A proposed new bond issuance by North Little Rock for an existing tax increment finance district in the Lower Baring Cross neighborhood would pay to create enough public infrastructure to support 45 new houses, Rockwater Village developer Lisa Ferrell said.
The 2019 bond series will be for $790,000 at a fixed interest rate of 5.25% yearly in conjunction with restructuring a 2017 bond series of $1.105 million issued at 3.25% interest. Both bond series are to mature Dec. 1, 2031.
The North Little Rock Electric Department is the purchaser of both bond series, according to an ordinance to be considered by the North Little Rock City Council at its 6 p.m. meeting Tuesday. A public hearing is scheduled before a council vote. The council meeting is moved from Monday because of the Memorial Day holiday.
The North Little Rock City Council created the Lower Baring Cross Redevelopment District in 2006 as a 40-acre, tax increment financing district, known as a TIF for short.
Property within a tax increment financing district is assessed before and after its development. Any increase in property-tax revenue that results from the development is used to pay off bonds issued for the project.
"It's been determined that there is enough revenue generated from the tax increment to justify additional borrowing to extend the infrastructure to the next Rockwater phase," City Attorney Amy Fields said last week.
The Lower Baring Cross Redevelopment District, the city's only tax increment financing district, contains the Rockwater Village mixed-used development. The bond issuance will allow for streets, drainage and utilities to support the addition of $300,000-plus houses on 15 acres north of Rockwater Boulevard, Ferrell said last week. The additional acres are already inside the district boundaries.
Ferrell and her husband, Jim Jackson, head North Bluffs Development Corp. that developed the "traditional neighborhood" of Rockwater Village homes along the banks of the Arkansas River and its 64-slip marina just west of Pike Avenue and Riverfront Drive. A 264-unit apartment complex off of River Road is also within the TIF but is separate for the Ferrell-Jackson properties.
The Arkansas River Trail for biking and pedestrians also weaves through the Rockwater neighborhood, making both the downtowns of North Little Rock and Little Rock easily accessible.
"This is the first time the TIF has been used for infrastructure for the houses," Ferrell said. "It was previously used for the roads, but this will be just for the houses."
The city approved $1.3 million in bonds in September 2011 for the final phase of street extension, sidewalks and drainage improvements for Rockwater Boulevard that extends from the roundabout at Pike Avenue to River Road. Federal stimulus money paid for construction of the Pike Avenue roundabout that serves as an entrance to Rockwater Village.
"The bonds are paid back from the increase in property value on property tax bills," Ferrell said. "Rockwater has already brought in over $50 million in additional value. This will bring in at least $15 million in additional property values. The property tax on existing Rockwater properties and these that are about to be built will pay for the bonds.
"Urban infill infrastructure and construction is more expensive because it's working with older infrastructure and older assets," Ferrell said. "The city is going to issue a TIF bond to be used to construct public infrastructure, which is sewer, water, roads, electric lines. So, public utilities."
Property taxes help to fund public schools, libraries, county hospitals and police and fire pension funds, which are carved out of TIF revenue by law.
"It's adding value," Ferrell said of the new project. "With the new construction, the property value goes up, so [schools, etc.] will start getting additional value right away. When the TIF bonds are paid off, they'll get all of the increased revenue."
Metro on 05/27/2019