WATERVILLE $ City councilors on Tuesday will vote on proposed changes to a tax financing district off Upper Main Street.

The meeting will be held at 7 p.m. in the council chambers at The Center.

It will be preceded by a private session at 6:15 p.m. to discuss a tax abatement; a public hearing at 6:30 p.m. to discuss a Community Development Block Grant for downtown revitalization; and a public hearing at 6:45 p.m. to discuss the Upper Main Street tax district.

The area off Upper Main Street from McDonald's restaurant north to Interstate 95, including Wal-Mart and The Home Depot and commercial properties across Main Street, is a tax increment financing district, also known as a TIF district.

In such a district, part of property taxes paid from that district is returned annually to the owner. TIF districts were created to reward new development.

Councilors Tuesday will consider expanding the TIF district to include 10 parcels behind the Holiday Inn and Pine Tree Mall and extending to Industrial Road, City Manager Michael Roy said Monday. Developer Robert Rosenthal is asking for the tax district change, he said.

As part of the changes, some parcels will be removed from the credit enhancement agreement that is part of the current TIF district, Roy said.

The Upper Main Street TIF district was created in 1996 and some properties were included in that district that should not have been included because they are not owned or controlled by the developer; in this case, Rosenthal, according to Roy.

In 1999, the city redefined the TIF district to exclude the properties not controlled by Rosenthal, but revenues from them continued to go back to him every year.

With the proposed TIF district changes, the city asks that those properties be taken out of the credit enhancement agreement, Roy said.

"Now, he (Rosenthal) is agreeing to that," he said.

Making the changes to the TIF district would benefit the city and save it money, Roy said.

"The city's very interested in doing this because we recognize the value of supporting commercial growth in the area and there is the opportunity to remove properties that never should have been included in the first place," he said.

Roy said he does not expect Rosenthal to attend Tuesday's meeting, as he is out-of-state.

Councilors must take three votes on the TIF district changes and may take one or two votes Tuesday, but the third must be taken at a later meeting.

Roy said he plans to meet with the city's TIF Advisory Committee sometime after Tuesday's meeting and before the next council vote to explain the proposed changes.

He said maps will be available at Tuesday's meeting that show the current TIF district and proposed changes.

Amy Calder $ 861-9247
acalder@centralmaine.com