Last Dance Project Update

This provided map shows the proposed site of a large new industrial park on a 315-acre property located just southeast of the Elkhart County 4-H Fairgrounds on C.R. 36/East College Avenue.

GOSHEN — Plans for the development of a large industrial campus on the city’s southeast side passed a major hurdle Friday during a meeting of the Goshen City Council.

At the meeting, council members voted 4-3 along party lines to approve an amended development agreement with project developer Last Dance LLC related to the construction of a large industrial campus in the newly formed East College Avenue Industrial Park, a 315-acre property located just southeast of the Elkhart County 4-H Fairgrounds on C.R. 36/East College Avenue. The vote followed similar action by the Goshen Redevelopment Commission during their meeting Tuesday afternoon.

Made up of three parcels — known as tracts 1, 2 and 3 — the entirety of the property is currently owned by Last Dance LLC.

As proposed, the project involves Last Dance LLC helping the city to extend water and sewer infrastructure to the site, after which the group has committed to constructing a total of six RV-related manufacturing buildings on the site over the course of several years at a cost of approximately $59 million.

According to the agreement, it is estimated that upon completion of the facilities, the campus is expected to employ approximately 500-800 full-time employees with an average wage of approximately $40 to $55 per hour by Dec. 31, 2025.

AMENDMENT NEEDED

As part of its initial plan to develop the property, Last Dance had committed to paying for up to two-thirds of the needed infrastructure improvements at the site, which initially had a projected cost of about $15 million. The city, in turn, would pick up the remainder of the bill.

In order to cover its funding obligations, Last Dance sought to purchase bonds from the city totaling $10.5 million that would then go toward funding most of that infrastructure work, while tax increment collected from the newly established College Avenue Economic Development Area would be used to fund the remainder of the work.

When it came to the financing of the bonds, Last Dance planned on paying for the bonds up front, constructing the infrastructure with the bond proceeds, and then as the project developed and revenue was generated, that revenue would be used to repay the bonds.

Given the amount of investment planned for the project, an ordinance authorizing the city to issue $10.5 million in economic development revenue bonds needed in order for the project to proceed was approved in 2021. That agreement included a request by Last Dance LLC that 100% of the TIF revenue generated by the new industrial campus go toward repayment of the bond for a period of 20 years.

However, during Friday’s meeting, council members were informed that cost projections for the project have jumped significantly in recent months, a fact due in large part to ongoing construction pricing increases and supply chain issues resulting from the COVID-19 pandemic.

According to Becky Hutsell, redevelopment director for the city, bids for several infrastructure contracts connected to the project were recently received, with all of them coming in higher than anticipated.

As such, council members were asked to approve an amended development agreement with Last Dance LLC raising the maximum amount of the economic development revenue bonds from $10.5 million to $21.38 million.

Other changes requested as part of the amended agreement included:

• Extending the 100% TIF pledge from the College Avenue TIF from 20 years to 25 years to maximize payment for the developer;

• The city will complete the College Avenue Reconstruction portion of the project as an LPA project, with Last Dance LLC committing to fund the city’s 20% contribution up to $1 million; and

• Last Dance LLC will commit to annexing four additional parcels of real estate adjacent to the previously annexed properties at the site.

COUNCIL DIVIDED

Prior to Friday’s vote, some on the council noted that while they understood that water and sewer infrastructure needs to be extended on the city’s south side in order to open up more expansion opportunities in the future, they wished the project leading to that infrastructure expansion wasn’t RV related, as the Last Dance proposal is.

“I feel like it’s a two-part thing, where I support one side of it, but I struggle supporting bringing in another RV company,” said council member Megan Eichorn, D-District 4. “My struggle with bringing in more RV is even greater now because of the current economic situation, the current gas prices, the effect it could have on other local RV companies, and pulling employees away from existing RV companies that have been here for a long time.

“But also, I’m struggling with the need of, yes, we need to be able to develop, potentially, and get water and sewer to these areas,” she added. “So, I’m struggling, and I don’t know how to go with this.”

Council President Brett Weddell, R-At Large, responded by noting that he, too, would like to see more diversification in the city’s job offerings, though his hope is that the infrastructure expansion resulting from the Last Dance project will actually open the doors to some of that diversification down the line.

“I think I would echo those statements as well,” Weddell said of Eichorn’s concerns. “What I’m hoping is with this water main loop — I’m not saying it’s going to — but I’m hoping it opens up the potential use of housing, and I’m thinking high-tech industry. ... But your mental struggle is, I think, all of ours, too, in that vein.”

For her part, council member Julia King, D-At Large, also noted that she would be much more inclined to look favorably on the Last Dance project if it were not RV-related, as she, too, would like to see more diversification in the city’s job offerings.

“And I understand, Councilman Weddell, your desire, and the desire of others, to see something else come down the road from that,” King said. “If it were the other way around — if this were something different — then I might be all for it. But this isn’t, yet, something different. So, now it’s a game of guessing what comes next, and I’m not prepared to put this much into the guess for the next one, personally.”

In the end, though, a majority of the council’s members came down on the side of passage, and a motion to approve the amended development agreement and bond issuance was narrowly approved in a vote of 4-3 along party lines.

Voting in favor of passage were council members Weddell; Donald Riegsecker, R-District 1; Doug Nisley, R-District 2; and Matt Schrock, R-District 3.

Voting against passage were council members Eichorn, King and Gilberto Pérez Jr., D-District 5.

John Kline can be reached at john.kline@goshennews.com or 574-533-2151, ext. 240315. Follow John on Twitter @jkline_TGN.

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