Dec. 16—TRAVERSE CITY — The city is officially moving forward with a 30-extension of a Tax Increment Financing plan.

The city’s Downtown Development Authority board Friday morning formally started the clock ticking toward a decision on a proposed 30-year extension of the TIF plan — formerly known as TIF ’97 — outlining tens of millions of dollars in downtown projects, upgrades and maintenance planned over the next three decades.

The DDA board’s unanimous approval begins a process that could put the TIF plan — called “Moving Downtown Forward” — in front of the City Commission in May. State law requires the updated plan to go in front of a Development Area Citizen Council made up of nine residents of the TIF district. An ad hoc committee of city commissioners including Mi Stanley, Jackie Anderson and Mitchell Treadwell will join DDA board members Peter Kirkwood, Scott Hardy and Ed Slosky to appoint the citizen group in January.

After the Citizen Council reviews the plan, it goes back to the DDA Board for an additional public hearing and a vote in March, and then on to the City Commission for another hearing before it considers final approval of the plan next spring.

“There’s a lot of opportunity for public input going forward,” DDA Board Chairman Gabe Schneider said.

DDA Chief Executive Officer Jean Derenzy said the TIF plan updates have been under with review for almost two years and include several significant modifications based on input from the public and other local units of government impacted by the plan. Tax increment financing captures property tax revenue increases within the TIF district downtown from other taxing units, including the city, Grand Traverse County, Northwestern Michigan College, BATA and others, which is diverted to the DDA for downtown projects and maintenance.

Because of growing concern over the annual revenue losses to TIF partners, the new plan includes a cost-sharing plan where the DDA would share more than $1.4 million a year with other local taxing units — about 30 percent of its annual TIF intake. It covers revenues received during the first seven years of the current TIF plan from 1997-2004, plus half the inflationary growth in each year of the proposed 30-year extension. The cost-sharing plan would generate upwards of $815,000 annually for the city’s general fund, and some $320,000 per year for Grand Traverse County.

Another change to the plan is to eliminate the tax capture on any city millages approved after Jan. 1, 2023, including the new 1-mill ambulance tax approved by city voters on Nov. 7. DDA Board member Ed Slosky said that provision was the result of citizen input at a recent joint meeting between the DDA Board and the City Commission.

“We are taking citizen input very seriously into this plan,” he said.

Major public projects outlined in the revised TIF plan include:

* Establishment of a permanent Farmer’s Market location and facilities downtown.

* $1.5 million in continued improvements to Rotary Square at the intersection of Union and State streets.

* Upgrades to the lower Boardman/Ottaway riverwalk.

* Development of a West End Mixed-Use project that will include a mix of retail space and workforce housing, plus a parking structure to serve the west end of downtown. Updated cost projections for that project are due next week, Derenzy said.

* $10 million to construct heated sidewalks throughout the downtown district.

Other smaller initiatives included in the plan include partnerships with local nonprofit organizations for attainable housing development, utility improvements along downtown streets and alleys, public art projects and continued support for the new downtown retail incubator. The plans provides for a maximum of $70 million in bonded indebtedness over the plan’s 30-year span. Ongoing maintenance costs for existing and future downtown improvements is also a major emphasis of the TIF plan, officials said.

Slosky questioned moving ahead with the plan’s approval process in the wake a citizen petition filed with the city clerk last month seeking a city charter amendment that would require city voters to approve tax increment financing plans. That petition goes to the City Commission on Jan. 16 where the commission is expected to approve the measure for the next city election in November 2024.

Mayor Amy Shamroe, who serves on the DDA Board, said the petition and potential ballot issue shouldn’t hold up the city’s review and decision on the TIF plan.

“We understand there’s a process to this,” Shamroe said. “How that vote (with the city commission) will go is how that vote will go in May, but there’s no reason not to bring that to us as part of this process.”

In other action Friday officials discussed three pending vacancies on the DDA Board. Member Pam Marsh stepped down Nov. 27, Pam DeMerle is leaving as of Jan. 1 and Michael Brodsky is resigning effective Feb. 1. The City Commission is expected to appoint an ad hoc committee to interview interested candidates and make recommendations to the commission for potential replacements in February.