WEST BEND — The creation of a new tax incremental finance district, including more than $9.7 million in city projects and to assist significant redevelopment at the West Bend Brewery site, is nearing final approval in the city of West Bend, as the required public hearings this week saw no input from the public and only brief discussion from the Plan Commission.
The Plan Commission met Tuesday evening and held the necessary public hearings on altering the city’s current Tax Incremental Finance District 10 to remove four parcels from it, and creating a new TID 15, including the four parcels from TID 10 and a handful of others along North Main Street. After the hearings, both items were approved unanimously by the Plan Commission.
“The amendment to TID 10 is a little bit different than what you’ve done in the past, where we are actually subtracting parcels, and the reason we’re doing that is to be able to fully realize the potential benefit of TID 15 through a proposed development,” said Phil Cosson of Ehlers.
Ehlers is a financial consulting firm that is assisting the current TID process.
Tax incremental finance districts are used by municipalities to encourage development and redevelopment. Within a TID, properties are largely removed from the normal tax rolls in which different taxing authorities such as the city, county, school district and the technical college, all receive tax dollars. While the base value of a TID’s properties — what they were worth at the time the TID was formed — continue to pay taxes to all relevant jurisdictions, the tax monies generated by new development or improvement during the TID’s lifetime all go to the city to be reinvested in the district.
The TID system is often used to fund infrastructure or development incentives, which allow for improvements and new projects which may not otherwise occur. TIDs usually have a maximum life of 27 years, after which the district is closed and the properties and their new values are returned to tax rolls.
A distressed TID that is not meeting revenue needs can obtain an extra 10 years.
According to Cosson, removing the four properties from TID 10 will not have a financial impact on that district. It is projected to close in 2034 with all its debts and obligations paid, which would be well within the timeline the district is allowed, and the current adjustment being made would not change that.
With those four properties added to TID 15, however, a proposed development for high-end apartment housing on those parcels and the brewery site immediately to the north will be able to move forward with TID support.
“It’s a pretty dense development, more dense that I think the city would typically see,” Cosson said.
The project currently proposed for the brewery site and the lots south of it, to Washington Street, would include two multistory buildings on about 3 acres, with about 6,400 square feet of commercial space and 181 dwelling units, according to project documents. City Administrator Jay Shambeau said that project is still in process, and still needs approvals for its site plan and a developers agreement before it proceeds.
Through TID funding, the project plan for TID 15 includes a projected $9.725 million in city project costs, including:
■ A $1 million developer incentive, which Cosson said was to fund acquisition and cleanup issues with the site for the current development proposal.
■ $500,000 for development of the riverwalk along the Milwaukee river, north of Washington Street.
■ $2.2 million for Riverwalk work south of Washington Street. Development Director Mark Piotrowicz said last week that the city is planning an underpass for the riverwalk beneath Washington Street where it bridges over the Milwaukee River, to allow safe pedestrian connectivity for the riverwalk.
■ $1.5 million for Main Street improvements adjacent to the TID.
■ $4.525 for a municipal revenue obligation to the developer, which Cosson said will be paid only after the city’s other costs are covered by TID increment. Shambeau said the incentive payments are to assist in the development, and the specific terms of such monies will go through city approvals in the developers agreement as that project moves forward.
The four properties being removed from TID 10 and then included in the new TID 15 include two owned by the city, one owned by Wisconsin Electric Power Company and the privately owned West Bend Brewery site at 415 N. Main St.
According to projections shared by Cosson, the brewery redevelopment is expected to create about $35 million in new value in the city of West Bend over the next several years, assuming the project moves forward as planned. That value would in turn produce about $640,000 in tax increment each year, and possible more if values rise over the years.
If further development happened within TID 15 on the parcels not included in the current project, that could result in further city or development items being funded through the TID, but those would be arranged at the time of future development based on the project and financial feasibility.
The final approvals for the TID matters are expected at the Common Council April 5, and the Joint Review Board April 15.