CADILLAC — COVID-19 is throwing a wrench into funding plans for the Cadillac Lofts project.

Originally, the city planned for the Cadillac Lofts to get a Community Development Block Grant to fund public improvements on Mitchell, Cass, Chapin and Shelby streets, the roads near the Cadillac Lofts. But those funds aren't available right now due to the COVID-19 "stay home" order, which prevents an in-person survey from taking place.

Instead, city leaders have proposed that the improvements be paid for using the brownfield's tax capture mechanism.

City council voted on Monday during a remote city council meeting to hold a public hearing on the amended brownfield plan. That public hearing is scheduled for May 18, 2020.

Under the new plan, the city of Cadillac would front money for public infrastructure improvement but would be re-imbursed through a tax capture mechanism.

"The kind of unique part, is this is a great tool because for all the other public infrastructure expenses that the city has, we don't have this source of funding that's available," said Mac McClelland, who advises the city on brownfield matters. Instead, the city foots the whole bill without any reimbursement.

But the Cadillac Lofts project is owned by a private business, and that has City Council Member Steve King uneasy. King was the sole "no" vote regarding scheduling a public hearing for the new brownfield plan.

How much financial support should the city give to a private project? King posed that question to Finance Director Owen Roberts during Monday night's city council meeting.

"I'm getting worried about the city taking too prominent a financial position in a private developer," King said.

But McClelland said that many communities, which would otherwise keep tax capture periods short for private projects, take a different tone when the developer is paying for public infrastructure improvements associated with the project.

"It may make sense for the community to extend that (tax) capture," McClelland said.

Plus, the new brownfield plan doesn't extend the repayment period much.

Due to a previous calculation error that shorted revenue, the proposed amendment to the Brownfield Plan would extend the the total tax capture period for just one year, according McClelland.

The improvements are budgeted to cost $875,000. Originally, the city was going to match the CDBG grant at $300,000, but if the brownfield plan is approved, the city will front the full amount (but will be repaid through the tax capture mechanism).

Cadillac will still pursue a Community Development Block Grant, but the infrastructure improvements need to take place this summer so the Lofts can open, McClelland said.

"If a grant is available these Brownfield/TIF dollars would not be utilized." McClelland told city council.

The public hearing is slated for Monday, May 18, 2020 at 6 p.m. during city council's regularly scheduled meeting. The meeting might be held remotely, if the governor extends some aspects of the "Stay Home, Stay Safe" order.

Cadillac News