ACTION REQUESTED:
Title
Communication from the City Manager with a Request to ADOPT the following ORDINANCES LEVYING Certain TAXES in Conjunction with the LOUISVILLE SLUGGER SPORTS COMPLEX SPECIAL SERVICE AREAS (Revised Ordinances):
A. An ORDINANCE Levying a PROPERTY TAX for the PEORIA SPORTS CENTER PROPERTY TAX SPECIAL SERVICE AREA;
B. An ORDINANCE Levying a HOTEL TAX for the PEORIA SPORTS CENTER HOTEL TAX SPECIAL SERVICE AREA;
C. An ORDINANCE Levying a SALES TAX for the PEORIA SPORTS CENTER SALES TAX SPECIAL SERVICE AREA;
D. An ORDINANCE Levying a PROPERTY TAX for the HOLIDAY INN PROPERTY TAX SPECIAL SERVICE AREA;
E. An ORDINANCE Levying a HOTEL TAX for the HOLIDAY INN HOTEL TAX SPECIAL SERVICE AREA;
F. An ORDINANCE Levying a SALES TAX for the HOLIDAY INN SALES TAX SPECIAL SERVICE AREA.
Body
On February 11, 2014, the City Council approved the First Amendment to the Annexation Agreement (originally between the City, Chambers family and other third parties and dated September 7, 1999) that outlined certain zoning changes and financial commitments in regards to the Louisville Slugger Sports Complex. That agreement requires that the City create Special Service Areas (SSA) in conjunction with the construction and opening of the Sports Complex and Holiday Inn and Suites. These SSAs were created by ordinances acted upon earlier on the May 27, 2014 City Council agenda. The ordinances were tabled at the July 22, 2014 Council meeting.
This set of ordinances levies the taxes outlined in the SSA ordinances. For both the Peoria Sports Complex SSAs and Holiday Inn SSAs, the hotel tax will increase by 3% (from 6% to 9%) and the retail sales tax will increase by 1% (from 8.25% to 9.25%). Both of these taxes will go into effect on November 1, 2015. The last set of ordinances establish the additional property tax levy, but that levy will not be set until near the end of 2015 when such levies are normally set. Please note that these ordinances have been revised from the original versions.
FINANCIAL IMPACT: The First Amendment to the Annexation Agreement approved on February 11, 2014 binds the City to the financial contribution of $9.6 million. The taxes associated with the SSAs create a mechanism to repay the bonds that will be required to make that contribution. There is no anticipated cost to the City and very little, if any, risk that sources of revenue in the SSAs will be insufficient. The project as a whole will be very beneficial to the City and should help increase hotel and sales taxes.
NEIGHBORHOOD CONCERNS: A public hearing was held on each of the proposed SSAs on April 22, 2014. There was no comment given. There has been opposition voiced regarding the project as a whole (though not necessarily the financing mechanism) by some residents of the Timberbrook subdivision.
IMPACT IF APPROVED: The taxes will be levied as outlined.
IMPACT IF DENIED: The taxes will not be levied and the City may be in default of its agreement and would not have a source to repay any bond issuance.
ALTERNATIVES: None.
EEO CERTIFICATION NUMBER: Not applicable.
WHICH OF THE GOALS IDENTIFIED IN THE COUNCIL’S 2014 - 2029 STRATEGIC PLAN DOES THIS RECOMMENDATION ADVANCE?
1. Grow Peoria: Businesses, Jobs, and Population
WHICH CRITICAL SUCCESS FACTOR(S) FROM THE COMPREHENSIVE PLAN DOES THIS RECOMMENDATION IMPLEMENT?
1. Grow employers and jobs.
DEPARTMENT: City Manager's Office