WATERLOO — Sinking property values in the Crossroads Center retail area are prompting the city to move the Lost Island Theme Park site into a different tax district.
The $100 million tourist attraction being developed by the Bertch family on Shaulis Road near the Lost Island Waterpark and Isle Casino Hotel Waterloo is currently in the Crossroads tax-increment financing district.
The actual location of the theme park isn’t changing, but city leaders are moving forward with plans to move the theme park property into the more successful San Marnan Drive TIF district to the west.
“The Crossroads TIF has seen problems in valuation that are currently leading to a negative increment,” said City Planner Aric Schroeder. “Additional concern has been raised over the outlook for valuations in the Crossroads TIF area and its impact on our ability to make the development agreement for the proposed theme park viable.”
Members of the city Planning, Programming and Zoning Commission voted unanimously Tuesday to endorse the plan. The City Council is scheduled to hold a public hearing and vote on the measure July 13.
TIF districts are geographic zones created to attract development. New property tax revenue generated from growth in a district isn’t released to other taxing bodies; it is retained by the city to spend on development incentives in that specific district.
The city of Waterloo created a new TIF district around the Crossroads Center area in 2014 to generate revenue so it could provide tax breaks to lure new businesses.
But property values in the district actually fell, primarily as the mall saw huge losses in is assessed value. The situation could worsen as Dillards closes its department store.
The lost tax base leaves no increment taxes to provide incentives to new businesses. It even forced the city to dip into other city reserves to pay for tax breaks already promised to other businesses in the TIF.
Meanwhile, the San Marnan TIF to the west is more prosperous thanks to an expansion at VGM, development in the Country Club Business Center at San Marnan Drive and Ansborough Avenue, and other new business openings.
The city has been using excess revenue generated in the San Marnan TIF to buy farmland for a new business park southeast of the Ansborough/U.S. 20 interchange. Those acquisitions are nearly complete.
Records show the city is planning to remove the Lost Island Theme Park site from the Crossroads TIF and then connect it to the San Marnan TIF by using a strip of Shaulis Road right-of-way.
City Council members to date have not approved a development agreement for the theme park. However, the proposed update to the San Marnan TIF includes a $14 million grant and $3.7 million in future tax rebates for the project, along with $10 million to improve the Shaulis Road corridor.
Meanwhile, Community Planning and Development Director Noel Anderson said the city hasn’t given up on making the Crossroads TIF successful. He said the city hopes property values eventually stabilize.
The Crossroads TIF was recently expanded north along La Porte Road, which is slated for a major reconstruction project in coming years. City officials hope the project will encourage more private investment there.
Staffer Tim Jamison’s most memorable stories of 2019:
Courier Reporter Tim Jamison's most memorable stories of 2019
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