By Jodi Wolfe
Staff Writer

In March, Pembroke will vote on most of the regulations required to approve a proposed 240-acre Tax Increment Financing (TIF) district, located near the intersection of Routes 106 and 3.

Tax increment financing allows towns to create districts where tax revenue can be used to pay for improvements in that district. The town can use all the tax revenue from the property except that meant for schools.

TIF PLAN – The proposed Tax Increment Financing district is shown in dark gray on this map. Route 3 runs from the top left to the bottom right, and Route 106 meets it at about the middle. The district would encourage commercial development near Concord but benefit Pembroke taxpayers. (Courtesy Map)

At Town Meeting, Pembroke residents will vote on establishing the location of the TIF district, adopting state statue RSA 162 K, and approving estimates for improvements to the district, but not the actual bond for the improvements. The town is looking at making approximately $3 million in improvements on three of nine TIF district properties. Part of this includes Phase II of Associated Grocers, a 350,000-square-foot wholesale grocery distribution center, scheduled to break ground on Thursday, Jan 13.

The improvements include a four-lane road from Route 3 into the TIF district, with a 150-foot right-of-way for maintenance. Inside the district, there would be a two-lane road. The improvements would also include enclosed storm drainage, water, gravity sewer, gas, underground electrical utilities and street lighting.

Pembroke officials reached a decision on these improvements at a joint planning board and selectmen meeting on Tuesday, Jan. 4. Three options were presented by Niel Cannon and Peter Phipps of the Capital Region Development Council. All three options reduced the length of the entrance road and included gravity sewer, municipal water and enclosed storm water drainage.

Option 1, estimated at $3,081,048, included a loop road inside the district and underground utilities. Option 2, estimated at $2,711,640, also includes a loop road inside the district with overhead electric utilities. Option 3, estimated at $2,425,000, does not include a loop road or underground utilities.

The second and third options violate zoning regulations and would need to be waived.

“These estimates are based on construction costs to this season,” said Phipps.

Cindy Lewis, a planning board member, pointed out there could be a problem if the connector from I-89 to Route 106 is constructed.

Planning board member David Beauchesne said that developers usually pay for costs to improve roads. “This is not going to naturally develop because of topography,” said Cannon.

Cannon also pointed out that a TIF district is advantageous to Pembroke because New Hampshire does not offer state aid for development projects.

Town officials chose Option 1 because it is compliant with zoning regulations and the town can look at ways to reduce the cost.

Roland Lemoine, a planning board member, said he is in favor of underground electricity.

“I think we’ll recoup every part of it in development,” he said.

Selectman Larry Young pointed out that one of the largest power lines runs through the district any way.

By approving the TIF district this year, land assessed at $6.3 million could be valued at as much as $22 million after improvements made through the proposed TIF bond.

That bond, if paid back over 20 years at 5 percent interest, would cost Pembroke $247,231 per year, but would generate $434,909 in tax revenue, said Pembroke Town Administrator Troy Brown. That would leave a surplus of $187,678 in tax revenue that could be spent on whatever the town decides or could be used to reduce the tax rate.

Planning board member Fred Kline asked what the difference would be between establishing a TIF district versus simply paying for the improvements.

Selectman Brian Tufts said the town can use the incremental increase in the value of the land to pay the bond off faster.

No bond will be offered to voters at Town Meeting this year because the selectmen and planning board want more information on costs.

Selectman are also looking for ways to cut costs.

The town will also need to determine the duration of the TIF district.

Selectmen can appoint an advisory board of five people who are either property owners in the district or abutters, said Cannon.

Beauchesne said the town will also need to make significant improvements to the water and sewer systems for the TIF district.

“This will be a huge change for taxpayers,” said Kline, “(This is) we will build it and they will come instead of they come and build it.”