MONROE - Whatever project the city builds in place of the parking ramp downtown, the city would need another source of revenue to fund it until the district realizes an increase in value and taxes to cover its current debt obligations and the new debt, according to Greg Johnson, an Ehlers financial advisor for the city.
Johnson delivered his financial analysis of Tax Increment District No. 7 Tuesday at the Common Council meeting.
Johnson verified what the city has known for several years since undertaking a $4.2 million downtown infrastructure renovation and street beautification project in 2009. The district's value has not increased enough to generate sufficient tax revenues to pay for the debt incurred. The city has been filling the gap to cover its debt payment.
Without any additional growth or appreciation, TID 7 is expected to maintain an annual deficit until 2030.
Johnson said additional development is necessary to pay for existing debt obligations.
The city is now considering investing more money to fix or replace the parking ramp, including a public/private venture that would include commercial, retail space. In his calculations, Johnson assumed an estimated, cumulative value of $4.5 million in new development over a three-year period.
Johnson found that $4.5 million of new development would "improve cash flow over the remaining life" of the district.
The additional tax revenue generated could be used to repay its $3.3 million debt with interest and reimburse the city water and sewer utilities' costs of $1.3 million for the 2009 renovations, or the city could use the additional increments to pay for additional projects.
Even if the city uses the money for new development, Johnson cautioned that the type and timing of projects and the actual construction of new development "should be carefully evaluated."
If the city should have costs before development occurs, it runs the risk of losing that invested amount or repaying any borrowed amount, if the development doesn't materialize or fails to reach its anticipated value.
Pam Christopher also spoke to the council Monday on behalf of the Chamber of Commerce, the downtown Business Improvement District and Main Street Monroe, and delivered a packet of information that the groups hope will help the city in its decision for the parking ramp.
According to Christopher, representatives of the three organizations have been researching the potential of a public-private venture to replace the parking ramp, and they consider the parking ramp vital to downtown business owners, employees and visitors.
The groups have pulled together estimated costs of constructing a parking ramp with extended retail spaces; have investigated grant opportunities through Wisconsin Economic Development Corporation; and are planning to do a parking study, using instructions provided by WEDC.
The council took no action on the future of the parking ramp.
Johnson delivered his financial analysis of Tax Increment District No. 7 Tuesday at the Common Council meeting.
Johnson verified what the city has known for several years since undertaking a $4.2 million downtown infrastructure renovation and street beautification project in 2009. The district's value has not increased enough to generate sufficient tax revenues to pay for the debt incurred. The city has been filling the gap to cover its debt payment.
Without any additional growth or appreciation, TID 7 is expected to maintain an annual deficit until 2030.
Johnson said additional development is necessary to pay for existing debt obligations.
The city is now considering investing more money to fix or replace the parking ramp, including a public/private venture that would include commercial, retail space. In his calculations, Johnson assumed an estimated, cumulative value of $4.5 million in new development over a three-year period.
Johnson found that $4.5 million of new development would "improve cash flow over the remaining life" of the district.
The additional tax revenue generated could be used to repay its $3.3 million debt with interest and reimburse the city water and sewer utilities' costs of $1.3 million for the 2009 renovations, or the city could use the additional increments to pay for additional projects.
Even if the city uses the money for new development, Johnson cautioned that the type and timing of projects and the actual construction of new development "should be carefully evaluated."
If the city should have costs before development occurs, it runs the risk of losing that invested amount or repaying any borrowed amount, if the development doesn't materialize or fails to reach its anticipated value.
Pam Christopher also spoke to the council Monday on behalf of the Chamber of Commerce, the downtown Business Improvement District and Main Street Monroe, and delivered a packet of information that the groups hope will help the city in its decision for the parking ramp.
According to Christopher, representatives of the three organizations have been researching the potential of a public-private venture to replace the parking ramp, and they consider the parking ramp vital to downtown business owners, employees and visitors.
The groups have pulled together estimated costs of constructing a parking ramp with extended retail spaces; have investigated grant opportunities through Wisconsin Economic Development Corporation; and are planning to do a parking study, using instructions provided by WEDC.
The council took no action on the future of the parking ramp.