A manufacturing facility called New Plastics Plus, currently based out of Otsego, submitted a proposal to the city of St. Michael earlier this month that would subdivide a 20-acre plot of industrial land into three parcels, and construct a plastics manufacturing facility on one of those three. The proposed facility would be 82,000 square feet and would be located on the south side of Highways 241, just in front of Lennar’s Waters Edge development. This land has been zoned industrial since 1997.
The city worked with Ehler’s, their financial consulting firm, to develop a Tax Increment Financing (TIF) plan that will go in front of the council and planning commission on Wednesday, June 27. The city will also hold a public hearing on the development plan at the meeting, which begins at 7 p.m. at City Hall. The city council will hold a special meeting directly after the planning and zoning meeting/public hearing to discuss the plan.
St. Michael’s Community Development Director, Marc Weigle, said this parcel of land has some unique challenges for development that makes it a good candidate for TIF. Under Minnesota state statute, TIF is meant to encourage developers into investing in new projects and promote development, redevelopment or housing in areas where it would not otherwise occur. The developer would pay all upfront costs for the facility’s construction and site improvements, but for a period of nine years they would receive a tax rebate on all local (city, school district and county) taxes they pay above the current undeveloped land’s tax rate.
“They’re basically getting the increased property taxes back for a period of time, and up to a certain amount,” Weigle explained. “This site does have challenges with some of the grading and soils to get it to a condition that can be developed. It’s got some high development costs.”
Weigle said the plans do call for “quite a bit” of landscaping along the south edge to provide screening and create a buffer between the manufacturing plant and the residential development. City staff is recommending that the buffer landscaping go in with the initial construction. The proposed facility is comparable in size to the Marketplace grocery store, though there are plans for a future 34,000 square foot expansion.