During Tuesday’s Redevelopment Commission a Public Hearing was conducted on the proposal to amend the list of projects in TIF District #3. There were a few comments received.
City Attorney Sean Surrisi said the amendment would create an “air parcel” as its own allocation area within TIF #3 for the Pretzel’s Inc, expansion project. He said the $71 million dollar investment will include a 120,000 square foot building addition and four new ovens. The special TIF District is only for the expansion project and designates Pretzel’s Inc as the designated taxpayer. The project will also create 180 new jobs.
Reggie Danielson, owner of the Mayflower Tavern asked what the procedure is if they don’t create the total positions stated. If they are receiving 100% of the TIF Funds to pay for the bond where is the responsibility to create the new positions?
Surrisi said unlike Tax Abatements where job creation is part of the justification for the incentive, there is no guarantee for the job creation. He said Pretzels will have to perform because the obligation to repay the bond lies solely on Pretzel’s Inc. Surrisi said, “If they are going to invest $71 million, in all likelihood they are going to try and maximize their investment by following through with those workers.”
Jerry Chavez, President and CEO of the Marshall County Economic Development Corporation said Pretzels Inc has a proven track record and a long standing history. He said, “The risk is for Pretzels Inc. and not to the city of Plymouth.”
Kip Cook asked what the bond amount was and the city attorney said it’s not a fixed amount where there is a set schedule of payments. It has been estimated by financial advisors as being a little over $9 million but the maximum would be no more than $13 million depending on how the County Assessor were to assess the improvements and equipment at 100% for the entire time.
Cook then asked what the $9 million bond issue would pay for. Surrisi said the economic development revenue bonds would will take the tax money and reinvest it back into the business. Basically the bond will finance the improvement for the expansion.
Cook also asked about the term length of the bond and was told approximately 16 years with the first payment due in 2021.
At the conclusion of the public hearing the Plymouth Redevelopment Commission took the last steps in the process by approving a resolution confirming its Declaratory Resolution amending TIF # 3 by adding the “Air Parcel” as its own allocation area. They also approved a resolution pledging certain TIF revenues to the payment of the economic development revenue bonds of the City of Plymouth.
