Joint Review Board approves TID-5 for Colfax
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By LeAnn R. Ralph
COLFAX — The Joint Review Board for the Village of Colfax has given final approval for creating Tax Increment Finance District 5.
The Joint Review Board’s approval of TID-5 at a meeting held September 28 was the final step in the process of creating a new tax increment finance district for Colfax.
Representatives on the Joint Review Board for the taxing authorities affected by the creation of a new TID included Keith Strey, Dunn County; Dan Lytle, Chippewa Valley Technical College; Tiffany Prince, public member; William C. Yingst Jr., Colfax school district; and Jody Albricht, Village of Colfax.
At a meeting held August 30, the Joint Review Board was organized for the proposed creation of TID-5, which was immediately followed by a meeting of the Colfax Plan Commission to hold a public hearing on the proposed plan.
Following the public hearing and review of the plan for TID-5, the Colfax Plan Commission recommended that the village board move forward with creating TID-5.
The Colfax Village Board approved a resolution to create TID-5 at the September 13 meeting.
According to the map of TID-5, the residential section would include 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 cover 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, TID-5 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, and TID-5 will have a combination of residential, commercial and industrial development.
In a tax increment district, the taxing jurisdictions 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 TID fund kept by the village, and the money is used for improvements to help the TID with further development, such as building roads and installing sewer and water mains.
When the TID district is closed out in 20 years, the money that remains is distributed to the taxing jurisdictions.
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.
The value of projects that could be constructed in TID-5 by 2040 could be $12.1 million, with a tax increment of $4.3 million.
The Joint Review Board unanimously approved creating TID-5.
Annual meeting
The Joint Review Board also held the annual meeting September 28 to review the progress of TID-3 and TID-4.
TID-3 was created in 2002, and the end of the expenditure period will be in 2024, said Josh Low of Ehlers, the village’s financial consultant.
TID-3 is a blighted district and includes the downtown area of Colfax and Main Street/state Highway 40 south to Fifth Avenue, east Railroad Avenue, the area south of the railroad tracks to Third Avenue, an area around Bremer Avenue, Willow Street and Elm Street, and an area south of Fifth Avenue to Short Street and south of Big Blue Stem Lane.
The current increment value in TID-3 is $4.2 million, and TID-3 has a fund balance of $178,173, Low said.
TID-4 shared revenue of $36,000 with TID-3 this year to help pay down debt in TID-3 of $1.3 million (2013 general obligation bonds), $350,000 (2015 general obligation note), and $410,000 (2016 promissory note), he said, noting that the outstanding principal on December 31, 2020, was $454,157.
TID-3 will have an anticipated balance of $820,000 when the TID closes out in 2030, Low said.
September of 2024 is the end of the expenditure period for TID-3, so now would be a good time to see what other projects could be done using the money in TID-3, he said.
No immediate projects are planned for TID-3, said Lynn Niggemann, village administrator-clerk-treasurer.
TID-4
TID-4 was created in 2006, and the end of the expenditure period was earlier this year, Low said.
TID-4 has an increment value of $2.28 million, and expenditures in TID-4 include the $17,000 payment for Timber Technologies to provide an incentive for development the company recently completed. The payments will continue until 2024, he said.
TID-4 basically covers the same area as TID-5 and includes the agricultural areas on the east side of Colfax and on the west side.
TID-4 has a cumulative balance of $14,214, and at the end when it is closed out, will have a cumulative value of $5,000, Low said, noting that the balance of $5,000 could be used to pay any close-out costs, such as attorney’s fees.
The Colfax Village Board approved interim financing of $120,000 for TID-4 earlier this year before the end of the TID’s expenditure year to help with construction costs on Dunn Street, Low said.
With the creation of TID-5, development can continue along Dunn Street and the tax increment can be included in TID-5 while the expenditures for infrastructure can come out of TID-5, he said.
“(TID-3 and TID-4) are both very successful districts,” Low said.
The Joint Review Board unanimously approved the resolution acknowledging the filing of annual reports for TID-3 and TID-4 with the state Department of Revenue and compliance with annual meeting requirements.