Project may be part of newly developed TID
By Bert Lehman
A proposed new Tax Incremental District and rezoning for a housing project moved forward and is closer to reality.
An open public hearing was held by the Clintonville Plan Commission on Jan. 25 to discuss the creation of a new TID.
Maureen Holsen, a representative from Ehlers, the city’s financial adviser, told the commission and the residents in attendance that a year ago the city of Clintonville was not in a position to create a new TID because the state limits TIDS to 12 percent of the city’s equalized value.
For Clintonville, that equated to around $25 million, and at the time one of the city’s TIDs had a valuation increment of $32 million.
“You were capped at being able to open up tax incremental districts,” Holsen said.
Clintonville closed all of its TIDs in 2017 so the opportunity arose for the city to create a new TID.
Since the closure of the TIDs, the city was approached by and has been in discussions with a developer about a multi-family residential project, Holsen said.
In an effort to move that project forward, the city is proposing the creation of a new TID near the city’s industrial park.
The residential development project would include four 12-unit buildings. Each unit would be two-story townhouse-style apartments that would have two bedrooms and an attached garage.
Hoslen said the developer would construct the buildings in one phase. The development would add about $4 million of new value to the city. Construction would begin this spring and be completed by the end of 2019.
“This new residential development would provide housing opportunities for workers in the city as well as diversify the housing stock for both young professionals and senior citizens that are looking to downsize,” Holsen said.
About $920,000 of costs would be expected to be incurred over the life of the TID. This includes $726,000 of a developer’s incentive, as well as project costs for three proposed projects within a half-mile radius that would benefit the TID. Administrative costs would be expected to be about $200,000 during the life of the district, Holsen said.
“All the costs that are included here allow them to be eligible TID expenses, which allow them to be paid for with TID revenue,” Hoslen said. “It’s not a commitment or requirement to move forward with these costs. And all of the costs and the developer’s agreement still need to come before the council for final approval.”
Potential projects within a half-mile radius that could also be done as part of the TID include:
• 16th Street reconstruction and sidewalk in 2018 at a cost of $50,000
• Ditch work by Creative Converting in 2019 at a cost of $40,000
• Reconstruction of Grant Street in 2020 at a cost of $60,000
These costs would be paid with TID revenue.
“This additional value will more than fully support these expenses, and the district is projected to close about halfway through its maximum life,” Holsen said.
Clintonville City Administrator Sharon Eveland added: “The TID revenue is what is generated by the new development. The new development will be paying property taxes based on their value. The funds that are generated from that will pay for the developer incentive and the half-mile radius projects. It’s basically money that we don’t have to pull out of our general fund or borrow.”
If the proposed TID is approved, the city could still change its mind about doing the projects within a half-mile, but they were included in the proposal because if they were to be added later, there would be an extra cost to add them to the TID, Eveland said.
The proposed TID would be approximately 23 ½ acres, Holsen said. Roughly 6 acres of that would be used for the apartment buildings.
The TID would be recognized as a mixed-use district because the land would be allowed to be used for two uses – residential and industrial. Currently the only proposed new project involves residential use.
The area is located south of the city’s industrial park. The northeast boundary starts at Spring Street. The eastern boundary line goes along Industrial Avenue and crosses over to 16th Street. The western boundary is just prior to Grant Street.
It is estimated that 70 percent of the TID would be used for industrial purposes, with the remaining 30 percent for residential use.
Eveland said the majority of the land in the proposed TID is currently empty lots. A couple lots have businesses located on them.
“The two that are being looked at for actual development are city-owned, unimproved lots,” Eveland said.
Eveland added that the proposed new TID would not displace any businesses or residents.
The name of the developer for the apartment buildings is not being released because it is considered confidential information until the city council has reviewed the developer’s agreement, Eveland said.
“I can tell you that it is a large, well-known company that has done a lot of developments,” Eveland said. “It’s not a small [company] or somebody who has not done this before.”
After an open public hearing, the Plan Commission approved rezoning parcel 30-24-31-8 from I-1 Industrial to R-3 Multi-Family District. This approval was needed for the proposed new housing project to move to the next step.
The Plan Commission also approved designating proposed boundaries and a project plan for Tax Incremental District No. 8 in the city of Clintonville.