Council approves annual TIF rebates, certification

     Multiple TIF (tax increment financing) resolutions were approved by the Monticello City Council during their Nov. 18 meeting.

   These resolutions appropriate the funds necessary to meet the city's obligation to various developers pursuant to previously approved development agreements.

   All incentives set out in the development agreements are subject to annual appropriations by the council.

   The following agreements were approved:

   • Karde's Inc., appropriating $28,436

   • Royal Flush Truck Wash, Inc., appropriating $56,970

   "Have there been a lot of fines related to the company?" asked Council member Mary Phelan of the DNR fines against Royal Flush.

   She asked if those fines could be used against the rebates.

   City Clerk Sally Hinrichsen said all of their fines and taxes have been paid in full.

   • Cobblestone Inn & Suites, appropriating $43,490

   • Orbis Mfg., appropriating $67,030

   • Lauren Welter, appropriating $1,044

   • Paige Jacobs, LLC, appropriating $1,104

   • Njs LLC, appropriating $1,122

   • MercyCare, appropriating $14,204

   • McMATT Properties, appropriating $8,380

   • BR3 Development LLC, appropriating $62,414

   • Oak Street Manufacturing, appropriating $34,754

   • Theisen Real Estate LLC, appropriating $1,272

   • Manternach Custom Creations, appropriating $3,460

   The city may collect the maximum of increment every year, so long as the total collections does not exceed the total city obligations. The city only certifies the TIF necessary to meet its obligations over the last several years, typically certifying between $550,000 and $750,000.

   When TIF is certified, the money goes into the city's TIF fund, not the general fund. Those funds can then be used for eligible TIF projects. However, if the city continually deposits all of the TIF money, increment, into the TIF fund, the general fund deposits won't grow and it would be difficult to meet inflationary increases without looking at deductions to city staff or services.

   "Fore example, if a building in the TIF district was worth $100,000 and now it's worth $250,000, the taxes on the original $100,000 will get divided amongst all the taxing entities normally, with the city, county, school, Kirkwood, etc., getting their share," explained City Administrator Russ Farnum. "The taxes on the new value of increment of $150,000 will, if certified, go to the city's TIF fund. The taxes on the new value of increment will, if de-certified, be divided just like the pre-TIF value of $100,000, amongst all of the various taxing entities, which includes the City of Monticello General Fund."

   In the last 10 years, the city has certified $650,000 in FY 2025, $550,000 in FY 2024, $500,000 in FY 2023, $700,000 in FY 2022, $600,000 in FY 2021, $210,385 in FY 2000, $750,000 in FY 2019, and $700,000 in FY 2018, 2017, and 2016.

   This year's city certification is proposed to be $725,000. The total incremental available for collection is approximately $1,615,996.

   The council approved the FY 2026 TIF certification in the amount of $725,000.