Flint, MI - Capitol Theatre Project at Risk if No Tax Freeze
From MLive.com: A $21 million plan to reopen the historic Capitol Theatre in downtown Flint could be dead if the Flint City Council doesn’t give the OK to transfer a 12-year tax freeze on the property.
The City Council narrowly approved holding a public hearing on the freeze and an official with the project said it may not move forward if the council says no.
“I don’t see how the Capitol Theatre will be able to move forward without the (tax freeze). The project was very thin,” said Tim Herman, president of Uptown Reinvestment Corp and chief executive officer of the Flint & Genesee Chamber.
The tax freeze was first approved in 2013 when the city was under the control of a state-appointed financial manager, but the theater was sold to a non-profit group and Herman said developers need the tax freeze transferred for the project to move forward.
“We’re so close now. This (tax freeze) will make the Capital Theatre a success and a game-changer for downtown Flint,” said Herman.
The transfer would keep the tax freeze intact for eight more years.
Taxes were frozen at about $15,000 per year when the original certificate was approved in 2013. The value of vacant commercial properties typically increase after undergoing a remodeling project.
A public hearing with the Flint City Council is set for May 9.
“I think that the city council, through their due diligence, has asked for more information,” Herman said. “That information has been provided by the city administration and Friends of the Capitol Theatre.”
Flint City Council Eric Mays said he supported the tax freeze under the past ownership but has not made his mind up on the transfer request.
“I want the residents to come out and weigh in on that,” said Mays, adding he believes there are other legal issues that need to be clarified before the council can vote.
Councilwoman Monica Galloway, who represents the theater’s ward, said Wednesday she is still gathering information about the proposal and declined further comment.
Uptown Reinvestment Corp. will partner with The Whiting and its governing body, the Flint Cultural Center Corp. to relaunch the Capitol Theatre. Both non-profits, Uptown will handle the redevelopment and restoration, while The Whiting will manage operations, programming and marketing.
The project is expected to cost $21 million to redevelop and reopen the landmark building.
Uptown group plans $21-million rehab of iconic Capitol Theatre in Flint
“It will be a very difficult project to make work,” Herman said. “It’s two non-profits that are going to be managing this. With all the things that we want to do with the youth ushering core and hiring people from the community – this is very, very important for the success of the operation of the Capitol Theatre.
“The operating model calls for break-even results, with any operating surplus to be rolled back into the Capitol Theatre.”
Former Emergency Manager Michael Brown approved the obsolete property rehabilitation district for the Capitol Theatre, 104 E. Second St. in 2013.
Tax break proposed for downtown Flint’s Capitol Theatre
The total property taxes for the Capitol Theatre were $15,327.13, city officials said in 2013. The obsolete property rehabilitation district tax abatement freezes the property taxes at current levels for up to 12 years.
Built in Italian Renaissance style, one ceiling was designed after the outer vestibule of St. Peter’s cathedral in Rome, according to Flint Journal files, and interior walls recreate views of buildings that evoke old Italy.
The building also hosted a mishmash of live concert performances, including AC/DC, Ray Charles, John Mellencamp and Mel Tillis from the late 1970s until the theater portion of the building closed about 20 years ago.
In addition to the 2,000-seat theater, the renovation plans include 25,000 square feet of attached office and retail space.
The Farah family owned the Capitol since 1977.
Councilman Scott Kincaid said the obsolete property rehabilitation act is a tool of the Michigan Economic Development Corporation.
He said there a previous resolution to set the public hearing was denied by council because no one from the city administration had spoken to them.
The Flint Journal could not reach Mayor Karen Weaver for comment.
“I support things like OPRA and tax abatements that invest in our community,” said Kincaid, who represents the city’s 9th Ward. “I support wheneverr we can have investment in our community because in the long range the jobs that they create and the income tax that we can capture outweigh the property tax that we can collect.”
The tax freeze could still have a chance, however, if council rejects the request.
Flint’s Receivership Transition Advisory Board could still approve the tax abatement transfer if the council votes against it.
That is exactly what happened at the former Perry store at 600 S. Saginaw St. last summer when Uptown officials decided to turn the property into multiple storefronts with a focus on small retailers trying to grow their businesses.
Read the full story and see an impressive photo gallery at MLive.com: http://www.mlive.com/news/flint/index.ssf/2016/04/tax_abatement_transfer_needed.html