Ansay seeks TIF funds for apartment projects

Port aldermen say they’re willing to consider new district for St. Mary’s site, incentives for marina-area development

AN ARCHITECTURAL RENDERING (left) shows what St. John XXIII’s St. Mary’s Catholic School would look like after Ansay Development converts it into an apartment building with between 25 and 35 units. Ansay officials asked the Port Washington Common Council Tuesday to create a tax incremental financing district to help fund the redevelopment project. Ansay Development has also proposed the eight-unit Lake Harbor Loft apartment project on the former Victor’s restaurant site on Washington Street (right).
Ozaukee Press staff

Ansay Development on Tuesday asked the City of Port Washington to create a tax incremental financing district to help fund the redevelopment of St. John XXIII St. Mary’s Catholic School and to provide development incentives to offset some of the cost of building an apartment complex in the marina district.

Aldermen seemed amenable to the requests, agreeing to further discussions on the TIF district for the school project and opening negotiations for TIF funds for the Lake Harbor Loft project on the former Victor’s property on Washington Street.

Tuesday’s meeting provided the first glimpse of Ansay’s plan to redevelop St. Mary’s School into an apartment building with between 25 and 35 market-rate units.

Ansay, which plans to acquire both the school and neighboring parish center, would leave the exterior of the school largely intact, said Ian McCain, Ansay’s design/construction manager.

The company would, however, raze the boiler addition on the northeast side of the building, he said.

It would also create a landscaped plaza with public art at the corner of Van Buren and Johnson streets and make changes to the streets to provide parking for St. Mary’s Church, McCain said.

To ensure the project is viable, Ansay asked the city to consider forming a “pay-as-you-go” TIF district.     

This type of district would require the developer to pay the cost of improvements upfront, with a city refunding a designated portion of that money through the increased taxes paid on the building.

McCain noted that preliminary estimates value the renovated building at $3 million to $4 million. The city currently receives no taxes from the property.

The amount to be refunded and the term over which it would be repaid would be subject to negotiations between Ansay and the city, explained Christy DeMaster, the city’s TIF consultant. 

If the development isn’t successful and doesn’t bring in the necessary tax revenue, she added, the city doesn’t have to make up the difference, provided officials build that into the agreement.

There are few pay as you go TIFs in the state, DeMaster said, primarily because they require a developer who can afford to pay for development upfront.

“All the risk is on our team, not the city,” McCain said. “Due to the scope and some of the challenges, we think this is the perfect use of a TIF.”

There are significant costs associated with renovating an old building like the school, which was built in 1916 with an addition constructed in the 1940s, he said, not the least of which is asbestos abatement. 

The TIF is vital to Ansay’s plan, McCain said. 

“We’ll walk away if this doesn’t work,” he said.

Ald. Mike Gasper was skeptical, saying, “I have a hard time believing that you don’t have an alternate plan.”

But other aldermen said they are willing to consider a pay-as-you-go TIF for the project, calling it a reasonable solution.

“As TIFs go, this is probably the best type of TIF to have,” Ald. Mike Ehrlich said. “Having a vacant school is not going to help this community at all. I think this is a great way to get residents near downtown, to create a vibrant neighborhood. I think this is a great development.”

Ald. Paul Neumyer agreed, saying, “What a great way to save that building and the history that goes with it.”

Gasper also asked whether approval of this plan would “open the floodgates” for other developers to seek TIF districts for their projects.

City Administrator Mark Grams said the city needs to weigh each project on its merits.

“I don’t think you could find a better case for redevelopment than an old school building that is going to be closed down,” he said.

St. John XXIII Catholic School is planning to close St. Mary’s School and consolidate operations at its St. Peter’s Campus in fall 2019.

Ald. John Sigwart said he is optimistic about the concept, but skeptical as well.

“You know what they say, if it sounds too good to be true, it probably is,” he said.

Aldermen also agreed Tuesday to negotiate a developer’s agreement with Ansay that would outline the terms of a development incentive for the firm’s Lake Harbor Loft project, which would create eight apartments on the former Victor’s property.

McCain said Ansay is prepared to begin work on the project in the next month or so, but is seeking $330,000 in development incentives to offset the cost of remediating the site.

The soils “are challenging, to say the least,” he said, noting some are contaminated while others are inadequate for development.

DeMaster said that with an estimated value of $2.2 million for the project, the apartments would generate $621,000 in tax revenue over the life of the TIF district — more than enough to cover the cost of the incentives.

Mayor Marty Becker said the city should approve the payment, saying the contamination likely happened when the Wisconsin Chair Co. was located there and officials at the time had to know it was occurring.

“They had to know,” he said. “It’s not your fault.”

While most aldermen seemed amenable to the incentive, Sigwart questioned the fact that $31,000 of the total would go to raze the existing building on the site.

“I fully understand when it’s buried. That TIF money would be well spent,” he said, referring to poor and contaminated soils. But demolition, he said, is an expected cost of development.

“I don’t agree with that,” Sigwart said.

A motion by Gasper to cap the incentive at $300,000 with no funds for demolition costs failed, 5-2, with Sigwart and Gasper voting for it.

A motion to begin negotiating an agreement on the incentive was approved 6-1, with Gasper dissenting.

Grams said he hopes to have an agreement ready for the council to vote on next month.

Ansay is also working on plans for a multi-use building at the site of Newport Shores, but has not said whether it will seek TIF funds for that project.


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