Auburn City Council members on Monday drew a boundary around three downtown blocks south of City Hall, a move they hope will help secure state funding for the $8 million South Division Street Promenade project and other related infrastructure improvements in the Transit Center area.

Within the newly created “Auburn Revitalization Area” the City plans to rebuild three blocks of South Division Street, including roadway pavement. Plans also call for crosswalks, sidewalks on the west side of the street, street trees and tree grates, potted plants, pedestrian and street lighting, city-owned fiber conduits, storm drainage improvements for street drainage and aesthetic improvements.

These amenities will be part of the Auburn Junction proposed by Alpert International.

No member of the public spoke for or against the revitalization area at the public hearing that preceded the vote.

Drawing such a boundary is required of cities that wish to be eligible for local revitalization funding, as authorized under State Senate Bill 5045, which Gov. Christine Gregoire signed into law in April. State lawmakers found that such development activities generate revenue for the state, and that it is in the public interest to invest in these projects through a credit against the state sales and use tax to those local governments that can demonstrate the expected returns to the state.

Auburn’s project would be eligible to receive $250,000 each year over a 25-year period with a match.

“It is a credit against existing state sales and use tax, like our current annexation tax credit,” Karen Jester, utility and accounting service manager for the City of Auburn told the Council. “It is important to point out that this financing is not a new tax or tax increase to any citizen or business.”

“One of the first things the feds, the state and other awarders of money do is ask you to define the area in question,” said Dave Baron, Auburn’s economic development manager. “They demand really specific, and in some cases microscopic, detail about how you draw the borders and where. When the state does tax-credit-type programs, it needs to know physical addresses so it can contact the people who will be affected.”

“(This) is about more than the Promenade project in terms of geography, but it would be applied to it,” Baron said of the revitalization funding.

The newly named revitalization area is bounded by Highway 18 to the south, the Union Pacific Railroad to the west, Third Street Northwest to the north E Street Southeast to the east.

City officials also expect to fund the Promenade with a $3 million Economic Development Administration (EDA) grant and the balance by issuing general obligation debt.

The date when the use of local property tax allocation revenue and other revenues from local public sources for local revitalization financing begins would be no earlier than July 1 2010, depending on the timing of other grant funding.