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City’s Joint Review Board Approves TID #7

There are now officially seven Tax Increment Districts (TIDs) within the City of Sturgeon Bay following approval last week by the city’s Joint Review Board.

Upon recommendation from the city’s Plan Commission, the Sturgeon Bay Common Council had previously adopted the boundaries for TID #7 surrounding a 12.6-acre vacant lot between the Target store and Duluth Avenue.

Premier Real Estate has proposed constructing a 96-unit apartment complex on the property, which was valued at $143,000 as of Jan. 1.

According to the project plan for TID #7, the city is able to stay under the state limit of all seven TIDs not exceeding 12% of the total equalized value of taxable property within the city.

The city’s 2021 equalized value, with the TIDs included, is approximately $1.03 billion, and TID #7 brings the total value of the TIDs to around $90 million. The value increment of all the TIDs is about 8.75%.

Property taxes generated from development (i.e., tax increment revenue) in a TID, once it is created, are able to go directly to pay for infrastructure improvements, rather than being split among the various taxing entities where the TID is located.

“Plan implementation will begin this year and roll out as increment becomes available,” said City Administrator Josh VanLieshout.

Community Development Director Marty Olejniczak said the city likely will not spend any funds on the public infrastructure projects until the apartments are under construction.

Olejniczak said a conditional-use hearing for the developer to build multifamily dwellings was scheduled for June 1 before the Plan Commission, after the deadline for this issue of the Peninsula Pulse.

“We are also working on a development agreement, which is required to receive [tax increment financing] assistance,” he said. “Once those two pieces are approved, the construction can commence.” 

Of the approximate $2.7 million in planned project costs for TID #7, $1.5 million is a developer grant/loan incentive. Property taxes generated from the site being developed would be used to pay off the loan.

TID #7 is the city’s first that is part of the Southern Door School District, after the previous six were created within the Sturgeon Bay School District.