Two resolutions approved by the Warsaw Redevelopment Commission on Monday tie in to a Danco Medical project, while a third puts the Warsaw Chemical property on their “want to acquire” list.
The first resolution Warsaw Community and Economic Development Director Jeremy Skinner presented to the board was on consolidating the Northern and Warsaw Central economic development areas into one area.
Randy Rompola, attorney with Barnes & Thornburg, said the resolution combining the two TIF (tax increment financing) areas does a few things.
“One, it has two expansion areas. One is to include the Danco property, and that’s just a separate expansion into the northern area. And then the other expansion area is essentially the territory that is needed to connect the two,” Rompola explained, saying it was only several hundred yards.
Skinner said the territory is along Ind. 15.
Rompola said they’ve talked about consolidating the two areas before and now seemed like a good time to do it.
“A lot of communities have done this for a couple of reasons. One, it makes the administration of the TIF areas and the economic development areas easier because you have one less area that is separate and apart to deal with. The second one would be that now, with the consolidation, you have greater flexibility with respect to the TIF that’s being generated. You can spend it in either area more easily,” he said.
The other thing the resolution does is it adds the Danco property to the acquisition list, which the second resolution before the Redevelopment Commission on Monday dealt with.
“It does the consolidation of the two areas and adds the Danco property to the northern area, and also adds that little bit of territory in the between to the northern area,” Rompola summarized.
“And why we have it set up that way - the northern area is an economic development area under the statute, the central area currently is a redevelopment area under the statute, and that’s more of an accident of history. When the central area was created many, many years ago, that was the predominant tool being used by redevelopment commissions,” he said.
The TIF allocation areas and the dates aren’t being changed, they’re just being consolidated so there’s just one large boundary.
The area between the two TIF areas will be designated as a new allocation area and have a 25-year life, Rompola said.
Council President Jack Wilhite asked what effect the section being added to join the two areas would have to those businesses within that section.
Skinner said, “The reason we’re having this discussion is twofold, one of which is to bring Danco in. Two, we’ve had a request, for about a year now, for a riverfront liquor license in that area, and the only way you can - under the statute, it has to be an economic development area, or there’s like three other types, but we don’t have any of the other types. So the only way we can give them that riverfront license is if we turn it into an economic development area. So in going through this process, it made sense at this time to just say we’ll combine the two.”
As far as those taxpayers in that area, Rompola said nothing will change.
The Redevelopment Commission adopting the resolution is the first step in the process of consolidating the two areas. Next it will go before the Warsaw Plan Commission, then the Common Council and then back before the Redevelopment Commission for a public hearing. Before the public hearing meeting, Baker Tilly will prepare a tax impact statement, that will be sent to all of the overlapping taxing units. Rompola assumed there won’t be any impact to the overlapping taxing units because they’re next expecting to generate any increment in the new area necessarily.
Commission member Joe Thallemer made a motion to approve the resolution, Wilhite seconded it and the motion passed unanimously.
The second resolution, regarding the disposition of property relating to Danco Medical project, was then explained by Rompola.
“The prior resolution you adopted added the Danco property to your acquisition list so it gives you authority to acquire it, and that process will be completed at your June meeting,” he said. “What we can do, at the same time, we can begin the process to start the disposition process as well. We don’t have to wait until June to start that, we can run them in tandem to save some time. So this resolution actually starts that disposition process.”
To sell a property, by statute, the Redevelopment Commission has to have the property appraised and then approve an offering sheet. Rompola said the resolution essentially approves the offering sheet.
According to the offering sheet, the appraised value - which is the average of the two appraisals - is $1,662,500. The rest of the offering sheet sets out the terms by which the Redevelopment Commission would dispose of the property.
After going through the process, with no one expected to make an offer on the property, the commission would have the ability to sell the property back to Danco at an incentive price, which would be below the appraised value, he said. At the same time, the commission would adopt a declaratory resolution adding Danco to the property list.
“Our contribution to Danco for the project is half a million that we discussed a couple months ago. They spent a little over $800,000 on the gas line, so it’s our contribution to that gas line. That gas line is expanded all the way to our Tech Park, so there’s some benefit to us to have that gas line underground,” Skinner stated.
After the meeting in June, assuming all the resolutions are adopted, Rompola said there would be two quick claim deeds. One would be for Danco to transfer the property to the commission and the second would be the commission quick-claiming it back to Danco for “essentially no consideration to Danco.”
Thallemer said getting that gas service to them is critical for Danco’s expansion and he was fully supportive of what’s been done. When that gas line comes down, it will impact and benefit the Warsaw Tech Park.
Wilhite made a motion to approve the resolution, Thallemer seconded it and it passed unanimously.
The third and final resolution was to add the Warsaw Chemical property within the Winona Interurban Redevelopment Area. “So basically amending that plan to add them to the acquisition list,” Skinner said. He said it was the first step in the process to work toward acquiring the property.
Rompola said it’ll have to go through the Warsaw Plan Commission, Common Council and back to the Redevelopment Commission for a public hearing.
“And all we’re doing to the Winona Interurban Area is simply adding the Warsaw Chemical property to the acquisition list. That will then allow you to purchase it at some point in the future,” he said.
Commission member Bill Curl asked what the purpose and plan were in even looking at acquiring Warsaw Chemical. “Is it to move the business somewhere else and make that more residential?”
Skinner said not necessarily, but it was to relocate Warsaw Chemical. The intent right now is try to create a technology incubator on that side, in conjunction with Grace College and the high school.
The resolution was approved.