Kincora Seeks CDA to Finance Roads

With eyes on getting roads tied to the approved Kincora development sooner rather than later, the Loudoun County Board of Supervisors agreed to examine a proposal to fund some of those projects with a community development authority, or CDA.

A CDA, essentially a special tax district set up to pay for infrastrcture, paid for the roads around the Dulles Town Center.

While a CDA previously was considered for the property, that earlier proposal included the approved stadium ­– where the Loudoun Hounds will play – as well as the major roads in and around the development, the new proposal scales that plan back. The portion of the plan under consideration by the county would allow a CDA bond issue of $27 million, which would be repaid through assessments on nonresidential property, to pay for the Russell Branch Parkway extension and a portion of the Pacific Boulevard extension.

The new proposal aims to dovetail with a request by the developer, Norton Scott LLC, for a low-interest state-subsidized loan. However, one option requested by Norton Scott is the ability to apply for the state loan through the CDA, rather than obtaining a direct loan. Regardless, that $39.3 million loan would pay for improvements to Gloucester Parkway, completing a key link between Ashburn and the Rt. 28 corridor.

The state loan would be repaid with capital facilities proffers for the residential units associated with Kincora, under the request.

Supervisors expressed concerns about the request to apply for the state loan through the proposed CDA, but Loudoun’s deputy CFO Ben Mays said he was focusing on the request for the Russell Branch and Pacific improvements.

“That is indeed what their letter said,” Mays said regarding the request to back the state loan with the CDA. “Their letter also said they are getting a direct loan.”

Mays pointed to a diagram in the staff report that showed the two separate lines of funding: the state loan for Gloucester appeared on the left side, while the CDA for Pacific and Russell Branch appeared on the right.

“We have suggested the CDA on the right side of the diagram is worth pursuing,” Mays clarified. “We have not opined about whether the left side if worth pursuing. Their concern is at the end of the day is that all of their support to pay back the state loan will be insufficient and they will need the CDA to pay the state back on the back side. We’re not thrilled with that concept.”

Supervisor Jim Burton (I-Blue Ridge) said he opposed allowing Kincora to use the CDA to back the state loan.

“I believe the county should not be involved with the financing of this project,” he said. “It is unfair to lend our name or assistance to one developer and not to the others.”

After Mays explained that the staff only supported examining the small portion of the proposal, he said the change of heart from previous concerns about using a CDA centered on the size of the proposed bond issue.

“Part of this whole issue is scale,” he said, adding that the county staff believes “the scale is manageable enough” and that the project is likely to generate ample revenue to pay for debt streams.

Burton presented fellow supervisors with some information about CDAs elsewhere to which Supervisor Stevens Miller (D-Dulles) objected because he had not had time to review the information before the discussion.

“I feel sandbagged and I wish that you had let us see this sooner,” Miller said, questioning whether Burton aimed to do the right thing or score political points.

County Chairman Scott K. York said supporting the item would only authorize further examination.

“This is a look-see only and will be paid for by the applicant,” he said, adding that it may fail to pass muster. “But if it all works, we get Pacific and Russell completed up front. If the other part of this works, we get Gloucester up front.”

Only Burton opposed moving forward.