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More details sought on N.O. project

Plaza proposal under scrutiny

Wednesday, September 23, 2009
By Rebecca Mowbray, Business writer
The Times-Picayune

Councilwoman Cynthia Willard-Lewis, a major supporter of efforts in her district to redevelop the defunct Lake Forest Plaza into a modern lifestyle mall, has asked Mayor Ray Nagin to get more detailed information on the proposal and more assurances that the project will move forward as pitched.

In a letter to Mayor Nagin on Monday, Willard-Lewis, the term-limited council woman who represents eastern New Orleans, said she remains “strongly committed” to the redevelopment of the mall and thinks that tax increment financing will be necessary to bring it to fruition, but believes the city needs more information.

“I have several concerns regarding project viability, as well as scale and specific use of tax increment once dedicated which the city needs to answer to insure that the project is developed with the greatest community benefit and at a reasonable cost to the City’s general fund,” Willard-Lewis wrote.

Lake Forest Plaza LLC, which is owned by Regional Transit Authority Chairman Cesar Burgos and First NBC Bank Chief Executive Ashton Ryan, hopes to re-develop the mall in several stages using a portion of future sales taxes generated at the property, a mechanism known as tax-increment financing.

The developers say the project would accelerate the recovery of eastern New Orleans by providing jobs and essential services; critics, such as the nonpartisan watchdog Bureau of Government Research, say there are no assurances the deal will be completed as promised and that the most tangible result of the taxing district would be to pay off the owners’ mortgage on the property.

Willard-Lewis, the sponsor of the ordinance to adopt the agreement authorizing the public financing of the mall redevelopment, also recommended that the issue be kicked back to the council’s budget and special project committees because the proposal has implications for the city’s general fund. Filling Willard-Lewis’ requests and sending the issue back to committee could take weeks.

Burgos, who has said the project is time-sensitive, said he had not seen the letter, but believed that most of the issues could be resolved before Oct. 1, when the measure is scheduled for a vote at the Council. “I believe we can address most, if not all of the issues, before the first so this matter can come up for a vote,” Burgos said.

Willard-Lewis said she has not seen any analysis of the project by the city, and if the city doesn’t have the staff to do it, it should hire a professional to go over the proposal and negotiate terms on the city’s behalf.

She also asked the city’s economist to review the taxing district’s impact on the general fund, and get an appraisal of the property, copies of mortgages and any other essential notes related to the project, as well as more details on how the developers plan to use the sales taxes to support their project.

Under the proposed deal, the City of New Orleans and State of Louisiana would each dedicate two cents of future sales tax collections at the site to the project. Willard-Lewis asks for “a firm written commitment” from the state on its portion.

Finally, in response to concerns that Wal-Mart, which is envisioned as the anchor tenant in the first phase, may not actually be interested, Willard — Lewis asks for “a signed letter of intent from a large format retailer committing to the property.”

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