With the annexation of 115 acres from the town of Milton and approval of a TIF agreement, Clasen Quality Chocolate Inc. (CQC) moves closer to creating a 390,000-square-foot facility and at least 50 new jobs in the city of Milton.
The city council took several actions during a virtual meeting Dec. 17.
Among the first was approving an ordinance to annex land.
Clasen Quality Chocolate intends to purchase the annexed land from private property owners to help create a 169-acre site in Crossroads Business Park, on the east side of Milton.
Phase 1 of the development plan for the site is constructing a manufacturing and distribution facility just north of Putman Parkway by the end of 2022. CQC specializes in chocolate and confectionery coatings and has facilities in Middleton and Watertown, with corporate offices and an innovation center in Madison.
City Administrator Al Hulick said the number of new jobs could increase to “hundreds” in subsequent phases of development, which are under consideration, but do not yet have dates associated with them.
“They’re talking about the facility tripling in size over their subsequent phases and their number of employees to quadruple or more,” he said.
Upon completion of Phase I, CQC has committed to create a projected taxable value of not less than $29 million.
“This is a ‘pay-go’ TIF development agreement,” Hulick said. “As increment, or as taxes are generated from the creation of that project, the city will provide an incentive close to that increase in value. It actually works out to be about 85% of the value they create they would receive.”
The total incentive is $5.387 million over 12 years or at the time CQC’s projected “increment” (increased property taxes generated by private development) reaches the total incentive amount, whichever comes first.
“It is to their advantage to create a pay value higher than what they are projecting ($29 million) so they can recoup their incentive quicker,” he said.
As part of the agreement, CQC agrees to purchase 9.1 acres of land from the city, extend Putnam Parkway to the entrance of their site and extend a rail line about 3,500 linear feet from west of Penn Color, along Putnam Parkway and into their site.
The city, in turn, agreed to sell a 9.1-acre parcel to CQC. According to Dec. 17 memo from Hulick to the mayor and council, the date of the closing has not been established but likely will occur sometime in early 2021. Other land is being acquired from private landholders.
For the annexed land, the city will pay the town a total of $474.15 per over five years. The amount is based on what the town levied and the town filed no objection to the annexation. Annexation petitions were submitted by William R. and Jacqueline F. McNall Revocable Trust (64.76 acres) and Van Horn Living Trust (50 acres).
With the land annexed, the Joint Review Board finalizes the creation of TIF District 11 and amended TIF District 6 on Friday.
Hulick said the City of Milton and CQC are working with the Office of Commissioner of Railroads, Watco, the WisDOT, and Wisconsin Southern Railroad to secure the construction of the rail spur.
CQC intends to start construction on the rail line, Putnam Parkway and their facility as soon as they can in 2021, Hulick said.