Muskego looks for someone to pump up prime location
Small parcel on Janesville Road could again generate tax dollars
Muskego — After picking up a former BP gas station property at a bargain price, the city is now trying to turn it something that will again pump property taxes into the city's treasury.
Muskego got the one-third-acre tract at southwest corner of Janesville Road and Lannon Drive for $2,500 from Waukesha County, which had earlier acquired the lot to use a portion of it for the Janesville Road widening project.
While the county had no use for the remaining land, city officials were eager to control the development of what they view as a prime corner on the city's "main" street.
"It's a high-profile property in the middle of our downtown and we certainly want to get it back on the tax roles as soon as possible," said Mayor Kathy Chiaverotti.
Finding the right use
While the gas station was still in operation prior to 2012, the property had been valued at $150,000 by the city.
Muskego's Community Development Authority is advertising for proposals, telling potential developers that it will sell the land cheap for the right development. Proposals are due Oct. 4.
Although the road widening took a chunk out of the lot, there's enough left for a large-enough structure to accommodate almost any kind of business, said Jeff Muenkel, community development director.
"You can get a good (building) footprint on there," said Muenkel, adding that he had already received a couple of inquiries while the city was in the process of acquiring the parcel.
He said the city would like to see a development oriented toward general merchandising, restaurant, office, or community and customer service establishments. However, any proposal will be looked at based on its own merits, he added.
There is one problem with the lot: Part of the land has petroleum contamination due to its past use as a gas station. So, city officials are looking for developments that will disturb the contaminated parts the least, Muenkel said.
The oil company did some environmental cleanup and capped the site, he said, and the state Department of Natural Resources gave BP "closure" on the site, meaning it was fine, if not disturbed.
Putting landscaping or a parking lot — the latter would disturb only about two feet of contaminated soil — on top would work the best, Muenkel suggested. Either way, it would add about $5,000 to the development costs, he estimated.
By comparison, putting a building on that part of the site would mean digging 10 feet into the contaminated soil and the cost would likely be more like $10,000, Muenkel estimated.
A developer can ask the city about incentives to help deal with contamination, he said, noting that the city has several options available such as grants or low-interest loans.
Because the area is inside a special tax incremental financing district, the city would get reimbursed faster for such help than under ordinary circumstances.
Under that TIF district, the city would be able to keep all of the additional property taxes — instead of sharing the revenue with the other taxing jurisdictions — generated by the new development to offset certain development costs for a specified time period. One purpose of TIF is to encourage investment in hard-to-develop areas.
In fact, the city already has some TIF money available that could be used to help with cleanup, Chiaverotti said.
"That's what those funds are for," she said.
Another incentive for developers is that the city is willing to sell the land at cost — meaning the $2,500 purchase price plus any applicable staff and attorney fees (roughly totaling $10,000 to $15,000).
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