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Mitchell Planning Commission Approves Tax Break for Chef Louie’s Revival

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The Mitchell Planning Commission has taken a significant step towards reviving the Chef Louie’s Steakhouse brand by recommending approval for Tax Increment District (TID) No. 44. This decision, made during a meeting on October 14, 2023, will now be presented to the Mitchell City Council for final approval, which holds the authority over tax districts within city limits.

The proposed TID is part of a larger initiative led by local developer Chuck Mauszycki Sr., who aims to bring the iconic steakhouse and lounge back to life. The district’s boundaries extend over 6.26 acres, situated north of Little Learners daycare and reaching eastward to Highway 37. Mauszycki has requested $2.9 million in increment financing, expected to be generated within the district over its maximum lifespan of 20 years. The total eligible costs for the project amount to approximately $5.46 million, indicating a funding gap that may need addressing.

Mauszycki indicated to the Mitchell Republic that there are currently 16 investors interested in the project, with soft commitments in place. Six of these investors are builders eager to participate in the construction phase, pending approval from the council. He emphasized the urgency of the project, stating, “We’ll need to be in business by next fall, one way or another.” The planned steakhouse is projected to create 15 full-time and 25 part-time jobs, enhancing local employment opportunities.

The envisioned establishment will cover roughly 13,000 square feet, featuring nearly 2,500 square feet dedicated to main dining, a bar area, a banquet hall, a boardroom, and even a casino section. In 2024, the Davison County Commission granted a $78,000 liquor license for the restaurant, which will be absorbed by the city following its annexation of the property in May.

The proposed TID overlaps with Davison County Tax Increment District No. 2. City Planner Mark Jenniges clarified that the county tax district would be settled before any increment funds are allocated to Mauszycki’s project, with an estimated payoff expected by 2028. The lots within TID No. 44 are also slated for future rezoning.

Mauszycki aims to complement the steakhouse with a fast-food restaurant and a lodging establishment, stating that the additional restaurant will not compete with the steakhouse, which is set to be developed first. He acknowledged that establishing a hotel or similar business could take up to five years.

Concerns were raised by Planning Commission chair Kevin Genzlinger regarding the potential failure of the fast-food and hotel developments to materialize and the implications for the increment financing. City Administrator Stephanie Ellwein reassured the commission that if the anticipated increment does not materialize, the developer would not receive any increment funds, posing no financial risk to the city.

Justin Johnson, the city attorney, supported this view, highlighting that the city would not be liable for any financing shortfalls. Don Petersen, an attorney representing the project, indicated that without the increment financing, investor interest would dwindle significantly.

The overall cost of the project is estimated at $9.2 million, which covers construction and infrastructure improvements, including extending Commerce Street northward with necessary utilities. Public Works Director Joe Schroeder noted that a right-of-way developer’s agreement would be required due to the public utility infrastructure involved.

Concerns regarding financial transparency were voiced by local resident Steve Sibson, who requested clarity on the project’s financials and the necessity of increment financing. He raised questions about whether the public should be entering a partnership with the private sector without a clear understanding of the project’s financial viability. Genzlinger addressed Sibson’s concerns, stating that a precedent for such financing had been established in Mitchell, and he expressed his support for the approval of the tax district.

The project plan for Tax Increment District No. 44 is set to go before the Mitchell City Council on October 20, 2023. Should the council approve the plan, a developer agreement will follow for further consideration. Mauszycki expressed optimism about the community’s enthusiasm for the project, asserting, “This community really likes this project.”

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