Êyiv, 23 march - SV Development. Six years ago, there seemed no limit to residential subdivisions springing up in Pleasant Prairie.
“I think it’s been the type of home building that we’ve provided for,” Village Administrator Michael Pollocoff said in August 2003. “We’ve been looking for larger homes and larger lots, which in turn have larger values. Demand has been outpacing supply in some respects in this area.”
Fast forward to today.
The faltering real estate market has the economy in a tailspin. There are newly built homes standing empty, and other residential development is on hold.
In turn, in planning its 2009 budget, the village axed four full-time positions, two closely linked to construction and development.
Still, even as three more developers recently were granted delays for residential subdivisions, both Pollocoff and Village President John Steinbrink were upbeat.
“If our projections hold, the village will be OK. When the economy begins to turn around, it won’t come rocketing back, but we’ll add staff back as it does. As far as budgeting, we’ve already taken the hit,” Pollocoff said.
The bigger concern is what happens when real estate values statewide level off, according to Pollocoff.
“Not just here, but everywhere. As new value is determined — what real estate is worth in the county — at some point that is going to affect (home and real estate) prices,” he said.
Municipalities, school districts and other local levying authorities won’t know how their tax base will fare until the state calculates equalized values later this year.
“If your tax base is primarily residential, it’s going to be difficult,” Pollocoff said. “The commercial and industrial (property values) may be coming down, but we’re talking minor compared to residential.”
That’s one reason the village is focusing its tax-incremental finance (TIF) dollars on commercial and manufacturing development, in an effort to maintain a balanced economy and minimize the pain for residential taxpayers.
While some might argue the village could help spark residential development by revisiting policies put in place during boom years, Pollocoff said that wouldn’t be wise.
“The first thing developers would say is, ‘Lift impact fees.’ But then all those costs get put on existing development. That wouldn’t be fair. That’s like a water balloon: Push on it over here, and the water goes over there. We’ve always followed a policy of existing development doesn’t subsidize new development,” Pollocoff said.
“Saying, ‘Let’s reduce expenses for a developer doing residential’ only shifts the costs to existing residences. Somebody has to pay for it. In good times, that’s hard. In bad times, it’s even worse. Development shouldn’t proceed until the market is ready for it.”
Steinbrink agreed. “It’s not fair to put it (new residential building) on other taxpayers. The bad economy isn’t their fault,” he said.
Meanwhile, he said he had no concerns about the overall well-being of the village.
“We’re not under a risk right now,” Steinbrink said. “The rest of the village goes on. We still take care of the roads and provide services to the rest of the village. That’s our job.”