BROKEN ARROW, Okla. — With mixed feedback about a possible amphitheater in Broken Arrow, city leaders aren't concerned about the project itself, they think investors will take care of that.
However, the city council is exploring a Tax Increment Financing district to fund the fringe infrastructure projects around the venue.
"This is not our first TIF district, and they’ve served us well, city councilor Johnnie Parks said.
According to the Oklahoma Department of Commerce, tax increment financing is a public tool that reallocates newly generated tax dollars for up to 25 years to support development or redevelopment in certain limited areas of a city, town, or county.
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Broken Arrow city leaders think the new amphitheater will also serve the city well. So much so they’re trying to create some circular funding.
The people brought in by the theater will require more parking, some land acquisition, and various infrastructure projects.
Those same people will be shopping in town and sleeping in BA's hotel rooms. City leaders are eyeing those new tax dollars to fund the infrastructure projects.
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"It’s not unique to Oklahoma," said Nate Ellis with the Oklahoma City-based Public Finance Law group. He is assisting the city in the process.
"Every state is a little bit different; there’s statutory structures that are a little different, but in Oklahoma, it’s just an economic development tool," Ellis said.
Though Ellis doesn’t live in Broken Arrow, he’s impressed by the amphitheater plans.
"Editorially, sounds like a really cool project," Ellis said.
Local law enforcement said if the project is actualized, public safety will be a top priority:
The new taxes used to fund the plan will come from three different places.
- 100% of the sales tax from the amphitheater.
- 50% of sales tax from new developments around the theater, like new restaurants and shops.
- 50% of sales tax from hotels within the district.
Housing developments are excluded from the plan.
"It didn’t make sense to include them in the TIF district. They’re not going to be redeveloped or changed in any way," Ellis said.
The meeting on Jan. 3 was just the beginning. Though no members of the public chimed in at the hearing, there will be another one on Jan. 16.
"Then the city can actually create an ordinance that creates the TIF district and adopts the project plan," Ellis said.
The state of Oklahoma has an FAQ page related to TIF districts, which can be seen at this link.
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