ABOUT TWO MONTHS after a motion to issue the bonds were passed, city officials are now negotiating the rates for bonds that will reimburse developers for infrastructure improvements made on one of Ridgeland’s most prominent developments.

On January 6, the mayor and board of aldermen approved a measure to issue $35 million in tax-increment financing (TIF) bonds to repay the builders of Colony Park for installing infrastructure, such as roads, for the project - a cost normally incurred by the city.

For the next 20 years, a portion of the taxes generated from the $390 million development will be used to repay the debt. While no one argued that the bonds were needed, some board members were concerned about how long it would take to pay them back.

Some on the board wanted the bonds to be retired over the next 15 years, instead of the next 20. Regardless of the disagreement, Ridgeland Mayor Gene McGee said it’s a small price to pay for such a huge investment in south Madison County.

“It has nine office buildings, two hotels, seven banks, four state headquarters, nine restaurants, 900,000 square feet of office space, and a half a million square feet of retail space,” he said. “I’m comfortable that it’s a 20-year development.”

THE CITY entered into an agreement with H.C. “Buster” Bailey and other developers of the Colony Park project years ago to issue the TIF bonds when needed. Developers spoke to the board earlier this month saying they needed the bonds to move forward.

TIF bonds are generally issued by a municipality to cover infrastructure costs incurred by the developer when putting the project in and are paid back over time by the city with a portion of the new sales and property taxes generated by the development.

Ridgeland also issued a $5 million TIF for the Lowe’s project on County Line Road.

Ridgeland City Clerk David Overby said about half of the sales and property tax from Colony Park will cover the TIF repayment, but money generated for the Madison County School District won’t be affected.

He said the school district doesn’t participate in the TIF and will likely get close to a million a year in revenue generated from Colony Park. That amount will increase again if and when the 200 Renaissance Building is completed.

Although exact numbers weren’t available, McGee said sales tax figures for the 2008-09 fiscal year are up about 6.5 percent. He said it’s difficult to determine how much more is being generated in the way of property taxes as a result of Colony Park.