Details Of 425 Pact Face Public Hearings

July 13, 2007
| By Pete Daly |
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WALKER — A public hearing on the infrastructure financing plan for the proposed OrchardPark development, which involves a Public Act 425 agreement between Walker and Wyoming, will be held in Walker July 23. The Wyoming City Commission is expected this week to set a hearing date for the agreement for its Aug. 6 meeting.

Meanwhile, changes in the original plans for the proposed commercial and residential development — which hinges on a Cabela's store being built there — will be the subject of a Walker Planning Commission meeting on July 18.

Jeff Sluggett, an attorney representing the city of Walker on the 425 agreement with Wyoming, said there is a tentative agreement on a plan. It would authorize the city of Wyoming to tax the OrchardPark property at the Wyoming millage rate, which is several times higher than Walker's. Wyoming would then reimburse Walker the amount Walker would have collected on the property. Wyoming would keep a portion of the tax revenue, and as the developed land begins going up in value over the coming years, the additional tax revenue from those increases would be "captured" and used to pay for the infrastructure (streets, sewers, etc.).

The site has also been declared a brownfield, because the soil has been contaminated by agricultural chemicals. State law allows "core" municipalities to set up Brownfield Authorities that can capture property taxes for use in cleaning up the pollution, which would be part of the infrastructure cost. Legally, Wyoming is a core community; Walker is not. Thus, Wyoming can, with the 425 agreement, capture part of the taxes on the proposed OrchardPark development.

The developer, Jim Bossenbroek of Northgate Holdings, has said he cannot afford to pay for the city infrastructure at the site, which is now undeveloped agricultural land.

Bossenbroek has said the OrchardPark commercial development would be successful if he can persuade Cabela's, the sporting goods company, to build one of its "superstores" there. Cabela's is reportedly interested but has not yet made a commitment. Each Cabela's superstore traditionally draws millions of shoppers a year in the regions where they are located. Other retail companies are interested in locating close to Cabela's.

Walker city officials have stated the development must include some residential developments — condos and townhouses — or they will not grant permission for the project to go ahead.

Walker mayor Rob VerHeulen said the proposed 240-acre development would require "a great deal of infrastructure expense." On the other hand, Walker city officials have indicated they do not want Walker taxpayers to have to pay for that infrastructure. Public Act 425, which enables Michigan communities to allow other communities to assume some of their jurisdictional duties, is planned as a form of tax increment financing of the infrastructure. The owners of the OrchardPark property would be paying much higher property tax than the normal Walker millage rate, and the excess would be used to pay off the infrastructure costs in the long term. Sluggett said the 425 agreement with Wyoming might last 20 to 30 years.

According to VerHeulen, the 425 agreement would probably terminate automatically when the infrastructure costs are paid.

At any rate, the 425 agreement would not mean that part of Walker literally becomes part of Wyoming. VerHeulen said the OrchardPark development would still be served by Walker's police and fire, and Walker residents who live there would still be legal residents of Walker

The 425 agreement is "a creative solution to a difficult problem," said VerHeulen.    

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