Elkhart hopes to keep TIF win streak going

ELKHART LAKE IS HOPING to go twofor two in tax incremental finance district success stories.

That would be batting 1.000, a winning percentage that’s hard to top.

The village is in the midst of the approval process for its second TIF district. This TIF would help spur a $15 million expansion of the Sargento Foods research and development/engineering facility in the village.

In the bargain, it could also help spur new residential development in the village and provide a funding mechanism for some needed infrastructure work – all without costing village property tax payers any additional money.

The creation of this TIF is going much smoother so far than the village’s first TIF, which was created to aid development of The Osthoff resort.

That TIF came about only after a great deal of controversy. Many in the village were pessimistic about the chances of success for the resort development, fearing the consequences if it failed and the village was left on the hook for huge bills relating to the TIF.

Others were upset about the size and scale of the development and its impact on the village, focusing in particular on the closing of a portion of Lake Street requested by The Osthoff as part of its development plan.

None of those fears came to reality. Instead, The Osthoff is succeeding spectacularly and has helped revive the tourism industry in the entire village, spurring improvements and expansions at the village’s other results.

The TIF was able to pay off all its associated debts in the allotted 20-year period and finished with excess funds, which were distributed back to the various taxing entities.

The newest TIF projects to cash flow positively over its 20 years, and that is even with the conservative financial projections provided by the village’s consultant, Phil Cosson of Ehlers and Associates.

For instance, Cosson’s calculations of future tax revenues used a total property valuation of just $8.5 million for the Sargento expansions, even though Sargento has said it plans roughly $15 million worth of new construction. Cosson told village officials that state officials set property values for industrial properties such as Sargento and often set that figure at less than construction costs.

The bulk of the projections in the TIF 2 plan are equally conservative, which means that if growth within the widespread district exceeds those projections – as seems quite likely – the TIF will be able to support all of the projects in the plan and perhaps more, as well as finish with a positive balance at the end of its 20-year life.

That would be an outcome that would be loudly cheered by all involved come 2034.

At issue:
Elkhart Lake TIF 2
Bottom line:
A prospective winner for all

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