Killington Tax Increment Financing District Application Approved
Hilary DelRoss, Communications Director
Vermont Department of Economic Development
Killington Tax Increment Financing District Application Approved
Town plan includes water system and roadway infrastructure improvements
Montpelier, Vt. – The Vermont Economic Progress Council (VEPC) has approved Killington's application for a Tax Increment Financing (TIF) District for Killington Road and the Killington Village area. The VEPC board voted on Thursday to approve Killington’s application, which will allow the town to install new water infrastructure, resolve water contamination, mitigate road hazards, and enhance transportation capacity and accessibility.
“Growing Vermont’s economy in all corners of Vermont has been a top priority of my Administration, and providing for the basic needs of all Vermonters, including access to safe and clean drinking water, is an essential component.” said Governor Phil Scott in response to VEPC’s decision. “Improving public infrastructure such as water systems and roadways opens new opportunities for a community to grow, and I’m pleased to see Killington accepted into the TIF program to begin this important work.”
The Town of Killington is home to Killington Mountain and Killington Resort – a year-round destination for in- and out-of-state visitors and a major economic driver in Rutland County as the region’s second largest employer. The Town’s proposal for $62.3 million in public infrastructure improvements will facilitate private development of the long awaited Six Peaks Village which will include a hotel, over 35,000 square feet of retail space, and approximately 323 new units of housing consisting of condos, townhomes, and single-family homes.
“Establishing Killington’s TIF District and completing the proposed improvements are important steps toward attracting private investments in projects that add value to the community and grow the economy,” said Commissioner of the Department of Economic Development Joan Goldstein. “The Town’s plan focuses on important economic opportunities that would continue to stall without the use of the TIF program.”
Capital investments in the development of compact, high-density housing and commercial space in Killington have proven untenable without a foundational road and water system in place. Envisioned since the 1980’s, development of a resort village has been thwarted by the lack of municipal infrastructure. Development resulting from these TIF investments will be in locations identified by the Town and region to preserve other areas for natural habitat, recreation, and open space.
“Installing a public water system and improving the road infrastructure is necessary groundwork for attracting new businesses and residents to town, which are needed for our local economy to stay relevant and continue to rebound from the impacts the pandemic had on our hospitality-based economy,” said Killington Town Manager, Chet Hagenbarth. “Without the public investments, the Town will continue to see the stagnant and declining Grand List growth that has occurred over the past decade. Funding these investments locally without TIF would effectively double the Town tax rate, which is too much for taxpayers to bear.”
TIF, which refers to Tax Increment Financing, allows the town to bond for critical infrastructure projects such as road improvements, parking, water and sewer extension and upgrades, and brownfield cleanup. That work enables private developers to construct projects that rely on that infrastructure and that will create jobs, grow the tax base, and enhance the general economic vitality of the municipality. With TIF, Killington is allowed to use a portion of the new property tax revenue generated from the private property growth within the boundary of the TIF District to finance the cost of the public improvements over time. In addition, the State Education Fund will continue to receive its base tax revenue and remain unaffected or grow over time due to new education property tax revenue generated. This mechanism eases or eliminates the burden of increasing property tax rates for property owners outside of the TIF District to finance the public improvements.
In the Killington TIF District, the improvements are anticipated to add over $285 million of new taxable value to Killington’s Grand List, yielding over $115 million in new property tax revenues over the 20-year retention period for the TIF District. Over $26 million of those new property tax revenues will go to the Education Fund, $4 million to the Town’s General Fund, and the remaining $84 million will be used to service debt taken on by the Town to make the improvements.
Killington will be required to submit additional documentation to VEPC as the project proceeds. The first phase of the project proposed under the TIF program will focus on installing a new $26.7 million water system that will help to provide for a clean water source and address the contamination of per- and polyfluoroalkyl substances (PFAS) that exists along Killington Road.
“Killington is currently home to approximately 70 small public water systems and many more private water sources,” said Bryan Redmond, Director of the Department of Environmental Conservation’s Drinking Water and Groundwater Protection Division within the Agency of Natural Resources (ANR). “The construction of a new public community water system to provide safe drinking water to the homes and businesses in Killington is a major step forward.”
According to Redmond, this work exemplifies ANR’s work to manage and address PFAS compounds in public water systems statewide—one reason that the Agency is supporting this project with an additional $2.3 million in American Rescue Plan Act funding from its Village Water and Wastewater Initiative.
Improvements along Killington Road are anticipated to be completed in four phases with the first focusing on addressing hazards at the intersection of Killington Road and Route 4, and improvements to the southern end of Killington Road. When complete, the road project will increase traffic capacity, improve flow and provide for greater multi-modal accessibility to Village businesses and amenities.
“Economic development for the entire Rutland County Region takes a transformative step forward with the approval of the Killington TIF District,” said Lyle Jepson, Executive Director of the Chamber and Economic Development of the Rutland Region. “I applaud the Town of Killington for being innovative and proactive in their planning and for being the catalyst for a transformative period in our region’s history.”