Hillsboro accepts TIF compromise

The Hillsboro City Council accepted by consensus the compromise proposal offered late last month by the Marion County Board of Commissioners regarding the future of the city?s tax-increment financing district.

The TIF district was called into question when it was discovered the plat filed with the county mistakenly did not include Hillsboro Business Park, the development that had prompted the formation of the district.

With a TIF district, almost all of the additional property taxes generated by developing a piece of ground is funneled to the entity that developed it, in this case the city of Hillsboro. The county and school district are not included in the tax distribution for up to 20 years.

County commissioners agreed at their Jan. 24 meeting to allow the city of Hillsboro to correct the error in the plat.

In addition, the commissioners agreed to allow the city of Hillsboro to receive the property taxes from the area of the park already developed. But the city will be required to come to the commissioners for permission to develop additional areas within the area and could not use a TIF strategy to finance the work.

J.T. Klaus, the city?s bond counsel, said via speaker phone that the compromise was ?eminently reasonable.?

Klaus said he would meet with the commissioners as soon as possible to have them approve the exact wording of the agreement. Once approved, the agreement will be brought back to the city council for formal adoption of the necessary ordinance to put it into effect.

The city took the initiative to add USD 410 to the proposal as well, even though the school district had not approached the city about it.

Opting out

In an unrelated decision, the council opted not to sign on for the county?s new neighborhood revitalization program.

Asked about economic benefits for participating, Mayor Delores Dalke said Hillsboro residents can benefit from the program, which uses tax incentives to encourage building improvements. In fact, the city has more projects in the program than any other community in the county.

At the same time, she added. there?s little incentive for the city itself to participate.

?I don?t think we need this for people to decide to build in Hills?boro,? Dalke said. ?If we needed it for that, it would be different. I don?t see any sense to doing it. We?re giving away tax dollars that we could use to build up our infrastructure.?

The mayor cited as an example the city?s participation in the recruitment of HMC/CAH Consolidated Inc. as a buyer for the local hospital. The for-profit company will be building a state-of-the art $10 million facility in the community, significantly increasing the city?s property valuation.

?We work hard on these things,? Dalke said. ?(The county?s neighborhood revitalization program) didn?t make any difference in getting them to come.?

Councilor Bob Watson said he initially had been interested in the city participating in the program ?to help relations between us and the county.? Now he agreed the program wasn?t economically helpful for the city.

New auditing firm

In other matters, the council accepted a bid from the firm of Adams, Brown, Beran and Ball for a three-year contract to perform auditing services for the city beginning in 2011 at an annual rate of $11,900.

The city had received seven proposals in response to its request for applicants, Paine said. The city?s previous auditing firm, Swindoll, Janzen, Hawk & Loyd, submitted a contract for those services, not a proposal, so was not included in the interview process.

?We are recommending Adam, Brown, Beran and Ball for two reasons,? Paine said. ?First is their introduction of their audit manager. The second was that their firm has a Hillsboro presence.?

Dalke said: ?I think it?s a good idea to switch auditors every few years. We get a fresh set of eyes looking at our situation.?

Employee residence policy

The council deferred action on its policy requiring city employees to live within the city limits.

Paine said he has received inquiries about the policy, including from one employee who currently lives within the city limits but is considering a move to an unincorporated area nearby.

?I know there?s a public perception that people who work for the organization ought to live within the boundaries of the organization,? Paine said.

Paine said he wasn?t recommending a change in the policy, but added: ?It will present a problem in the near future.?

He cited one current employee who, after a fire in their Hillsboro home, moved with her spouse to Peabody because of his job there.

?Requiring residency in that situation does not appear to be reasonable,? Paine said.

Council members identified advantages and disadvantages to the current policy, but agreed an important issue is the ?on-call? impact on other city employees when a member of the crew lives a distance from town.

Other business

In other business, the council:

? was reminded about the town hall meeting the city is calling for 7 p.m. Wednesday, Feb. 16, to receive public input about the future of the Mennonite Settle?ment Museum and the Schaeffler House.

Paine said the format for the meeting will have participants meeting around tables in the community room of city hall as the best way to get ?positive and useful information opposed to just negative comments.?

He said the focus of the meeting will be developing a vision for the best use and management of those facilities into the future, not reviewing past decisions.

? approved the appointment of Mason McCarty and Chris Gibson as volunteers with the city fire department.

Fire Chief Ben Steketee said McCarty has already received a unanimous affirmation from the other volunteers; a similar query is planned for Gibson in the near future.

Both men will fill existing openings in the volunteer roster.

? agreed the city should prepare to move ahead with the refinancing of bonds for the city aquatic center. The council had stepped away from that action a couple of months earlier when changes in the interest rate made the move less economically desireable.

Recent projections are that making the move now would save the city $187,000?considerably above the $150,000 the council had earlier set as a minimum bench mark.

? approved the lease for Lloyd Funk, rural Hillsboro, to farm about four undeveloped acres that are part of the Willow Glen housing development now owned by the city. The agreement would divide crop revenue one-third to the city and two-thirds for the lessee.

? authorized the mayor to sign a lease-purchase agreement through First Bank of Sterling that would enable the city to acquire a skid loader through White Star Machinery & Supply of Wichita. The sale price of the skid loader would be $27,609; the lease expense would be $3,900 for 2011.

?The benefit of this program for the city is significant,? Paine said. ?Each year we receive a brand new skid loader for which we can use it up to 1,000 hours.

? approved the mayor?s appointment of James Thomas to the Salem Home Board.

? heard the city is turning over delinquent utility notices to a collection agency. These notices apply to residents who have moved away from the city without paying their final bill, and have resisted other efforts to collect the money.

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