City taps utilities funds to cover TIF 6 income gap

by Emmitt B. Feldner of The Review staff

PLYMOUTH – The city will take money out of one pocket to fill another pocket until money starts coming in the second pocket.

The City Council Tuesday approved a resolution transferring just under $100,000 from Plymouth Utilities’ reserve funds to the Tax Incremental Finance District 6 fund.

“We’re at the last year where there was a shortfall,” for TIF 6, City Administrator Brian Yerges told the council.

The single-parcel TIF district was created in 2010 to help facilitate an office expansion at Sargento Foods.

Under the TIF, the city borrowed for infrastructure and other projects related to the development, with the funds to be paid back out of tax proceeds from the improvements.

“Beginning in 2013, (the district) will generate more tax increment than expenses,” Yerges explained in a memo to the council.

“Pretty much all of the project expenditures for TIF 6 have been completed,” Yerges said. That means all of the tax revenue from the improvements can go toward paying off the TIF’s debt.

Yerges said the total the city had to transfer from Plymouth Utilities funds to cover shortfalls is just under $500,000.

The city will repay that amount at an interest rate of 1.26 percent, which Yerges said was based on the interest rate on the city’s last bond issue.

The council also approved reconstruction work on Well #15, located near Meyer’s Park.

Yerges explained that a video examination that was part of a rehabilitation project at the well showed rust and corrosion on the well casing as well as holes in the casing.

That, he said, is allowing sand and soil to infiltrate the well. “Eventually, that will go into the pumps and basically destroy the pumps,” Yerges continued.

The result is that the well, part of the city’s water supply, is producing water at a lower rate than usual.

Plymouth Utilities Manager John MacKinnon recommended a steel liner pipe and other work at the well, at a total cost of $18,950.

“A smaller sized pipe is going to be put into the well casing,” Yerges explained.

The city is moving forward with another well, Well #17, starting this year, but that well will not go on line until sometime in 2014, according to Yerges.

The new well is needed to add capacity to the city’s water system, Yerges said, but in the meantime Well #15 needs to kept on line.

“The liner will extend the life of the well but it is unlikely to be a longterm solution,” Yerges explained in a memo to the council. “We will realize some capacity loss and we do not know how long the well will be productive due to the finer sand migrating into the coarser gravel.”

He added that the city and Plymouth Utilities will continue to monitor the well after the repairs are completed.

Yerges reported that Public Works Director William Immich is working on getting the traffic signals at the intersection of Eastern and Highland avenues working again.

“Essentially, water got into the wiring and shorted out the lights,” which have been out for a week or more, Yerges told the council. It is not the first time it has happened to the lights at the busy intersection, he added.

“Bill is working to get a cost estimate to rewire the whole thing,” Yerges related. “He hopes it will be dried out soon, but obviously not with tonight’s weather.”

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