Proposed development costs could pit city vs. city
New Berlin may ask Muskego to fund improvements for office/industrial project
A sand and gravel pit shared by Road Construction Materials Co. and Johnson Sand & Gravel is seen from Racine Avenue looking northwest in New Berlin. The site may be developed into a business park called Mill Valley. This panoramic image was created by combining three pictures to show a panoramic view of the property. Photo By PETER ZUZGA
A proposed development of a gravel pit has New Berlin city officials questioning whether to sink $25 million in infrastructure improvements or seek help from neighboring Muskego, because the property lies within the Muskego-Norway School District.
The project, called Mill Valley, is located on the southwest corner of the Interstate 43 and Racine Avenue interchange and, once fully developed, would be worth $150 million to $200 million.
If the proposed mix of mainly commercial and industrial businesses had been in place last year, it would have brought about $800,000 in property taxes to New Berlin, said Gregory Kessler, director of community development. It would have brought in about $1.5 million for the Muskego-Norway School District.
The development would be on the portion of a sand and gravel pit operated by the Road and Construction Materials Co. on the southwest corner of the interchange. Road and Construction Materials occupies the eastern portion of the pit that it shares with Johnson Sand & Gravel, which will continue to operate.
The gravel pit owners are already obligated to restore the land, but it will take more than restoration to get it ready for development, said Joseph Eberle, manager of the Mill Valley project. He is a consultant with the engineering firm of Ruekert and Mielke, which is being paid by the pit owners.
It would cost about $25 million to get it ready by installing sewers and water mains, grading the area, installing streetscaping, Eberle estimated.
Muskego-Norway benefits
The New Berlin Community Development Authority now must decide whether an investment that large is worth it, especially since the lion's share of the new property tax dollars generated by development would go to the Muskego-Norway School District, not the New Berlin School District.
Because benefits to the Muskego-Norway schools would be almost twice the benefit to the city of New Berlin, some CDA members think Muskego should chip in toward development.
"I would like to see them give sewer and water," said CDA member John Fillar.
In any case, Muskego is the most efficient source of sewer and water for the proposed project, Eberle said.
TIF might be formed
To help pay the approximately $10 million needed to get development going, New Berlin officials are considering establishing a tax-incremental finance district. It would enable the city, either by itself or in partnership with the pit owners, to borrow money to do the sewers, water and grading. The annual debt payments would be paid with the property tax dollars coming from new development.
It would be three to five years before a shovel goes into the ground, even if things go smoothly, Eberle said.
The Mill Valley plan involves retail in the northeast section of the area along Racine Avenue. Most of the rest would be for office, light manufacturing and distribution. A thin ribbon of single-family homes would be along the southwestern edge of the development along Tans Drive.
Water management ponds answer residents' concerns about the proposed development flooding neighboring areas and runoff contaminating ground water, Eberle said. The three stormwater ponds will be able to handle so-called 100-year storms, which have a 1 percent chance of occurring any year, he said.
There would be no negative impacts in terms of flooding or contaminating ground water, he said.
NEXT STEP
WHAT: Community Development Authority discussion of approaching Muskego about securing sewer and water services for the proposed Mill Valley development
WHEN: tentatively at 7:30 a.m. Dec. 3
WHERE: New Berlin City Hall, 3805 S. Casper Drive
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