Jerry Smith

The News Journal

Kent County legislators have introduced a series of bills that would establish Delaware’s first public-private partnership for transportation initiatives and benefit the Dover economy – without using taxpayer dollars.

The five bills, sponsored by Rep. Bill Carson, D-Smyrna, would allow Dover and Kent County to take out bonds for transportation projects and then use specific economic development tools such as tolls, tax increment financing and special development district designations to pay the debt service over time, according to a press release from the Delaware House of Representatives.

The bills were introduced to expedite a proposed traffic alleviation and expansion plan around the Dover Mall. The $31 million project calls for a new exit along Del. 1 near the back of the mall and the construction of roads that run parallel to the highway. Developers and local officials tout this as an opportunity to draw consumers to the Dover area and add high-end stores to the mall in order to revamp it and have it rival the Christiana Mall and the outlets downstate.

Currently in the Delaware Code, there is a provision that addresses alternate ways to fund, design and build plans for transportation projects throughout the state without depending on state or federal revenue. The Delaware Department of Transportation has set schedules for various projects in all the counties, but those projects are reliant on federal and state funding and ranked on a priority list.

However, under a public-private partnership, developers could expedite transportation projects by developing a funding and construction plan, and then turn over maintenance of the projects to the state.

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The ability to use tax increment financing and special development districts allows municipalities to redirect future tax revenue and levy taxes on redeveloped property to pay for the bonds, but only if the city, county and school district sign off. Currently, New Castle County and Wilmington are authorized to use those funding mechanisms.

“In these difficult budget times we have to look for creative solutions to move Delaware forward and bolster local economies,” said Rep. Carson in the release. “This one-of-a-kind partnership could become a model for the state at a time where we need transportation projects funded, but our state revenues are lacking.”

Representatives from the Simon Property Group and Western Development Corp., as well as city, county and state officials, would like to fast-track the $31 million project that is far down on both the Delaware Department of Transportation and Kent County lists of projects. As it stands now, DelDOT wouldn’t even start the design process until 2021.

The timing of the project prompted developers to look for alternative ways to move it forward. Under this new public-private partnership and proposed legislation, construction would begin by 2019 and would be financed through potentially three sources: a 50-cent toll, tax increment financing and special development districts. The financing would not use public money.

“It’s impossible to overstate the importance of driving economic development in Dover and Kent County, both by building on our success improving growth downtown, and by protecting and supporting the anchors of our regional economy, such as Dover Downs and, in this case, the Dover Mall,” said Sen. Brian Bushweller, D-Central Kent County. “Wilmington and New Castle County have access to TIF and special development districts to help support strong economic growth; making those tools available to our state’s second-largest city should be a matter of common sense.”

If the connector-distributor road off Del. 1 gets the nod by the General Assembly, the Simon Property Group has grand plans for the Dover Mall, which was built in 1982 and is antiquated compared with Christiana Mall and the outlets in Rehoboth Beach.

John Paradee, an attorney representing the mall owners, said plans include renovating the existing mall by adding 54,000 square feet, which would involve a redesign of the Sears store and the addition of new stores. He said there would be a new look altogether.

“The front of the mall would face SR 1 and look more like Christiana Mall,” he said. “It would be more visible to the travelers on SR 1.”

The biggest seller, according to Paradee and mall owners, would be the addition of a “Power Center” on 85 acres at the back of the mall. Plans call for 647,000 square feet of high-end retail space, much like what you see at the Christiana Mall.

“We envision three to four new large anchor stores – at least one of which would likely be a major national department store – and then several other complementary retailers,” Paradee said. “The end game is to elevate the Dover Mall to a Class B mall, with the same sort of high-end retail mix as found at the Christiana Mall.”

While Paradee said market studies show travelers bypass the Dover Mall because of the number of stores and the types of stores offered, he said the number of shoppers has remained steady the past few years. It’s the next couple of years that concern him.

“Both directions currently have better options,” he said. “But if we could elevate Dover Mall to a Class B mall and accelerate building the connector roads, I believe people would have reason to stop in Dover.”

Paradee said that adding 700,000 square feet of retail space to the Dover Mall would not only double the size of the existing mall, it also would be one of the biggest developments in Kent County history.

He said the project would bring more than 1,600 jobs to the area and employee more than 300 construction workers.

House Bills 115, 116, 117, 118 and 119 have been introduced and assigned to the House Administration Committee.

Reach Jerry Smith at jsmith17@delawareonline.com. Follow him on Twitter at @JerrySmithTNJ.