Thursday, June 19, 2003

Mall makeover: Bond issue

Power up the port

The redevelopment deal for chronically troubled Forest Fair Mall is good for this region - the entire region.

Wednesday, Hamilton County Board of Commissioners and Cincinnati City Council authorized the Port of Greater Cincinnati Development Authority to help finance the mall's $70 million makeover into "Cincinnati Mills." Some on council at first questioned why the city should help revive a huge suburban mall that could compete against downtown retail. Yet council voted 8-0 for it, and rightly so.

Cincinnati Mills can help generate sales tax revenues Hamilton County needs to finance such capital projects as $68 million parking garages promised for Cincinnati's central riverfront. The mall is expected to create about 3,000 jobs. Mall owners, Virginia-based Mills Corp., say their new mix of tenants will draw new customers from outside Hamilton County, not suck shoppers away from downtown.

Cincinnati has made tentative maneuvers to reconstitute the port authority as only a city-run development authority, but this Cincinnati Mills project shows the advantages of a city-county organization with broad powers. The mall site straddles Forest Park and Fairfield, Hamilton and Butler counties, plus three school districts. It can do one bond issue instead of several, avoiding costs and complexity. The bonds, for roughly $20 million, are mainly for mall parking and guaranteed by Tax Increment Financing assessments on the owner/developer. Mills Corp. is a national mall developer with a track record of holding investments for the long haul.

The mall project will add to the port's revenue stream. It will collect a fee for issuing the bonds and about $50,000 a year over 30 years from parking revenues. It also will collect tariffs on commodities off-loaded at a public dock it is developing on the Ohio River. That's how ports become self-sufficient. The Greater Cincinnati port's scope from the start was countywide. What is there not to like about the Mills project? The entire region should benefit from turning a half-empty white elephant into a busy retail destination.

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