By Emily Ford
eford@salisburypost.com
KANNAPOLIS ó The future of the new Cabarrus Health Alliance building remains uncertain as city leaders search for a way to pay for it.
“We’re on the bottom of the roller coaster again,” said Dr. William Pilkington, director of the health alliance.
The health alliance, which serves as the public health department for Cabarrus County, had hoped to be constructing a new building by now across Dale Earnhardt Boulevard from the N.C. Research Campus.
The construction has been delayed by the poor economy, which stalled a bond package that would have paid for improvements around the Research Campus, including a $15 million health department.
But the tax-increment financing, or TIF, bond might be back on the table.
The city is exploring “whether the market has improved for a publicly offered TIF,” Kannapolis City Manager Mike Legg said. “Our preference has always been to stick to the original plan.”
The city and Cabarrus County agreed last year on a $168.4 million TIF bond package. The city is responsible for raising the money.
Although the market for publicly offered TIF bonds dried up in the recession, a few have been successfully sold in the past few weeks in other locations, Legg said.
The lead underwriter, Bank of America, is investigating.
“If that’s feasible, that is clearly the best option,” Legg said.
TIF bonds allow cities and counties to borrow money without voter approval for public projects. The increase in property value from the development district goes to paying off the bonds.
“In our case, we have proven revenue,” Legg said.
The N.C. Research Campus TIF district generated about $2 million this year.
The city had considered selling a private TIF worth between $25 million and $30 million to BB&T. But the bank approved only $18.5 million.
That deal is still a possibility, but the city would prefer a $25 million to $30 million sale to pay for the new health alliance building and several other smaller infrastructure projects, as well as reimbursements to the city and campus developer Castle & Cooke.
“Certainly our goal is to get to the $25 million mark so we can include all the components,” he said. “Anything short of that, somebody’s going to be left out.”
The city should know in 30 days whether it will pursue a publicly offered TIF.
The health alliance extended its construction bid again, until Nov. 5.
“I don’t know how many times we can do this,” Pilkington said.
Because construction costs have fallen, the cost of the building is down to $8 million.
The agency also has cut equipment costs by $1 million, he said.
“We’ve done as much cutting as we can,” Pilkington said.