By Jessica LeDuc
Blade staff writer
A decision to use tax increment financing dollars for a project on West 5th Street turned into a much larger discussion over other uses for TIF dollars at Wednesday night's Concordia City Commission meeting.
The Commission authorized City Manager Larry Uri to proceed with using $56,452 in TIF funds for projects on West 5th Street for McDaniel Memorial and Destiny Breault Photography.
The McDaniel Memorial project, at 322-312 West 5th Street, is to remove and replace the sidewalk across all four properties, remove and replace curb and gutter, pour two driveways, and tree, sewer line and utility pole removal.
Destiny Breault Photography, to be located at the corner of 5th and State streets, is asking for TIF funds for sidewalk and curb and gutter work.
Uri said that neither project will generate enough of an increment over the remaining life of TIF to recover the total project costs. Finance Director Amber Farha said the TIF fund currently has $397,149 in cash available for projects. That does not include the $100,000 that the city has committed to the Brown Grand Theatre's restoration project.
Farha also said that over the remaining life of TIF, which is scheduled to end in 2019, if there is no increase in the mill levy or valuation the fund will end with a little more than $1 million.
"If the mill levy or valuation goes down, then this number will also go down, but given the history of valuation and mill levies, this is unlikely," she said. "This means the city will have this much money to use on TIF projects as they see fit."
Earlier this month, the Commission approved moving forward with using $200,000 in TIF funds as a match for a Kansas Department of Transportation grant to construct a 1.3 mile walking trail around the flood control area. The plan also calls for three footbridges, a new parking lot adjacent to Cloud County Community College, and a shelter and restroom building.
Uri said last night he had received letters from both the Cloud County Commission and USD 333 saying neither supported using TIF dollars for the project. Uri said he felt using the money on the grant match was an appropriate use.
"Reasonable minds can definitely differ as to what it is appropriate to spend TIF dollars on," he said.
In 2011, he said, the Commission approved using $2 million in TIF funds to build the dam in the south development, as well as prepare commercial lots for sale.
That resolution stated the project was "public infrastructure improvements necessary to maximize economic development and recreational opportunities while controlling storm water drainage. . .including construction of storm drainage systems, roadways, public utilities, recreational trails, and other public amenities."
"In 2011, we stated recreational trails as being among the purposes of that bond issue," Uri said. "Back when we borrowed this money, notification (to the TIF partners) was given as to what we were trying to do. There's nothing new about this project."
In reality, he said, the $2.1 million bond should be able to pay for the dam, the commercial dirtwork and the match for the grant.
"Right now, it's a grant application," he said. "Who knows if we're going to get the money. I think it's well within what we can do as a TIF project."
Uri said there have been other projects that have used TIF dollars that haven't directly related to economic development, in addition to the dam project.
"The lion's share of that money (for the dam project) is not going to raise property taxes, and no one objected at all to that expenditure of money."
The same could be said of the $100,000 in TIF money the Commission has pledged to the Brown Grand, he said.
"The Brown Grand does not pay property taxes, and no one objected to that expense."
USD 333 Superintendent Bev Mortimer said she would agree with Uri that legally, the city could used TIF money to fund the walking trail. But given the state of school funding, she said, the district has become more vocal about TIF usage.
Over the past three years, she said, the district has lost $690,000 in state aid in the local option budget.
"We don't benefit as a district until the end of the TIF district," Mortimer said. "Our benefit wasn't noticeable when they (the state) paid our state aid. We've had to increase our LOB mill levy to generate less money because they're not kicking in state aid."
She said the district was in favor of TIF projects that either increased the property tax value or brought new families to town. If a new TIF district is formed, Mortimer said, the school district might not be as likely to participate.
"It'll be hard for us to support and sign off on it knowing we're not getting our full state aid, and knowing that it's been the way it has been done where maybe not everything does improve a property value," she said. "We're not against growth and improvements at all. We just have to protect our side of things, but perhaps the school district property could be in the next TIF district and then we can work together in that way also."
In other business, the Commission approved purchasing a computer server from Computer Solutions for $12,925.
The Commission also heard a year-end report on the Fire and EMS Department from Fire Chief Eric Voss. He said in 2012, the department had 627 calls – 110 fire related, 517 EMS, and 90 long distance transfers. The average response time, he said, was two to seven minutes.
In 2013, Voss said the department is working on increasing the level of EMS service, going paperless, increasing the inspection process, and increasing the level of training.
During his manager's report, Uri said he had invited engineers to town to discuss the viability of converting the Concordia Middle School into a police department and community center. That meeting was cancelled, he said, given that Concordia does not have a police chief after the resignation last week of Chris Edin.
He said he decided to hold off on moving forward with the project until a new police chief is hired. He also asked that the Commission let him know at the next meeting if the project is worth pursuing.
After two executive sessions for non-elected personnel and attorney-client privilege, after which no action was taken, the Commission adjourned to a study session to discuss insurance proposals and the north development gas line.