Cascade TID for cheese plant expansion on track, board told

by Rodney Schroeter of The Review staff

CASCADE — The Tax Incremental District (TID) initiated by the village of Cascade is on track. However, certain aspects of the TID need review, to enable a more accurate projection of revenues for the village for the TID’s 23-year life cycle.

Village board President David Jaeckels had asked Scott Schramm, an engineer at Strategic Municipal Services, to address the board at its June 10 meeting to clarify some points regarding the TID.

Also present was Keith Babler who, with his wife and son, own the Cascade Cheese Co., which has been operating in Cascade for over a century, according to Babler.

The basic idea of a TID, Schramm explained to The Review, is that when the Bablers put up the new building, make improvements to existing facilities, and update equipment, it increases the tax base for the village of Cascade. With the TID in place, all of that increased revenue will go back to the village of Cascade, for use in building and upgrading infrastructure.

Schramm told The Review he’s helped numerous communities with TID plans for 30 years.

Functions of the TID are regulated by Wisconsin law.

Jaeckels said one of his main concerns, and main reasons for asking Schramm to address the board, are that currently-understood revenue projections are not as high as those originally projected.

“We’re at the very beginning of the TID life cycle,” Schramm told the board. “When the TID was put into play in 2011, and adopted, it basically started a 23-year life cycle.” He said the initial TID plan was based on a total project of $1.25 million. Instead of putting up a $1.25 million project right away, the Bablers are adding to their cheese company in phases.

The timeline of the TID at this point is:

2011: TID started.

2012: Remodeling project at the cheese company (Phase I of III).

2013: The first revenue (about $6000) from Phase I is seen by the village.

2014: A receiving building (valued at roughly $400,000) became functional (Phase II).

2015: Phase III (early that year); first revenue expected from Phase II (late in the year).

2016: First revenue expected from Phase III.

Schramm said, “If the building went up in 2012, then the Department of Revenue has to come out and assess the building addition, and then put it on the tax roll. So there’s usually a one to two year lag, between when [Babler] puts up a building, and you actually start to see taxes come in to you through the TID.”

Phase I, Schramm told the board, “was just a baby step in the bigger picture.”

Schramm said that the assessment for Phase I came in lower than expected. Babler explained, “The reason the assessments were light, is because the lighting, electrical, and heating are not considered part of the building.”

Jaeckels asked, “So, bottom line, it’s going to take a few years before we see returns on this?”

“Significant returns,” Schramm agreed.

Jaeckels asked Schramm to review and revisit the numbers, to get a more accurate idea of what revenues to expect over the years. Schramm agreed to work on that, and have a report at next month’s meeting.

Schramm said, “On the positive side, at the end of the day, is that what Keith and Betty [Babler] are doing is a lot more ambitious than what we originally talked about in 2011. So that’s good for the village.”

Once the board had updated numbers and projections, Schramm said, “then you’ll have a better target to work from. We are on track. The numbers are a little light for Phase I, but don’t panic, because things are going to ramp up.”

Babler estimated that the value of Phase III would be $4 to $4.5 million.

Schramm and Babler said they would do their own research, as well as keep in touch with each other, for a follow-up report to the board in July.

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