Study: Norman development would generate $25 million in annual taxes
NORMAN — The proposed University North Park development in north Norman would generate $25 million in new annual taxes if fully developed, economists said Tuesday.
According to studies by University of Oklahoma economist Robert Dauffenbach and the Oklahoma Department of Commerce's Jon Chiappe, the proposed 500-acre, mixed-use development also likely would create at least 2,000 jobs.
"We are in a different world as far as retail is concerned. We have to do things to bring people out more," said Dauffenbach, director of the Center for Economic and Management Research at OU's Price College of Business.
"That's a real advantage of this sort of entertainment-district design in this plan. We need to think more about how we bring people out to spend their money rather than just leaving them at home with their laptops."
University North Park is on the east side of Interstate 35. Tuesday's studies focus on the northern part of the project between Rock Creek and Tecumseh roads. The southern portion of the project between Rock Creek Road and Robinson Street is about 70 percent developed.
The northern portion of the project is projected to include an entertainment district with a multipurpose arena, which would be home to University of Oklahoma basketball games. The northern project also is expected to include an expo center, hotel, recreational and restaurant venues, commercial offices and housing.
When fully developed, the area is projected to generate about $12.6 million in annual property taxes and about $8.6 million in new annual city and county sales taxes, Dauffenbach said.
All economic projections are based on assumptions, but Dauffenbach said his study benefited from the recent results of the southern portion of the project, including building costs and projected demand.
"I've been doing economic analysis for more than 40 years, and I've never had a study where we had more factual basis for scoping out the parameters and the types of businesses," Dauffenbach said. "It's been a factually grounded study. I wish all my studies had that kind of basis."
The project also could generate an additional $3.5 million annually in city and county taxes if the project successfully attracts about 1,100 high-tech office and manufacturing jobs and 650 retail, hospitality and entertainment jobs, said Chiappe, director of research and economic analysis at the Oklahoma Department of Commerce.
"It is an ideal location in proximity to a major university in the state," Chiappe said. "Students have an opportunity to live and work in the Norman area. It benefits the community and the state if we're able to retail highly skilled people within Oklahoma who earn wages and pay taxes."
Tuesday's studies do not include construction costs and estimate revenue generated when development is complete, in about 10 years. The projects are expected to generate about $500 million in construction over the next few years.
"The entertainment district and arena would be in the first phase of development projects," University of Oklahoma Foundation President Guy Patton said. "Incremental revenue associated with construction would come online first, as quickly as physically possible."
The Norman City Council is considering a tax increment financing (TIF) district to spur development of the northern portion of the project. An existing TIF for the southern portion of project was approved in 2006 and is scheduled to run through 2021.
Most of the northern portion of University North Park would be funded by private developers, but the University of Oklahoma Foundation is asking for the TIF to pay for about half of the $160 million cost of the arena and attached parking garage.
The project has drawn support from Norman Public Schools and some economists, but others have challenged the effort, questioning the overall benefit and saying it will lead businesses to move to University North Park from existing locations in Norman.
The University of Oklahoma Foundation and developer Callison RTKL detailed plans for the northern portion of the project in September 2017.
"We hope these studies provide compelling evidence that this needs to be done," University of Oklahoma
Foundation President Guy Patton said Tuesday. "We have believed from the beginning that this project will have a strong positive impact for the city of Norman."
The project is designed to attract employees aged 25 to 44, a group that is underrepresented in Norman, said Scott Martin, CEO of the Norman Chamber of Commerce.
"This could go a long way toward ensuring graduates from our university stay here and attract others here," Martin said. "We believe this is something we should embrace and figure out a way to find the solution to make this happen. This is a project that is not only good for the immediate area, but one that will enhance our entire community."
The Norman City Council was scheduled to consider the proposed new TIF district at its meeting earlier this month, but the issue has been delayed at least until the next scheduled meeting on May 10.