Although Bomgaars has not officially been annexed, documents are now being drafted for tax increment financing to expand the water main to the area west of Neligh.
The Neligh Economic Development Board voted Monday night to start the paperwork necessary, per the request from Bomgaars for their expansion, who submitted a letter to Economic Development Director Greg Ptacek stating the project would not proceed without assistance.
On June 24, Torrey Wingert, vice president/CFO of Bomgaars, sent Ptacek a letter stating, “Without this TIF, our development project would not be economically feasible and would not occur. We understand that there are no assurances as to the amount of the TIF or if the TIF will be approved.”
The decision to start the paperwork was approved 3-1 on a motion by Dennis Anderson and seconded by Al Stelling. Anderson, Stelling and Terry Jensen voted in favor. Casting the lone dissenting vote was Ryan Koinzan. Ashley Krohn was absent.
Koinzan asked who would use the water line, specifically asking if Larry Baker would be required to use city water. Ptacek said property owners in those areas could attach to the line; however, they would be "grandfathered in with their current wells" and would not be required use the water line immediately. He said property owners could remain on their own well system until major repair is needed on their wells. At that time, they would need to utilize the City of Neligh's water line.
Melissa Smith, who is an owner in the Mill Pointe project, questioned the hesitancy in moving forward with drafting the funding. She asked if the Bomgaars project meets state statute, which Ptacek said it does.
"So this project meets all the criteria set forth by state statute for use of TIF?" Smith repeated. "So my concern is what is the question of whether this is appropriate to use. Why is this project different from our project? We're both doing well over a half million dollar investments in Neligh. Why was our project OK and this project is questionable?"
Jensen said having to annex property was the difference in the two projects. Koinzan said to him the difference was annexation and having to build infrastructure to accommodate Bomgaars.
Smith reminded the economic development board members that the Bomgaars project would be an economic benefit to the community.
"Our main concern is the economic development of the overall community. We have a building we'll need to fill and will be starting construction soon and hopefully will help grow Neligh and get some businesses to Neligh," she said. "Hopefully, we have the environment that welcomes any business to expand or start a new business. I'm a little concerned about the hesitation on passing this project."
Located just west of the Neligh current city limits, Bomgaars is planning to start a 8,400 square foot addition this month and have the new space in use after the holidays. In order to qualify as a TIF project, the business must be located inside the City of Neligh.
Bomgaars is expected to officially be annexed next week during the third reading of the ordinance at the Tuesday, July 14, City Council meeting. Should annexation not occur, action taken during Monday's meeting would cease, Ptacek said.
The Neligh location is the smallest of Bomgaars' 69 stores in Iowa, Colorado, Nebraska, Minnesota, South Dakota and Wyoming. The expansion will take the now 12,000 square foot store to just over 20,000 square feet.
At the March City Council meeting Dave Meyer, senior vice president/chief operating office of Bomgaars’ corporate office in Sioux City, said the issue facing Bomgaars was being required to sprinkle the building. He said there’s not enough water pressure to run a fire sprinkler system.
Ryan Bolinger, project manager for W.A. Klinger, LLC, told the Council that water is the most important aspect for the expansion and "without having the water, the state won't let us build." He said Bomgaars is currently using a septic system and could continue that way.
W.A. Klinger, L.L.C. is now accepting bids for the expansion. Bids are due by 2 p.m. on Tuesday, July 21. Bolinger will be at the Neligh location from 10 a.m. until 3 p.m. on Thursday, July 9, to provide information and answer questions for any subcontractors interested in bidding the work. Bids to be submitted by email to Bolinger at email@example.com or fax to 712-277-5300.