Project Plan for Tax Increment District No. 6 Amendment No. 1

Transcription

1 Project Plan for Tax Increment District No. 6 Amendment No. 1 DRAFT April 12, 2016 Report prepared for City of Lake Mills, Wisconsin Report prepared by: Mead & Hunt, Inc W. Research Drive Wauwatosa, WI / Strand Associates, Inc. 910 West Wingra Drive Madison, WI / Ehlers, Inc. N21W23350 Ridgeview Parkway West Waukesha, WI / Public Hearing: April 26, 2016 Plan Commission Approval: City Council Approval: Joint Review Board Approval:

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3 ACKNOWLEDGMENTS CITY COUNCIL Edward Grunden Ward 1 & 8 Alder Steve Kurkiewicz Ward 2 & 6 Alder Rudy Schaar Ward 3 & 7 Alder, Council President Diann Hosp Fritsch Ward 4 & 5 Alder Mike Foster At-Large Alder PLAN COMMISSION Pamela Lazaris Mike Foster Wayne Magnussen Steve Homann Ken Persson Ken Schwark CITY STAFF Steven Wilke Elizabeth Milbrath Vickie Schmidt Paul Hermanson Melissa Quest Heather Crawford CITY CONSULTANTS Brandon Herbert, PE James Mann, CIPFA Duane Vandermause, PE Dustin Wolff, AICP Mark Sauer, AICP JOINT REVIEW BOARD Steven Wilke Randy Otto Jennifer Bakke Ben Wehmeier Dr. Richard Mason Chair Council Representative Member Member Member Member City Manager City Treasurer-Finance Director City Attorney Director of Public Works City Clerk Deputy Clerk, Administrative Assistant Strand Associates, Inc. Ehlers, Inc. Assistant to the Director of Public Works Mead & Hunt, Inc. Mead & Hunt, Inc. Chair, City Representative Citizen Member Representative Madison College Representative Jefferson County Representative Lake Mills School District Representative Acknowledgements ii

4 TABLE OF CONTENTS SECTION I. INTRODUCTION & DESCRIPTION OF DISTRICT... 1 Introduction... 1 History and Inventory of Area... 1 Type & General Description of the District... 1 Amended Document Sections... 1 About Tax Increment Financing... 2 SECTION II DESCRIPTION OF HOW TID NO. 6 AMENDMENT NO. 1 WILL PROMOTE THE ORDERLY DEVELOPMENT OF THE CITY OF LAKE MILLS... 3 SECTION III. TAX INCREMENT BOUNDARY DESCRIPTION AND EQUALIZED VALUES... 4 TABLE 1: CITY S ESTIMATED CAPACITY TO CREATE TID NO. 6 (EFFECTIVE JANUARY 1, 2015):... 4 TABLE 2: STATE CERTIFIED AND ESTIMATED TID VALUES:... 4 TABLE 3: CITY S REMAINING ESTIMATED CAPACITY TO CREATE ADDITIONAL TIDS:... 4 MAP 1: DISTRICT BOUNDARY... 6 SECTION IV. EXISTING USES AND CONDITIONS OF REAL PROPERTY... 8 MAP 2: EXISTING USES AND CONDITIONS OF REAL PROPERTY MAP 3: EXISTING ZONING OF PROPERTY IN THE DISTRICT SECTION V. STATEMENT OF KIND, NUMBER AND LOCATION OF THE PROPOSED PUBLIC IMPROVEMENTS TABLE 4: PROPOSED PUBLIC IMPROVEMENTS & COSTS MAP 4: PROPOSED PUBLIC IMPROVEMENTS SECTION VI. SOURCES OF NON-TAX REVENUES SECTION VII. ECONOMIC FEASIBILITY ANALYSIS & DESCRIPTION OF THE METHODS OF FINANCING Purpose TABLE 5: ESTIMATED PROJECT COSTS & FINANCING PLANS TABLE 6: DEVELOPMENT ASSUMPTIONS Economic Feasibility Analysis Available Financing Methods Anticipated Financing Methods TABLE 7: TAX INCREMENT PROJECTION Analysis of Overlying Taxing Jurisdictions TABLE 8: CASH FLOW PROJECTION SECTION VIII. CONSISTENCY OF ACTIVITIES WITHIN TID NO. 6 WITH THE CITY ZONING ORDINANCE, MASTER PLAN, AND OTHER DEVELOPMENT ORDINANCES City of Lake Mills Smart Growth Comprehensive Plan City of Lake Mills Zoning Code & Map City of Lake Mills Subdivision Code SECTION IX. ANNEXED PROPERTY SECTION X. STATEMENT OF THE PROPOSED METHOD FOR RELOCATION OF ANY DISPLACED PERSONS SECTION XI. SUMMARY OF FINDINGS Table of Contents i

5 APPENDICES APPENDIX A: BOUNDARY DESCRIPTION OF LAKE MILLS TID NO APPENDIX B: PROPERTY EVALUATION APPENDIX C: PLAN COMMISSION PUBLIC HEARING NOTICE & PROOF OF PUBLICATION APPENDIX D: TAXING JURISDICTION CORRESPONDENCE APPENDIX E: JOINT REVIEW BOARD MEETING PUBLIC NOTICES APPENDIX F: JOINT REVIEW BOARD MEETING MINUTES APPENDIX G: JOINT REVIEW BOARD RESOLUTION APPROVING THE TID NO. 6 PROJECT PLAN AND BOUNDARY APPENDIX H: PLAN COMMISSION PUBLIC HEARING MINUTES APPENDIX I: PLAN COMMISSION RESOLUTION APPROVING THE TID NO. 6 PROJECT PLAN AND BOUNDARY APPENDIX J: CITY COUNCIL RESOLUTION ADOPTING THE TID NO. 6 PROJECT PLAN AND BOUNDARY APPENDIX K: LAKE MILLS CITY ATTORNEY S OPINION Table of Contents ii

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7 SECTION I. INTRODUCTION & DESCRIPTION OF DISTRICT Introduction Lake Mills, Wisconsin is located along Interstate Highway 94 at State Trunk Highway 89, between Madison and Milwaukee. Tens of thousands of vehicles pass between Madison and Milwaukee daily, providing a tremendous opportunity for recruiting residents, businesses, and industries. Historically, the City developed around its downtown, the civil and commercial heart of the community. However, as the City s population continues to rise, so does its need to accommodate new, and retain expanding business and industry, providing jobs and diversifying the tax base for a sustainable future. History and Inventory of Area There is no change to the History and Inventory of Area Section from the TID No. 6 Project Plan. Type & General Description of the District TID No. 6 Amendment No. 1 in the City of Lake Mills has been prepared in compliance with Wisconsin Statutes The Amendment proposes to add approximately 60 acres to the existing 105 acres of land in the District. This provide the opportunity for the expansion of the Lake Mills Business Park. TID No. 6 is classified as an Industrial District based upon a finding that at least 50-percent (50%), by area, of the real property within the District is suitable for industrial sites and zoned for industrial use. The Study Inventory found in Appendix B of this Plan includes calculations demonstrating compliance with this requirement. Wisconsin Statutes declares the policy of the state to encourage and promote the development of industry to provide greater employment opportunities and to broaden the state s tax base to relieve the tax burden of residents and home owners. It is recognized that the availability of suitable sites is a prime factor in influencing the location of industry but the existing available sites may be encroached upon by the development of other uses unless protected from encroachment by purchase and reservation. The policy of the state authorizes cities to borrow for the reservation and development of industrial sites, and the expenditure of funds for that purpose is determined to be a public purpose. As such, the City intends to use TIF to promote development within the TID No. 6 area that will: Promote retention and expansion of existing Lake Mills businesses and industries. Recruit and attract investment from new businesses and industries. Expand the City s infrastructure to provide access for developable sites. Establish the Lake Mills Business Park as a regional model for economic development. Capitalize on the proximity of both the Milwaukee and Madison area labor markets. Amended Document Sections The amended Sections included in TID No. 6 Amendment No. 1 include: Section I: Introduction Section II: Description of How Amendment No. 1 Will Promote the Orderly Development in the City of Lake Mills Section III: Tax Increment District Boundary Description and Equalized Values Section IV: Existing Uses and Conditions of Real Property Section V: Proposed Public Works and Estimated Costs Section VII: Economic Feasibility Analysis Section VIII: Consistency with City Zoning Ordinance, Master Plan, Maps, Building Codes, and Other Development and City Ordinances Section IX: Annexed Property Section XI: Summary of Findings Maps 1, 2, 3 & 4 Tables 1-8 Appendices Section I: Introduction & Description of District 1

8 If Sections, maps or tables are not included, no change was made from the Amendment No. 1 Project Plan. These include: Section VI: Sources of Non-Tax Revenues Section X: Statement of Relocation About Tax Increment Financing There is no change to the About Tax Increment Financing Section from the TID No. 6 Project Plan. Section I: Introduction & Description of District 2

9 SECTION II DESCRIPTION OF HOW TID NO. 6 AMENDMENT NO. 1 WILL PROMOTE THE ORDERLY DEVELOPMENT OF THE CITY OF LAKE MILLS The City of Lake Mills Plan Commission and City Council realize that not only is this District an important extension of the Lake Mills Business Park, but also a potential major employment center for the region because of its proximity to the Milwaukee and Madison labor markets. The Project Area is located less than 2 miles from I-94 and within 7 miles of both US Highway 18 and state trunk highway (WIS) 26. WIS 89 is an important arterial running through the City, and with the territory amendment will be immediately adjacent to TID 6. The City of Lake Mills cannot fully realize its potential for quality industrial and economic development without public improvements to infrastructure and a public commitment to development. Amendment No. 1 to TID No. 6 add territory this is not encumbered by environmental constraints that impact other lands in the industrial park. This amendment will also provide a financing vehicle for the City to undertake the public improvements necessary to stimulate private investment within this important area of the community. Without these tools and public improvements, it is unlikely that significant improvement to this area would occur. In fact, it is more likely that low-density sprawling development will develop in this area unless the land is specifically reserved for the type of employment opportunities desired by the City. The City s adopted Smart Growth Comprehensive Plan aims to strengthen and diversity the City s economic base and attract and retain businesses. The Comprehensive Plan has the specific economic development objective to identify and plan for the needs of existing and future businesses and industries with regards to adequate land, transportation, utilities and municipal services. More specifically, the Plan anticipates that the current Lake Mills Business Park will be built out over the next 25 years, and therefore reserves additional undeveloped land to the south of the industrial park along the projected extension of S. CP Ave. To that end, the City has established TIF Districts and prepared detailed plans to encourage development of these areas. TID No. 6 will further the City s proactive efforts to improve land, increase property values, and to create job opportunities. TID No. 6 will stimulate the recruitment and expansion of businesses and industries by providing several larger parcels for development (as shown on Map 1: District Boundary). Larger lots will accommodate industrial development, allow for sustainable site design without compromising usable square footage, and create tax base and jobs. The City can provide common parking areas, provide safer vehicular and pedestrian movement, and continue to upgrade the visual image at the southern entry of the community through the site and design guidelines already in place. Amendment No. 1 to TID No. 6 will enable the City to provide new access to several parcels to create development opportunities that otherwise would require a substantial private investment. Concentrating on infrastructure improvements will allow businesses and industries to capitalize on the location of Lake Mills in the region. TID No. 6 is necessary to fund the proposed public improvements and land assembly needed to accomplish the City s identified economic development goals. The TID will remove the burden of funding from the individual taxpayer and place the burden on the individual projects the major direct benefactors of the improvements to cover the funding. Section II: Promote Orderly Development 3

10 SECTION III. TAX INCREMENT BOUNDARY DESCRIPTION AND EQUALIZED VALUES The boundary of TID No. 6 with the additional of the Amendment No. 1 lands is officially designated on Map 1: District Boundary. The metes and bounds description for the boundary can be found in Appendix A: Boundary Description. The District contains properties that generally front along American Way and one property which will be access from S. CP Ave. extended. There are six (6) currently undeveloped properties (totaling 34.6% of the district) to be added to the TID 6 project area. Prior to considering the specific area to include within TID No. 6, the City established criteria as outlined in the Wisconsin Statues to act as guidelines. The criteria are as follows: The aggregate value of equalized taxable property of TID No. 6 Amendment No. 1 plus the value of increment of all existing districts cannot exceed 12-percent of the total equalized value of taxable property within the City, as indicated in Table 1. Compliance with this requirement is illustrated by Table 2 and Table 3. TABLE 1: CITY S ESTIMATED CAPACITY TO CREATE TID NO. 6 (EFFECTIVE JANUARY 1, 2015): Total Equalized Value Of the City 12% of the City s Total Equalized Value $490,855,800 $58,902,696 Source: Wisconsin Department of Revenue TABLE 2: STATE CERTIFIED AND ESTIMATED TID VALUES: DISTRICT STARTING BASE VALUE JAN. 1, 2015 TOTAL VALUE VALUE OF INCREMENT % OF CITY CAPACITY TID No. 2 $27,177,100 $11,445,700 $15,731, % TID No. 3 $9,141,400 $6,993,800 $2,147, % TID No. 4 $16,148,200 $7,848,200 $8,300, % TID No. 5 $5,797,200 $5,932,900 $(135,700) 0.00% TID No. 6 $3,166,600 $3,304,800 $(138,200) 0.00% TOTAL $61,430,500 $35,525,400 $26,179, % Source: Wisconsin Department of Revenue TABLE 3: CITY S REMAINING ESTIMATED CAPACITY TO CREATE ADDITIONAL TIDS: Total City Capacity $58,902,696 Existing TIDs $26,179,000 Remaining Capacity $32,723,696 or 6.67% A minimum of 50-percent of the land area in TID No. 6 must be either blighted, in need of rehabilitation or conservation, be suitable for industrial sites and zoned for industrial use, or suitable for mixed use development. This TIF is an area where 50-percent of the area is suitable for industrial sites and zoned for industrial use as illustrated in Appendix B: TID No. 6 Parcel Data. Section III: Boundary Description & Equalized Value 4

11 All lands within TID No. 6 shall be contiguous. TID No. 6 may include only whole units of property as are assessed for general tax purposes. Map 1: District Boundary illustrates the district boundaries and private property lines, and all of the lands are contiguous. Section III: Boundary Description & Equalized Value 5

12 MAP 1: DISTRICT BOUNDARY Section III: Boundary Description & Equalized Value 6

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14 SECTION IV. EXISTING USES AND CONDITIONS OF REAL PROPERTY An illustration of the existing land uses within the proposed boundary for TID No. 6 is located on Map 2: Existing Uses and Conditions of Real Property and the existing zoning on Map 4: Existing Zoning. The property to be include in the District are undeveloped agricultural and greenfield lands. The properties are currently zoned PI, Planned Industrial District; and RD, Rural Development District. The existing industrial districts can accommodate the kind of future development desired in this area. The PI, Planned Industrial zoning district permits a range of light manufacturing and industrial activities generally within the confines of a building including, but not limited to processing, production, wholesaling, warehousing, construction, research and testing, offices, and public services. The type of tax increment financing district that TID No. 6 is created under is an industrial TID. The City can have an assortment of types of industrial uses under this classification. The boundary does include parcels currently zoned RD, Rural Development zoning district. This district permits uses that center on agricultural activities and support such as: agricultural sales, greenhouses, and campgrounds. Section IV: Existing Uses & Conditions of Real Property 8

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16 MAP 2: EXISTING USES AND CONDITIONS OF REAL PROPERTY Section IV: Existing Uses & Conditions of Real Property 10

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18 MAP 3: EXISTING ZONING OF PROPERTY IN THE DISTRICT Section IV: Existing Uses & Conditions of Real Property 12

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20 SECTION V. STATEMENT OF KIND, NUMBER AND LOCATION OF THE PROPOSED PUBLIC IMPROVEMENTS This section describes the proposed public works projects and their estimated costs. These are referred to as project activities. Map 4: Proposed Public Improvements identifies the location of potential public improvements. Table 4: Proposed Public Improvements & Costs outlines the proposed project costs. The proposed costs include projects within the proposed boundary and within a ½ mile radius of the proposed boundary of the District that will directly benefit TID No. 6. Detailed engineering, bidding, and construction of all improvements will take place based upon market demand for serviced parcels. This section of the project plan includes a narrative of the public purpose project costs and development increment assumptions, as well as and anticipated schedule of when each project will occur. The City has identified various projects that will address desired objectives and improve the quality of life for current and future residents. The desire of the City to implement these projects, however, is dependent on the availability of financial resources. The creation of TID No. 6 and the addition of territory in Amendment No. 1 provides the City with the resources to undertake the planned improvements. The tax increment revenues will be generated through private development that may not otherwise take place. The public investment undertaken by the City and outlined in the Project Plan will eventually benefit all of the taxing bodies that share in the tax base of Lake Mills by providing the catalyst for such additional private development. In the event that any of the planned activities are determined not to be reimbursable out of TID No. 6, special funds under Wisconsin Statues, then such project or projects will be deleted from the plan. It is critical that the City require all new development to adhere to the Planned Industrial District future land use category to determine pattern, scale, and style of development consistent with the intended future of the area. It is recommended that developer agreements effectively outline public and private responsibilities, and to ensure public costs are recovered. Such scrutiny and conditions will provide assurances to existing and prospective businesses that their investment will be protected and enhanced. After all, the City has committed to constructing infrastructure to solicit business development, and is paying for those improvements through the taxes generated by the new development within the TID. For all planned projects, the costs of engineering, design, surveys, inspections, materials, construction, restoration, acquisition, relocation, demolition, legal and other consultant fees, testing, permits, environmental studies, claims for damages, and related expenses are eligible project costs to be paid from the tax increments of the district. The following is a description of the proposed public improvements which corresponds to Map 4: Proposed Public Improvements. The Project Plan allocates the proposed projects and their respective costs over a proposed 15-year spending period. The costs were developed by Strand Associates, the City s consulting engineers. The proposed project activities within this project plan have been comprehensively planned and prioritized on the basis of providing public works improvements that have the greatest chance of stimulating immediate private investment and economic development. These project activities and costs are estimates and may be adjusted and refined. The adjustments and refinements may include changing the year in which a project activity is undertaken and reallocating the cost of specific projects within the limitation of the total estimated project costs. Adjustments to the proposed project plan will be made on the recommendation of the City Plan Commission to be reviewed and adopted by the City Council. SITE PREPARATION ACTIVITIES Site Preparation. Land within the District may require site clearing and grading to make it suitable for development, to remediate hazardous materials issues, to provide access, and to control stormwater runoff. The City may need to remove and dispose of excess material, or bring in fill material to provide for proper site elevations. Expenses incurred by the City for site preparation, grading, and remediation are eligible Project Costs. Property Acquisition. The area is noted for having a number of larger parcels. In order to construct the public improvements, and for the development of private property, the acquisition of property may be necessary in this District. The acquisitions could vary from rights-of-way to entire parcels. Section V: Proposed Public Improvements 14

21 Site Improvement Loans & Grants. Where necessary or convenient to the implementation of the Project Plan, assistance in the form of loans or grants may be provided to private development projects that demonstrate that but for such assistance, the project would not occur. Such TID funds may be used to reduce the cost for site improvements. Site improvements could include construction of buildings, the preparation of sites for construction, environmental remediation, the landscaping of sites, architectural and engineering work related to the preparation of development plans for properties, and similar types of related activities UTILITIES Sanitary Sewer System Improvements. There are inadequate sanitary sewer facilities serving areas of the District. To allow development to occur, the City may need to construct, alter, rebuild or expand sanitary sewer infrastructure within the District. Eligible Project Costs include, but are not limited to, construction, alteration, rebuilding or expansion of: collection mains; manholes and cleanouts; service laterals; force mains; interceptor sewers; pumping stations; lift stations; and all related appurtenances. To the extent sanitary sewer projects undertaken within the District provide direct benefit to land outside of the District, the City will make an allocation of costs based on such benefit. Those costs corresponding to the benefit allocated to land within the District, and necessitated by the implementation of the Project Plan, are eligible Project Costs. Implementation of the Project Plan may also require that the City construct, alter, rebuild or expand sanitary sewer infrastructure located outside of the District. That portion of the costs of sanitary sewer system projects undertaken outside the District, which are necessitated by the implementation of the Project Plan, are eligible Project Costs. Stormwater Management System Improvements. Development within the District will cause stormwater runoff and pollution. To manage this stormwater runoff, the City may need to construct, alter, rebuild or expand stormwater management infrastructure within the District. Eligible Project Costs include, but are not limited to, construction, alteration, rebuilding or expansion of: stormwater collection mains; inlets, manholes and valves; service laterals; ditches; culvert pipes; box culverts; and infiltration, filtration and detention Best Management Practices (BMP s). To the extent stormwater management system projects undertaken within the District provide direct benefit to land outside of the District, the City will make an allocation of costs based on such benefit. Those costs corresponding to the benefit allocated to land within the District, and necessitated by the implementation of the Project Plan, are eligible Project Costs. Implementation of the Project Plan may also require that the City construct, alter, rebuild or expand stormwater management infrastructure located outside of the District. That portion of the costs of stormwater management system projects undertaken outside the District, which are necessitated by the implementation of the Project Plan, are eligible Project Costs. Electric Service. In order to create sites suitable for development, the City may incur costs to provide, relocate or upgrade electric services. Relocation may require abandonment and removal of existing poles or towers, installation of new poles or towers, or burying of overhead electric lines. Costs incurred by the City to undertake this work are eligible Project Costs. Gas Service. In order to create sites suitable for development, the City may incur costs to provide, relocate or upgrade gas mains and services. Costs incurred by the City to undertake this work are eligible Project Costs. Communications Infrastructure. In order to create sites suitable for development, the City may incur costs to provide, relocate or upgrade infrastructure required for voice and data communications, including, but not limited to: telephone lines, cable lines and fiber optic cable. Costs incurred by the City to undertake this work are eligible Project Costs. STREETS AND STREETSCAPE Right-of-Way Acquisition. Available right-of-way in the project area is limited, and the City may need to acquire additional right-of-way to complete the necessary public improvements. Street Improvements. There are inadequate street improvements serving areas of the District. To allow development to occur, the City may need to construct and/or reconstruct streets, alleys, and access drives. Eligible Project Costs include, but are not limited to: excavation; removal or placement of fill; construction of road base; asphalt or concrete paving or repaving; installation of curb and gutter; installation of sidewalks and bicycle lanes; installation of culverts, box culverts; utility relocation, to include Section V: Proposed Public Improvements 15

22 burying overhead utility lines; street lighting; installation of traffic control signage and traffic signals; pavement marking; right-of-way restoration; installation of retaining walls; and installation of fences, berms, and landscaping. Streetscaping and Landscaping. In order to attract development consistent with the objectives of this Plan, the City may install amenities to enhance development sites, rights-of-way, and other public spaces. These amenities include, but are not limited to: a multi-model path, landscaping; lighting of streets, sidewalks, parking areas and public areas; and installation of brick or other decorative walks, terraces and street crossings. These and any other similar amenities installed by the City are eligible Project Costs. MISCELLANEOUS Projects Outside The Tax Increment District. Pursuant to Wisconsin Statutes Section (2)(f)1.n, the City may undertake projects within territory located within one-half (½) mile of the boundary of the District provided that: 1) the project area is located within the City s corporate boundaries and 2) the projects are approved by the City Council. The cost of projects completed outside the District pursuant to this section are eligible project costs, and may include any project cost that would otherwise be eligible if undertaken within the District. The City intends to undertake project cost expenditures outside the District, which will likely include: roadway improvements for CP Avenue, American Way, and Unzhaven Lane, trail crossing improvements at the Glacial Drumlin State Trail, storm water and sanitary sewer improvements in CP Avenue, American Way, and Unzhaven Lane, water and sanitary sewer looping in STH 89 (Main St), electrical transmission improvement to serve the District, and streetscaping. Gas, and communication infrastructure may also be included. Professional Service and Organizational Costs. The costs of professional services rendered, and other costs incurred, in relation to the creation, administration and termination of the District, and the undertaking of the projects contained within this Plan, are eligible Project Costs. Professional services include, but are not limited to: architectural; environmental; planning; engineering; legal, audit; financial; and the costs of informing the public with respect to the creation of the District and the implementation of the Plan. Administrative Costs. The City may charge to the District as eligible Project Costs reasonable allocations of administrative costs, including, but not limited to, employee salaries. Costs allocated will bear a direct connection to the time spent by City employees in connection with the implementation of the Plan. Financing Costs. Interest expense, debt issuance expenses, redemption premiums, and any other fees and costs incurred in conjunction with obtaining financing for projects undertaken under this Plan are eligible Project Costs. With all projects the costs of engineering, design, survey, inspection, materials, construction, restoring property to its original condition, apparatus necessary for public works, legal and other consultant fees, testing, environmental studies, permits, updating City ordinances and plans, judgments or claims for damages and other expenses are included as Project Costs. In the event any of the public works project expenditures are not reimbursable out of the special TIF fund under Wisconsin Statute Section , in the written opinion of counsel for the City for such purpose or a court of record so rules in a final order, then such project or projects shall be removed from consideration, and the remainder of the projects outlined shall be deemed the entirety of the projects for purposes of this Project Plan. The City reserves the right to implement only those projects that remain viable as the Plan period proceeds. Project Costs are any expenditures made, estimated to be made, or monetary obligations incurred or estimated to be incurred, by the City and as outlined in this Plan. Project Costs will be diminished by any income, special assessments or other revenues, including user fees or charges. To the extent the costs benefit the municipality outside the District, a proportionate share of the cost is not a Project Cost. Costs identified in this Plan are preliminary estimates made prior to design considerations and are subject to change after planning is completed. Proration of costs in the Plan are also estimates and subject to change based upon implementation, future assessment policies and user fee adjustments. The City Section V: Proposed Public Improvements 16

23 reserves the right to reallocate funds among the various project element categories, or fund any additional project elements directly or indirectly related to the project elements listed. NON-PROJECT COSTS Non-Project costs are public works projects that only partly benefit the District or are not eligible to be paid with tax increments, or costs not eligible to be paid with TIF funds. Examples include: A public improvement made within the District that also benefits property outside the District. The portion of the total project costs allocable to properties outside of the District would be a nonproject cost. A public improvement made outside the District that only partially benefits property within the District. That portion of the total project costs allocable to properties outside of the District would be a non-project cost. Projects undertaken within the District as part of the implementation of this Project Plan, the costs of which are paid fully or in part by impact fees, grants, special assessments, or revenues other than tax increments. The City does not expect to incur any non-project costs in the implementation of this Project Plan In the event any of the public works project expenditures are not reimbursable out of the TIF fund under Wisconsin Statute Section , in the written opinion of counsel for the City for such purpose or a court of record so rules in a final order, then such project or projects shall be removed from consideration, and the remainder of the projects outlined shall be deemed the entirety of the projects for purposes of this Project Plan. Section V: Proposed Public Improvements 17

24 TABLE 4: PROPOSED PUBLIC IMPROVEMENTS & COSTS Section V: Proposed Public Improvements 18

25 MAP 4: PROPOSED PUBLIC IMPROVEMENTS Section V: Proposed Public Improvements 19

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27 SECTION VI. SOURCES OF NON-TAX REVENUES There is no change to the Sources of Non-Tax Revenues Section from the TID No. 6 Project Plan. SECTION VII. ECONOMIC FEASIBILITY ANALYSIS & DESCRIPTION OF THE METHODS OF FINANCING Purpose The purpose of the economic feasibility analysis is to determine if the projected revenues generated from the District as a result of the proposed development can finance the costs associated with the implementation of the Project Plan. This section focuses on the additional development projections and corresponding incremental new value as illustrated in the tables included in the Project Plan for TID No. 6. Table 5: Estimate Project Costs & Financing Plans highlights the total financing needed to fund the proposed projects. The total net development increment is based on the assumptions presented by category and value in Table 6: Development Assumptions. These development assumption values are conservative and are based on similar development in place within the region as well as on discussions with developers and the City Assessor with an understanding of the general market conditions and feasibility within the area. Conservative development estimates have been made and are considered realistic for purposes of the economic feasibility analysis. Any changes in the development would result in expected increases and/or decreases in projected revenues. The assumptions on when development will occur, or the rate of absorption, are based on a review of market conditions that exist in It is expected and recommended that the City Economic Development Commission (EDC) and the City Council annually review the financial condition of TID No. 6. This Project Plan has been reviewed by the City s EDC in the course of the City s approval process. In addition, project expenditures will not take place except when a developer comes forward or is recruited and an appropriate developer agreement is negotiated and consummated prior to any expenditure of funds. Section VII: Economic Feasibility Analysis & Financing 21

28 TABLE 5: ESTIMATED PROJECT COSTS & FINANCING PLANS Section VII: Economic Feasibility Analysis & Financing 22

29 TABLE 6: DEVELOPMENT ASSUMPTIONS Section VII: Economic Feasibility Analysis & Financing 23

30 Economic Feasibility Analysis The economic feasibility projections are based on the utilization of approximately 20 years of the allowed tax increment collection period, which is the maximum for the TID. The economic feasibility analysis should be considered as a baseline projection that is annually monitored to ensure projected targets are met. The purpose of the annual monitoring is to determine that total incremental value has been achieved rather than whether a specific identified project created those increments. Future public borrowing and/or expenditures should be based on this annual review process. The information in Table 6: Development Assumptions summarizes the development assumptions that have been used in the economic feasibility analysis in conjunction with the Project Plan. These projections have been prepared based on information received from City staff and consultants. The projections in Table 7: Tax Increment Projections include assumptions on new value created from the proposed projects. The incremental new value projections included in Table 7: Tax Increment Projections are not total construction cost estimates, but are factored to equate to the anticipated equalized value to which an annual mill rate will be applied. The actual construction costs may be higher than projected value because construction costs may include soft costs not necessarily assessed by the City. Real estate valuation can also significantly fluctuate from year to year. For that reason, there should be an annual review and evaluation of the stability of the increment value prior to making annual borrowing and/or spending decisions. In compliance with the statutory requirements of tax incremental financing, a finding has been made that the private development activities projected would "not otherwise occur without the use of tax incremental financing"; and therefore have met the but-for test. It must be understood that these projected private development increments will not naturally occur without the proactive implementation of this Project Plan. The implementers of the Project Plan will need to be aggressive in stimulating the identified private development projects. The economic feasibility analysis for the Project Plan for TID No. 6 is presented in Table 9: Cash Flow Projection included below. Table 7: Tax Increment Projection shows the projected tax increments from TID No. 6 based on the development assumptions made in Table 6: Development Assumptions. Table 8: Cash Flow Projection includes the projected tax increment revenues from Table 7: Tax Increment Projection and the estimated debt service obligations of the projects within the District. It is assumed the priority for payment of additional tax increment revenues will be to repay existing and future obligations and, as necessary, to provide annual payments to proposed developers for reimbursement of certain eligible costs as identified through the remaining term of the District. While the preliminary economic feasibility analysis projects that TID No. 6 is feasible, the City is still cautious of spending at the levels projected in Table 4: Proposed Public Improvements. The City will annually analyze the fiscal condition of TID No. 6 as to the accuracy of the development assumptions. Decisions to continue spending is be based on this annual review. Available Financing Methods There is no change to the Available Financing Methods Subsection from the Amendment No. 6 Project Plan. Anticipated Financing Methods There is no change to the Anticipated Financing Methods Subsection from the Amendment No. 6 Project Plan. The City may also pursue grant funding to finance a portion of the project costs. Current projections indicate that all project costs of the district should be financed by tax increment revenue within the twenty year statutorily-required retirement period. The Project Plan has been written to enable project costs to be completed in order to encourage new development within the District boundaries. An annual analysis should be made to strategize financing alternatives in consideration of potential shortfalls between tax increments collected and debt service required to pay the bonds. Excess tax increments will be available to cover potential shortfalls with repayment to the City prior to retirement Section VII: Economic Feasibility Analysis & Financing 24

31 of the District. The City anticipates annually reviewing future expenditures and determining economic feasibility prior to authorizing additional expenditures. The total scope of activities is estimated within the project cost estimates in Table 4: Proposed Public Improvements & Costs. Any non-tax revenues received may reduce the applicable TID project expenditures which, in turn, will reduce the total amount of TID project costs. This reduction will allow the City more flexibility in determining the timeframe for other project expenditures. Section VII: Economic Feasibility Analysis & Financing 25

32 TABLE 7: TAX INCREMENT PROJECTION Section VII: Economic Feasibility Analysis & Financing 26

33 Analysis of Overlying Taxing Jurisdictions Taxing Districts overlying the City of Lake Mills TID No. 6 include Jefferson County, Lake Mills School District, Madison College, and the State of Wisconsin. Many of the projects planned for the TID would not occur or would occur at significantly lower values but for the availability of tax incremental financing. TID No. 6 is a mechanism to make improvements in an area of Lake Mills which is experiencing little to no development. All taxing jurisdictions will ultimately benefit from the increased property values and community vitality which will result from the projects outlined in the Project Plan. Section VII: Economic Feasibility Analysis & Financing 27

34 TABLE 8: CASH FLOW PROJECTION Section VII: Economic Feasibility Analysis & Financing 28

35 PAGE INTENTIONALLY LEFT BLANK Section VII: Economic Feasibility Analysis & Financing 29

36 SECTION VIII. CONSISTENCY OF ACTIVITIES WITHIN TID NO. 6 WITH THE CITY ZONING ORDINANCE, MASTER PLAN, AND OTHER DEVELOPMENT ORDINANCES City of Lake Mills Smart Growth Comprehensive Plan The Future Land Use Map illustrates the future use of the area for Planned Industrial, and Community/Institutional Facilities, Mixed Residential, and Planned Neighborhood uses. Mixed Residential is intended for higher densities and defined by a variety of multi-family units with three (3) or more dwelling units per building. Mobile home parks are also included in this category. The proposed development of the area encouraged by TID No. 6, following the assembly of properties desired by the City, amendments to the Future Land Use Map will be necessary ensure desired land use activities on specific properties. The Economic Development chapter of the Plan outlines specific objectives, policies, programs and recommendations intended to achieve the City s goals of strengthening and diversifying the economic base and attracting and retaining businesses. Specific objectives from the Plan which are consistent with the goals of TID No. 6 include: continue to identify and plan for the needs of existing and future businesses and industries with regards to adequate land, transportation, utilities, and municipal services; provide appropriate sites for a range of additional industrial development at appropriate locations with the City that minimize the negative impacts on residential and natural resource areas of the community. Similarly, the Plan identifies three primary areas for economic development including the Lake Mills Business Park. The Plan anticipates that the current industrial park will be built out over the next 25 years, and therefore has reserved additional undeveloped land to the south of the industrial park along the projected extension of S. CP Ave. south to WIS 89. City of Lake Mills Zoning Code & Map The land to be included in TID No. 6 Amendment No. 1 is zoned PI, Planned Industrial District and RD, Rural Development District. The existing industrial districts can accommodate the kind of future development desired in this area. The PI, Planned Industrial zoning district permits a range of light manufacturing and industrial activities generally within the confines of a building including, but not limited to processing, production, wholesaling, warehousing, construction, research and testing, offices, and public services. The boundary does include parcels currently zoned RD, Rural Development zoning district. This district permits uses that center on agricultural activities and support such as: agricultural sales, greenhouses, and campgrounds. It is anticipated that the lands zoned RD will be rezoned to the PI, Planned Industrial District. The City will amend its adopted Zoning Map to promote the development of the Project Area as it is proposed. City of Lake Mills Subdivision Code Title 11 of the Lake Mills Municipal Code regulates the subdivision and development of land. The TID No. 6 Project Plan intends to allow the City to provide larger tracts of land for industrial development and to extend infrastructure to serve the properties. If subdivisions or the assembly of smaller properties into larger, developable tracts is proposed, the regulations of Title 11 will be followed. SECTION IX. ANNEXED PROPERTY The boundaries of TID No. 6 will not include territory that was not within the boundaries of the Lake Mills on January 1, 2004, AND where less than 3 years have elapsed since the territory was annexed by the City. SECTION X. STATEMENT OF THE PROPOSED METHOD FOR RELOCATION OF ANY DISPLACED PERSONS No acquisition of properties requiring relocation is anticipated to occur within TID No. 6 due to the implementation of the project activities listed in this Project Plan. It is anticipated that any acquisition of land will be fee simple. In the event relocation or the acquisition of property by eminent domain becomes necessary at some time during the implementation period, the City will follow applicable state statues as required in Chapter 32 of Wisconsin Statutes. Section VIII: Consistency with Master Plan & Zoning Ordinance 30

37 SECTION XI. SUMMARY OF FINDINGS As required by Wis. Stats., and as documented in this Project Plan and the exhibits contained and referenced herein, the following findings are made: 1. That but for the creation of this District, the development projected to occur as detailed in this Project Plan: 1) would not occur; or 2) would not occur in the manner, at the values, or within the timeframe desired by the City. In making this determination, the City has considered the following information: Some of the sites proposed for development have remained vacant or underutilized due to inadequate infrastructure availability. Given that many of the sites have not developed as would have been expected under normal market conditions, it is the judgment of the City that the use of TIF will be required to provide the necessary infrastructure and inducements to encourage development on the sites consistent with that desired by the City. In order to make the areas included within TID No. 6 suitable for development, the City will need to make a substantial investment to pay for the costs of: land assembly, improvement of utilities and streets, and related streetscape items. Due to the extensive initial investment in public infrastructure that is required in order to allow development to occur, the City has determined that development of the area will not occur solely as a result of private investment. Accordingly, the City finds that without the use of TIF, development of the area is unlikely to occur. 2. The economic benefits of TID No. 6, as measured by increased employment, business and personal income, and property value, are sufficient to compensate for the cost of the improvements. In making this determination, the City has considered the following information: As demonstrated in the Economic Feasibility Section of this Project Plan, the tax increments projected to be collected are more than sufficient to pay for the proposed project costs as outlined by the schedule in Table 8: Cash Flow Projection. On this basis alone, the finding is supported. The development expected to occur within the District would create nearly $37 million in new value resulting in over $12 million in increment for the District over the next 20 years. These values are outlined in Table 6: Development Assumptions and Table 7: Tax Increment Projection. 3. The benefits of the proposal outweigh the anticipated tax increments to be paid by the owners of property in the overlying taxing jurisdictions. If approved, the District s creation would become effective for valuation purposes as of January 1, As of this date, the values of all existing development would be frozen and the property taxes collected on this base value would continue to be distributed amongst the various taxing entities as they currently are now. Taxes levied on any additional value established within the District due to new construction, renovation or appreciation of property values occurring after January 1, 2014 would be collected by the TID and used to repay the costs of TIF-eligible projects undertaken within the District. Since the development expected to occur is unlikely to take place or in the same manner without the use of TIF and since the District will generate economic benefits that are more than sufficient to compensate for the cost of the improvements, the City reasonably concludes that the overall benefits of the District outweigh the anticipated tax increments to be paid by the owners of property in the overlying taxing jurisdictions. It is further concluded that since the but for test is satisfied, there would, in fact, be no foregone tax increments to be paid in the event the District is not created. As required by Section (4)(i)4., a calculation of the share of projected tax increments estimated to be paid by the owners of property in the overlying taxing jurisdictions has been made and can be found in Table 7: Cash Flow Pro Forma of this plan. Section XI: Summary of Findings 31

38 4. Not less than 50-percent by area of the real property within the District is suitable for industrial sites and is zoned for industrial use. 5. Based upon the findings, as stated above, the District is declared to be an Industrial District based on the identification and classification of the property included within the District. 6. The project costs relate directly to promoting development in the District consistent with the purpose for which TID No. 6 is created. 7. The improvement of such area is likely to enhance significantly the value of substantially all of the other real property in the District. 8. The equalized value of taxable property of the District, plus the value increment of all existing tax incremental districts within the City, does not exceed 12-percent of the total equalized value of taxable property within the City. 9. The City estimates that approximately 10% of the territory within the District will be devoted to residential development at the end of the District s maximum expenditure period, pursuant to Sections (5)(b) and (6)(am)1 of the Wisconsin Statutes. 10. The Project Plan for the District in the City is feasible, and is in conformity with the master plan of the City. Section XI: Summary of Findings 32

39 APPENDICES APPENDIX A: BOUNDARY DESCRIPTION OF LAKE MILLS TID NO APPENDIX B: PROPERTY EVALUATION APPENDIX C: PLAN COMMISSION PUBLIC HEARING NOTICE & PROOF OF PUBLICATION APPENDIX D: TAXING JURISDICTION CORRESPONDENCE APPENDIX E: JOINT REVIEW BOARD MEETING PUBLIC NOTICES APPENDIX F: JOINT REVIEW BOARD MEETING MINUTES APPENDIX G: JOINT REVIEW BOARD RESOLUTION APPROVING THE TID NO. 6 PROJECT PLAN AND BOUNDARY APPENDIX H: PLAN COMMISSION PUBLIC HEARING MINUTES APPENDIX I: PLAN COMMISSION RESOLUTION RECOMMENDING APPROVAL OF TID NO. 6 PROJECT PLAN AND BOUNDARY APPENDIX J: CITY COUNCIL RESOLUTION ADOPTING THE TID NO. 6 PROJECT PLAN AND BOUNDARY APPENDIX K: LAKE MILLS CITY ATTORNEY S OPINION Appendices 33

40 APPENDIX A: BOUNDARY DESCRIPTION OF LAKE MILLS TID NO. 6 Said boundary description consists of land in the NE 1/4 of the NE 1/4, the NW 1/4 of the NE 1/4, the SE 1/4 of the NW 1/4, the SW 1/4 of the NW 1/4, the NW 1/4 of the NW 1/4 and the NE 1/4 of the NW 1/4 of Section 24, T7N, R13E, and part of the SE 1/4 of the SE 1/4 of Section 13, T7N, R13E, and part of the SW 1/4 of the SW 1/4, part of the SE 1/4 of the SW 1/4, part of the SW 1/4 of the SE 1/4 of Section 18 in T7N, R14E, all in the City of Lake Mills, Jefferson County, Wisconsin referenced to the following line: Beginning at the Northeast corner of Section 24, T7N, R13E; Thence Southerly 1107 feet more or less along the East line of the NE 1/4 of the NE 1/4 said Section 24 to the northerly right of way line of the former C & NW railroad, now owned by the Wisconsin Department of Natural Resources; Thence westerly 1334 feet more or less along said northerly right of way line to the west line of the NE 1/4 of the NE 1/4 of said Section 24; Thence continuing westerly, 1186 feet more or less along said northerly right of way line to the east line of a former spur track, now part of the Glacial Drumlin Trail; Thence northeasterly, 1460 feet more or less along the east line of said former spur track to the north line of NW 1/4 of the NE 1/4 of said Section 24; Thence easterly, 22 feet more or less along said north line to the southwest corner of Outlot 1 of Certified Survey Map number 3695 recorded in Volume 17 of CSM s, pages as document number at the Jefferson County Register of Deeds; Thence North East, feet along the west line of said Outlot 1 to the southwest corner of Certified Survey Map number 3412 recorded in Volume 15 of CSM s, pages as document number at the Jefferson County Register of Deeds, also being on the westerly right-of-way line of CP Avenue; Thence continuing North East, feet along the said westerly right-of-way line to the westerly extension of the northerly right-of-way line of American Way; Thence North East, feet to the southwest corner of Lot 1 of Certified Survey Map number 4676 recorded in Volume 24 of CSM s, pages as document number at the Jefferson County Register of Deeds, also being on the said northerly right-of-way line of American Way; Thence continuing North East, feet along said northerly right-of-way line to a southeast corner of said Lot 1; Thence continuing North East, feet to a point on the northerly right-of-way line of American Way also being a southwest corner of Lot 1 of Certified Survey Map number 4794 recorded in Volume 25 of CSM s, pages as document number at the Jefferson County Register of Deeds; Thence North East, feet along said northerly right-of-way line to the southeast corner of said Lot 1 also being the southwest corner of Lot 1 of Certified Survey Map 4968 recorded in Volume 26 of CSM s, pages as document number at the Jefferson County Register of Deeds; Thence South East, feet along the south lines of Lots 1 and 2 of said Certified Survey Map number 4968 to the southeast corner of said Lot 2 also being the southwest corner of Lot 1 of Certified Survey Map number 5040 recorded in Volume 26 of CSM s, pages as document number at the Jefferson County Register of Deeds; Thence South East, along the south line of said Lot 1 also being the northerly rightof-way line of American Way; Thence continuing South East, feet more or less to the easterly right-of-way line of Industrial Drive also being the southwest corner of Lot 1 of Certified Survey Map number 3750 recorded in Volume 17 of CSM s, pages as document number at the Jefferson County Register of Deeds; Thence South East, feet along south line of said Certified Survey Map number 3750 to the southeast corner thereof being the westerly right-of-way line of Brookstone Drive and being on a west line of the Plat of Brookstone Meadows- Phase IV; Appendices 34

41 Thence South East, 66 feet along the west right-of-way line of Brookstone Drive to the southerly right-of-way of American Way; Thence continuing South East, feet; Thence North West, feet to the west line of the SE 1/4 of Section 18; Thence westerly 1297 feet more or less along the south line of the North 440 of the SE 1/4 of the fractional SW 1/4 of Section 18 to the west line of said SE1/4 of the fractional SW 1/4; Thence south 889 feet more or less along said west line to the south line of said SW 1/4; Thence west feet along said south line to the point of beginning. Also, Commencing at the northeast corner of Section 24, T7N, R13E; Thence Southerly 1107 feet more or less along the East line of the NE 1/4 of the NE 1/4 said Section 24 to the northerly right of way line of the former C & NW railroad, now owned by the Wisconsin Department of Natural Resources; Thence continuing southerly, 100 feet more or less along the East line of the NE ¼ of the NE 1/4 said Section 24 to the southerly line of the former C & NW railroad; Thence continuing southerly, 120 feet more or less along said East line to the south line of said NE 1/4 of the NE 1/4 said Section 24; Thence westerly, 1325 feet more or less along the south line of said NE 1/4 of the NE 1/4 said Section 24 to the west line of said 1/4-1/4; Thence continuing westerly, 1325 feet more or less along said south line to the northeast corner of Outlot 2 of Certified Survey Map number 3379, recorded in Volume 15 of CSMs on Page 65, as document number ; Thence S 00 o E, feet along the east line of Outlots 2 and 3 of said CSM to the south line of Unzhaven Lane. Thence S 89 o W, feet along the south line of Outlot 3 and Unzhaven Lane to the easterly right of way line of STH 89; Thence N 32 o W, feet along said easterly right of way line of STH 89; Thence northwesterly, feet along the arc of a curve to the left having a radius of feet and whose long chord bears N 34 o W, feet; to the northwest corner of Outlot 1 of said CSM 3379; Thence northwesterly, 244 feet more or less along the easterly right of way line of STH 89 to the southeast corner of Jefferson County parcel number ; Thence N02 o 02 W, feet more or less along the east line of said Jefferson County parcel number to the southerly right of way line of the former C & NW railroad, now owned by the Wisconsin Department of Natural Resources; Thence easterly, 507 feet more or less along said southerly right of way line to the east line of the NW 1/4 of the NW 1/4 of said Section 24; Thence continuing easterly, 1333 feet more or less along said southerly right of way line to the east line of the NE 1/4 of the NW 1/4 of said Section 24; Thence continuing easterly, 1333 feet more or less along said southerly right of way line to the east line of the NW 1/4 of the NE 1/4 of said Section 24; Thence continuing easterly, 1333 feet more or less along said southerly right of way line to the east line of the NE 1/4 of the NE 1/4 of said Section 24 and the point of beginning. Appendices 35

42 Appendices 36