Five-year abatement period passes on split vote
Polaris is expanding its facility in Wyoming, and as a result of council action taken on Thursday, it now will have help from the Minnesota Investment Fund as well as benefits from the remaining years of the Minnesota JOBZ program and the city tax abatement program established earlier this year.
Nancy Hoffman, Director Chisago County EDA-HRA, reviewed the expansion plans. The existing building is 140,000 square feet. The new addition will add about 145,000 square feet to its facility. Hoffman indicated that additional expansion is planned for 2018.
The project cost is $17 million for the building and $3.5 million for equipment. Currently the company has 315 employees. The majority of the new hires for the company have moved into the Chisago County area, according to company representatives attending the meeting and the accompanying map.
Hoffman explained all parts of the proposed financing, but the council acted upon them individually. Minnesota Investment Fund is a loan program for communities, who in turn, loan the money to businesses. In this case, the loan is to Polaris. In this program, the loan is forgiven if the employee goal is met within two years. Initially, Polaris is targeted to add 115 jobs, at wage-rates of $15-plus an hour.
The amount of the MIF loan for equipment is $400,000. The council approved the loan by a vote of 5-0. Action authorizes Mayor Eric Peterson and Administrator Craig Mattson to sign the legal documents on behalf of the city.
The JOBZ program helped Polaris build the original part of the Wyoming facility. The program ends in 2015. According to Hoffman, primary benefits of this program “will be job tax credits and sales tax exemptions.” Council members approved participation in JOBZ by a vote of 5-0.
Benefits to the city for the JOBZ for the original building end in 2015. Taxes are assessed 2016 and paid in 2017. The understanding of city officials was that taxes for the improved property would be payable to the city in 2014.
Council established a tax abatement program this August to encourage business development and expansion within the city and to create jobs. The limit of the city program is $5 million.
As the last part of council action on the Polaris expansion, was approval of tax abatement for the company. The abatement is to begin when the JOBZ program ends in 2017 and last until 2022.
Tax abatement requested from Chisago County was $365,672 for five years. The request from the city portion of taxes was $292,758 for five years. This amounts to $73,134 annually for Chisago County and $58,552 for the city.
Once the five-year abatement period is over, Chisago County will see an increase in property taxes of $110,076 a year and the city, $88,127.
Steve Zerwas was opposed to the full five years of the abatement program. Abatement begins when JOBZ ends in 2017, then the city won’t realize full benefit until 2023. He said he was comfortable with three or four years. In addition, the city “may” grant abatement for up to five years. Zerwas thought two or three years was enough. Linda Yeager agreed with Zerwas, saying that the “city can deviate from the policy.”
Roger Elmore said the city had given its word for a period of five years for the abatement term. Mayor Eric Peterson this is sort of a “litmus test for the City of Wyoming.” The motion to grant five-year tax abatement to Polaris passed by a vote of 3-2. Both Yeager and Zerwas voted against the action; staying with the position that it is “not to our advantage.”
The council certified unpaid utility bills for 2012 to be turned over to Chisago County for collections 2013 property tax payments. This applies to water, sewer, and surface water utility bills; residential and business customers.
Residents have been given written notification of council action and have the opportunity to pay these bills by Dec. 2, to avoid having them tacked onto property tax statements. Council members noted that some of these were small. Mattson indicated that many are usually paid before the deadline. The council vote was unanimous.
In a council work session, preceding the council meeting, engineer Mark Erichson discussed the next step in planning for city street repairs. A map showing the streets which need work, color-coded to match the degree of deterioration. Erichson said this is not “exact, but projects can be determined by length and roughest.” The next step is to set priorities, based on road ratings. Feasibility studies are necessary to identify poor sub-grade.
Girl Scouts Cellea Osterbauer and Allison Nolden of Troop 50244, raised money to help with park cleanup as part of their scouting Gold Award. Unlike Eagle Scout projects (Boy Scouts) who raise funds and volunteers for projects, Girl Scouts seek to involve the community, Osterbauer said.
The project was originally presented to the Park Board, and there was general approval, but no funding authorization. Roger Elmore recommended the duo return to the Park Board to complete the petition through official channels. Ultimately the decision is made by the city council. The council was pleased by the work completed by these scouts and their families. Source of funds is likely to be gambling funds.
Council approved by unanimous vote a variance request for Sherwood Heggen to build an attached garage to his house with an 84-foot set-back from the CR-22 centerline. Fred Weck explained that the Planning commission recommended approval.
The police department has an unclaimed Yacht club trailer in the impound lot, but it is not useful to the department. At the request of Paul Hoppe, the city council unanimously authorized its sale through public auction.
In other business, the results of the city election were certified by the council.