City and Private Perspectives of Land Acquisition
With the prospect of a large development being undertaken in the downtown area of Superior, some have expressed concerns about being forced out of their homes. The good news for those potentially affected by the proposed Better City Superior initiative is that Wisconsin does not allow eminent domain (the right of a government or its agent to expropriate private property for public use, with payment of compensation.)
According to Jason Serck, Superior Planning Director, there are an estimated 40 to 50 properties in the area being considered…largely residential, with some commercial. If properties are obtained by the City of Superior, purchases include relocation benefits for owners and tenants.
“I believe the new maximum for relocation per owner is around $33,000….that is on top of the purchase price of the property. Commercial is treated differently, but there is a relocation cost there as well,” Serck said.
Bruce Thompson of National Bank of Commerce, head of BCS group, has suggested that properties could be acquired privately at market negotiated rates, not involving the City. He also believes that while property owners cannot be forced to sell their home or commercial sites, it would be in their best interest to sell since after the development gets underway their property values may suffer.
Ultimately, this would be a multi-generational investment in our downtown. Those that participate and cash out by relocating or cooperating in other ways will always be considered key players in the future of Superior and will be permanently recognized as community builders, according to Thompson. If work-arounds are necessary due to a reluctance to sell, there is a risk of limited marketability for the existing properties.
The Expo District will be a public/private organization with taxing power granted by referendum and state/city law. This organization will be responsible for putting the property together for the footprint of the development, and will will work with one or more developers to design and construct whatever buildings they decided to develop.
The Superior City Council will have oversight of the organization as well. According to Serck, there are a similar models in Milwaukee and Green Bay whose examples could be followed.
cShown below is the resolution that was approved by the City Council in August that set the language for the advisory referendum. Under the last WHEREAS***, notice that the Council also set limits on the monetary mechanisms for funding…mainly borrowing/bonding. This restriction, as it sits, would not allow the City to borrow or bond for dollars related to the project.
Serck explained that the City would participate, but through the “pay as you go” tax increment proess which relies on revenues from the completed project to more or less reimburse the developer over a 20 to 25 year span through payments.
The City has State and local restrictions on borrowing capacity, so this has become their preferred manner of funding economic development projects. The most recent such development is the new Hampton Inn being constructed on Highway 2 across from Barker’s Island.
From the City’s point of view, the borrowing limit set forth in the resolution would make it very difficult to complete up front purchases of property since no cash would be on hand.