City takes first step to create TID 14
The city of Medford is looking to use a development tool to boost a proposed housing project on the city’s south side.
On Monday, representatives from the city, county, school district and technical college district met for a Joint Review Board to formally start the process to create Tax Incremental Finance District No. 14. The proposed mixed-use district will include the city-owned land along Pep’s Drive as well as the Marathon Cheese parcel and extending down the south side of Jensen Drive to the intersection with Gibson Ave. Altogether it includes about 105 acres of land and buildings.
The proposed district is driven by the need to create additional housing for current and future workers in the community. The city owns a large parcel on Pep’s Drive located south of CTH O, which was originally planned for industrial expansion. In an initiative spearheaded by the Medford Area Development Foundation and in partnership with the city, a 64 unit apartment complex is planned for the northwest corner of that parcel with the hope to lead to additional apartments in the adjoining space. The south end of Pep’s Drive, which borders a branch of the Black River is being planned for single family homes.
TIDs are financing tools which allow the city to keep the portion of the property taxes on improvements to the property that would normally go to the overlying taxing entities including the school, county and technical college district. The districts would still receive the base level of taxes on the parcels but the portion on the improvements would go to help pay off the debt associated with developing the area.
The city has been successful in using TIDs for economic development efforts with the most striking success seen in TID 12 which includes the Marathon Cheese facility.
According to Brian Reilly of Ehlers and Associates, the firm assisting the city with the TID creation and management, in recent years the city has been unable to create additional TIDs because the existing districts accounted for more than 12% of the value of the equalized value of the city.
“TID 12 is the lynchpin given its substantial value,” he said, explaining that this is a good issue to have since it shows they are growing. In order for the city to create a new TID, it will have to close other ones, Reilly said the plan is to close TID 12 and TID 8 which when taken out of the TID pool will bring the city below the threshold by about $3 million.
Bringing the base value of those TIDs onto the general tax rolls, Reilly said would have less of an impact on Taylor County and Northcentral Technical College because they are so much larger. “It is meaningful for the city going into the next fiscal period,” he said.
Board members also reviewed the project plan. Every TID has a project plan which is a sort of wish list of allowable projects that TID funds can be used to do.
The largest proposed expenses are for water, sewer and road right of way improvements in the district.
Proposed projects and their estimated cost include: 1 Single Family Housing Subdivision Infrastructure in 2022 $750,000 2 Sewer and Water upgrades in 2022 $300,000 3 Parks Amenities in 2024 $200,000 4 Development Incentives in 2024 $100,000 5 Bicycle Paths in 2024 $215,000 6 Well #14 in 2026 $650,000 7 Commercial Spec Building in 2030 $500,000 8 Progressive Avenue Resurfacing in 2030 $250,000 9 Land Acquisitions in 2030 $400,000 Total projects are expected to add up to about $3.365 million over the life of the district.
“Just because it is in the plan doesn’t mean it is going to happen,” Reilly said, assuring board members that the city council will have to approve each project as they come up before they can take place.
Reilly said at this point the project plan is more a feasibility analysis to show that the level of revenue projected to be gained from the district would be sufficient to recover the cost.
The JRB review of the project was just the first step in the creation of a new TID. No formal action was taken by the JRB at this time, but the body will need to vote on it at a future point in the process. The goal is to have the TID in place by the end of March.
Following the Joint Review Board meeting, the Medford Planning Commission met and held a public hearing on the proposed TID 14 plan. Reilly went over the TID project information and walked the commission members through the plans.
He explained that the life of the TID will be 20 years with the city able to expend funds on projects within the first 15 years.
Reilly noted the projected increment increase for the district is projected to be about $15 million over time, which will generate enough tax income to pay off the debt service for the money needed to complete the project plans.
During the planning commission meeting, member Peggy Kraschnewski raised concerns about traffic flow in the area, specifically entering and leaving Pep’s Drive. She noted the plans call for up to eight 16-unit buildings as well as single family homes. She asked if the city considered adding turn lanes on CTH O near the Pep’s Drive intersection.
City coordinator Joe Harris said there is already additional turning space in that area and that they had taken it into account in their planning.
Planning commission members gave the TID 14 plan unanimous support with member Dave Zimmerman absent.
Future steps in the process will be formal approval of TID 14 by the city council on March 14 with final action by the Joint Review Board the next week.
