43°

Lake Country Weather

  • Log-in Edit profile
  • Register Logout

Advertisement

City starts work on donor TIF

March 28, 2012

City of Oconomowoc - State legislators failed to address a request from the city that would help its ailing tax incremental financing district (TIF) before the legislative session ended this spring. So the city is taking things into its own hands, moving parcels that belong to Lac La Belle Lake Management District to the Fowler district.

The move will allow the city to continue pursuing the donation of increment from one of the city's more successful TIF districts to its lagging downtown TIF. This will avoid the danger of the unpaid loan falling on taxpayers.

Last year, the city announced it had discovered a way to help its downtown TIF ensure on-time or even early repayment: if language was amended in state law which allows for one TIF district to donate to another if the districts have the same taxing jurisdictions. TIFs 3 and 4 do partially overlap, except for 23 parcels in the Lac La Belle Lake Management District in TIF 4.

The city was working with state Sen. Joel Kleefisch and state Rep. Neal Kedzie to amend the law to allow for the exclusion of sanitary districts and lake management districts from participation in tax incremental financing if a city requests it. However, the request was not considered before the session concluded.

TIF history

With the lack of anticipated development downtown, TIF No. 4 has been struggling. So far $6 million of the $13 million designated for the district was spent on the Wisconsin Avenue reconstruction.

The TIF is set to close out in 2030, and while that seems like plenty of time, this spring the city learned that the state has changed the way it calculates the equalized value of TIF districts.

The change in method dropped the downtown TIF values by 12 percent from 2009 to 2010. The equalized value for the downtown TIF was about $69.4 million in 2009 and about $61.1 million in 2010. The increment the city is collecting on the district dropped from $20.3 million in 2009 to $12 million in 2010, a nearly 40-percent decrease.

In sharp contrast, the Pabst TIF sits at more than $275 million, an increase of $269.2 million from the base value of $6 million that the property was assessed at in 2001 when the district was created. City Administrator Diane Gard said that even with no more development, the TIF would likely be paid off ahead of the 2017 end date.

City Finance Director Sarah Kitsembel said that for the downtown TIF to close by 2030, the city would need $25 million in new development by the end of 2012. With this news, the city begin to explore other possible options to help and discovered the donor TIF.

What is a TIF?

Tax incremental financing districts (TIF) provide ways for communities to promote tax-base expansion by financing public improvements in certain areas. The money for public improvements does not come out of the city's general fund, but from the increased value of the real estate after improvements to the designated district. If the incremental increase in taxes falls short of the money borrowed, then the city would have to use alternative revenue sources to pay the debt service, such as increased city taxes.

New plans

Gard said in an interview last week that the city will request approval by the Joint Review Board and Common Council to move the 23 parcels, which she said are in the area of North Lake Road "from around Splash (martini bar) to City Beach." Once that is approved, the city can use any increment that comes in from Pabst Farms TIF 3 to help downtown TIF 4. She said there is potential that both TIFs could close out earlier, which is better because the tax dollars will then return to the city's tax base.

This site uses Facebook comments to make it easier for you to contribute. If you see a comment you would like to flag for spam or abuse, click the "x" in the upper right of it. By posting, you agree to our Terms of Use.

Special Sections

See all special sections

 

2014-15 "Destination Oconomowoc" special section:

 

Weekend Happenings

Featured this week:  

Musical Theater Audition Workshop: 1 p.m. April 18, Lake Country Playhouse, 221 E. Capitol Drive, Hartland. April 18 workshop is held from 1-4 p.m. for ages 16 and up April 19 workshop is held from 11 a.m.-2:30 p.m. for children ages 8 to 15. Tuition is $85 per session. Enroll via email broadwayplayground@gmail.com

Chris Kohn: 9:30 p.m. April 18, Delafield Brewhaus, 3832 Hillside Drive, Delafield. Kohn’s original music is a  blend of acoustic rock, funk, jazz and soul. For information call (262) 646-7821.

Jeremy Allen’s Grand Illusions: 2 p.m., 6 p.m. April 18, Hamilton Fine Arts Center, W220 N6151 Town Line Road, Sussex. Allen performance includes live tigers, death-defying escapes and awesome illusions. $0-$50. hamiltonfineartscenter.com

 

Wisconsin Poet Laureate Kimberly Blaeser: 10:30 a.m. April 18, Delafield Public Library, 500 Genesee St., Delafield. Blaeser will discuss poetry, answer questions, and sign books. Blaeser is a UW-Milwaukee English professor of Anishinaabe ancestry. Free.

Updates to this calendar are made weekly Monday afternoon. 

 

All weekend happenings.