Crow Wing County weighs in on proposed TIF district
Baxter is considering establishing a tax-increment financing (TIF) district for redevelopment in the Isle and Falcon drives area. Specifically the district would be used to assist in covering the cost of public improvements to Isle Drive and acce...
Baxter is considering establishing a tax-increment financing (TIF) district for redevelopment in the Isle and Falcon drives area.
Specifically the district would be used to assist in covering the cost of public improvements to Isle Drive and access for the development of an 18,000-square-foot office building.
The redevelopment TIF district would be in effect for 25 years and total costs are expected to be $1.8 million.
The office development is expected to begin this year with an estimated market value once it is completed of $2,072,000.
A public hearing is set at 7 p.m. June 17 at Baxter City Hall.
As is policy, the TIF district proposal goes before the Crow Wing County Board for comment. The board doesn't have the jurisdiction to approve or deny the proposal. Historically, the county has responded with a boilerplate language saying the board has no comment but "is concerned with the impact on individual taxpayers arising out of public support of these projects through" the TIF process.
And the board routinely waives the 30-day review period. Deborah Erickson, deputy auditor, presented the project to the board saying it is designed to assist with the street improvements and public infrastructure. The TIF district is proposed to begin in 2016 and end in 2041.
Erickson said staff is strongly encouraging entities get the TIF proposals in so the county has the full comment period, normally 30 days or 45 if there is an effect to a county road.
It's been a few years since the county received a TIF proposal to review.
Commissioner Paul Koering expressed concern for the TIF asking if a business moving into the district would have reduced taxes. Erickson said a business would still pay the same amount of taxes on the value today but the increase would be captured to pay for the improvements.
Administrator Tim Houle described TIF as having a property with a $10 tax and then building on it so if the taxes go up to $100, with TIF, $90 of those new tax dollars would be captured to help pay for items such as road or sewer that goes along with bringing in more cars and people to the area. After a set amount of time the district would end.
Koering said not getting the additional tax puts more pressure on the school district and the county. Houle said there are two ways to think of it, proponents say the development that will spread the tax burden more broadly may not have happened without the initial assistance of the TIF district. On the other hand, Houle said opponents say development should occur on its own and government shouldn't be in the middle.
There are 36 TIF districts in the county, 14 housing, seven economic and 15 redevelopment districts.
Koering said he wanted to go on record as opposed to the TIF district as a negative impact on all taxpayers and businesses in the county.
Commissioner Paul Thiede said the county board doesn't have the ability to say yes or no. Koering said he could still express his opinion and opposed the vote.