Council creates urban renewal district

The Mountain Home City Council formally approved the creation of the new Urban Renewal District, after creating at its previous meeting the Urban Renewal Agency and appointing its commissioners.

Monday night's action set the boundaries for the district, which essentially includes the Optimist Park/Scott Industrial Park area where the Marathon Cheese packaging plant will be located, as well as much of the downtown business district.

Creation of the Urban Renewal District was part of the agreement that brought Marathon Cheese and its 250-500 jobs into the community.

Financing from the district is expected to pay for building infrastructure improvements, such as road, water and sewer lines, to the new plant. It could also be used for other projects to revitalize the downtown area as well, based on whatever plan is developed by the district's commissioners.

Fred Prouty is the chairman of the commission, Lisa Anderson is vice chairman and Irene A. Castillo, Hampton Wright and Phil Rainey also will serve as commissioners.

The plans they will develop must ultimately be approved by the city council.

Prouty, appearing before the council Monday night, noted that he had had some reservations about accepting a position on the Urban Renewal District commission, concerned that the council had not been unanimous in its selection of the commissioners and noting the recent history of disagreements between the mayor and council members.

"My experience," said the man who had previously served on the city council for 22 years, "is that the only way things work is if you talk (things out and work together.

"We're going to be going through quite a learning curve," he told the council, "and I beg your patience as we learn."

"It will be a learning curve for all of us," Mayor Joe B. McNeal admitted. "But I appreciate your taking this chairmanship. It's a great responsibility, but I know from experience you can handle it." Both Prouty and McNeal had served together as councilmen previously.

Prouty said after talking with the mayor and other individuals, he had decided that the Urban Renewal District would be a positive force for the community, and that it would have the support of the mayor and council.

"Now," he said, "I look forward to debating ideas with you."

The district's commissioners will create a general Urban Renewal Plan, looking at projects it wants to accomplish, and then develop a specific Revenue Allocation Plan showing exactly how, when and where the money it receives will be spent. Both those plans are subject to approval by the city council.

The district will receive its financing through the states' Tax Increment Financing law.

Essentially, the process works like this: With the district in place, all tax assessments, as far as the district is concerned, would be "frozen" as of Jan. 1 of this year. That would form a base line of assessments for the district. Excluding normal assessment increases by the assessor's office, the district would be eligible to receive taxes based on any improvements (major remodeling) or new construction that would occur within the district's boundaries above and beyond the base line assessment.

For property owners the process would be transparent, since their tax bill would be based on the normal levies imposed by all the government entities levying a tax on property in the URD. They would pay as they do normally.

But the money raised by those normal taxes on the new construction -- such as the $27 million cheese plant -- and improvements beyond the base line assessment, would not go to those governments. In effect, they would not be able to "capture" that growth.

Instead, those tax dollars the governments had levied in the URD area would be diverted to the URD. The URD itself would have no control over tax levies in the district.

The only government not affected under law by that diversion of tax dollars is the school district, which would be able to capture the growth in the URD.

Any person or business inside the URD can present a request to the URD for financing of some infrastructure improvement in the district that would benefit the city and/or the property owners in the district. That might, for example, mean the district would acquire land in the downtown area for expanded parking, or finance sidewalk, street lighting or beautification improvements.

The first plan to be presented, however, is likely to be the plan outlined in the Memorandum of Understanding between the city and Marathon Cheese for assistance in building infrastructure improvements, such as road, water and sewer lines, to the new plant.

In addition to approving the district's boundaries (maps are available at city hall), the council also authorized the district to acquire the property donated by Stan Scott and his partners where the cheese plant will be built. The district will purchase the property, technically, for $1, and then sell it to Marathon Cheese for $1.

In other council action Monday night Mayor McNeal thanked Stan Franks, the city's parks and recreation director, for the "outstanding job," he had done on the golf course during the past year, noting "I asked you to do a job that was highly volital.

"I apologize for what you and your wife had to experience from some small people in the community," the mayor said, but he added that Franks had been given a tough job and had carried out his instructions well.

Councilman Mark Russell asked that the golf course be a regular part of the "old business" item on the council's agenda for a while, until all the issues related to that controversy have been cleared up.

Darren Monasterio, who has been named as a temporary manager of the golf course, reported on actions taken recently, including cleaning up the restaurant after it was shut down and completing an inventory of the shed and pro shop.

He reported that the course was esssentially operating on its normal winter hours ans fee schedules at present.

The city council appears to be leaning toward reinstating the personal services contract system for running the golf course, and Councilman Tom Rist urged all the council members to review previous contracts to help develop a final contract proposal.

Councilman Rich Urquidi, noting that some cart storage contracts were up for renewal at the end of the year, urged the Golf Advisory Board to quickly review the fee structure and make a recommendation to council in the next few weeks.