Claremont approves first free lot home, establishes TIF District

Claremont City Council members approved the purchase agreement for the first free lot in the city last week and also established a Tax Increment Finance (TIF) District for the Al-Corn Clean Fuels expansion project.

James Konz has been approved for one of the free lots in the RK&T Development that the city is making available for those who meet certain financial criteria, Tom Monson of the city’s Economic Development Authority said.

The Claremont Development Program was created to encourage construction of single family residences in the city. The city owns 14 lots in the development.

The lots are available at no charge to families of two or less with a gross income of $77,100 or less and to families with three or more and a gross income of $88,665 or less.

Council members were told that Konz plans on moving in a house that has already been approved by the building inspector. He has obtained the required permits and paid the non-refundable administration fee, Monson said.

The council also officially approved TIF District No. 1-5 and the Al-Corn Business Subsidy Agreement moving the expansion of the Al-Corn Clean Fuel plant one step closer.                                                                                                                                            Mike Bubany of David Drown Associates said the tax increment generated over the life of the TIF is estimated at $2,720,578. After the project, the city’s tax base will increase by about 60 percent.

Tax Increment Financing uses the increased property taxes that a new development generates to finance the costs of the development. After the TIF district is created the taxes paid by the increase in value is paid to the development authority and the authority uses the increment to pay the costs of the project.

The city, and to a lesser extent the county, are temporarily giving up the new taxes, Bubany said, in anticipation of the benefit when the project is completed.

TIF Districts are generally established for 11 years, Bubany said, with a limit of nine collection periods.

The council also heard from State Sen. Vicki Jensen who spoke about the past legislative session, the possibility of a special session yet this year and prospects for the upcoming 2017 session.

Most of her presentation centered on Highway 14 expansion.

There were monies for Highway 14 in the transportation bill that failed at the end of the session because there were no funds for light rail transit. The money that would have been available, she said, was for right-of-way purchase.

She said legislators knew the bill could not pass without transit funds but her understanding was that an agreement had been worked out where the local taxpayers would pay for transit. 

Without those local tax dollars, she said, $900 million in federal funding would be lost. The bigger issue, she said, is that if the state does not fulfill its part of the bargain for the grant money, future federal grants could be in jeopardy.

Jensen said she could just not understand the opposition