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Stories Added - April 2009
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City offi cials hold workshop on MMUD development tool
Polk County Enterprise - April 2009
LIVINGSTON – City Council held a special economic development workshop Thursday to learn more about Management Municipal Utility Districts (MMUD). Anthony Properties (AP), a land-development fi rm from Dallas, has requested the city create this special district to manage utilities, drainage, landscaping and for the construction of new roads on the hundred acre vacant parcel of land across from Tractor Supply Company on Hwy. 190 west of town. The city has called a special meeting for 5:30 p.m. Thursday to consider approval of the MMUD. A Management Municipal District though, is a “MUD on steroids” according to Attorney Jeanne McDonald, the city’s guru on all things related to utility districts. AP has only recently brought this proposal before City Council and is asking the city to rush this proposal through but so far has been vague about the reasons for the quick pace. Nucherino admits the economy has slowed progress on other AP projects under development and that this project could be a “saving grace” for his company. Four Corners is one example of how the economic downturn has affected Anthony Properties. It is a master-planned community located about 10 minutes west of Livingston at the intersection of Hwy. 190 & FM 3126. That development project hasn’t had a sale in a number of months, according to Nucherino. Nucherino said construction plans for the new high school have forced AP to speed up their plans. The original plan was to develop along Hwy. 190 only, but with construction plans moving forward for the high school AP realizes it can develop the property in the rear as well by building a road through the property to connect Hwy. 190 with FM 350 South.
The road would meet FM 350 across from the proposed entrance for the new high school, giving students three exit options. The road would increase the value of the land at the back of the property by providing more road frontage for those retail spaces. Nucherino believes the city can protect itself from future liability by placing goals and deadlines into the legislation that would dissolve the agreement if certain conditions are not met. He believes these choke points should alleviate any concerns the council may have about moving so quickly. City offi cials see a bigger picture of the situation. There is more involved in this decision than what the developer can or cannot achieve. Some feel the rapid pace ignores the bigger question of whether the city can live with either of the two possible outcomes if all deadlines are met. If the plan succeeds the city gets a new self-governing retail district able to levy assessments and impact fees on landowners within its boundaries. The city will have very little control over this entity and it can grow larger on its own as its directors see fi t and as neighboring lands become available. On the fl ip side, the city could be forced to take over the district if progress stalls in the coming years. If the district is unable to survive on its own and pay for its own infrastructure through bond sales and revenue generated from landowners and residents in the district, the city may fi nd it necessary to take the district over so it can spread the burden across the city. In a scenario involving a MMUD failure the city would have to pay for the bonds outright and assume whatever other debts there are. The bond issue alone could be upwards of $8 million according to infrastructure estimates from Nucherino. Nucherino needs a letter of approval from the city so the creation of the MMUD can be approved by the current session of the state legislature which is due to end in May. The state legislature meets only in odd years so the next session will not begin until January 2011.
The governor can call a special session during the legislative recess, but it is highly unlikely such a session would be called for a matter of such little impact outside of Polk County. City Council will decide this matter without Mayor Clarke Evans. He must recuse himself since his company Evans and Associates is being used to broker deals with potential buyers of the individual parcels of land and for other AP properties being sold in the area. Evans has been working with Anthony Properties long before it decided to pursue approval for a Municipal Utility District for the site and before he was elected mayor. Their sign advertising available lots on the site is beginning to show signs of age. The mayor was present Thursday as Jeanne McDonald presented a primer on MUDs. This is permissible since no action was taken as it was a learning workshop for all council members. Frank Nucherino said several companies have shown an interest in locating stores in a district such as this, but none have finalized any of the deals. He said an extendedstay hotel has indicated it would take the property between Long King Creek and the proposed Hwy. 190 intersection. Don Baskin, developer of the Southpoint shopping center and former owner of the Baskins department store chain doesn’t believe the MMUD would be a good investment. He was asked to participate in financing for that hotel project but declined the offer.
He has a partnership interest in the hotels located in Southpoint shopping center and said his hotels have not reached their capacity in quite some time. He feels it is because of the economic downturn of late and that an investment in the Town Center hotel project would be imprudent before the economy recovers. Baskin asked the city to provide utilities to his site when it was under development back in 1983 but was turned down. “It was my responsibility to take care of all utilities,” Baskin said. “If I hadn’t, I wouldn’t have gotten this far.” He was forced by state regulations to install a sprinkler system on the property but he couldn’t use it because he didn’t have sufficient water pressure to run it. That project cost him $40,000. He’s not bitter though. He is a big proponent of progress and growth for the community. “I am not against development for that piece of land, but it should stand on its own two feet. That’s what we’ve had to do.” Baskin said. Should the city decide to decline AP’s request the developer will have alternative options. The worst case scenario for AP is they would have to wait as much as a year and a half for the next legislative session.
The high school won’t be completed until late 2011 or early 2012 and won’t begin to serve students until fall of 2012. So the road Nucherino is in such a hurry to build wouldn’t even serve its intended purpose for more than three years from now. If the plan is put on hold it would give the city more time to generate traffic flow reports and market studies to give council members a better understanding of how this decision will affect the future of this area, and what impact it will have on the city itself. “This is not the time to stretch out,” Baskin said. “It’s a time to hold close what you have.” Some of the reasons for creating a MMUD are to get the site developed “bigger, better and faster,” McDonald said. But she cautioned the council about becoming an investor in the project. “Cities should not speculate with their money, and you must have an exit strategy if the plan doesn’t work.”