08-24-88 Council Minutes - Laserfiche WebLink

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MINUTES City Council August 24, 1988 TIF Lar•r•y Lee repor•ted that he has a client inter•ested in occupying one of Distr•ict his existing buildings. However•, there are r•elocation costs of about No. 2 $280,000 to get this tenant into the buildings. Lee r~eported that he (Cont.) is looking for a tool to assist in the relocation costs and felt that the company would be a good r~esident for the City. Lee also reported that he has another client inter•ested in locating in the City in one of Lee's buildings and this company would requir•e about $250,000 in relocation costs. Scalze felt the use of TIF to relocate companies into existing space was bending the rules. Scalze stated that she felt TIF should be used to assist new construction to increase the tax base of the City. Lee pointed out that the additional impr~ovements to the building would increase its value and, thus, the City's tax base. Scalze again stated that she felt TIF should be used for new construction. Fahey asked if other• cities are doing this. Wilson replied that the City could do it, however~, the TIF bond sale being consider~ed this evening will not gener•ate the kind of money Mr. Lee is talking about. This bond sale will have a sur•plus of approximately $56,000 after administr•ative costs. Wilson also pointed out that the money gener•ated within one of the City's TIF Districts has to be spent within that Distr~ict as well. Scalze asked why TIF would be used to assist in the construction of DeSoto. The City Planner pointed out that the City is pr•ohibiting the use of DeSoto by the industrial pr•operty, an~, ther~efore, it would be unr•easonable to r•equir•e these properties to pick up the cost of improving DeSoto. It has been suggested that TIF could be used to pick up what would have been the industrial properties share of the cost of DeSoto. The other~ cost of the street improvement would be assessed against the benefiting residential pr•oper•ty. Scalze also pointed out that ther•e is a portion of the street under the NSP easement which could not be assessed. Wilson pointed out that the City's policy says that 10% of the cost of the pr•oject will be available to the developer to assist in this project costs, and 5% will be available to the City for public impr•ovements. Blesener stated that he could see using TIF to make impr•ovements to a building, but cannot see using TIF to move a company. Blesener asked what Lee will use the $140,000 in TIF funds for. Lee r~eplied that the $140,000 will be used to write-down land acquisition costs. Page -14-