City to Explore Incentivizing Redevelopment of Strip Malls
Tax increment financing is one possible tool. Also, January 21 is officially "Huntley Day" in Fredericksburg.
by Adele Uphaus
MANAGING EDITOR AND CORRESPONDENT
Fredericksburg City Council is starting the New Year with a new project—exploring how to incentivize the redevelopment of vacant and underused shopping centers along U.S. 1 and 3 through public-private partnerships.
Council agreed to task city staff with developing a process to encourage multiuse, multimodal redevelopment of strip mall-style shopping centers—and their accompanying acres of paved parking lot—that is not reliant on approval of a special use permit.
Jason Graham, who represents Ward 1, introduced the idea Tuesday night at Council’s first meeting of 2024.
“I think Council is in agreement that the old suburban-style strip malls are not what we think of when we think of the City of Fredericksburg,” Graham said. “These types of development are going to be very expensive for the private sector to redevelop. If we are serious, I think it is incumbent upon Council and staff to begin looking at a process for what that redevelopment can look like.”
Graham said he worries that the special use permit approval process is a deterrent.
“For a project that size, I am very concerned that we would not find the level of interest that we would need if a developer could get 90% of the way there just for Council to reject a special use permit,” he said.
One tool the city could use to facilitate this kind of redevelopment, Graham suggested, is tax increment financing, or TIF.
This is a revenue tool that uses taxes on future gains in real estate values to pay for new infrastructure improvements. The city of Carmel, Indiana—which Graham pointed to as a possible model that Fredericksburg could look to—has used TIF in partnership with private developers to fund the infrastructure necessary to turn suburban-style strip malls into taller mixed-use buildings.
Specifically, Fredericksburg could look at “(Carmel’s) use of TIF to develop underground parking, which then makes the rest of the surface area economically viable and able to produce economic activity and drive the kind of tax revenues that a growing city like Fredericksburg is going to require,” Graham said.
Virginia Code permits localities to adopt tax increment financing through an ordinance that designates a development project area as a “TIF” district for a certain period of time, usually 20 to 30 years.
According to a 2019 Bloomberg article, critics of TIF say that it diverts tax revenues from schools and other public services to the private sector and that it creates a separate, possibly opaque, pot of money.
Supporters say that projects funded by TIF would not have happened “but for” TIF and that the revenues are not being diverted because they wouldn’t have existed. TIF projects can be a tool for redeveloping blighted areas and have funded public transit and affordable housing, according to Bloomberg.
Graham said Tuesday that staff should incorporate the Planning Commission, Architectural Review Board and community members in developing a process for using TIF in Fredericksburg.
Council members said they were “intrigued” by the concept and “interested to see where it would go,” and City Manager Tim Baroody said staff would “make time for this important conversation.”
“This is the kind of work that we need to be undertaking,” he said. “I wouldn’t commit a time frame for a report back, but I’m certain we can put time to this important initiative.”
A ‘Huntley Homecoming’
Mayor Kerry Devine—presiding over her first meeting since being elected to replace outgoing mayor Mary Katherine Greenlaw—presented two proclamations, one to Bill Monteleone, managing partner of Greenchip Recycling and Anita Crossfield, owner of Italian Station, for working to “extensively illuminate” a live tree in Hurkamp Park this holiday season; and the other declaring January 21 as “Huntley Day” in Fredericksburg.
“Huntley is a recognized singer-songwriter and son of Fredericksburg, who performs American Blues and Rock in venues throughout the City of Fredericksburg and beyond,” the city’s public information officer, Sonja Cantu, wrote in a press release about the proclamation. “He made national news on December 19, 2023, as the winner of Season 24 on NBC’s ‘The Voice.’ Huntley credits his connection to the Fredericksburg community as an important part of his musical journey and it’s only fitting that his hometown supporters join in the celebration!”
Fredericksburg will host a Huntley Homecoming on January 21, starting with a “celebrity processional” through downtown at 1 p.m. and followed by a pep rally at Virginia Credit Union Stadium, home of the FredNats, at 3 p.m.
At Huntley’s request, the event will raise funds and awareness for Loisann’s Hope House. Admission to the pep rally is free but reservations are required. Reservations will be accepted starting at 9 a.m. on Thursday, January 11.
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