Posted 3/13/13 (Wed)
By Neal A. Shipman
The plans for a nine-hole expansion of the Fox Hills Golf Course & Country Club in Watford City that would use a PILOT (payment in lieu of tax) program to pay for the expansion ran into some serious concerns from members of the Watford City City Council at last Monday’s city council meeting.
While the majority of the city council supported the concept of expanding the golf course to meet the growing needs of the community, they did not believe that right now was the right time to be diverting future tax dollars to pay for the development.
According to David Johnson, of Advanced Engineering, the golf board has been working on plans to expand the current nine-hole course to an 18-hole course for the past five years. But because of funding and land issues, the plan has never been able to move forward.
But, according to Johnson, a new residential developer is proposing to build the course as part of his plans to construct up to 250 new homes in a new development to the west of the existing course. And to make the $7.5 million addition to the golf course feasible, the city would have to be agreeable to forfeiting property tax revenues on the property back to the developer for a period of years.
“This is a plan that is the best we can have with the land available,” stated Johnson. “The owners of the land want to develop it and the timing is right to do it now.”
According to Johnson, the developers would donate the land, valued at $2.5 million and provide $2.5 million of in-kind construction. In return, they would receive an incentive program of $7 million.
While Johnson stressed that the city would not have to put any money into the project, the city would not be getting any of the property taxes from the development, which would be annexed into the city, until the developer has recovered his costs.
And it was the loss of those tax dollars, as well as the precedent such a property tax exemption could have on other developments in and around the city, that had the city council members concerned.
“We’re getting nothing to pay for bussing students, plowing the roads and providing law enforcement,” stated Brent Sanford, Watford City mayor, on the loss of tax dollars. “And right now, we’re asking all of the other developers to pay for the development costs on their land.”
Sanford also expressed his concern on the precedent that the use of this program would have on other developments being planned.
“We have to look at how we’re going to help build schools,” stated Sanford. “If every developer wants to put a school in their development, they are going to want to use the PILOT program. We’re in a situation where we have huge needs and expenses. We need tax dollars.”
According to Sanford, under the proposal to expand the golf course, the city could be losing approximately $500,000 a year in tax dollars, while the city is only generating $350,000 in property taxes today.
Sharing Sanford’s concerns on the prospect of losing future tax dollars were several other council members.
“I don’t know if this is the right time to fund the project with city tax dollars,” stated Doug Bolken, councilman. “I support the concept of an 18-hole golf course. I just don’t think with all our expenses we can do this right now.”
For Councilman Justin Voll, the issue was dealing with all developers fairly.
“It would bear a little more credence with the council if the developer bore more of the infrastructure costs,” stated Voll. “It’s a great project. We’ve put our money into other projects that set our community apart from others.”
But for Johnson and the golf course board of directors, the time is right for the city to help make the expansion a reality.
“The city council has done a tremendous job of looking at what we want this community to be,” stated Johnson. “This is an important project when you look at a community of 7,000 people. Our existing course is already too busy.”
While the council took no action on the plan during its March 3 meeting, Curt Moen, city planner, stated that he would continue to work with the golf course board.
“This is too good a project to let die,” stated Moen. “I’ll work with David to find a way to make this work.”
In other business, the city council approved entering into a $200,000 one-year agreement with McKenzie County for the use of the county’s jail services.
According to Sanford, while the city only paid the county $44,000 last year for jail services, the increase in fees was fair.
“The new rate is reasonable considering the volume of prisoners that we are pushing their way,” stated Sanford. “In addition, we share dispatch services with the Sheriff’s Dept.”
As part of the agreement, the city will also be responsible for all medical expenses that accrue over $10,000 per city-arrested prisoner.