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Consideration of creating Tax Increment District No. 17, approving its project plan and establishing its boundaries
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Submitted by:
John Ruggini, and Jon Cameron (Ehlers)
Department:
Finance Department
A. Issue
The Project Plan for the Creation of TID #17 was approved by the Community Development
Authority on March 16th, 2026, following a public hearing on the same date and is now before
you for consideration.
B. Background/Options
Municipalities have the authority in Wisconsin to create Tax Increment Districts to facilitate economic development that would not have otherwise occurred but for the municipal support. This support can be in the form of public infrastructure (roads, sewers, water mains, etc), site remediation (demolition, environmental clean-up, land acquisition, etc) or a developer grant to address extra-ordinary costs. In Wauwatosa, the “but for” test is answered by proving two questions as outlined in our Economic Development Investment policy (attached):
1. What expenses are the developer occurring that are extra-ordinary compared to a development on a “green field” with room for surface parking and no site remediation?
2. Do these extra-ordinary costs result in a below-market return on investment that would prevent the developer from raising sufficient equity and/or securing loans to proceed with the project.
We typically engage a third-party financial consultant to assist with this analysis (memo attached).
This financial assistance is made possible by the “tax increment” that is generated by the new development within the geographic boundaries of the District. “Tax Increment” is new property value and the corresponding taxes generated by any development that occurs after the District is created and that exceeds the value and taxes that are already (and continue) to fund the overlapping taxing jurisdictions (City, School District, County, Technical College, Sewerage District). This is depicted below. The Department of Revenue’s “TIF Manual” is also attached which includes additional background as well has helpful statistics about the utilization of Tax Increment District financing state-wide.
Wauwatosa Tax Incremental District (“TID”) No. 17 (“District”) is a proposed Blight District comprising a 1.7-acre single-site at 2825 N Mayfair Road. The District will be created to pay the costs of development incentives and infrastructure needed (“Project”) to be developed by Cream City Real Estate Investments LLC for the Latitude 43 multi-family development.
In addition to the incremental property value that will be created, the City expects the Project will result in approximately $21.9 million in new taxable value within the City and significant additional housing opportunities at various price points. The City anticipates making total expenditures of approximately $5.04 million to undertake the projects listed in this Project Plan (“Plan”). Project Costs include an estimated $2.85 million in development incentives (future value estimate figure) on a pay-as-you-go basis through the issuance of Municipal Revenue Obligations (MROs) for the project within the District boundary.
The anticipated new taxable value to be developed within the District is projected to be $19.62
million. Based upon the economic feasibility study located within the Project Plan, the City
anticipates that the District will generate sufficient tax increment to pay all project costs within 18 years of the allowable 27-year lifespan.
C. Strategic Plan (Area of Focus)
Priority Area One: Economic Development & Financial Resilience
D. Fiscal Impact
The attached project plan shows that the Tax Increment District will generate sufficient increment to cover its expenses, will increase property value and will also incorporate public infrastructure improvements so there should be a net positive benefit to the City.
E. Recommendation
I recommend the Committee and Council approve the Tax Increment District 17 project plan.