Commissioners take up large infill redevelopment and tax incentive request
The Fargo Board of City Commissioners is set to debate a high-profile economic development package Tuesday that would reshape a large underused parcel south of downtown and test the city's approach to redevelopment incentives.
At issue is an application from COVE Living LLC, developed by RDG2 LLC and associated with developers James Roers and Shannon Roers Jones, requesting a 100% Payment in Lieu of Taxes (PILOT) exemption for 10 years on a proposed $61.6 million infill redevelopment. The request will be heard during the regular public meeting at 5 p.m. in the City Commission Chambers following an executive session scheduled for 4 p.m.
City officials noted that open discussion of the pending lawsuit would adversely affect the city’s financial and bargaining posture.
That executive session is listed as a closed-door consultation with legal counsel over litigation tied to James Ingstad, et al. v. City of Fargo (Case No. 09-2026-CV-03405). Officials cited potential harm to the city's legal and financial position if the lawsuit were discussed publicly.
Project scope and financial analysis
The proposal targets a 13.75-acre parcel at 300 45th Street South currently occupied largely by surface parking — about 1,100 spaces under the current configuration. In their place, developers would build a 6.5-story wood-frame structure atop a precast concrete podium containing:
- 229 residential apartment units
- 15,507 rentable square feet of commercial space
- 96 enclosed on-grade parking spots
The project is designed to connect to a neighboring commercial campus being repurposed as the Center of Innovative Ventures & Entrepreneurs — branded “COVE.”
| Item | Figure |
|---|---|
| Project cost | $61.6 million |
| Parcel size | 13.75 acres |
| Residential units | 229 |
| Commercial space | 15,507 sq ft |
| Existing surface parking | ~1,100 spaces |
| Proposed enclosed parking | 96 spots |
Economic justification and tax trade-offs
The city engaged consultant PFM to run a “but-for” analysis examining whether the project would move forward without incentives. PFM determined the development was unlikely to proceed absent public assistance, concluding that the developer’s internal rate of return (IRR) over 10 years would be approximately 7.69% without incentives and about 9.74% with them. PFM noted market norms generally fall between 10% and 15% for comparable projects, which frames the request as an attempt to shift the IRR closer to market levels.
City staff estimate the full gross property tax benefit over the 10-year period would be nearly $8.4 million.
The City’s Economic Development Incentives Committee (EDIC) reviewed the application and voted unanimously to recommend approval to the City Commission. That endorsement places the main policy question before commissioners: whether a decade-long, full tax exemption on a sizable private development is an appropriate use of municipal authority and public dollars.
Local impact and considerations
Proponents argue the project converts low-value surface parking into higher-density housing and active commercial frontage, potentially increasing long-term property values and supporting the adjacent COVE innovation hub. For residents, the development would add rental inventory and commercial storefronts but reduce publicly available surface parking.
Opponents of generous PILOTs often point to short-term reductions in tax revenue, concerns about setting precedents for future requests and the fairness of using public incentives for projects that may attract higher-income tenants. The PFM analysis — showing a projected IRR under typical market thresholds without help — will be a central piece of evidence in that debate.
Commissioners will also weigh this request amid other agenda items including broader redevelopment incentive policies and long-range infrastructure investments, all of which shape Fargo’s fiscal trajectory.
The meeting begins with an executive session at 4:00 p.m. in the Red River Room, followed by the public hearing at 5:00 p.m. in the City Commission Chambers, where public comment and the formal vote could determine whether the PILOT moves forward.
