Keystone discusses development funding
Timeline too short for establishing TIF district
By John Faucher
The New London Economic Development Committee met on Monday, Oct. 5 and discussed a recent proposal by Keystone Development for the city owned riverfront property.
A group from New London toured a similar development owned by Keystone earlier in the month.
Mayor Gary Henke reported to committee members that could not attend the tour. Henke said that the tour was informative and that the buildings all looked very nice.
The development is a tax credit assisted housing development, principally for low and moderate-income families. They have an onsite manager, common area for meetings along with a weight room.
A representative from Keystone, Andy Dumke, was on hand to explain how a development proposal is scored for tax credit funding consideration by the state.
Only 12 per year are awarded out of over 50 applicants statewide. Keystone was awarded three of the projects last year, the maximum allowed in a year.
Dumke noted that the scoring criteria is weighed heavily by the level a community participates financially.
Keystone’s proposal in New London is for a group of two-story townhomes, and would be a tax credit assisted housing development, for moderate to low income families.
Henke and other committee members expressed concerns over the timelines for the development.
The city had offered to contribute the land, however the developer was also asking for the development of a Tax Increment Finance (TIF) District. The TIF district would collect approximately $49,000 in taxes a year from the development and return $41,500 of the taxes back to Keystone for 15 years, or over $600,000.
Committee members also discussed the deadline for establishing a TIF and meeting the January deadline for the tax credit financing application.
Zoning Administrator Paul Hanlon also said there would be a zoning issue that would have to be worked out.
City Administrator Kent Hager said it would be a narrow timeline if they wanted to incorporate a TIF into the proposal.
“If you can do it without the TIF, you’re better off,” said Hager.
Alderwoman Lori Dean agreed and said the timing is not right at this time.
The city’s TIF consultant noted that there was a very tight timing window to get a TIF in place in order to benefit the proposed development by the January deadline.
The committee agreed, and will inform Keystone to consider other options, or bring back its proposal next year if it is still an option.