By Zoe Tillman
Thursday, October 21, 2010; PG19
The developer behind the Brandywine Crossing shopping center might get a multimillion dollar boost from Prince George's County for its next phase of construction, which includes a movie theater scheduled to open in 2012.
The Prince George's County Council is considering whether to approve a $4.5 million tax increment financing plan that would reimburse the developer for public infrastructure improvements such as building new roads.
County officials have supported TIF in the past, arguing that new development creates jobs and expands the tax base. But when the council proposed the Brandywine Crossing plan last fall, some residents protested, saying tax revenue was too valuable to give back to developers.
A public hearing on County Bill 78 is scheduled for Tuesday. If approved, Bethesda-based developer Faison could recoup as much as $4.5 million that the company will invest in roads, lighting and other infrastructure during the planned second phase of construction. The second phase includes the movie theater and other unidentified restaurants and retail stores.
When construction began in 2007, the movie theater was scheduled to open in 2010, but the recession slowed production, said John Erzen, spokesman for County Executive Jack B. Johnson (D). Johnson initially proposed the TIF.
The first phase of construction, which includes an existing Costco, Target, Safeway, Marshalls and Jo-Ann Fabric and Craft stores, was completed late last year, said Howard Biel, Faison senior managing director.
Faison recently sold a large section of the properties completed during the first phase to Excel Trust, a San Diego-based company, for about $45 million, although Biel said Faison will continue to manage and lease the properties.
According to the proposed TIF deal, Faison would receive small increments of money from taxes the developer pays the county during the next two or three decades, Biel said. The expectation is that if the movie theater and other stores are successful, the property's value -- and the amount of taxes Faison owes -- will increase.
However, the money is not guaranteed.
Financing is dependent on the county receiving more tax revenue once the second phase of Brandywine Crossing is completed, according to County Bill 78. This means Faison would not be given county money if the second phase is not built or the stores fail to open.
In the past decade, the council has approved a handful of similar tax-based incentive arrangements to spur development, most notably for National Harbor in Oxon Hill. This year, the council is considering TIFs for Woodmore Towne Center in Glenarden and Kingdom Square in Landover. Public hearings for those bills are also scheduled for Tuesday.
Johnson favors public financing for Brandywine Crossing because of the jobs created during the first phase and the money the project has brought the county through taxes, Erzen said. The first phase expanded the real estate tax base for that property from $4 million to $48 million. Annual property taxes paid to the county rose from $38,000 to $426,000, according to Erzen.
Although Erzen did not know the exact numbers of jobs created by the first phase, he said that Costco, Safeway and Target together had hired about 450 new employees and that between 80 and 90 percent of them were Prince George's County residents.
The first phase of construction also brought in about $1.2 million in contracts for minority-owned businesses, Erzen added. The second phase of Brandywine Crossing is expected to generate about $1 million annually in tax revenue, he said.
The Brandywine Crossing bill follows up on a measure the council passed in November, which declared Brandywine Crossing a special tax zone, known as a development district, making it eligible for public financing.
At the time, several residents opposed the resolution, expressing concern about the speed council members moved it through the legislative process. From introduction to approval, the process took about one week when it usually takes several. Residents also complained about the addition of more developments to a once-rural area.
Kamita Gray, president of Brandywine/TB, Southern Region Neighborhood Coalition, was against the council decision in November, calling it a "taxpayer bailout."
Gray said in a phone interview earlier this month that she remains opposed because it would take revenue away from the county for a retail project she thinks is unnecessary, given the amount of retail in Waldorf and Clinton. However, she said, she is not completely against public financing and might be in favor if it went toward commercial office space, which she thinks would bring in better-paying jobs for residents.
Biel noted that Faison is working with another developer on plans to build commercial office space on about 18 acres of land east of Brandywine Crossing.
Brandywine resident Kathy Honeycutt said that although she is worried that new development could worsen traffic along Route 301, she has enjoyed the shorter drive for groceries and is looking forward to the movie theater.
"My original thoughts, honestly, [were that] it would be really nice to have a grocery store, but I really didn't see the need for another shopping center," Honeycutt said. But she welcomes the movie theater, because "there's nowhere nearby to go."