St. Paul officials divided on additional public subsidies for development near soccer stadium

St. Paul officials have agreed that taxpayers will cover infrastructure improvements around the proposed soccer stadium and forgo property taxes at the stadium site — and some City Council members say that's enough.

Council Member Rebecca Noecker will propose a resolution Wednesday opposing tax-increment financing (TIF) at the 25-acre Midway Shopping Center property next to the planned Minnesota United stadium. The Midway property is part of a 34.5-acre site at Snelling and University avenues that would be transformed by the developers' master plan.

"We trust that [the stadium] will be a catalyst," Noecker said about development of the Midway property. "I don't think creating a new TIF district on the site is warranted."

Tax-increment financing diverts additional tax revenue that a new development generates and uses it to help cover certain development costs. It is intended to spur growth where it would not otherwise occur, or pay for public improvements.

The public has already been pouring money into the area with projects like the Green Line light rail and the A Line bus rapid transit, and the city's recent agreement to fund $18.4 million in infrastructure updates around the stadium, Noecker said.

The developer's plans for the Midway site show mixed-use buildings with predominantly retail on the ground floor, and other uses above, including office space, housing, a hotel and movie theater.

City officials will consider the master plan in August and tell the developer what they would allow, and then the developer will try to build out the site, said Tonya Tennessen, spokeswoman for Mayor Chris Coleman. Until then, it is too early to dismiss a TIF district, she said.

"As with any development, until you know what a potential deal is, why would you take something off the table?" Tennessen said.

Council Members Dai Thao and Russ Stark said they do not know if it makes sense to use TIF at the site, but they also do not want to rule it out.

A TIF district might be necessary to ensure developers include low-income housing, green space and other components that the city wants to see at the site, Thao said.

"I think that it's premature," Thao said of the resolution. "We're taking a tool away from a community that has been disinvested."

Thao also said the resolution is not equitable. Noecker's ward, which includes downtown, has received $152 million in TIF spending, according to research done by Thao's staff.

"If we're going to have a TIF policy it should be across the board," he said, and if Noecker wants to remove the financing option somewhere, it should be in her own ward.

But Noecker said each development should be individually evaluated to determine if TIF is necessary. "This is one site where, if we're ever going to put our foot down and say 'No, there's been enough public investment here,' this is it," she said.

Council Member Jane Prince said she supports the resolution, which she said can be revisited and doesn't permanently rule out a TIF district.

"We just need to start generating property taxes as soon as we possibly can to make this a benefit to St. Paul," Prince said.

"That's been the whole premise of why we should grant a property tax exemption to 12 acres at that site."

The Legislature still needs to sign off on the exemption of the 12 acres to the south of the Midway Shopping Center site, which would be used for the stadium and some open space.

Rick Birdoff, president of the company that owns the shopping center, did not respond to a request for comment.

The council will consider the resolution around 3:30 p.m. Wednesday.

Even if it does not pass, Noecker said the discussion will let developers know where they stand on the issue.

Jessie Van Berkel • 612-673-46491