If the Harford County Council passes legislation for tax increment financing next week, history will be made.

Clark Turner, a private developer, is asking Harford County government to help underwrite a $14 million loan against future tax revenues to develop the former Beechtree Golf Course in Aberdeen.

While tax increment financing, or TIF, legislation has been around for decades, according to a few council members, this is the first time it will be used, if it's approved.

Beginning at 6 p.m. Tuesday, March 16, the council will hear testimony on Bill 10-10, to provide tax increment financing and a special taxing district for Beechtree Estates in Aberdeen.

Turner, the prospective beneficiary of the legislation, is a close friend of County Executive David Craig. Although he sponsored the bill at Turner's request, Craig said last week he is not pushing the council to pass it.

The bill would authorize the county to issue, on behalf of the developer, up to $14 million of special obligation bonds to finance or reimburse the cost of development, such as roads and water and sewer lines and stormwater management facilities.

The legislation also states the maximum interest rate on the bonds will be 9 percent “after giving effect to any federal subsidy.” If the bonds are sold under one of the myriad of new federal stimulus programs, the interest rate could be significantly discounted.

While the county is selling the bond on behalf of the developer, it is the developer’s responsibility to pay off the principal and interest on the bond.

The bond does not have the full faith and credit of the county behind it.

Likes the concept

Council President Billy Boniface said he is a strong proponent of tax increment financing, or TIF, and of special taxing districts.

If this deal goes through, the county will levy a special tax each year on Beechtree Estates to pay annual principal and interest on the bonds and related costs.

"That's why we lobbied our delegation in Annapolis to get enabling legislation for special taxing districts," Boniface said.

Although he favors the TIF concept, Boniface said he would reserve comment on the bill itself until after the public hearing.

"In a nutshell, it's development paying for itself," Boniface said. "It's not taxpayers here today paying for future development and future taxpayers coming to the county."

Boniface also said Harford's special taxing district is one of the most restrictive districts in Maryland.

"If TIF is requested, it requires 100 percent of the owners within the district to agree to it," Boniface said, adding other districts only require 70 or 80 percent. "In the case of multiple owners, every single one has to agree before it's utilized."

Special taxing districts also include stringent requirements, according to Boniface.

"When someone comes to purchase a house, they know what the obligations are," he said. "If you buy a piece of property within a special taxing district, believe me, you're going to know what you're getting into. It's very specific how it's presented to buyers."

Amendments possible

Councilwoman Mary Ann Lisanti, whose district includes Havre de Grace, said she supports the concept of TIF, but she has some questions.

"I still have concerns," Lisanti said. "My main concern is the public benefit. I want to ensure this particular bill has a long-term public benefit."

Lisanti also said she intends to introduce amendments, specifically to deal with the timing of the project and to ensure criteria is met.

"More importantly, we need to nail down where income is coming from and make that part of the legislation itself," Lisanti said. "We need to add stricter language: it's coming here for this purpose."

TIF legislation could give the county an opportunity to improve infrastructure, she said.

"Right now, we're facing a situation where the county doesn't have a lot of money to spend on roads and neither does the state," Lisanti continued. "There are many intersections that could be improved by this project that are probably eight to 10 years from being funded. This is a tool, if done properly, to make that time frame a heck of a lot shorter."

768 houses

The 300-acre Beechtree property carries zoning for housing. A development plan that includes 371 single-family homes, 397 townhouses and a 94-acre natural resource district was approved by the county in 2008.

Councilman Dick Slutzky, whose district includes Aberdeen and the proposed Beechtree development, thinks the housing would greatly benefit the county, especially with the influx of people coming to Aberdeen Proving Ground for BRAC.

"I'm a firm believer if you build it, they will come. These are quality opportunities, upscale and desirable communities," Slutzky said. "If we do that on the Chesapeake Science and Security Corridor and eastern side of the county between Joppatowne and Havre de Grace, I believe we will bring people to the community that will have a positive impact on the community."

The Beechtree property is about one mile from the Route 715 entrance to APG, Slutzky said.

"So proper housing done in a classy way will bring top residential communities to people who live near the proving ground," he said. "They can commute a mile to APG to work."

A shorter commute will help eliminate congestion on some of the county's main thoroughfares, such as Routes 24, 22 and 40, he added.

Aiding BRAC

Councilman Dion Guthrie, whose district includes Edgewood and Joppatowne, also thinks the housing development is prime location for relocated BRAC families.

"Of course, with BRAC coming and all of those thousands of people, it will certainly be a very good location close to APG for that type of development," he said.

Guthrie also thinks TIF legislation would help move construction along faster than it would under normal circumstances.

"Certainly, that is a major piece of construction there with 700-something houses being built there at some point," he said. "That's a lot of infrastructure, water and sewer, et cetera, et cetera."

But Guthrie said the TIF bill seems to have a lot of people "tiffed."

"We're starting to get some e-mails and some noise from some constituents that are opposed to it and some that are for it," he said. "Right now, I haven't made a decision. I'm going to listen to testimony at the hearing and see what everybody has to say."

Councilmen Joe Woods, whose district includes Abingdon and Fallston, Jim McMahan, whose district includes the town of Bel Air, and Chad Shrodes, who represents northern Harford County, chose to reserve comments until after the public hearing.

Tuesday's legislative session will also include public hearings on several resolutions, including surplus property on Schucks and Chapel roads and the special benefit district for the Foster Branch dredging project.

The public hearings will begin at 6 p.m. inside the council chambers in Bel Air.

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