Batavia development project still alive

Updated 3/20/2020 8:49 PM

The Batavia City Council this week approved an extension of a tax increment financing district that will keep the One Washington Place project alive, but it added a provision that the TIF will end when bonds are paid off.

Other taxing bodies also will need to approve the extension, but in preliminary discussions they appear to be on board, City Administrator Laura Newman said.


Aldermen voted 9-5 to authorize the extension of the Washington Wilson TIF "with the understanding that staff will be working with the other taxing bodies to explain that in the intergovernmental agreement we are seeking a sunset," according to the city.

"We end the TIF the day it's paid off," Alderman Alan Wolff said.

In a TIF district, property taxes above a certain point are funneled into development rather than to local governments.

The $40 million multiuse development, planned for North River and State streets where Route 25 jogs, has been hit with delays that have put the project on a schedule that won't allow enough time to pay off $16 million in bonds the city planned to issue to finance the venture.

The delays were mostly caused by environmental issues when lead-contaminated soil forced remediation plans in 2018.

Although there are other options, including creating a new TIF district for the project or scrapping the plan for a smaller development, an extension of the TIF is the most beneficial to the city, Newman said. It will get the bonds paid off, offer the best chance for Batavia to recoup costs already put into the development, and allow time to find an alternate project if this one doesn't work.

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"The offramps are still in play," Newman said, meaning the city has some options to back out of the agreement.

A financial consultant for the city, Zoran Milutinovic of Kane, McKenna and Associates, said it is most cost-effective to extend the TIF.

"Even if you move forward, it doesn't bind the council to move forward with this developer," he said.

David Patzelt, president of Shodeen Group, the developer, said that without the extension the company wouldn't be able to get financing, and without financing it wouldn't be able to complete the project.

He said Shodeen is willing to work with the city on the design. Although the original plan included retail space, it was eliminated during subsequent discussions. Patzelt presented an option Monday to restore retail space while eliminating just four of the apartment units.

Chris Aiston, economic development consultant for the city, said the site is better off than it was four years ago due to work that has been done.

"It is more valuable than it was," he said. "There's value in the extension in and of itself. It's critically important to get the extension."

"We need to get this thing done," Alderman Mike O'Brien said. "It's important we put a shovel in the ground in 2020. Let's get this done."

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