Just a Thought

Historically, my recommendation with regard to a TID in the Downtown is to do nothing. The City had a verbal report from Vandewalle and Associates indicating that property values in the downtown area were too high and it would be difficult to generate any significant increment and property values have only been going down recently. However, this recommendation does not take into account another option.
If the Council is willing to consider purchasing property in the downtown area (213 W. Madison Street) then a larger project should at least be considered. I propose that we purchase the Opera Hall, Old Marina, vacant lot on the corner, 213 W. Madison and 205 W. Madison Street. The plan would be to purchase the land and demolish all the existing buildings for redevelopment. The city purchasing the land would lower the assessed value for all these properties and then creation of a TID on the one Main Street block would be viable. Fire inspection reports indicate that the Opera Hall needs substantial repairs, the Marina is already not compatible with the existing buildings, the vacant lot may need environmental work and the houses are old and the real estate would add valuable land to the downtown district.
The redevelopment in the area would generate increment for use in the downtown. It would help generate capital to allow new development in the downtown meet the requirement to be compatible with the historic architectural character of existing buildings. The TID would also provide us capital to work with developers and the Main Street Program to encourage reinvestment in the remaining historic buildings.
Business and developer resistance to locating in our downtown generally stems not from an unwillingness to locate in two or three story structures, but from obsolescent buildings that are deficient in ceiling height, utilities, insulation, space for HVAC equipment, compliance with ADA and other aspects. The problem is that there’s only so much of a market for small obsolescent buildings that are deficient in ceiling height, utilities, insulation, space for HVAC equipment and aren’t in compliance with ADA.
In some cases, the costs of renovations to these buildings, even when physically possible and incentives are available, are substantially more expensive then new construction would be. In cases where it is not possible or desirable to save or rehabilitate existing buildings, the City through the TID could assist in meeting the architectural character requirements for new buildings by having incentives that encourage characteristics necessary to preserve the historical pattern and character of the City of Lake Mills’ downtown. Developers want the convenience of the new structures and/or renovations and aren’t opposed to buildings consistent with valued historic appearance, especially if the TID provides assistance. These new structures can be important not only to retaining the historic appearance and unique community character of the district but can also preserve its long term viability and vitality as a center for commerce and civic activity.
The City will have to borrow money for any land purchase and the TID would help repay any debt incurred. Prices for land and building acquisition by the City are at the lowest level in many years. The City could sell the land for the value of the land less improvements and thereby substantially encourage new development in the downtown. It would also provide the downtown as much city based development opportunities as the Main/Tyranena corner.
Obviously, there is a lot of risk in this proposal with our current economic conditions. The desire to invest in buildings that are compatible with the historic architectural character of existing buildings adds cost when bank financing is already tight. The city would be investing up front dollars like has been done for TID#2, rather than pay-as you-go dollars similar to TID#4.
I haven’t put enough time into the problem to frame it adequately much less suggest that this is the proper solution. This is my first review of the idea and it needs work if the Council is at all interested in continuing with the concept.