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29 <br /> STAFF REPORT <br /> DATE: February 9, 1996 <br /> TO: Mayor and Councilmembers <br /> FROM: Michael Mornson, City Manager <br /> ITEM: VACANT LOT ADJACENT TO CUSTOM INDUSTRIAL <br /> PRODUCTS <br /> Ken Solie and Jerry Cowan, two local developers, are requesting up to $233,000 in TIF to <br /> assist them in the construction of a 30,000 square foot commercial facility. This facility <br /> would serve two tenants who would provide a minimum of 30 jobs. The facility would have a <br /> value of$1.2 million and a tax bill of$60,000 per year, compared to the estimated taxes of <br /> $5,000. This $60,000 per year is approximately the same amount of taxes that the Custom <br /> Industrial Products building is bringing in. In addition, they will also need a public hearing <br /> for subdivision and one for an expectant variance request. <br /> • Policy Impact <br /> The City's policy states that the City can provide up to $10,000 in assistance for each <br /> $100,000 increase in value and $5,000 for every job created or retained. <br /> $1.2 million in value = $120,000 <br /> 30 jobs 150.000 <br /> $270,000 <br /> The City has approximately $500,000 in the fund balance from the Chandler and Kenzie TIF <br /> districts. I would propose the City use those funds for this redevelopment, as we did for <br /> American Monarch and the two townhouse projects. The benefits of this are: (1) no bond <br /> sale; (2) no TIF district created; (3) no LGA penalty; and, most importantly, (4) the City, <br /> School and County benefit immediately. <br /> To be able to provide the funding for this development, the City will need to conduct a public <br /> hearing to amend our budget. I have attached the activities that are currently permitted to <br /> utilize TIF funds. Since we are going through the hearing, we may want to add or delete to <br /> the plan. <br /> • PIease let me know within the next 30 days, if there are any changes you would like to see in <br /> the TIP pian. <br />