On Tuesday, the Common Council will consider issuing Industrial Development Revenue Bonds (IDRBs) in support of the Dental Associates project being proposed on 27th Street. I'm sure many would like to know what exactly an IDRB is, and how it's relative to this development. According to Investopedia.com:
Industrial Development Revenue Bonds are issued by a government to assist a private company that might otherwise be unable to obtain financing for its industrial venture or unwilling to undertake the project on its own. The government's goal in providing the debt securities is to improve the economic and employment conditions of its region.
In this case, Dental Associates likely can claim the equipment they use for dental procedures as "industrial" in nature, and qualify to ask for such support.
Speaking with developers over time, one thing I have been made aware of is that even with excellent credit rating, banks are simply not lending. If a developer wants to pursue a project and goes to a bank, they will need to have full occupancy of the project and other methods of investment even before the bank will consider the project for approval. In other words, it's a big pain in the behind these days for developers and new ventures, despite taxpayers bailing out the banks via TARP and other stimulus plans since 2008.
So, in the case of Dental Associates, they're looking to the City of Franklin to provide the financing needed to get the project off the ground. Their position gains much more traction given the following points:
- Their building likely means the elimination of the "Cash 4 Gold" business, since they expressed interest in acquiring the building for its additional land.
- The facility brings in additional jobs and visitors to Franklin, increasing the daytime population of the city.
- It fits more in line with what the City of Franklin has down for 27th Street Corridor standards than what is there presently.
- It will provide greater tax base for the City of Franklin than what is there presently.
The biggest minus is, as with any project along 27th Street, Franklin Public Schools doesn't receive a penny from that facility. All school district taxes go to Oak Creek. I can see some using that as an issue, and I wouldn't blame them. The majority of Franklin taxpayers live in the Franklin Public School District, yet we're not going to get any relief on our school district taxes from this project. From the city's perspective, however, some aldermen have been known to observe that they could give a hoot on whether or not a project is in the "proper" school district - as long as city taxes are benefiting from it.
So there you have it. In closing, I believe this project will be approved to receive IDRBs necessary to help finance it.
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