REA headquarters moving to Lake Mary TownshipDouglas County commissioners approved plans to convert an area of Lake Mary Township into a tax increment finance (TIF) district. The Runestone Electric Association will be expanding and moving.
By: Crystal Dey, Alexandria Echo Press
Douglas County commissioners approved plans to convert an area of Lake Mary Township into a tax increment finance (TIF) district. This will help the Runestone Electric Association, which is expanding and moving.
Douglas County Housing and Redevelopment Authority (HRA) executive director Jeff Schiffman said residents could start seeing activity as soon as Friday, June 29. Landscaping and surveying of the REA’s two buildings on the property are planned.
Schiffman met with the commissioners during a public hearing on Tuesday to discuss the redevelopment plan that will enhance the geographic area. Economic development projects are generally paid through bonds or a pay-as-you-go plan.
TIF districts allow an area to develop while maintaining a lower tax level as it grows. The taxable value on the property now is $1.3 million; at the time of completion, the property’s tax value will be an estimated $3.8 million. REA will pay taxes based on the $1.3 million rate for the next 10 years.
“In 2022 when the district is dissolved, they will be paying full rate,” Schiffman said.
Bonnie Huettl, president of the Douglas County Lakes Association, questioned if the project would be moving forward if the TIF financing was not an option. Huettl is a candidate for Douglas County commissioner in District 1 this year.
Attorney James Casserly of the Minneapolis firm Monroe Moxness Berg, said the TIF financing helps facilitate the project starting immediately.
Casserly is a consultant for the Douglas County HRA. Schiffman said Casserly helped design legislation for tax increment financing in the 1990s and has worked with the Douglas County HRA on numerous TIF projects.
“The project is here to help heal the infrastructure bust,” Casserly said. “It is a project that needs to start immediately.”
Casserly said the project will help create construction jobs as well as maintain companies and provide future employment opportunities.
The economic development project involves moving the REA corporate offices from downtown Alexandria to the Lake Mary Township location. More space is required for the REA’s planned growth, which will result in job creation in Douglas County.
The present 22 positions with REA will remain intact and another five are anticipated to be added over the next five years.
Schiffman speculates the downtown building will remain an REA property. He said since REA was already expanding, were it not for the TIF financing, costs could have been passed onto the customers.
REA will share the office space in Lake Mary Township with energy consultant, Star Energy Service. REA will be in one building, which offers 14,000 square feet and Star Energy will move into a 17,000 square foot building. It is anticipated that Star Energy will be adding another five employees as well.