Otsego willing to consider TIF for apartment complex

Sports Reporter

 

by Eric Oslund
Reporter
The Otsego City Council met with Otsego Apartments, LLC in a special meeting Aug. 28 to discuss the possibility of a tax increment finance agreement. Nothing was set in stone, but Otsego Apartments wanted to make sure the council would be willing to consider taking that route before it moved forward with the project.

The project is for a new set of apartments and a storage project, and while apartments are not typically high on the TIF priority list for the City Council, these were a special case. Riverbend Manufactured Home Park is also near by the proposed area, and it is currently hooked up to a private wastewater treatment plant instead of city water.

The city wants the mobile home park hooked up to city water, and a TIF agreement could assist in the removal of the existing private wastewater treatment plant and payment of sewer hookup charges to the existing mobile home park and the proposed apartment buildings. For that reason, the council said they would consider using TIF depending on how things progressed.

“I think it’s a unique situation,” city attorney Andrew MacArthur said at the meeting on Aug. 28. “It is a low priority, but this is a very unique situation in that not a whole lot of cities have an existing wastewater treatment plant that’s been there since before they incorporated. That is the kind of unique situation we are looking at.”

The process took another step during the council’s meeting on Monday, Sept. 25, when the city staff recommended that the council approve an agreement to undertake a redevelopment study of the property to determine whether it meets the criteria for a redevelopment under a TIF analysis. Staff also recommended entering into an escrow agreement with Otsego Apartments, LLC to pay for the study.

The study would cost $5,900, and the escrow agreement would require $7,000 to cover any additional costs that arise during the study. A traffic study would also need to be undertaken.

The council approved a motion to undertake the analysis, subject to the execution of the escrow agreement between the city and Otsego Apartments, LLC, by a vote of 3-0. Council Member Jason Warehime was absent at the meeting and Council Member Tom Darkenwald abstained from this agenda item as he has family involved in the project.

There will be a special meeting on Oct. 9 to discuss the results of the study.