Council ‘votes positive,’ approves tax abatement requests

The Clear Lake City Council unanimously approved two requests from downtown building owners for participation in its Retail Incentive Program.

Following a public hearing in which the Council received several positive responses to the program and encouragement to continue to offer new building owners the opportunity to participate in tax abatement the Council discussed the merits of the program, as well as some possible improvements to the 2008 program.  In the end, VSA, LLC, doing business as K&B Emporium at 8 N. 4th St., and the City will enter into an agreement to provide property tax incentives in the form of annual property tax payments in a cumulative amount not to exceed $250,000.  The amount would be payable over six years.

The Council also voted 5-0 for a second development agreement and property tax rebate request made by Michael and Kristi Pedelty, who have purchased the retail property at 308 Main Ave. where Emerson’s is currently located.  The couple is seeking tax increment payments in a cumulative amount not to exceed $22,000.  The funds will be used for roof repair.

The majority of the Council’s discussion centered around the request made for the K&B Emporium building restoration and business.  Three members of the City Council expressed their strong support for the business.

Although supportive of the business and the extensive work done by building owners Vicki and Steve Sukup, Councilman Mike Callanan said he continued to be pulled in different directions by the tax incentive proposal.

“It is not my intent to be against K&B, it’s just that for five years the language in this plan has been to a smaller scale.  This thing doesn’t fit the shoe.  What I struggle with is trying to apply a policy written in a different way,” said Callanan.  “Maybe we need to find ways to improve the policy.”

Councilman Tony Nelson acknowledged the policy “could use some tweaking,” but said approval of the K&B request is consistent with what has been done in the past.

“We will be collecting the same taxes as if the building were sitting empty.  At the same time there are new jobs and more people.  It’s a win-win,” said Nelson.

Jim Boehnke thanked the Sukups for their dedication to restoring a downtown building in the character of the downtown and investing the future.  “This is amazing,” he said.

Gary Hugi told fellow Council members he felt the K&B project qualified for the program on a number of fronts.  He noted the policy is intended to provide opportunities and incentives for revitalization and development, stimulate private investment, and eliminate blight while promoting revitalization in the downtown.

“It’s a wonderful, wonderful project— the first of its kind in our town,” said Hugi.  “Investors put new life in it… I applaud their actions.”

Even Mayor Nelson Crabb added his voice to the issue, encouraging all Councilmembers to “vote positively.”

“One shoe doesn’t fit everyone.  This is not a cookie cutter approach,” said Crabb.  “Business and government should be working together.  We want to be partners with the community.”

Chamber of Commerce Executive Director Tim Coffey and Chad Schreck from the North Iowa Corridor also encourage passage of the tax abatement request.

“This is a return on investment.  It is important we support them and an opportunity to encourage and support development,” said Schreck.  He noted the program is based on new tax valuation for the properties.  “This is money you would never have if their project hadn’t happened.”