Finding a way to retain Mille Lacs Academy within the city limits remains in a seemingly constant state of negotiations between the city of Onamia and Nexus, Inc.
Finding a way to retain Mille Lacs Academy within the city limits remains in a seemingly constant state of negotiations between the city of Onamia and Nexus, Inc.
At a special city council meeting held on Thursday, March 1, council members discussed property options, including a particular piece of property in which Nexus has expressed an interest.
Nexus has told the city they will purchase the property - exact location has yet to be determined - and pay for the nearly $8 million academy development, if the city, county, state or someone, will pay for upgraded roads and bring in utilities.
Nexus has expressed an interest on nearly 40 acres of land owned by Leonard and Helen Vanderpoel near the Onamia schools.
This property has raised concerns with the council. If Nexus were to purchase that piece of property, they in turn want somebody to bring them sewer and water. The cost to do so is nearly $150,000. Add to that the cost to blacktop the road to the new development.
"We (city) obviously don't have the money for that," Mayor Larry Milton said.
A major portion of the road to this property is owned not by the city, but by Bradbury and Onamia townships. Milton said he refuses to spend taxpayer money to develop roads the city does not own.
Milton suggested asking for state bonding help from Rep. Sondra Erickson and Sen. Betsy Wergin.
The option of tax increment financing was also discussed. However, it is believed the TIF option will not apply to the Nexus development at this property because Nexus is tax exempt.
"It is a nice piece of property," Milton said of the Vanderpoel location. "But there are other properties that already have sewer and water with less work required on the roads."
Nexus is asking the city to move forward with a proposal within 30 days. The council agreed to continue looking for alternative property options to show to Nexus with easier access for utilities.
"We still have some time," Council Member Bill Hill said.
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What is TIF?
Tax increment financing, or TIF, is a tool for redevelopment and community improvement projects used throughout the United States for more than half a century. With federal and state resources for development generally less available, TIF has become an often-used financing mechanism for municipalities.
TIF is a tool to use future gains in taxes to finance the current improvements that will create those gains. When a public project such as a road, school, or hazardous waste cleanup is carried out, there is an increase in the value of surrounding real estate, and often new investment (new or rehabilitated buildings, for example). This increased site value and investment creates more taxable property, which increases tax revenues. The increased tax revenues are the tax increment. Tax increment financing dedicates that increased revenue to finance debt issued to pay for the project. TIF is designed to channel funding toward improvements in distressed or underdeveloped areas where development would not otherwise occur. TIF creates funding for public projects that may otherwise be unaffordable to localities.
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