Chance to reshape ‘our identity and economics’ long into the future
COVINGTON, Ky. - The City of Covington will soon own 23 acres of land once described by an East Coast commercial developer as one of “the most exciting land redevelopment opportunities between Baltimore and New Orleans.”
In an emergency meeting held today and called on Wednesday, the Covington Board of Commissioners authorized Mayor Joe Meyer to sign papers formalizing the agreed-to-purchase price of the site of the Internal Revenue Service’s shuttered paper-processing facility, which sits between Third and Fourth streets just west of the Northern Kentucky Convention Center.
City officials were ecstatic and talked about the impact on Covington decades from now.
“It would be difficult to exaggerate the magnitude of this opportunity,” Meyer said. “The size and value of this site and its potential for development awards Covington the chance to reshape the very identity and economics of the city long into its future.”
The 3-1 vote directs Meyer to accept the negotiated sales price of $20.5 million offered through the federal General Services Administration.
The City tapped into its unobligated fund balance to deliver 10 percent of that price - i.e. “earnest money” - to the federal government as required by the agreement, City Manager David Johnston said. The City will issue general obligation bonds to recoup that payment and pay the overall purchase price.
City officials heaped praise on Northern Kentucky’s representative in Congress, Thomas Massie, for helping the City acquire the property and get the price reduced from the GSA’s earlier appraisals.
“We simply could not have done this without Congressman Massie,” Meyer said. “We had many conversations and meetings with him and his staff, and his constant engagement, leadership, support, and knowledge of the process not only helped us navigate the corridors of federal agencies but also saved Covington taxpayers a significant amount of money at the same time.”
Johnston said Covington residents were fortunate not only that Massie is a member of the House Committee on Transportation and Infrastructure - which oversees the disposition of federally owned properties - but also that the Congressman dedicated himself to helping Covington.
“He really went out of his way,” Johnston said.
The city manager said Covington worked to keep the offices of Kentucky’s two senators -Mitch McConnell and Rand Paul - informed throughout the process.
The City called today’s emergency meeting late afternoon yesterday in order to meet the GSA’s submission deadline. Commissioner Shannon Smith was out of town on business and unable to attend.
Covington will spend the next three months securing the title to the property - dotting proverbial “I’s” and crossing “T’s” - and planning the long and expensive process of physically preparing the site for the market, Johnston said.
He said the City hoped in the coming year to begin demolishing the expansive, one-story building, which takes up about 17 acres. But he expected full site preparation to take three years or so, including demolition, reestablishing a street and sidewalk grid, and running utility infrastructure -- such as water, sewer, gas, electric and telecom - as needed.
The City began negotiating with the GSA in mid-December but had been working on the effort for a long time.
The IRS closed the facility last September after serving notice of its intent in fall 2016, ceasing operations after 52 years. In late 2018, Covington hired Atlanta-based global architecture and design firm Cooper Carry to help it secure ownership of the site and to create a conceptual master plan - a “vision” - for how it could be developed.
Cooper Carry led a year-long effort that relied heavily on market studies, the City’s needs, and public engagement, offering residents and other stakeholders dozens of opportunities to weigh in on the plan.
In December, officials from Cooper Carry and its team attended a City Commission meeting to deliver and explain a final report that incorporated elements of three conceptual scenarios shown to the public earlier in July.
The “vision” - which Johnston said would serve as a guide for development and can be seen HERE
- included a restored street grid, a levee park, a community plaza for festivals, and a mixture of buildings containing offices, retail shops, and places to live.
Officials said it was critical to look at the conceptual plan in the context of the goals and strategies outlined during the consultant’s conversations with City officials, the business community, and Covington residents:
- Jobs and tax revenue from a variety of workplace environments.
- A mixture of uses and outdoor spaces.
- A walkable and drivable street grid.
- Enhanced connections to the Ohio River.
- Integration with surrounding neighborhoods and business centers.
- A flexible framework to accommodate market demand and proposals.
Using a model that foresaw development of the site in stages, Cooper Carry’s team projected that - as of 2027 - the site could create 1,159 permanent jobs and 1,651 temporary construction jobs. The former alone would bring an estimated $1.7 million in payroll taxes. Subsequent development of the rest of the site would create even more jobs.
“Jobs are the key,” Johnston said. “What goes on this site can’t just look pretty - it has to pay off for the Covington taxpayer. The bonds add debt to the City, and it creates a moral obligation for us to pay that debt down as quickly and efficiently as possible. I want Covington taxpayers to know two things: One, we are not going to sit on this but work diligently to get it developed as quickly as is feasible. And two, the City is going to solicit the best deals and get the best return on investment it can for the entire Covington community.”