Legislation submitted to council asks for approval to let the city borrow $20 million from the Department of Housing and Urban Development. The developers would enter a payment-in-lieu-of-taxes (PILOT) agreement with the city. The city would use a portion of the PILOT funds to pay back the HUD loan.
The project would also get a $4 million state grant and $2.8 million in various economic development incentives. It would also get $3 million in infrastructure improvements made by the city.
The total cost of the first phase is $82 million, but that doesn’t include the cost of a planned hotel and conference center.
There are three big pieces of news here. First, the College Town project is happening. Second, taxpayers will be heavily invested. Third, we have a better idea of what the project will encompass.
According to the legislation:
The pedestrian-scaled development will showcase street level retail and restaurants, outdoor patios, spacious sidewalks, and a public gathering space. Specifically, the development will include a 25,000 sq. ft. two-level bookstore, 20,000 sq. ft. gourmet market, 64,000 sq. ft. of other retail, 75,000 sq. ft. of office, 150 units of market rate residential units and a 150 room hotel and conference center. The project also includes a proposal for an 850-space parking garage and RGRTA multi-modal center.
There’s no mention of a YMCA facility that had been in the works for the site.
The developers need the loan to secure additional financing for the $82 million first phase of the project.
There’s no doubt this will a fantastic development for the University of Rochester. But this is a tax-exempt institution with an endowment of $1.7 billion. The developers will be paying a PILOT, some of which will be used to fund the project itself. This is not an area of the city that needs help and studies show subsidizing retail has little economic benefit.
“I’m shocked by that. A $20 million loan? We have people living paycheck to paycheck,” said Councilman Adam McFadden. “Somebody who has means and could do this with their eyes closed, I don’t understand why we keep getting into this practice. The excuse of leveraging funds? This is a project that is going to be profitable.”
City council votes on the loan later this month.