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District 88 approves ‘tax abatement’ bonding project

June 8, 2013
By Josh Moniz - Staff Writer , The Journal

NEW ULM - The District 88 Board of Education approved a new "tax abatement" bonding project to fund improvement to school parking lots Friday morning, during a special school board meeting.

The project is for $680,000 for improving the main parking lot and entrance roads for New Ulm Public High School. The project also includes minor improvement projects such as curb and gutter reconstruction of the school parking lot's inner loop and the crack repair and seal coat improvements for both the staff parking lot and playground surface.

The project was approved unanimously with two board members absent, including Sharon Gieseke who previously voted against the project.

"Tax abatement" is not non-payment of taxes in the traditional sense, but instead is a specialized economic development tool that provides a levy for improvements with public benefits separate from the traditional school levy. In this case, the project is allowed because there are several public uses of the school parking lot for events. The levy will tax at a rate roughly equal to $2 per year for $100,000 residential owner-occupied property and $12 per year for $250,000 commercial-industrial property.

The only bid for the project came from M.R. Paving & Excavating and it was $21,000 over the proposed bonding, which will be covered by transfers from a deferred maintenance fund. School officials said the single bid was due to several large projects in the region being put up for bids just prior to the school project, resulting in the other expected bidders having their schedule filled.

The board will take up approving bonds for the initial cost at its July 3 meeting, which would allow M.R. Paving to complete the project by August. The bond will be paid back by the specialized levy.

Josh Moniz can be e-mailed at jmoniz@nujournal.com.

 
 

 

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