The Monona Rag

Dealing the Dish on Monona, Wisconsin

Tag: TIF

Monona Community Calendar

Here’s a list of some of the great family events happening in Monona that you should make sure you put on your calendar.

Great Road Construction Celebration
All Year through 2015

Rally for a Stop Sign at (insert street)
All Year Long

School Closing / Budget Cut Bonanza

Election Hysteria

Ill-Informed Letters to Editor Bash
Usually coincides with School Closings / Budget Cuts and Election Hysteria

Belle Island Sandbag Party
May (bi-annual event)

Winnequah Park Hash and Marijuana Fest
Saturday nights, all Summer long

Monona/Cottage Grove School Board Festival of Peace and Harmony

Insane ‘How did this get on the Agenda’ City Council Issue Marathon
Date Varies

Goose Poop Frolic

Rake Your Leaves into the Streets Festival

Doug Wood Wears a Tie Day

Christmas with TIF

Alderman Mike Veserat on TIF

Mike Veserat

Monona Alderman Mike Veserat sent us this with regard to the recent discussions on TIF projects here in Monona. Here you go:

Why I voted ‘Yes’ to TIF.

I believe TIF to be a tool.

In my  opinion I believe that the cap rate of 8.5% used in the analysis to value the purchase price was indeed to high.

I believe that a more conservative cap rate of 13% was more appropriate. I am not a lawyer, I am not a CPA, I am not a banker, but I am a resident and businessman in Monona. This was business….and I am sure many of the council members share many of the concerns of the abuse of this “tool”.

The dilema is this: I am one council member and as such am subject to open meeting laws. Without closed session on this subject my cross examination of the facts  some may have found abrasive or to others not abrasive enough.

The seller and the buyer negotiated the purchase price, not the city (I hope). the amount of TIF that is guaranteed is up to $2.55 million. If the site is deemed clean the amount will be approximately $475,000 less. This alone should reduce the amount of time for pay back and represents the 20% to 25% reduction in TIF that I was going to offer as an amendment.

I know that there is no way of knowing if the site is clean until it has been cleared, but if it is clean this will reduce the dollar and time of this TIF. That is why I voted yes for TIF in this case – because the U.W. would be very similar in terms of dollar amount and time duration for our liability as a city.

I am concerned that some in our community would mistake Alderman Jeff Wiswell’s and Mayor Kahl’s respectful dialoge as staging. I for one happen to agree with Alderman Jeff, but at the same time have to respect an opinion from our city attorney.

Lastly, I believe the message of matching liabilities with revenues may have gained traction. I have no way of knowing how the other council members will view my message of managing interest rate risk. So If anyone wants to take shots at the council (me included), it is because – in my humble opinion as a retailer – the city has not financed long term liabilities with long term debt – and that was the only other stumbling block for my ‘Yes’ vote .

We may not have taken up the question directly, but I believe the interest rate risk that has been “put on the table” will hopefully soon be addressed.

Thanks to Alderman Veserat for posting this (he’s the second Monona alderman – along with Doug Wood – to post on the Rag). Alderman Veserat posted this in our comments section and we thought it would make a good post in of itself. Veserat owns and operates the Village Pedaler bike shop on Monona Drive.

TIF Q&A with New Assistant Mayor

Assistant Mayor SmithersThe Monona Rag had the pleasure of interviewing new Assistant Mayor Smithers with regard to the $2.55 million TIF proposal for the new Meriter facility on Broadway Drive.

Rag:  Tell me the details of the proposed TIF district at the corner of Stoughton and Broadway.

Smithers:  We’re very excited. We are talking about a slick new health clinic bringing jobs and money to Monona.

Rag:  But this is a TIF proposal we are talking about – the city providing $2.55 million to the developer to get this done. Correct?

Smithers: Ummm. Yes. That is correct.

Rag: What are the dangers of the TIF proposal?

Smithers: We really don’t see a downside. It’s jobs, jobs and smiling babies as far as we can see.

Rag: There are no downsides?

Smithers: According the Herald Independent there are no downsides. This will be one slick deal.

Rag: But the city is borrowing $2.55 million to give to the developer/proprietor through the assumption that the property value increases after the development is completed?

Smithers: Sure.

Rag:   What if the property values goes down?

Smithers:  Over time property values always go up.

Rag:  Unless they go down.

Smithers:  That would be unusual and is very rare.

Rag:  Have you gotten the latest assessment for your house?

Smithers. (silence)

Rag:  What if Meriterr or the developer encounters major financial difficulties?

Smithers: In this economic climate it’s unlikely a large company would fail. You don’t see banks fail, do you?

Rag: Umm…. we’ll move past that. What are the implications if Meriter is sold to a large corporation – such as a Aurora?

Smithers: Good question.

Rag: And the answer?

Smithers: Good question.

Rag: Where can I actually find financial details on how this TIF deal works?

Smithers: Ummm…. what’s the URL to Monona Doug’s blog.

Mayor wants entire city of Monona declared TIF zone

Okay, maybe we’re exaggerating, but it’s not that far off.

Mayor Kahl is proposing that Meriter, one of the biggest corporations in the state, get $2.55 million in TIF money from the city.

TIF (Tax Incremental Finance Districts) is essentially a way for a city to sort of bribe companies to build in their community.

The most recently approved TIF requests for the UW Health construction, Garden Circle, Monona Drive and the trailer park area on Broadway (I think this one is correct).

The city has also received TIF money request from the Princeton Club Xpress.

At this rate, Mayor Kahl can just declare the entire city blighted and make everything a TIF zone.