After TIF fails, Branson Adventures team undecided on next move

David Cushman: The board misunderstood CP Branson’s financing plan.

Developers of the proposed Branson Adventures resort might still have a fighting chance to pull off the project, but the team likely will have to scale down the venture if not altogether drop their efforts to secure public funding.

The Branson Board of Aldermen recently denied a tax-increment financing plan for the project that called for the use of roughly $115.6 million in public funds, secured mostly through property and sales tax revenue.

The revenue would have covered nearly a quarter of the estimated $446 million total project cost to build a whitewater rafting course and a 465,000-square-foot indoor waterpark resort – the largest component of the concept, costing some $157 million. Other project attributes include luxury cabins, a rope course and mountain bike trails.

During its April 24 meeting, the Branson Board of Aldermen generally appeared supportive of the project, just not the public funding. The board ultimately voted down the financing plan 5-1, though the plan could be reintroduced after Oct. 24, according to city Communications Manager Melody Pettit.

The next steps for Branson Adventures remain in limbo. Lead developer David Cushman, principal of CP Branson LLC, said plans moving forward could include downsizing the financing proposal or taking the plan to another city.

“We haven’t made a decision as to what our future plans might be in the Branson marketplace,” said Cushman, who reportedly fell ill and missed the meeting.

Troubled TIF
Branson City Administrator Stan Dobbins, a public supporter of the project, said the complex, 228-page revised TIF proposal was largely misunderstood, despite weighty efforts to boil down the financing.

“I think they did everything they possibly could to explain it,” Dobbins said of the development team. “I wish they would have had more public meetings. I still to this day have people who don’t understand that the taxes only come from that property.”

Dobbins said the proposed tax revenue would have come only from future site development and sales within the 300-acre project site along highways 76 and 376, on Branson’s west side.

Three overlaying districts, Cushman said, would have been created there: a TIF district, a community improvement district and a transportation development district. Tax revenue used to fund Branson Adventures would have come collectively from just those three districts, not the city or county at large.

Cushman said the percentage of allowable property taxes diverted from the 300 acres would have dropped to 75 percent from 100 percent by year 11, and to 50 percent by year 18.

Overall, he said, some $25.4 million in additional property tax revenue would have been delivered to the Branson School District throughout the 23-year lifespan of the TIF.

“It appears that many people believed that the city was going to be losing tax revenue out of their current budget from other parts of the city,” Cushman said. “And that’s not how a TIF works.”

Risky business
The city would have rolled the dice by approving the TIF plan, Dobbins said, but by and large, the financial risk would have been on the development team. The city would not have contributed funding to secure secure revenue bonds backed by the financing, he said.

“TIFs are very complex, and sometimes, we maybe get caught up in a little bit of minutia with them,” he said. “As far as the city, financially, we had no dog in the game backing the bonds.

“All of the financial risk, from that perspective, is on the developer,” Dobbins said, later adding: “They would have to go out and get their own bonds to finance this project. ... If the project failed, there would be no tax revenue.”

On the city’s end, however, public costs would have surfaced for construction and maintenance of public infrastructure, such as water and sewer lines, and city streets, Dobbins said.

The developers forecasted up to 600,000 new visitors annually to the Branson market if the project came to fruition.

If the resort ultimately failed, however, the city still would have been on the hook for the added infrastructure and personnel costs, Dobbins said.

Muddy water
Asked whether city staff and the Board of Aldermen adequately explained the proposed TIF plan, Dobbins declined to comment.

To that end, alderwoman and vice mayor Betsy Seay said the task of explaining the project fell solely on the developers. Seay presided over the April 24 meeting with Mayor Karen Best being absent. Best could not be reached for comment.

“I think we explained it the best we could, based on the information the developer was giving us,” Seay said, later adding the development team refused to elaborate on certain project details, such as unnamed future developments and lodging occupancy rates.

“The board can only relay what the developer gives us in public meetings,” she said.

Meanwhile, Cushman said just one seated alderman, Bob Simmons, agreed to meet face-to-face and discuss the proposal before the full dais was set to vote on the TIF plan. Prior to being sworn in, Bill Skains also met with Cushman.

“The public at large probably misunderstood the TIF plan, because it’s a very complicated project,” Cushman said. “And, I think, the aldermen ultimately misunderstood the TIF plan.”

Yes and no
During the April 24 meeting, the “no” camp outweighed project supporters during the meeting by a 3-to-1 margin, with nearly 20 residents speaking on the issue.

Project opponents stood ground on talking points ranging from inconsistent project information and a cannibalization of existing businesses to a general distortion of the free market. Each point appeared rooted in unfair public financing for the project.

Some claimed to have no issue with competition. Those who spoke publicly during the meeting ran the gamut of Branson businesses, representing the tourism, hospitality, live entertainment and attractions industries.

Most seemingly agreed that Branson faces a challenging future but others, such as Branson/Lakes Area Lodging Association President Jay Wilson, simply couldn’t bite on proposed public financing.

“Our strip is suffering, and we’ve got to find a way to improve that,” Wilson said. “But I’m not sure that this project is the way.

“It’s bigger than all of the hotels in Branson combined,” he later added, taking note of the nearly half-a-billion dollar price tag and the financial commitment of the public being too risky.

Bill Tirone, general manager of the Hilton properties in Branson, compared detractors of Branson Adventures to those of Branson Landing. The outdoor retail center opened in 2006 on the banks of Lake Taneycomo at a project cost of $420 million and a $176 million TIF, according to city Finance Director Jamie Rouch.

Recalling initial skepticism of the now 12-year-old development, Tirone said, “If Branson is to grow, we need to offer incentives to developers that will give our current visitors another reason to come back, but also to give new visitors a reason to try our market.”

New Alderman Skains, who declined Springfield Business Journal’s interview request, lodged the lone supportive vote for Branson Adventures’ proposed TIF plan.

“I think Branson is not moving forward in the right direction,” he said before the vote. “I think (Branson Adventures) will add to this community. I don’t think it will take away.

“We are so negatively affected,” Skains added, “by this negative thinking we have here.”