Plan Commission Approves TID#3 Amendment, Concept for New Development

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Cameron Bren

MIDDLETON–The City of Middleton Plan Commission approved a resolution that would subtract $163 million of value from the city's tax increment financing district #3. The action, if approved by the city council and TIF district Joint Review Board, would return $100 million to all tax districts to reduce property taxes and invest $63 million into infrastructure projects in TID#3. 

The Plan Commission also granted concept approval for two duplexes proposed at 7103 Twin Sunset Rd. 

The city’s TIF consultant Scott Harrington from Vandewalle & Associates said TIF is the single most powerful economic development tool that communities have and Middleton’s TID#3 is one of the most successful in the state.

TID#3 covers a large swath of downtown and areas west of the Beltline. Over the life of the TIF district the city has subtracted $340 million and all taxing jurisdictions have received $6.6 million in additional tax revenue which reduced rates for all taxpayers, Harrington said. 

“Even though the state legislature extended the life of the district the city has been very aggressive in removing value and returning it to the city and the other underlying taxing districts as quickly as possible so that all of the taxpayers can benefit from the increased tax base,” Harrington said. 

After the latest subtraction $508 million of value would remain in the district, Harrington noted. 

Vandewalle has been working strategically with the city for this amendment, taking out property that has already been redeveloped and adding parcels that could be, Harrington said. The amendment would remove 33 parcels while adding six. 

The $63 million spent on infrastructure projects would facilitate an estimated $98 million in tax base growth, Harrington said. 

Mayor Gurdip Brar asked why the return on investment is lower than in the past. Harrington said there are a group of expensive infrastructure projects that have been delayed for various reasons that are now planned to be done before the district spending period ends.

There were no comments during the public hearing on the matter, nor was there any discussion among plan commission members about the amendment before moving to a vote, which was unanimously approved.

The Middleton Common Council will consider a resolution to support the amendment on September 1 and the Joint Review Board will take up the matter on September 21.

Property owner Koteshwar Katukam and real estate developer Mayur Ragha presented a conceptual development proposal calling for four, two-story duplex buildings at 7103 Twin Sunset Rd.

The plan commission received emails and heard comments from neighboring residents in single family homes concerned about the size of the buildings.  

Plan Commission member Kurt Paulsen said the proposal creates a conundrum because the currently empty lot is a buffer between a 60s/70s style rural subdivision and an urban subdivision, the Hidden Oaks neighborhood to the southwest. 

Ragha explained that the concept includes proposals for developing four or six units on the site. More units would make the cost cheaper and could provide affordable housing, Ragha said. 

District 7 Alder Dan Ramsey asked if the units would be owned or rented. Ragha said it could go either direction but was leaning towards rental.

Paulsen pointed out that the lot could be split in two for single family homes without being rezoned, but a duplex would require rezoning.

Plan Commission member Jennifer Murray said she would support four units on the parcel. 

Plan Commission member Kitty Tyson said she struggled with the concept that the city would allow this type of development next to an established neighborhood.

“I know we want affordable housing and we want a lot of it, up to 7,000 people worth, but we don’t need to destroy the property value of the beautiful little neighborhoods we‘ve got around the city and this is exactly what it’s going to do it,” Tyson said. 

Paulsen pushed back on Tyson’s comment.

“I ran some numbers on this development, minimum if he did four townhouses, each of those would price at $340,000 to $370,000, which is more than the assessed value of all the houses in the neighborhood,” Paulsen said. “So it wouldn’t bring down property values, that is just not true given how expensive new construction is.”

Tyson said the new buildings may create value but the neighboring homes would lose value. 

“Everybody is aware of the fact that when you start to introduce something that is entirely different you end up with some big problems,” Tyson said. “The concept of trying to come up with affordable housing is highly questionable in this location, it’s just not necessarily suitable here.”

Ramsey pointed to one of the design renderings of a duplex building that was nearly indistinguishable from a single family home as the best fit. 

Plan Commission member John Schaffer said property values were not at issue but rather a visual dilemma. He said he could only support four units and also preferred the single family home design. 

Tyson made a motion to endorse the concept of either allowing a subdivision of two lots with one single family residence on each lot, or one duplex on the existing lot, but the motion failed two to five. 

Paulsen then made a motion to endorse the concept of allowing a subdivision of two lots with up to one duplex (two units) on each lot. The motion passed six to one with Tyson opposed.

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