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Whitewater, county settle on TIF charges

WHITEWATER — Whitewater city officials struck an intergovernmental agreement with Walworth County to receive more than $123,000 in special charges related to one of its taxing districts.

City Manager Kevin Brunner said sides were able to avoid litigation by reaching a settlement earlier this month. The deal, approved Tuesday by the city council, was unanimously passed by the county board last week after its finance committee recommended rejecting it.

The city previously entered an agreement with Elkhorn Road Venture for future development in Tax Increment Financing District 4. When the company was unable to make "pilot payments" in lieu of taxes to the city, it submitted those charges to the county for reimbursement as special assessment charges.

Brunner said the county disputed Whitewater's claim, prompting a meeting between city and county officials.

"We believed that we had submitted a proper special charge to the county … for payment by the county when the annual tax settlements take place," Brunner told the council Tuesday. "The county disagreed with that characterization and determination.

"(The settlement meeting) was probably one of the better meetings I have been to in my career. We were able to resolve a thorny issue by developing the agreement you have before you tonight."

Elkhorn Road Venture was expected to develop retail space in the taxing district, Brunner said. When the recession hit, it was unable to follow through with those plans.

In the agreement with the county, the city will get paid for the special charges, but when payments are eventually made on the Whitewater property, the county will be reimbursed. That keeps Walworth County from suffering financial losses, according to the settlement.

Whitewater city attorney Wallace McDonell said the city would only need to compensate the county if it doesn't recoup the money through development, sale or foreclosure of Elkhorn Road Venture's property.

Also Tuesday, Brunner asked the council to consider approving $85,000 to repair a well that was damaged last month during a power outage.

The well, located off Carriage Drive, has the highest output in the city. Brunner said the city might receive some insurance money to cover costs, but the well needs a new pump and piping.

The council wasn't expected to act Tuesday. Brunner said money that was designated for another well could be used for the project.