tax increment districts tids

A Personnel and Finance Committee meeting where this topic appeared was canceled.

This topic appeared on a Joint Review Board meeting agenda.

Staff reviewed pending state legislation that could expand how the city can use TIF, including options related to affordable housing and small-lot, owner-occupied housing.

Council discussed how potential state-law changes could add flexibility for future housing and infill strategies if enacted.

Staff reported the Revolving Loan Fund balance was just over $1 million and said three active loans (VT Industries, Pop Start Pizza, and Violet Inn) were being repaid.

Staff flagged 2026 work to analyze and possibly end some underperforming TIF districts.

Staff noted discussion about potentially acquiring the former Hamilton’s property, with a Dec. 2 status meeting mentioned.

Staff described a 2026 TIF strategy discussion referencing the city operating 12 TIF districts and using a performance review based on 2025 data to drive recommendations.

Staff indicated the review could lead to recommendations including early termination of underperforming districts and amendments to active TIF districts to reflect state law changes.

City staff provided an annual review summary of activity and finances for all TIF districts.

Staff reported RW Baird was hired to prepare a valuation estimate for all TIF districts, with a report expected the next week.

Staff said the valuation information would be shared once received.

Staff presented proposed TIF fund budgets using the same total property tax revenue as last year, redistributed based on updated increment values, and noted the numbers will change once levy information arrives.

The committee heard that TIF districts 6 and 10 are expected to close in 2026 with negative balances.

The committee heard that TIF districts 15, 16, and 17 may also end the year slightly negative due to service fees, despite having years left.

The committee reviewed Revolving Loan Fund and TIF balances, including current commitments and remaining capacity, and staff walked through lending strategy and guidelines; no action was taken.

City Council approved Resolution 26-043 to terminate TIF district 13 early by a 6-0 vote.

Staff said ending TIF district 13 would return the district’s value to the regular tax rolls, with property tax revenue flowing to the city’s General Fund starting Jan. 1, 2027, also benefiting the county, school district, and Lakeshore Technical College.

City Council approved Resolution 26-044 to terminate TIF district 16 early by a 7-0 vote.

Staff said ending TIF district 16 would return the district’s value to the regular tax rolls starting Jan. 1, 2027, increasing revenue for the city, county, school district, and Lakeshore Technical College.

City Council approved a facade improvement grant not to exceed $17,536 for the Cool City Motel (3009 Lincoln Avenue) to replace 28 exterior doors and locking systems, with reimbursement funds coming from TIF district 11.

City Council approved a facade improvement grant not to exceed $10,000 for the Lighthouse Inn (1515 Memorial Drive) for exterior lighting and signage, with reimbursement funds coming from TIF district 12.