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By LeAnn R. Ralph
COLFAX — The Colfax Village Board is considering ways in which the village could help Timber Technologies with a 25,000 square foot expansion.
After the expansion is completed, the village could give back to Timber Technologies half of the property tax money generated by the new construction, said Lynn Niggemann, village administrator-clerk-treasurer, at the Colfax Village Board’s February 25 meeting.
The company is planning to enclose the yard where the lumber is stored, and construction could start in April.
Sean Lentz of Ehlers & Associates, the village’s financial consultant, told the village board during a meeting in November that one method for helping the company with the expansion project would be a “pay as you go” incentive rather than the village borrowing more money,
Under pay-as-you-go, Timber Tech would pay their costs for the expansion, and the village could enter into an agreement with the company in which the village would collect the additional property taxes generated annually by the Timber Tech expansion and then pay back half of the property taxes to Timber Technologies, Lentz had explained to the village board at the November meeting.
The expansion would be assessed for property value in January of 2020 and would generate property tax revenue in 2021, Niggemann said.
“When the (property) tax money is paid in, (the village) could give a percentage back,” she said.
That way, the village would not have to finance any assistance given to Timber Technologies, Niggemann said.
Other possible ways of helping Timber Technologies could include the village assisting with the installation of additional sewer and water for the expansion, installing the stormwater management culvert and paying for road repairs, Niggemann said.
If the village cannot provide any assistance, Timber Tech will completely finance the expansion and other work associated with it, she said.
Rand Bates, Director of Public Works, confirmed that the Timber Technologies expansion would require two street openings, another stormwater retention pond, sewer and water extensions and street repair.
Niggemann said the recommendation for the property tax reimbursement is not to make it for the life of the Tax Increment Financing District, but rather, for three to five years at either a 25 percent reimbursement or a 50 percent reimbursement.
Niggemann also suggested that “getting better numbers” from Lentz would help with making a decision.
Mark Halpin, who was the acting village president in the absence of Gary Stene, agreed that more concrete numbers would help.
The two options the village board can consider, Niggemann reiterated, are for the village to pay for some of the upfront costs or for the village to do a tax refund.
Timber Technologies is going ahead with the project “no matter what” — whether the village board decides to help with upfront costs or to do a tax reimbursement, Bates said.
Keith Burcham, village trustee, said he was in favor of giving back a percentage of the new property taxes generated.
Margaret Burcham, village trustee, said she, too, was in favor of reimbursing a portion of the property taxes.
The village board “needs numbers to know the best option for the village,” Halpin said.
Niggemann said she would contact Lentz and ask him to put together more concrete numbers.
Niggemann said she would also let Dale Schiferl of Timber Technologies know that the village board was leaning toward a TIF-tax refund to the company.
In a TIF district, new property taxes generated by improvements in the district are set aside in a special fund to be used by the village for certain additional improvements in the district, such as streets or other infrastructure.
During the life of the TIF district, other taxing authorities that would normally receive property taxes, including Chippewa Valley Technical College, Dunn County and the Colfax school district, do not receive those property taxes for the life of the TIF district.
When the TIF district is closed out, the other taxing authorities receive their share of the money remaining in the TIF fund.
TIF districts neither hurt nor help school districts because when TIF money is paid to a school district, state law requires the school district’s state aid to be decreased by that amount.
Halpin suggested it would be helpful if Lentz could attend the village board’s next meetingMarch 11 to talk about the options.
“I will see if Sean is available,” Niggemann replied.
Because of the 25,000 square foot project, Timber Tech will be “disturbing” more than an acre of land, and the company also will be adding a certain amount of impervious surface to create more runoff during rainstorms.
The disturbance of more than one acre of land and the additional impervious surface will require Timber Tech to install a large retention pond on the south side of Bremer Avenue.
Timber Tech already has a retention pond on the north side of Bremer Avenue.
A culvert must be placed under Bremer Avenue as well so the water can drain from the retention pond on the south side to the retention pond on the north side.