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TO: Honorable Mayor and Members of the Common Council FROM: Kelly Nieforth, Director of Community Development DATE: July 23, 2024 SUBJECT: Res 24-441 Approve Dissolving Tax Incremental District No. 12 Division Street Redevelopment

BACKGROUND

On April 24, 1997, Council approved a creation resolution for a project plan and boundaries for Tax Incremental Financing District (TID) No. 12 Division Street Redevelopment. The TID was created to assist with the rehabilitation of blighted property and to add parking on Division Street and Main Street between Irving Street and Church Avenue. On March 12, 2024, Common Council approved an Affordable Housing Extension to extend TID 12 for one additional year, which will result in approximately $168,000 being added to the Healthy Neighborhood Initiative for housing improvements in the community.

ANALYSIS

State statutes require that a TID be terminated after enough increment has been generated to pay all remaining project costs or after any applicable extensions end. TID No. 12 has now reached its statutory termination of 27 years and must be dissolved. The TID increment is currently valued at approximately $6,916,000.00, which will be added to the general property tax roll upon closure.

FISCAL IMPACT

The cash balance for TID No. 12 is about $850,000. After the final audit is complete, the City will retain about 30% of the funds to establish a reserve fund to help other underperforming TIDs in the city. According to state statutes, the municipality must return excess funds based on each taxing jurisdiction's portion of the total tax rate. The Department of Revenue recommends basing the distribution on the most recent tax levy proportions without the tax increment. The other taxing jurisdictions include the Oshkosh Area School District, Winnebago County, and Fox Valley Technical College, in proportion to their contributions.

RECOMMENDATION

Staff recommends approval of dissolving Tax Incremental District No. 12 Division Street Redevelopment.

Attachments Res 24-441

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