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mentions that he has discussed locating his expansion in Hugo to be near rail <br /> access. <br /> It was noted Mr. McDowell is requesting a five (5) year tax abatement as an <br /> incentive for Northern Forest Products to expand in Centerville. The abatement <br /> would only be granted for five (5) years if there is an actual expansion. Only a <br /> one (1) year abatement would be granted, if no expansion occurred. If the <br /> Council is willing to grant this abatement, a new public hearing will have to be <br /> held. The abatement would only be granted for the increased market valuation, <br /> not for the existing valuation. <br /> Sid Inman and Carolyn Drude addressed the Council. Mr. Inman presented an <br /> impact analysis to show the costs of the requested abatement. Mr. Inman <br /> indicated that tax increment financing requires tear down or build new which does <br /> not apply to existing businesses. He stated three (3) years ago the tax abatement <br /> law was changed and currently is a tool that cities may use to help existing <br /> businesses expand and stay within the their communities. <br /> Council Member Nelson referenced the spreadsheet that was provided to Northern <br /> Forest Products and inquired as to if the letter from them was their response to the <br /> City's proposal and, if so, did that mean they were unhappy with the proposal <br /> from the City. She also asked if Northern Forest Products would be happy with <br /> one (1) year or if they were demanding five (5). Mr. March indicated that the <br /> letter was Northern Forest Products' response to the City and that they would <br /> prefer the five (5) year to the one (1) year abatement. <br /> A.w& <br /> Mayor Wilharber asked if the City were to prov de tax abatement to Northern <br /> Forest Products was the City required to notify County and the School <br /> District. Mr. March did not believe the City needed to do so, but they certainly <br /> could. Mr. March indicated he does not recommend exceeding a five (5) year tax <br /> abatement. <br /> Carolyn Drude said Northern Forest Products was requesting five (5) years. <br /> x9 <br /> Council Member Broussard Vickers asked if the City chooses not provide a five <br /> (5) year tax abatement, if the one (1) year abatement would solve the current <br /> problem or is it still possible that it would end up in litigation. Mr. March stated <br /> Northern Forest Products has indicated that they have shopped other communities <br /> who are willing to provide tax abatement or Tax Increment Financing (TIF) and <br /> vot-expand in another city if not granted their request. <br /> toK <br /> Council Member Broussard Vickers questioned what would happen to the old <br /> situation if the City agrees to a one (1) year abatement rather than a five (5) year <br /> abatement. Mr. March indicated it would take care of the two (2) old notes and <br /> that Norther Forest Products would not expand in Centerville. <br /> Page 2 of 22 <br />