AUBURN – City councilors will consider a proposal to establish a new tax increment financing district at their Oct. 15 meeting, a critical next step in bringing a Marriott hotel to the city.

“It won’t happen otherwise,” said Roland Miller, the city’s economic development chief.

Local officials revealed plans to bring a Marriott hotel near the Auburn Mall in May, a collaboration between hotel operators Ocean Properties and local developer George Schott. The hotel is likely to be a Marriott Courtyard. Final negotiations are under way, Miller said.

Significant to the project is a mechanism for spreading out the development costs, called a tax increment financing district. Councilors will be asked to remove 1.5 acres from the existing TIF No. 9, which was approved for road improvements to the Turner Street/Mount Auburn Avenue area, and submit it to the state for approval as TIF No. 15.

The new TIF will not cost the city any more money, Miller said. It would fall under the existing terms of TIF No. 14, the $3.3 million reimbursement to Schott that was approved in 2006 to help cover his upfront costs to develop retail centers near the intersection. As new development adds to the city’s tax base, Schott is reimbursed a percentage of the $3.3 million until he receives the entire amount or until the TIF expires in 20 years.

The 1.5-acre parcel, wedged between the vacant Androscoggin Plaza and the new Turner Street roundabout, would be added to the 1.7 acres on which Androscoggin Plaza sits, to create a parcel big enough for a hotel. The plaza that once housed Androscoggin Bank, AAA and a photo-finishing business would be demolished to make way for the hotel.

“Within TIF 14 we projected a financial plan for the realization of a hotel,” Miller said. “There’s not one cent of additional obligation from the city (with TIF 15).”

If the city could simply add the 1.5 acres to TIF 14 without any adverse effects, it would, Miller added. But state law says that any expansion of an existing TIF district requires all new assessments and resets the reimbursement clock back to zero. Under that scenario, Schott would lose credit for the investments he’s already made, Miller explained.

He expects the measure will get council support when it appears on the Oct. 15 agenda. Miller noted that all the development costs of the hotel – site preparation, construction, road links, wetland mitigation and more – will be paid by Schott.