A plan to fund roughly $98 million of infrastructure improvements in Ridgefield received final approval last week, with most of the projects expected to be complete by the end of the decade.
During the Nov. 2 meeting, the Ridgefield City Council voted unanimously to approve a tax-increment funding (TIF) area on 942 acres of land near the city’s junction with Interstate 5.
Approved by the Washington State Legislature and signed into law in 2021, the TIF area directs property taxes on new development in the area to fund infrastructure projects.
During the last update of the city’s comprehensive growth management plan in 2015, one focus for Ridgefield was to become a regional employment center for Clark County, Ridgefield Finance Director Kirk Johnson said during an Oct. 26 public briefing. The infrastructure improvements are intended to bring in private investment that will create jobs in the city.
Tax revenue subject to the TIF will fund nearly a dozen infrastructure projects. Two major ones are the widening of Pioneer Street to four lanes from 56th Place to Royle Road and the construction of a corridor connecting South 10th and 11th streets, including an overpass over I-5.
Other projects include the building of several new roads, mostly on the west side of I-5 near Pioneer Street, as well as a stormwater facility, according to a project list present to the council. The area will also fund the purchase of land for Clark-Cowlitz Fire Rescue for the fire district to build a new fire station that will serve the area.
Though the TIF area will last 25 years, Johnson said the majority of the projects would be able to be completed within the first two years of the TIF area’s formation. The latest project in the list provided to the council was the I-5 overpass in 2028.
All of the projects are anticipated to cost about $98 million, with roughly $50 million expected from TIF area tax revenue. With the infrastructure projects supported by the TIF revenue, the city can expect $700 million in private development and nearly 2,400 full-time-equivalent jobs at full buildout, Nick Popenuk, an economic consultant for the city, said during the public briefing.
Most taxing districts with jurisdiction in the area are subject to the collection, with a few exceptions like property taxes for state and local school levies. This proved to be a sticking point for the fire district, CCFR, which, by their estimates, would forgo $23 million in revenue over the 25-year lifetime of the area.
To make up for the revenue loss, the city and CCFR have worked on a mitigation plan. That includes the city purchasing land for a new fire station and continued conversations through the TIF area’s lifetime to address impacts from the development the area projects will allow for.
One of CCFR’s requests was for the fire district to be removed from the TIF area if the funding goal for projects were met. Johnson said there wasn’t anything in the law allowing one district to be exempt from having their taxes diverted. Instead, Johnson said the next-best solution was dissolving the whole district once repayment on bonds taken out for the projects are repaid.
Johnson said the City Council would have an interlocal agreement with CCFR before them at the next meeting, after which the fire district will make its own approval.
Though there have not been many TIF areas approved in the few years the funding scheme has been law, Popenuk said Ridgefield was lucky in that one is in Clark County with the Port of Vancouver. That has helped with Ridgefield’s own work in implementing a plan that has realistic assumptions on what revenues the city’s TIF area will generate.
With the approval, the TIF area will officially be active June 1, Popenuk said at the briefing. After that, the city can issue debt and begin construction on projects.
The city has been working on a plan for the TIF area for about a year. Alongside outreach to affected taxing districts and to the general public, Ridgefield also received comments from the state treasurer’s office.
None of the treasurer’s office’s comments gave staff any “heartburn” about the given recommendations, Popenuk said. Those recommendations revolved around funding expectations and the city’s own debt service planning to help fund the projects. Current economic forecasts show the city will need to devote about $1.14 million of general fund revenues annually to keep up with payments, Popenuk said.
He said the additional tax revenues including sales tax from new development would exceed the amount needed on an annual basis.
“In theory, even if general fund contribution is going to be required, this development in the area will be generating other taxes that bolsters the city’s general fund and will help them to be able to make these debt service payments,” Popenuk said.
