2012-01-13 / Front Page

Brunswick, MRRA talk TIF details

BY BETH BROGAN
Times Record Staff

BRUNSWICK

Officials from the town of Brunswick and the Midcoast Regional Redevelopment Authority have begun negotiating details of tax increment financing deals that would shelter new valuation at Brunswick Landing from county taxes and the valuation formula for state aid to education.

While state economic development officials told town staff they would conditionally approve such districts, details such as how much valuation would be sheltered, how those dollars would be spent, and whether some of the dollars would be returned to MRRA, remain to be negotiated.

As closed-door discussions about those development programs continue, the Town Council on Tuesday will consider setting a public hearing to discuss the geographical boundaries of two proposed tax increment financing (TIF) districts on the former Navy base.

TIF districts

A tax increment financing district is a locally approved plan that allows municipalities to earmark property taxes for economic development or other specific municipal uses. When new commercial development happens, a town can set aside the new taxes generated by the increase in valuation on the property and shelter it from county taxes and from the valuation formula for state aid to education.

Town staff recommends that the council designate the districts now so that any taxable value in the districts as of April 1 would be considered TIF revenue and would not be used to calculate the town’s property tax rate, according to a Jan. 10 memo from Town Manager Gary Brown.

Two districts would be necessary because the acreage that would be included would exceed state restrictions.

Maine Department of Economic and Community Development staff told the town that they would conditionally approve two districts at the former Brunswick Naval Air Station, Brown wrote, given the condition that full approval be subject to DECD approval of development programs for each district.

If the DECD approves the development programs agreed upon by the town and MRRA, the Town Council would hold public hearings — likely in the summer — and then council adoption would be required before the districts could be finalized.

As proposed, one district, the “Brunswick Landing TIF District,” would encompass areas identified in the BNAS master reuse plan as the professional office, community mixed-use and business and technology districts.

The “Brunswick Executive Airport TIF District,” would include the area immediately adjacent to the airport.

Development programs

Original TIF proposals would shelter upwards of $40 million in new assessed value at Brunswick Landing, according to MRRA executive director Steve Levesque.

“That’s our estimate of how much new value this property will generate over 20 to 30 years,” he said Thursday.

The percentage of new value to be sheltered, how much would go to the town and how much would go to MRRA, and how those dollars would be spent are among details still to be negotiated, according to Levesque.

MRRA might use the funds for upgrading and maintaining utility systems and roads, infrastructure enhancements or building improvements, he said.

“Over 20 years we have to raise about $170,000 just to operate and maintain this facility,” he said, “including about $65,000 just for infrastructure improvements, so TIF revenues are a piece of that. The town could use TIF revenue for things outside the fence — road improvements, etc.”

MRRA owns assets, both occupied and unoccupied, at Brunswick Landing, according to Brown. The nature of a business leasing space from MRRA determines whether the town collects property tax.

Currently — and as of April 1, 2011 — no property at Brunswick Landing was taxable because it was all still owned by the federal government, but as that land is conveyed to MRRA, it will be taxable as of April 1 of this year. Brown said the town has not yet determined taxable values.

Levesque said he hopes to encounter no obstacles to the TIF agreements, noting, “There are benefits to everybody by doing a TIF.”

Former Navy housing

Meanwhile, Brown said Thursday that town officials expect to meet with representatives of the Maine State Housing Authority and Affordable Midcoast Housing — the business owned by George Schott, who purchased 702 units of former Navy housing in October 2010 — to finalize an affordable housing TIF.

Schott and MRRA officials also are expected to close this month on an agreement that would convey to Affordable Midcoast Housing the land beneath that former military housing, according to a memo from Special Projects Assistant Denise Clavette to the Town Council.

Community Block Development Grant

Also on Tuesday, the council will consider applying for a $200,000 Community Development Block Grant on behalf of Integrated Marine Systems, Inc., (IMS) also located at Brunswick Landing.

The company plans to secure $250,000 in matching funds through bank loans and other private investment, according to a Jan. 11 memo from Economic Development Specialist Brian Dancause.

According to a Dec. 6, 2011, letter from IMS President William M. Peterson, IMS has signed a long-term lease for hangar and office space for aviation and marine systems integration (IMS’s Brunswick Air Sea Integration Center, or BASIC) and plans to use the funds “to assist in the purchase of control system components with which the company will assemble and operate various innovative technologies destined for defense and commercial customers.”

The project would create at least seven new production jobs this year, meeting state stipulations.

“Our business plan projects an additional 20 employees by the end of 2013,” Peterson wrote.

The Town Council will meet at 7 p. m. Tuesday at Brunswick Station, following an executive session at 6:30 p.m.

bbrogan@timesrecord.com

Return to top