NEGAUNEE — The newly organized Negaunee Downtown Development Authority is looking to expand its boundaries beyond its traditional downtown.

DDA members viewed an updated map of the expansion proposal and heard options for how tax revenue could be distributed between the DDA, the city and the county in the proposed district during its meeting on Monday.

The current 42-acre tax increment financing, or TIF, district centers on two blocks of Iron Street, bordered on the west by Tobin and Gold streets and on the east by Teal Lake Avenue with the northern border of the district consisting of a portion of Jackson Street and the southern border running along Rail Street. The district also encompasses property to the south between Gold, Silver and Copper streets, and a portion east of Division Street south to County Road.

The district was approved by the Negaunee City Council.

The TIF district is where the DDA would gets its money.

The financing works by freezing the taxable value of a property at what it was when the DDA was formed and the district established, then collecting or “capturing” any property value tax increases beyond that amount each year.

According to a February 2017 Mining Journal article, proposed TIF recapture for the existing district would be less than $2,000 annually.

According to a notice of a public hearing set for Oct. 10, the proposed district generally consists of “properties east of the downtown (Tobin Street) extending to the west City jurisdictional line, properties north of the rail line and U.S. 41 adjacent to the Teal Lake Road intersection.”

The expansion would include Jackson Mine Park and would run along the south side of U.S. 41 along Teal Lake traveling west.

Some parcels in the proposed TIF expansion are currently zoned for public use, while most others are zoned Business 1, which would encompass restaurant and retail. Other areas are zoned for Business 2, which accommodates industrial businesses, Negaunee City Manager Nate Heffron said, but some of the areas of undeveloped land in the proposed district are zoned Residential 1, providing for single-family dwellings, some of which would need to be rezoned for business use.

“That’s in order to be able to be prepared for developers coming to the community rather than have them wait four to five months to have to rezone something,” Heffron said.

He said the Negaunee Planning Commission is working on recommendations for the rezoning project and notices have gone out to adjacent property owners.

Once approved by the planning commission, the proposed zoning changes would be subject to a public hearing and review and acceptance by the Negaunee City Council, Heffron said.

The city is currently in negotiations with the county with regard to how the taxes would be shared in the proposed TIF district, which is estimated to grow from its current taxable value of $6.3 million to about $10.2 million at a growth rate of .25%.

“(That is) very slow growth. We are hoping to have more on that if the economy stays good and developers want to invest in Negaunee that annual valuation will increase dramatically,” Heffron said.

Heffron said there are three options being considered at this time, and whatever tax-sharing option city and county administrative officials agree on and recommend would have to be approved by both the Marquette County Board and the Negaunee City Council.

“Again, we want to be careful how we approach this,” Heffron said. “We have seen other tax increment financing plans and districts that don’t do so well. So, working it out so some of that money goes back to the city, some of that money goes back to the county and some of that money goes into that TIF plan might be a good mixture so we can have a natural draw-down to a certain extent.”

Lisa Bowers can be reached at 906-228-2500, ext. 242.