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March 11, 2014 | 04:31 PMFONTANA — The end of Fontana's tax increment financing district is near.
The Fontana Community Development Authority voted to declare the district distressed at its Feb. 5 meeting. The motion passed unanimously.
Before the district is officially closed, a joint review board must approve the decision.
The review board is composed of a member of each of the taxing entities affected by the district: Fontana Elementary School, Big Foot High School, Gateway Technical College, Walworth County and the village.
Declaring the district distressed means that no new projects can be developed within the district, and the village's payback period is extended.
CDA commissioner Skip Bliss said the status of the village's TIF district isn't unusual.
"Many TIF districts within the state have been devalued by the DOR," he said. "It was out of the CDA's control."
Bliss said many of the projects already built in the district will continue to grow, even if it's declared distressed.
"It's a drain (on the village) now," he said. "Long term, though, it won't be. Those projects will mature."
Bliss said declaring the district distressed does "nothing detrimental" to the village.
"It just extends the life of the TIF," he said.
CDA Chairman Bob Chanson said the village gets a bad rap because of the TIF district's status.
"People are saying the financial issues of the village are due to the TIF," he said. "The information isn't complete. Some projects, like the beach house, (didn't have to be done), but other projects, like the main lift station, had to be done."
Chanson said the village is better off because the TIF district was established.
'"With Highway 67, the DOT was going to re-do it straight through like it is in Williams Bay," he said. "Instead, they allowed us to upgrade that into the boulevard it is now."
A history of Fontana's TIF district
Created in 2001, the district was originally valued at $30 million.
In 2009, the district was valued at $92.8 million.
The following year, under new Department of Revenue measurements, the district was assessed at $66 million.
Village President Arvid "Pete" Petersen said the rules were changed midway through the game.
"The DOR changed the rules, and the changes were to our detriment," he said at the CDA meeting. "They changed the rules twice on us."
The village borrowed money on the expected growth of the district.
Because the district's revenue was less than the loan payments, the village now must pay back the loan with general tax revenue.
The 2013 tax burden from the TIF district was $375,000, and the 2014 amount will likely be $500,000, according to numbers given to the Regional News in November 2013.
Other CDA news
Bliss questioned why the building improvements for the Lake Geneva Marine on Lake Street never came before the CDA. He wanted to know what projects need CDA approval.
The building improvements were approved by the village plan commission and then the village board, but the question never came to the CDA.
Petersen said that because Kevin Kirkland, who rents the Lake Street building from the village, wasn't requesting money from the village, the CDA didn't need to approve the plans. Village Administrator Dennis Martin said the CDA must approve projects within the village that cost more than $10,000, and the plan and parks commissions are tasked with handling proposals for development.