The current City of Mason City Iowa Reinvestment District plan and application to the Iowa Economic Devel. Authority Board includes this Ice Arena project at a cost of $12,550,000 of which $10,550,000. is to be raised via four different public tax sources. Plus a PLEDGE campaign to seek $2M from the community. The City will front end this $2M via selling bonds the City will be required to pay off via the PAID pledges and covering any amount of the $2M that may not be achieved.
The plan includes the making of this $12,550,000 gift to U S Bank, N A owner of Southbridge Mall. The private owner will spend this sum to build THEIR ICE ARENA.
Then this City Council will Lease the Arena from the owner and no doubt become responsible to cover ALL of the private owned arena annual operating costs INCLUDING this new / additional property tax on the private owned ice arena. This $200,000 Tax Increment necessary to provide sufficient annual, for 20 years, money to retire the City’s Tax Increment bonded debt of $3,950,000. This $3,950,000 money becomes part of the $12,550,000. GIFT to U S Bank, N A.
The Iowa Reinvestment District law allows our State to fund so called Re-investment District Plans & projects that our State EDA Bd. favors. For Mason City’s five projects the most money, $4,900,000. of the tentative allocation of $7,100,000 form the $100M Iowa fund, is for Mason City to GIVE to the $12,550,000 funding of this GIFT DEAL to U S Bank, N A.
You ask, what is the contribution / investment from the current Southbridge Mall owner to achieve this Ice Arena they get for no cost to them?
Answer: Next to nothing.
Just like their history has been since Jan. 2013 when they acquired this sinking shopping center via a Sheriff sale. No investment to upgrade and improve it to date. No new Lessee. Seven Lessee departures since Jan. 2013.
For this sad story the State and Local tax sources plus some private paid pledges will be drained to gain access to a phony, “property will stay on the tax roll & no new taxes” political line. Plan is really to avoid a voter referendum for partial funding of the arena project for the same $3,950,000 that could be retired via the same revenue sources the Council will have to access to cover the property tax obligation in the Lease between the Lessor, U S Bank, N A and the Lessee, the City of Mason City. Of course the current dream being floated in the community is that the Owner / Bank is paying the property tax increase on this end run toward some $3,950,000 of bonding necessary to fill the DEAL–$12,550,000.
Read the Lease if it ever becomes public before the voting starts in Des Moines and Mason City Room (council).
Why is this current Arena DEAL stupid? Read above once more.
– 100% public funded project
– 100% of the annual operating costs DEAL / obligation of the City of Mason City (Lessee)
– Public ends up with a Lease, (maybe a little Thank you card for the $12,550,000 cash GIFT and a private ice arena we can use IF we keep paying per terms of the LEASE.)
Where was Donald Trump when this DEAL was hatched? Representing U S Bank, N A ???
