIF districts and will not increase, according to Thursday’s project plan. The hotel portion of the project is expected to generate $8 million in hotel occupancy taxes over the 25-year life of the TIF district.
Once the project is complete, the city will be responsible for maintaining the public infrastructure and improvements needed within the project, as well as providing police, fire, parks, and other municipal services. However, according to the plan, the arena would be operated independently of the city.
The commission has not approved it to go to the Planning Commission. Discussions regarding the proposed plan will continue on May 23rd.
This article was edited by Ana Barboza. Avery Avery Copy edited this article.
Taylor Jones covers business in Norman. Taylor is focused on using journalism to inform, engage and elevate the voice of the city. She is from Anna, Texas and can be reached at Taylor.P.Jones-1@ou.edu.
