City gives property owners more time to pay assessments
Downtown business owners will have an extra year to round up funds to pay the first tax assessment for the repayment of a bond for renovation of the Tonganoxie Central Business District.
The city has determined it will take several months to prepare loan documents, so assessments will not have to be paid until 2002, instead of 2001.
Chris Clark, city administrator, said he thought this was fair to the business owners.
"We're not trying to put people out of business," Clark said.
Mayor John Franiuk sees the completion of the renovation as a plus for downtown business owners and the city of Tonganoxie.
"We built a good project," Franiuk said. "It is well-lit, the streets are widened by three feet and there is better access to those with physical challenges. With what we had to work with, I think we built a really good project. These people (downtown business owners) should be well-respected for taking on the commitment and opening their wallets to help pay for the improvements."
Franiuk said he thinks the extra year will help the businesses.
"It gives them the chance to adjust their business plans or whatever means they need to pay the increased property taxes," the mayor said. "I wish that we could extend the cash payments for them. But, we can't."
He said that whether the assessment payoff was 10 years or 20 years, it wouldn|t actually be that big a difference once the interest was applied. For a typical assessment, $3,500, payoff would be approximately $400 a year and only about $25 less if stretched over 20 years, Franiuk said. Clark said the estimated actual assessment for $3,500 is $516 with the interest and can be paid at two intervals during the year. For those who wish not to pay the interest, they can pay the assessment in full by Sept. 7. If they haven|t paid by then, payments will roll over into the 10-year plan. At least one business owner has already pre-paid, Clark said.
Downtown business owners say they|re upset about the 10-year plan because they say were told the payoff would be over a 20-year period. Owners claim that the former city administrator told them this throughout the project. Franiuk said he was unaware of this because he never attended any of the meetings. He admitted that the whole process should have been monitored and discussed more carefully.
The total cost for business owners is $294,328. The city|s portion is $315,970. The individual business owners| portion of the cost was divided by the number of lineal feet of their property to determine the amount of the assessment.
Many business owners were upset with the decision and voiced their opinions at the Aug. 14 council meeting.
"I did not know what to expect," Chris Donnelly of First State Bank and Trust, said. "I took the position that we would go along with the majority of the individuals. It was not a significant issue for us. Either 10 or 20 years was fine with us. We just have to live with it and move on."
Some business owners are still confused.
"I was not at the meeting, but I really had a preconceived notion of what the tax bill would be before the project started," said Bill Altman of Community National Bank. "I assumed the amount would be half of what was originally anticipated. I|m just very confused."
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