Chronicle Editorial

Rewards for endured faith
     While proper management and attention to the small details sets a community up for success, administration is only part of the equation in creating prosperity for its members. The other factor is luck.
     The truth is that fine-tuning revenues and expenditures only make a community more efficient with the money it currently collects. Unless an exterior force boosts that income, the marginal savings from keen administration basically maintain the status quo. The other truth of the matter is that opportunities to expand economic growth in the form of income, taxes and jobs are few and far between, and often, are once in a lifetime, especially for small communities with limited resources…especially in the rural Midwest.
     As The Chronicle has reported the last two weeks, it seems that the City of Latimer has stumbled upon such luck.
     The details of Alliant’s interest in the Latimer Industrial Park lots can be found in an article in this week’s paper, “Latimer ponders establishing TIF zone for Industrial Park,” where it also explains the caveats to going through with such a proposal.
     The City of Latimer would have to invest approximately half a million dollars to make the four lots shovel-ready (according to preliminary estimates, with much of the money needed to go towards a gravel road that Alliant would want as an alternative entrance into the lots), which is not money that the city readily has available; they would need to bond for the money and pay it back.
     In normal circumstances, a city doesn’t want to use bonds for just any purpose. Though the interest rates for governments are relatively low, interest is still interest and must be paid back using taxpayer dollars. Cities will usually look for public-private partnerships and grants to avoid bonding for large quantities at a time.
     The estimate on the valuation of the improvements that Alliant will make to the site is approximately $1 million, which isn’t a bad deal in terms of tax revenue from the property. The city’s interest in making the area a Tax-Increment Financing (TIF) zone to pay back such a bond in improvements is the keen awareness needed to make communities of its caliber run efficiently.
     The catch is that with tax credits and other laws that incentivize the creation of renewable energy in the Midwest, the TIF zone that Alliant would be located in would only allow taxes on the property to cap-out at 30 percent of the valuation. Over 20 years, the city wouldn’t even earn back a quarter of the bond needed for the project.
     Under normal circumstances, the city, over 20 years, would be able to tax the total value, and over those 20 years, would come out neutral with its investment, finally being able to collect taxes on the 21 year. But in the meantime, the benefits go beyond taxes in the form of jobs, attention to the city, and a boost in surrounding economies. At the height of the wind expansion, approximately 300 people would be around the site.
     The catch is in going through with such a project is that yes there is a perk that favors Alliant in such a deal, but that perk is optional. Alliant doesn’t need to invoke its 30 percent valuation cap. It can incur taxes on the improvements to the property. When it comes down it, this project can only be made possible if Alliant doesn’t invoke the cap.
     The fact of the matter is that not just Latimer, but Franklin and Wright Counties need Alliant; Alliant also needs Latimer. The city’s prime real estate next to the Interstate is great for moving materials and getting parts quickly. Its relatively remote location means there are no obstacles for 18-wheelers to move around and Alliant doesn’t need to worry about noise or other external factors that more populated areas would present.
     For the community, both Franklin and Wright Counties would be frequented heavily. Employees will need to live close to the area; restaurants and attractions will be visited and traffic on Highway 3 will increase. Not to mention, the coming addition of Kwik Star this summer (featuring diesel for trucks) is just 10 miles East. Both parties benefit greatly from the opportunity before it.
     Franklin County has been very thankful to Alliant for building its wind projects in the area, and Alliant has expressed much gratitude towards the county for working with them. The community is no enemy of the company, and in fact, has great respect and friendliness towards it. For this reason, both parties should heavily negotiate this 30 percent cap.
     Alliant’s Bradford location and South Franklin County location have invoked the 30 percent cap. Some might ask, “why shouldn’t they?” They’d have a point. Building renewable energy doesn’t come cheap. The whole reason special tax laws were written was to get companies to build and invest in infrastructure. Alliant deserves what it is owed.
     But both parties need the other. On it’s own, Alliant cannot prepare the site. It’s city property. Alliant cannot prep any site for that matter. Even if they could, the company would be on the hook for more than $500,000 in initial investments to get their project up and running.
     Latimer needs Alliant. If Latimer is willing to take the risk of bonding for the money, then the standard approximately $33,000 annual in taxes to the city is a sign of faith in one another.
     No, it is not the responsibility of private businesses to go around making sure that the communities they occupy are taken care of. It is not the purpose of private companies to take on the responsibilities of financially supporting a town. But great businesses do, and build loyal customers in the process.
     The county and its constituencies have supported Alliant in its past endeavors, and with this proposal, will continue to support Alliant. Sure, Alliant has the right to enact its rights, but when both parties stand to benefit greatly from such an opportunity to change the track of a small Midwestern town, that once in a lifetime opportunity should be taken advantage of, for the good of all those involved.