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Grand Forks Herald: Grand Forks City Council approves tax breaks for UND Memorial Stadium, Lyons Auto Supply, Townhouse and St. John’s Block redevelopments

February 2, 2021

A Grand Forks City Council vote on Monday night was the last civic hurdle for four tax breaks that would help redevelop some of the city’s biggest landmarks.

Written By: Joe Bowen | Feb 1st 2021 – 8pm.

Four Grand Forks landmarks are set to be revamped or outright replaced.

Grand Forks City Council members on Monday unanimously approved tax breaks for redevelopment projects at UND’s Memorial Stadium, the Townhouse Hotel, Lyon’s Auto Supply and St. John’s Block apartment building – at least $108.2 million worth of construction work in all. The council’s vote was the last that those four projects needed to secure a “tax increment financing plan,” which means the properties will be taxed at their existing property tax rate, rather than the much higher one they’d incur once they’re completed. The TIFs will exist for several years each, after which the developers will pay the higher tax rate.

Mayor Brandon Bochenski thanked a series of city officials and administrators as well as the developers who are set to work on those projects.

“I really want to thank you guys for being willing to make these investments in this city,” Bochenski said shortly before the vote, “and just the real commitment to Grand Forks. It’s just really great to see.”

The Townhouse, which sits off DeMers Avenue in downtown Grand Forks, closed in October due to the financial strains of the coronavirus pandemic, and it’s set to be turned into The Beacon, a multi-building complex of apartments, condos, commercial space and a plaza for concerts, car shows, and so on. It’s set to cost $48.9 million, according to an analysis by consultants from Baker Tilly that was presented to civic leaders on Dec. 9.

Memorial Stadium has been a university mainstay since 1927. It’s set to be torn down and replaced by a five-story building that would hold several floors of apartments and the school’s athletics department. The building would connect to the nearby High Performance Center via a glass-walled walkway that planners have dubbed the “Hawkway” after the school’s mascot. In all, it’s at least a $25 million plan.

St. John’s Block, the large apartment building that towers over Town Square and the Greenway, isn’t set to be replaced, but it’s still in line for about $7 million worth of renovations.

And Lyons Auto, which has sat empty for years, is set to be turned into several stories’ worth of office and retail space, plus apartments. It’ll cost about $27.3 million. Developer Northridge Construction initially proposed the plan to city administrators in November 2018, but the project stalled and ended up alongside the other three near the end of 2020.

All four received preliminary approval from city leaders in December, but North Dakota law stipulates that other public bodies have a say, as well. That meant city leaders needed to get approval from school district and county officials. Grand Forks County Commission and Grand Forks School Board members OK’d all four “TIF” plans last month.

In related news, council members:

  • Approved a new set of “Renaissance Zones,” adding a series of properties along Gateway Drive and the spot occupied by the city’s old water treatment plant. Redevelopment projects within Renaissance Zones can receive tax breaks that are fundamentally similar to tax increment financing plans, in which a developer temporarily pays property taxes on a redeveloped piece of land as if they hadn’t touched it.
  • Informally considered the merits of reducing the “franchise fees” for properties that draw a particularly large amount of electricity. Those fees are a way for an electric company or other utility to recover the cost of using a public space for their power lines or other infrastructure. Companies charge customers a relatively small fee – 2% in Grand Forks – and forward the revenue from it on to the city. Xcel Energy and Minnkota Power Cooperative have suggested lowering that fee to attract companies that use a prodigious amount of power, such as data centers and large agricultural firms.
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