Michael Horne
Plenty of Horne

Next Stops For The Streetcar

The devil is in the details of tax incremental financing and various meetings and approvals needed before construction begins.

By - Nov 24th, 2014 12:14 pm
Milwaukee Streetcar.

Milwaukee Streetcar.

The Barrett administration announced the formation of one tax incremental financing district (or TID) and the extension of another to provide additional funding for the long-delayed streetcar.

Here is a look at what you can expect over the next few weeks as this train finally pulls out of the station more than three years after receiving Common Council approval.

The first stop for the streetcar TID will be a public special meeting of the Redevelopment Authority of the City of Milwaukee, scheduled for Tuesday, December 2nd. RACM meetings are held at 1:30 p.m. in the first floor conference room of the Department of City Development at 809 N. Broadway.  (note the December 2nd meeting is being held at 2:30 p.m.)

At the meeting, the administration will propose the creation of the East Michigan TID #82 and the extension of the existing Erie / Jefferson Riverwalk TID #56.

East Michigan Tax Incremental District #82

This 4.6 acre TID is comprised of two adjacent properties:

  • 909 East Michigan Street (taxkey: 392-1678-121)
  • 833 East Michigan Street (taxkey: 396-0491-000)

The 909 E. Michigan St. property is the currently tax-exempt parcel that houses the Milwaukee County Downtown Transit Center, an underutilized facility that is perhaps the most poorly sited such facility in the nation. This controversial site is currently owned by the county and is zoned “Park.”

The Couture Rendering - Sept 2014.

The Couture Rendering – Sept 2014.

Rick Barrett of Barrett Visionary Development plans to develop the site as the Couture, a “44-story mixed-use development comprised of approximately 302 market-rate apartments, approximately 49,835 square feet of retail and restaurants, and substantial public components,” according to the TID proposal. The Couture “will provide an integrated multimodal transit hub, publicly accessible plazas and publicly accessible natural indoor/outdoor spaces, pedestrian bridges and a new lakefront stop for the proposed streetcar line.”

The apartments will rent from $1,620 a month for a studio to $6,869 for a penthouse unit, or from $1.83 to $3.50 per square foot. Cash flow from the residential units will comprise 82 per cent of the project’s anticipated revenue.

The retail component of the project will provide 13 percent of the project revenue, with projected rents of $24 per square foot.

Upon completion, the Couture is expected to provide a $122-million increment to the existing assessed valuation of $0.

The 833 E. Michigan St. property is the site of an 18-story Class A commercial property with 6,000 square feet of retail space currently under construction by Irgens. It is more than three-quarters leased.

It will consist of 358,000 square-feet of rentable office space, valued at $74 million;  a 6,000 square foot restaurant, valued at $840,000; and 450 parking spaces valued at $3.8 million. Total valuation of the project is expected to be $79 million. It is currently assessed at $5.4 million, yielding a $73.6 million increment for TID purposes.

TID 82 is expected to provide $48,650,000 in funds over its lifespan. These funds will be used to pay back bonds to be issued by the city. Of those funds:

  • $31 million will be devoted to streetcar project costs
  • $17.5 million will support “Couture Public Amenities” consisting of:
    • Public Transportation Concourse $6,000,000
    • Visitor Walkways $3,100,000
    • Public Area Core/Common Space/Pedestrian & Bike
    • Amenities $3,000,000
    • Public Pedestrian Visitor Plaza $2,200,000
    • Publicly Accessible Plazas and Natural Indoor/Outdoor
    • Spaces $2,000,000
    • Public Access Stairs to Walkways $1,200,000
  • $150,000 will be spent on the repaving of N. Astor St. between E. State St. and E. Kilbourn Ave. The only building on that block is the Regency Condominium. Although that property is not within the TID district, it lies within a half-mile of the boundaries, which enables funds to be spent there according to state law. The city makes no mention of why this little project was incorporated into the TID.

In the event the Couture does not proceed, it has been determined that the 833 project will provide sufficient revenue to support $31.65 million in TID funding.

Erie / Jefferson Riverwalk TID #56 Amendment #3

The Erie / Jefferson Riverwalk TID #56 will be the second source of streetcar revenue to be considered by the RACM board at its December 2nd special meeting. It was established in 2004 to extend the riverwalk from N. Broadway to the harbor. At the time it was established, the Base Value of the district was $8,958,600. The 2014 Value of $122,294,800 has resulted in an Incremental Value of $113,336,200. This is some $6 million more than had been anticipated at its creation. The TID is scheduled to be retired in 2015, but approval by RACM will allow it to be extended to 2031.

Extension of TID #56 will allow for the following items:

  • $18,300,000 Public Infrastructure – Milwaukee Streetcar
  • $695,942 for a Riverwalk Extension for the Mandel Group’s planned Domus, an apartment building adjacent to the Marine Terminal Lofts.
  • $540,000 for Public Improvements – N. Milwaukee Street & East Corcoran Avenue. (Let’s hope they don’t plan another bamboo garden.)
  • $400,000 Cash Grant for business expansion or relocation. (The recipient of this largesse is not identified in the documents.) Jeff Fleming, Communications Director at City of Milwaukee, responded to an email about these funds writing, “The city is in active negotiations with a specific company regarding a corporate headquarters.  At this stage, we are not revealing the name of the company. I do anticipate an announcement in the not-too-distant future when the discussions are final. “

Although TID #56 is not on the streetcar route, it lies within a half mile of it, and therefore is eligible to provide funds for the project.

What Next?

1. Zoning Neighborhoods and Development Committee Public Hearing

After the RACM hearing, if the proposals are approved, the matter will come before the Zoning Neighborhoods and Development Commitee in a public hearing.

The Committee will meet at 9:00 A.M. in room 301-B of City Hall on Tuesday, December 9th. Aldermen Bob Bauman and Nik Kovac are on the panel, and are considered the foremost proponents of the streetcar on the council.

As Bauman tells Urban Milwaukee: “As a long time supporter of improved and expanded transit in general and urban rail specifically, I support the Mayor’s plan as I did 39 months ago when the council approved the plan on a 10-5 vote (July, 2011).”

If the committee approves the TID proposals, the matter will come before the Common Council.

2. Common Council Meeting

If the proposal is approved at the Zoning Neighborhoods and Development Committee hearing, it will then go before the full Common Council for approval.

The Council will meet at 9:00 A.M. in the Common Council Chambers of City Hall on Tuesday, December 16th.

3. Joint Review Board

Finally, the proposal will go before the Joint Review Board, consisting of city, county, MPS and MATC representatives along with a citizen member. After this formality is concluded, it will go to:

4. Mayor Signs

Mayor Barrett will sign the legislation, and the streetcar project will go forward.

Urban Milwaukee Streetcar Coverage

Streetcar Renderings

More about the Milwaukee Streetcar

For more project details, including the project timeline, financing, route and possible extensions, see our extensive past coverage.

Read more about Milwaukee Streetcar here

Categories: Politics, Real Estate

9 thoughts on “Plenty of Horne: Next Stops For The Streetcar”

  1. David says:

    Wow….. pretty quiet for such a provocative issue. I think the detractors have finally had enough. Talk radio is talking about the streetcar, but not devoting entire shows to the issue. I’m getting excited that we just might be on the verge of getting this through. Does the state have any leverage? Donovan?

  2. I agree with your assessment, David. Glad the AM gabbers are finding something else to talk about. I don’t think the state will have any leverage to meddle with this. Donovan’s quixotic quest is more of a means to accumulate signatures for future nomination papers as anything. I am getting excited about the possibilities, too. In a period of “watchful waiting.” Keeping my fingers crossed, but ready to pounce if need be.

  3. Casey says:

    @David maybe this will help: Choo Choo, boondoggle, Conductor Tommy, Choo Choo Barrett, use the federally earmarked transportation money on something else as if the feds would allow that….feel free to add in your own grade school type name calling or logic…

  4. David says:

    When have I ever name called. I’m not sure I understand your post.

  5. David says:

    @Casey…. I think I get it. Ha! It’s cloudy and snowing. I’m alittle slow today.

  6. David says:

    no worries David- just for clarity I was filling in for the anti-streetcar crowd. Maybe they’re trying beat the snow and left the office early and are stuck on west bound I94 trying to escape back to Walker-sha

  7. Bruce Thompson says:

    From an economic development viewpoint one of the criticisms often made of street cars–that they are far harder to reroute than buses–becomes an asset. A developer can commit millions of dollars with reasonable confidence that it will still be there. So using TIFs to help fund it makes sense.

  8. Tina Klose says:

    RACM meetings are held at 809 N. Broadway (not 709).

  9. Dave Reid says:

    @Tina Thanks.. I corrected and noted that this particular meeting is at 2:30.

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