Traverse City commissioners will take another stab at approving language for a tax increment financing (TIF) ballot proposal tonight (Monday) – something they failed to do at their July 6 meeting and are now facing a looming deadline to approve. Commissioners are legally required to put the proposal to voters this fall. Commissioners will also vote tonight to make the two-way traffic flow on State Street, Pine Street, and Boardman Avenue permanent.

TIF Ballot Language
A new TIF plan – called the Infrastructure First TIF Plan, which would replace the soon-to-be-expired TIF 97 plan in downtown Traverse City – is headed to voters for approval this fall.

But first, city commissioners must decide how the proposal will be worded on the ballot. After residents voted to change the city charter in 2024 to require TIF plans to go to a public vote, the city adopted an implementation process that outlines how such plans will be placed and described on the ballot. If an entity like the TC Downtown Development Authority (DDA) – which recently approved the Infrastructure First TIF Plan – is seeking to move forward, the TIF proposal must go to the city commission to put to voters at the next regular or special election. Doing so is “a ministerial function, meaning the city commission has an obligation to take this action,” according to the city’s legal counsel Dan Kelly.

Commissioners reviewed the proposed ballot language at their July 6 meeting. The board had extensive debate about how the tax capture projections in the TIF proposal should be calculated and delayed their approval until that language could be tweaked. TIF districts work by capturing taxes on rising property values on properties just within their boundaries, with those revenues then going to public improvement projects. The capture projections are only estimates, as it’s impossible to accurately predict how property taxes might vary over two decades. “We’re doing the best we can,” said Mayor Amy Shamroe. “This is a 20-year forecast.”

Kelly reiterated that point. “Similar to projecting the CPI, inflation, or interest rates over the next 20 years, it is solely a good faith estimate of future increases or decreases in the TIF capture,” he wrote. Still, after several commissioners felt the projected estimates were too low, the ballot language has been adjusted to reflect a seven percent annual increase year-to-year. That depicts the “most robust assumptions for future growth and increases the capture, which should avoid any criticism of underestimating the TIF’s potential future capture,” Kelly wrote.

Commissioners also struggled with how to word a new element in this TIF plan, which is a 70-30 split on revenues between the DDA and other local taxing jurisdictions like the city, Grand Traverse County, BATA, and NMC. In the new version of the ballot language on tonight’s agenda, the reference to that split has been removed entirely. The projected capture of nearly $140 million over the lifetime of the TIF plan reflects the fact the DDA will only be receiving 70 percent, however.

“It is important to remember, the plan as approved does not allow the TIF to receive more than 70 percent, so for transparency purposes this is the amount consistent with the charter and policy’s intent,” Kelly wrote. “Additionally, this avoids explaining the 30 percent revenue-sharing requirement, which may be confusing and is not accounted for in the implementation policy.”

Commissioners are facing an August 11 deadline to approve the language and put it on the November 3 ballot.

Two-Way Streets
Commissioners tonight will also vote to make the two-way traffic pattern on State Street, Pine Street, and Boardman Avenue permanent.

The board would approve a traffic control order that would maintain the two-way flow “until such as it may be rescinded by future commission action,” the motion states. The DDA board, a DDA traffic engineering consultant, and an independent engineering consultant retained by the city have all “recommended maintaining the two-way traffic configuration,” according to City Manager Benjamin Marentette.

City commissioners have the final say and considered the topic in February, but held off making a decision until the city’s new Complete Streets Advisory Committee (CSAC) could weigh in. That board met this spring and also supported a two-way configuration. According to the group’s June 2 meeting minutes, the committee found the current design –  which has been tested for several years as part of a pilot project – “enhances accessibility and connectivity for all users while also providing operational benefits. In addition, it improves traffic circulation and offers greater flexibility for managing vehicle movements during events and street closures on Front Street.”

The city is expected to invest in a series of improvements if the corridors remain two-way permanently, which could range from modernizing traffic signals at key intersections to extending two-way operations on Front Street between Pine and Union and Park and Boardman to improve downtown flow. Cost estimates vary depending on improvements but will likely be in the six figures. Converting State Street back to one-way traffic would also have required construction changes at an estimated cost of $62,395.