D & D Development, who is developing the land out across from Piggly Wiggly, has requested consideration for additional TIF assistance for the commercial portion of their development. ----Mason Braunschweig, Tom Cothard, Diane Roberts, Adm. Dan Wietecha, Eric Jepperson and Mayor Sandy Decker discuss the issue.
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John Morning did not receive any TIF assistance to put in the new street, sewer, water main, etc. for the new Ace Hardware, Bank of Evansville, small "strip mall," etc. Why should the city give TIF assistance to D&D Development, just across the highway from John Morning's lots, to put in the street, sewer, water main, etc. for their new commercial lots. If the city agrees to give such assistance to D&D Development, shouldn't John Morning be able to come back to the city and ask for his share?
ReplyDeleteThat being said, it might be a good deal for the city to give some TIF assistance to D&D Development for streets, sewer, water main, etc. for their new commercial lots IF AND ONLY IF D&D Development guaranteed that the new INDUSTRIAL lots in the TID would generate a certain amount of tax increment revenue (or else D&D would make payments to the city for the shortfall in projected industrial tax increment revenue). The Economic Development Committee discussed such a concept for a deal at a meeting that was attended by a representative of D&D. Why hasn't D&D come forward with a proposal along these lines?
Bill Connors
Former Evansville City Administrator
Bill did John Morning ask for tif?
ReplyDeleteI do not know if John Morning asked for TIF assistance originally. But he has asked the city more recently, arguing that if D&D Development receives it, he should receive it to be fair.
ReplyDeleteJohn has had to recover his investment in street, sewer, water main, etc. through the sale price of his commercial lots. Why should D&D Development not be required to do the same?
Given how prized the location of D&D's new commercial lots will be after construction of the biodiesel plant (and the possible soy bean crushing plant), D&D should be able to ask a high enough price for their new commercial lots to recover their investment in infrastructure and make a tidy profit (especially since they paid very little for the land in the first place). If the city agrees to give them TIF assistance to repay their investment in the infrastructure for the new commercial lots, D&D will be able to recover their investment in the infrastructure twice, once through the sale of the lots and once through the gift of tax dollars from the city. If this comes to pass, their profit on the new commercial lots will be obscene. And this will be true even if the deal involves pay-as-you-go financing.
I hope Mason can talk enough sense into enough of the alderpersons to keep this from being approved. It appears there are some in the city government who are so determined to make this bloom during their term in office that they are willing to sell out the future of the city to make things happen now. When I was in charge of TIF-law enforcement in Minnesota, I saw many examples of cities' giving unnecessary TIF assistance to make development happen now rather than a few years from now, driven purely by the desire of elected officials to produce results while they were in office.
Bill Connors
Former Evansville City Administrator
I seem to remember an ED meeting where it was discussed to expand the TID to include the land behind the AMOCO. The thinking was that TIF money could be used to redo the J Lindemann intersection and that it could be used as incentive to develop the land behind the AMOCO as well.
ReplyDeleteThis was before the Biodiesel plant was a done deal and we were still talking 70-30 industrial-commercial.
If we are talking about the same lot, Grumps is correct that the area of the TID was expanded to include the the BP gas station/convenience store/McDonalds and the adjacent lot between the BP gas station and the Piggly Wiggly. This was done for two reasons. First, the convenience store with the gas station might be expanded onto the adjacent lot, which would generate tax increment revenue (without any investment of tax increment). The additional tax increment revenue would be used to pay off the city's debt from development of the anticipated new industrial lots on D&D Development's property (or the cost of the new round abouts). Second, if Landmark Services determines their fuel depot located at the gas station no longer is viable (because, for example, there were restrictions placed on the intersection of J. Lindemann Dr. and USH 14, which WisDOT was discussing at one time), they might close the gas station, and TIF assistance would be needed for redevelopment of the gas station parcel. The cost of redevelopment is higher than new development on bare ground, so use of TIF assistance for redevelopment usually is justified.
ReplyDeleteI do not recall any discussion about providing TIF assitance to encourage commercial development on the lot between the gas station and the Piggly Wiggly.
Bill Connors
Former Evansville City Administrator