Sturgeon Bay Proposes TID #9 for Multi-tenant Industrial Building

This drawing shows what the multi-tenant industrial building known as the Sturgeon Bay Business Center would look like on a 17.8-acre parcel the city owns between South Neenah Avenue and Shiloh Road, where Sturgeon Bay’s Tax Increment District # 9 is also proposed. Submitted.

Sturgeon Bay’s Finance/Purchasing and Building Committee made a pair of recommendations Tuesday related to the future development of a 17.8-acre parcel the city owns on the west side between South Neenah Avenue and Shiloh Road.

The site is where the Sturgeon Bay Common Council voted in February to approve a memorandum of understanding (MOU), effective through the end of this year, between the city and Howard Immel, Inc. to design and construct a 50,000-square-foot building and space for about five tenants in the Industrial Park. 

Under that agreement, the city would provide the vacant former Zak property along South Neenah Avenue and some level of financial incentives for construction. However, the MOU doesn’t bind the city to any level of financial incentives or a specific development agreement.

The committee recommended the city hire R.W. Baird for consulting services to create Tax Increment District (TID) #9 at that site.

Community development director Marty Olejniczak said Baird, which the city uses for consulting services to create new TIDs, would charge the city $7,000. 

He said if TID #9 is successfully implemented, the fee would be collected from future tax increments generated by development, or if the TID is not implemented, the fee would be paid out of the general fund. 

Olejniczak said the area would be a good location for a new TID to help cover the costs of infrastructure to expand industrial development.

“That’s how we did TID #1 [for the Industrial Park on the west side],” he said. “We got a lot of industry and expansions in the original Industrial Park.”

The Common Council also voted this year to close TID #1 and free up capacity to create additional TIDs.

Even if the multi-tenant industrial building now referred to as the Sturgeon Bay Business Center wouldn’t be developed on the former Zak property, Olejniczak said the city would still market the site for other business uses.

“Most of the infrastructure is already put in,” he said. “This is kind of that hole in the middle of our Industrial Park. Shiloh Road has sewer, water, storm sewer [and electrical service] – the same thing with Neenah [Avenue].”

Besides the former Zak property being included in the TID, Olejniczak said a vacant 20-acre site to the north that is currently not for sale might also be added.

Because a TID’s boundaries could be expanded or contracted in the future after being created, District 3 Alderman Dan Williams said it would makes sense to create TID #9.

“I don’t think we have to be too aggressive on the front-end of this, but I think we should always keep our eyes peeled for where it makes sense [to change the TID boundary],” he said.

The committee also recommended hiring Cedar Corporation for engineering services at the site, with the city’s portion estimated to cost from $20,000 to $25,000, depending on stormwater management design, with Immel’s portion costing $15,500.

“It makes sense, given the topography out there, to have a regional [stormwater] pond,” Olejniczak said. “That’s a large part of the city’s portion of this contract.”

He said the city received proposals for engineering services from Cedar Corporation and Stantec, with the latter not providing a specific timetable for performing those services.

“The one from Cedar’s we thought was the best in terms of the timing, which was the most important thing,” Olejniczak said. “Immel thinks that if everything goes smoothly, they could start construction on this in fall. They’re pushing to get going on development agreements, [tax increment financing] districts, design [and] engineering.”

City administrator Josh Van Lieshout said the engineering services amount to an initial step to develop the property.

“It’s not uncommon to split costs and share costs when you have an interested developer,” he said. “That’s why the prices are reasonable, and I think the recommendation to go with Cedar is reasonable as well.”

Van Lieshout said the city worked with the Door County Economic Development Corporation (DCEDC) to find someone interested in constructing a manufacturing building.

DCEDC executive director Michelle Lawrie said in January that she backed the project to provide space for developing companies to leave DCEDC’s business incubator.

The MOU calls for Immel to work with DCEDC and city staff to identify potential anchor tenants for the facility.

Williams said city officials have “heard over and over that Sturgeon Bay needs a building like this.”

“We might even be looking at another one at some point in the future,” he said. “I think it’s a very positive move for our city and our expansion of the Industrial Park.”

Even if the multi-tenant industrial building wouldn’t be constructed, Olejniczak said the engineering services that would be done on the city’s behalf would still be useful for expanding the Industrial Park and marketing sites there.

“It’s not like we’re throwing money away if the project doesn’t happen,” he said.

Carol Karls, director of preconstruction and client services for Immel, told the committee in January that the project concept calls for constructing a “fairly typical pre-engineered building.”

Karls said Immel, which would not own the building, will get to a point where it will turn the project over to a developer the company would select.