The City of Lester Prairie agreed to be the legal sponsor for a tax increment financing district (TIF) which was the basis of an offer to Formative Engineering to entice it to remain located within the city limits.
Forming a TIF district allows the city to sell bonds to raise funds for site improvement. The money cannot be used for the building itself, but can be used to install such items as sewer and water.
The city agreed to sell $165,000 in TIF bonds which will be paid back to the city over no more than seven years through property taxes collected from Formative Engineering.
A TIF district allows the city to collect all the taxes. The school district and county will not receive a portion of Formative Engineering's property taxes until the TIF bonds are repaid.
Formative Engineering's new building will be built next to its current site, located east on McLeod Co. Rd. 1.
The company's president, Dale Woodbeck, is requesting a variance hearing because its building plan calls for loading and unloading trucks and to have the parking lot in front of the building. The hearing will be May 11, during the regular council meeting.