Glenwood approves TIF District to address Fremad demolition, redevelopment

By Tim Douglass

tdouglass@pctribune.com

Glenwood City Commissioners last Wednesday approved establishing two Tax Increment Finance (TIF) Districts within the city. Both TIF Districts were established by unanimous votes and there was no opposition voiced at the public hearings on the districts.

One of the TIF Districts established was to assist with the demolition of the three buildings, including the Fremad Building on Franklin Ave. and 1st Ave. SE in downtown Glenwood.  That district would be between to government agencies–the city and the Pope County HRA/EDA– and would facilitate the demolition, but also re-establish utilities and redevelopment preparing the site for a developer. 

Jason Murray, executive director of the Pope County HRA/EDA, was at the hearing and told commissioners it was the first step in the process to correcting the “blighted property conditions” and carrying out the redevelopment of the site.  He said the demolition, with the property acquisitions of two buildings adjacent to the Fremad building, was approaching about $750,000–about $500,000 for the demolition, that is pushed upward because of asbestos in the buildings.  The cost of purchasing the two adjacent buildings was about $275,000, he said.  

“It is in our best interest (as the property owner) to promote the best development of the site,” he told city commissioners.  The higher the value of what’s built on the site will ultimately determine the timeline and specifications for the TIF, Murray stated.

Murray had approached the city in February to set the public hearings for the proposed TIF District to assist with the redevelopment of the Fremad and adjacent buildings.  The county and the county HRA/Eda have worked since 2014 to sell the Fremad building.

Tax Increment Financing (TIF) is a value capture revenue tool that uses taxes on future gains in real estate values to pay for new infrastructure improvements. TIFs are authorized by state law in nearly all 50 states and begin with the designation of a geographic area as a TIF District. TIF  Districts may be used as a tool to include public infrastructure, land acquisition, relocation, demolition, utilities, debt service and planning costs, it was stated.  

After another hearing, the commission also approved establishing a TIF District for a housing project.  That district specifications will be between the city and developers interested in constructing multi-family, market-rate rental housing on property just east of Highway 55 and north of the Dove International building.  That project is estimated at $4 million, but that figure could change once the city sets the details of that TIF District.  The developers are local, according to Ron Lindquist, who spoke in favor of the TIF for the housing project.  He said the city does need “good, market-rate” housing, adding that the project would include four, 10 unit townhomes built in phases.  The biggest challenge for the project is establishing a rental rate that allows developers to build something that works.

Lindquist explained that the project meets the “but for” questions for a TIF district, stating that it is a critical tool for developers who would not do the project, “but for” the tax increment financing.”

In other business, the commission:

• Authorized Glenwood Cody Bosek  to begin identifying suitable sites within the city for a new tennis court.  The motion also authorized him to begin fundraising for funding the construction of the court.  City Administrator Dave Iverson also stated that the court would need to be fenced and that should be considered when finding a suitable site.  Bosek received support to pursue a tennis court from the Glenwood Park Board earlier in March.  He will be looking at Barsness Park, City Park and other public sites within the city, it was stated.

•Acknowledged an update to the Glenwood Municipal Airport Layout Plan to accommodate an FDA grant to build a building to house snow removal equipment.

•Approved a resolution authorizing Mayor Sherri Kazda, Glenwood City Administrator Dave Iverson and Glenwood City Finance Director Mark Jones as signers for the city’s financial accounts.

•Heard some suggestions about the city’s towing policy during snow events from Glenwood resident Zach Sanford, whose vehicle was towed while parked on a city street during a snow removal period.  Sandford provided commissioners with a letter with suggestions about clarifying the city ordinance that allows vehicles parked on city streets to be towed during snow events.  Mayor Sherri Kazda and commissioners thanked him for his suggestions.