By Sara StrongWith the governor planning a trip to Luverne, and the county and school district signing off on the project, the city’s first JOBZ business expansion is all but a done deal.And it isn’t just important for the city of Luverne.Total Card Inc. is the first out-of-state business to expand in Minnesota because of Job Opportunity Building Zone tax breaks.The Sioux Falls credit card business will finalize the former Tri-State Insurance building sale next week. The proper paperwork is filed with the state, and there’s no reason to think Gov. Pawlenty’s scheduled April 23 visit won’t come through.As a part of JOB Zone, TCI will be forgiven property tax, income tax for major investors and sales tax for business improvements — all for 12 years.The clock started ticking on those 12 years Jan. 1 of this year.The Luverne School District is the exception to the tax breaks. It will still receive local property taxes from the business estimated at $81,000 over 12 years.Take what it can getWhile some might criticize giving a private business such a good deal, those involved say it’s the only way Luverne can draw a large industry that offers complete benefit packages and good wages.TCI’s starting wage is $9 an hour and some positions go up to $22 an hour.Considering that the Tri-State building didn’t get as much as a second glance from a private, tax-paying business, the city considers this an economic victory.Luverne Economic Development Director Dan Statema said, "The JOB Zone, in my opinion, put us on a level playing field."TCI was looking at other cities to expand in when Luverne came into picture, promoting the former Tri-State building as a future JOBZ site.Ideally, Statema said, a private business would have wanted to locate 200 white-collar jobs in Luverne, but that just wasn’t happening.Tuesday, the Rock County Board of Commissioners and Luverne School Board unanimously passed resolutions to allow nine acres of previously designated JOB Zone property to the Tri-State building and property. The city will swap the nine acres from wetlands near Gold N’ Plump.This was a necessary step because the building wasn’t a part of the tax-break designation yet.Both the county and school passed along resolutions of congratulations to the city.Commissioner Jane Wildung said the city, and Statema in particular, should be commended for all the work put into the deal.The major part of the deal is the city financing the property’s mortgage of $500,000 for 20 years at 4.5 percent interest. Other incentives like Pool and Fitness membership discounts, new roof, a $24,000 training grant, reduced lot prices for employees and establishing a nearby childcare center are all part of the agreement.City Attorney Ben Vander Kooi said that even if the company doesn’t last more than a few years here, the building will be ready and improved for another business to buy at an increased value.But that’s the worst case scenario. The best-case scenario is what City Administrator Greg LaFond said is already happening, even though the city is giving the company a good deal.He said the property is no longer generating any taxes because it is city-owned. Statema said, "The purpose of this isn’t to lose any existing property tax base."When the building was occupied, it most recently paid about $33,000 in property taxes.LaFond said, "At the end of 12 years, the city will be ahead $913,000." That’s accounting for electric and utility income and financing charges, and factoring in expenses on the part of the city.All things consideredThe city hopes to draw more people to Luverne, meaning more homes built and a higher property tax base. That could potentially mean lower taxes for existing homeowners.Also, the payroll of almost $3 million would circulate through Luverne’s businesses and as the dollars turn over, would mean a $10 million per year community impact.Local retailers, realtors and service industries all look forward to the added payroll circulating and the additional people working in town.But the school, which lost 25 students and $100,000 in pupil aid since December, is also looking forward to the business to help its budget shortfall.Superintendent Vince Schaeffer said, "It’s wonderful for the community and the school is a part of the community."He said he understood that some local people will get the new jobs, but hoped it would also attract more people to town."I hope it keeps people in town as well as brings in more, with families," he said.While they are pleased with the TCI deal, Statema and LaFond said they look forward to filling the remaining JOB Zones while the city’s on a roll, and while most of the 12-year breaks are available.LaFond said, "We have to move beyond this initial success and concentrate on additional opportunities. … We have the ability to get firms like this, so it behooves us to attract more." Governor Pawlenty in Luverne Friday, April 23
9 a.m. governor’s live radio address from Blue Mound Banquet and Meeting Center
10:30 a.m. program welcoming TCI to Luverne
11:15 a.m. community luncheon
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