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Bomgaars was officially given approval Thursday for a project that nearly doubles the size of its Neligh store, which is the smallest of all of the company's 69 locations.
According to Bomgaars officials, the 8,400-square foot expansion would have been impossible without funding assistance from tax increment financing (TIF) for its water line. The issue facing Bomgaars, according to Dave Meyer - senior vice president/chief operating office of Bomgaars’ corporate office in Sioux City - was being required to install fire sprinklers in the building.
Meyer told the City Council at a previous meeting there was not enough water pressure to run a fire sprinkler system. The TIF will assist Bomgaars with extending that water line. It fits the requirements as a TIF project because it will also serve public need, not only private.
A TIF is not a grant; it is a low-interest loan that will be paid back over a 15-year period. Bomgaars will pay $12,520 annually, which is an increase of $7,622 to be captured to pay for the water main.
TIF funding comes from property taxes from the project itself, not from other people’s taxes. Basically, the taxes only exist because of the project itself.
After approval earlier this month from the Re-development Authority and the Planning Commission, the Neligh City Council extended the final stamp of approval at Thursday's special meeting. The motion was made by Ted Hughes and seconded by Stephanie Wanek. It passed unanimously.
On June 24, Torrey Wingert, vice president/CFO of Bomgaars, sent a letter to Neligh officials 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.”
Meyer said they plan to have the new space in use after the holidays.
Several other resolutions were also adopted during the special meeting. The City Council adopted a resolution to declare a portion of Neligh blight and substandard. This area is located along the western corridor of Highway 275.
Keith Marvin of Marvin Planning Consultants told the Council that Neligh now has 19.1 percent blighted. He recommends no more than 35 percent.
Another resolution approved was for the redevelopment plan for the City of Neligh.