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<br />. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />Case #2: Discussion Re~ardin~ Extension Of Sewer And Water To <br />Industrial Area: <br /> <br />Commissioner Wagner reported that the Economic and Finance subcommittee has <br />met regarding various options for deferments and discounts for the proposed <br />assessments if the sewer and water project is approved. The preferred <br />option plan is that tax increment funds will pay for 50% of the project; <br />those paying the assessment or going on the tax rolls right away will <br />receive a 50% discount to their assessment; those going on the tax rolls <br />within the first five years will receive a 35% discount to their <br />assessment; those going on the tax rolls sometime in the second five year <br />period would receive a 25% discount to their assessment; beyond ten years, <br />there would be no discount applied to the assessment. <br /> <br />Commissioner Vevea inquired if interest would be accrued during the time of <br />deferment. <br /> <br />Commissioner Fults replied that rather than accruing interest during <br />deferment, at the time the assessment is accepted it will be based on an <br />an indexed construction cost. <br /> <br />Commissioner Ippel inquired as to how the city is going to meet the bond <br />payments by giving such liberal options for deferments and discounts. <br />Giving away too much can turn those tax increment bonds into general <br />obligation bonds. Commissioner Ippel also expressed concern with the City <br />investing too much in this project and not reserving any funds to help <br />future development projects that might come along. <br /> <br />Commissioner Fults replied that according to Mr. Hartley the City is in a <br />position of where they could pay for the entire project with no <br />assessments. <br /> <br />Commissioner Vevea stated that he is opposed to the project and proposed <br />assessments. In 1981, commercial/industrial real estate taxes doubled and <br />those properties are paying 6 times more than homestead properties for <br />taxes. Commissioner Vevea stated that commercial/industrial property is <br />already paying a rate of tax as though the improvements are already <br />installed; because of that the City should pay for the entire project. <br /> <br />Chairman Greenberg stated that a major concern expressed at the public <br />hearings is that landowners cannot afford any assessment right now. <br /> <br />Commissioner Ippel stated that approving this project will set a precedent <br />and future developers coming in will want the same favors; why the City is <br />participating in this project should be clearly defined. <br /> <br />Commissioner Vevea stated that he is not in the real estate business; he is <br />not looking at this project as a way to improve the sa1eab1ity of his <br />property; even the raise in property value created by the project will hurt <br />him and his business. <br /> <br />Mr. Hartley stated that the City is proposing to use tax increment funds to <br />EDC/November 12, 1986 <br /> <br />Page 3 of 6 <br />