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By LeAnn R. Ralph
COLFAX — The Village of Colfax could soon have a fifth Tax Increment Finance District.
A meeting to organize a Joint Review Board for the proposed creation of TID5 was held at 5 p.m. August 30, with a review of the proposed plan for the district, and immediately following at 6 p.m., the Colfax Plan Commission held a public hearing on the proposed plan and then recommended that the village board move forward with creating TID5
Josh Low, a municipal advisor with Ehlers Inc., the village’s financial advisor, presented the TID5 plan to the Joint Review Board and to the Colfax Plan Commission.
The Joint Review Board includes representatives for each of the taxing authorities affected by the creation of a tax increment district.
The August 30 meeting of the Joint Review Board included Jody Albricht, Colfax village president; Dan Lytle, representing Chippewa Valley Technical College; Vaughn Hedlund, representative for the Dunn County Board sitting in for Dave Bartlett, chair of the Dunn County Board; William C. Yingst Jr., Colfax school district administrator; and Tiffany Prince, the Joint Review Board member who is representing the public.
TID5 is basically an overlay of TID4, Low said.
TID4 is closing out, but it is not completely built out. The new development will be going into the new district so development can continue, he said.
The Colfax Village Board has done interim financing for improvements to Dunn Street under TID4, and the Dunn Street improvements could continue next year under TID5, he said.
TID5 would have a combination of residential, commercial and industrial development.
In a tax increment district, the taxing jurisdictions would continue to collect the property taxes on the base value of what is already located in the district.
When new development is constructed in the TID, the property taxes from the new development go into a special fund TID fund kept by the village, and the money is used for improvements to help the TID with further development, such as roads, sewer and water.
When the TID district is closed out in 20 years, the money that remains is distributed to the taxing jurisdictions.
All of the taxing authorities — county, school district, technical college and village — will still receive the base property taxes they collect today, Low said.
No one is worse off in the short run, and in the long run, the taxing jurisdictions have the potential for an increase in the property taxes they collect because of an increased tax base, he said.
One of the questions to consider when forming a TID is whether development would occur without the tax increment district, Low said.
A tax increment district is beneficial to taxpayers because the district funds the improvements.
For example, if Colfax borrows $250,000 next year to finish the Dunn Street project and install sewer and water so construction of additional residential units can occur, the payments on the $250,000 will come from the TID fund and would not be added to the tax levy.
According to the map for the proposed TID5, the residential section would be half of the farm formerly owned by Jim and Mary Schindler, extending south of the railroad tracks, along Dunn Street, out to 860th Avenue.
The commercial section would be the other half of the Schindler farm, east of the residential section, out to county Highway M and would include the Colfax Community Fire Department.
In somewhat of a U shape, TID5 would extend to the southern border of the village, in the area of the Viking Bowl and the Colfax Health and Rehabilitation Center, and then another large section of agricultural land located to the west would be intended for industrial development.
According to state law, a mixed-use TID can only have 35 percent residential development.
Colfax has quite a lot of land that could be developed that is currently in agricultural use now, Low said.
The question answered by the TID5 plan is — what could this area look like in 20 years? The project plan is a long-range plan. It’s a framework, Low said.
Just because something is put into the plan does not mean it will be developed. All proposed development would be reviewed by the plan commission, and the village board would make the final decision on whether to borrow money to complete the infrastructure for the proposed development, Low said.
All future borrowing is subject to approval by the Colfax Village Board, he said.
Gary Stene, village trustee and also a member of the Dunn County Board, asked if the existing commercial and industrial properties in TID4 counted toward the percentages for commercial and industrial that would be required in TID5.
“Yes,” Low said, the existing properties will be part of the new TID5’s base.
The housing that is being constructed this year in TID4 will be a credit for TID5, meaning the revenue from taxes will go into the TID, he said.
According to a chart Low used in his presentation, the value of projects that could be constructed in TID5 by 2040 could be $12.1 million, with a tax increment of $4.3 million.
Smaller residential projects and then additional commercial projects could add $1 million in value every other year in TID5, Low said.
“It is the way Colfax could (with an emphasis on “could”) be developed,” he said.
Following the plan commission’s public hearing on August 30 and the recommendation to move forward, the Colfax Village Board is expected to consider approval of a resolution forming Tax Increment District 5 at the September 13 meeting.
The Joint Review Board for TID5 will meet on September 14 at 5 p.m. at the Colfax Rescue Squad to consider approval of TID5.
The Joint Review Board has “the final, final say” on the creation of a tax increment district, Low said.