By Richard Uhlhorn
At last week’s City Council meeting (May 9) the City Council approved the new Council Rules of Procedure. “This has long been on the to do list,” stated City attorney Quentin Batjer. “All the (pertinent) issues were raised at workshops.”
The Council authorized the Mayor to finalize and execute the KRCI LLC, Parks Maintenance Building Stormwater Infrastructure Agreement. Public Works Director Jake Youngren told the Council that paving for the Maintenance building would be done by May 22 and that KRCI would install the stormwater system. An ample contingency fund of $34,000 was noted.
The Council Chambers was full of residents interested in any discussion on the proposed Tax Increment Financing (TIF) issue. City Administrator Wade Farris gave an update of what the City Staff has been doing.
The City’s TIF consultant Bob Stowe has reached out to each of the Junior Taxing Districts. Farris implored people to visit the City’s new website for more information on the proposal. “A page has been created on the website and is up and running,” said Farris.
TIF (Tax Increment Financing Proposal)
Tomorrow, Thursday, May 18, the City will host the Junior Taxing Districts in hopes of having a good discussion on the necessity of proceeding with the TIF.
The Council approved the necessity to move forward with the TIF, but will not approve the actual ordinance until after their Special meeting on May 24. Once approved the City as five years to enact the TIF and if not implemented any taxes collected goes back to the districts and the TIF goes away.
The State would be auditing the process very closely.
The City of Chelan sent out a letter and detailed information to the Junior Taxing Districts on May 16 detailing the additional work done to help them understand what is being proposed.
The Executive Summary outlines the information as follows:
- TIFs are not a new tax, but simply uses the existing tax levies that are in place
- The City plans on issuing bonds to construct a new water reservoir, a new booster pump and subsequent watermains that would be paid back from the taxes generated by new development within the TIF designated area over 25 years or when the bonds are paid off, whichever is sooner.
- In addition, the City will be pursuing all grant opportunities to assist paying off the bonds.
The TIF, when implemented, would help fund a portion of the cost of further developing the City’s water utility infrastructure. This includes construction of a Reservoir, Booster Pump Station and four watermain extensions for the surrounding neighborhoods.
The estimated costs of these public improvements is $25,059,100. Up to $16 million is planned to be supported by collected TIF revenues.
The City will issue two series of bonds; one in 224 for $9 million and another in 2028 for $7 million.
These infrastructure upgrades are not optional, but critical and necessary for the City’s future development.
Editor’s opinion: For years, the City has not only neglected its aging infrastructure, but has battled low fire flow in all of the upper reaches of its community. The need is critical, because water is now at a premium. In other words, the entire Valley is draining the last reserves of acre feet remaining as development continues at a rapid pace.
Chelan Fire and Rescue, while concerned about losing some tax revenue that will allow it to grow, also recognizes the need to fix the City’s water system so it has fire flow when needed.
Lake Chelan Health needs a reliable source of water for years to come. If the City runs out and is unable to supply water reliably, what solutions are available to the hospital.
These are issues that will hopefully be rectified at the Thursday meeting so the Council can move forward with its special meeting on May 24 to implement the TIF.
The Junior Taxing Districts also need to understand that the TIA (Tax Incremental Area) is a very, miniscule portion of their overall tax revenue generating districts.
All of the affected taxing districts will continue to receive:
- All property taxes generated outside the TIA
- Property taxes associated with the base value within the TIA
- New construction add-on values generated for all property inside and outside of the TIA in addition to the 101 percent increase each year in property tax.
For more information go to the City’s website: https://cityofchelan.us/CivicAlerts.aspx?AID=30