The developers of a project that would bring Publix and Walmart to a site near UT's campus are three million dollars short in funding.
Developer Jim Harrison with University Commons said his team received $5 million less in New Market Federal Tax Credits than it had previously been expecting. It had planned on using that money to fund the $65 million project, which could place a shopping center on the Fulton Bellows brownfield site. The property, which is located on Cumberland Avenue, was designated a brownfield because of contamination from a former factory that used to be located there.
Harrison told 10News University Commons plans to ask the Knoxville City Council for $1.5 million in public funds at its next meeting October 2 to help it with the project.
This would not be the first time University Commons has approached local government about a possible deal. In April, it received $10 million in tax increment financing from the Knox County Commission for its project.
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The Fulton Bellows site sits in Knoxville City Council Member Nick Pavlis' district. He said while he wished University Commons did not have to ask for money, he still supports its most recent request.
"I do think it will be a wise investment moving forward and I plan to support it," he said.
Pavlis said he believes University Commons' project could bloom into a major producer of revenue. He said the city currently receives $7,000 in property taxes from the site. He said if a Walmart and Publix were to actually be built on the Fulton Bellows site, the city could take in $120,000 in property tax revenue.
But, the request does not sit well with all city council members.
"I think it's a bad precedent to give private developers that kind of money for essentially, you know a strip center," said Marshall Stair, Knoxville City Council Member.
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He said University Commons' request for public funding is different than the one clothing retailer Urban Outfitters recently made with the city. In September, the city council decided to give Urban Outfitters a $250,000 incentive to locate its store in downtown Knoxville.
"The key difference with that grant was that came out of a special fund that had to be used for economic development, this is coming out of a rainy day fund," Stair said.
According to Harrison, the latest money request was "the last thing" University Commons wanted to do. He said the Mayor's office has been very cooperative during the process.
He said the project has to be done by the summer of 2014 per lease agreements with both Walmart and Publix.