Plans to turn a 40-year-old landfill into an $18 million development are starting to take shape in Cudahy after more than four years of discussion.
Cobalt Partners LLC, Milwaukee, plans to buy the 20-acre property from the city of Milwaukee and develop a big-box retail store on the site. The vacant property at 4701 S. Pennsylvania Ave. in Cudahy is next to Lake Parkway and General Mitchell International Airport.
“This represents 1 percent of our land mass in the city of Cudahy,” said Cudahy Mayor Ryan McCue,” and it currently is worthless.”
Cobalt has held the option to purchase the land for four years, but on Tuesday morning took the first step toward sealing the deal when a Milwaukee Common Council committee approved a $1.25 million sale agreement.
Representatives from Cobalt were unavailable.
But before anything can be built there, the developer has to tackle the estimated $7.5-million job of removing contaminated underground waste left behind by a landfill that closed 40 years ago, said Lara Fritts, Cudahy economic development director.
Cudahy in November signed an agreement with Cobalt to help pay for the cleanup if future development on the site is worth at least $18 million.
Cudahy on March 9 will have a public hearing on the plan to create a tax-incremental financing district that will help pay for the cleanup, Fritts said.
“We’re estimating that this is a three- to five-year project,” she said.
Tax-incremental financing districts let cities borrow money to pay for public projects and support private development in a designated area. The increased property taxes generated within the district pay off the project debt. When the debt is paid, the district dissolves and the property taxes revert back to traditional collections.
The city plans to borrow $2.1 million through a new TIF district to pay for remediation costs. Cobalt would borrow $3.5 million through the TIF district for the same purpose.
If the remediation costs exceed $5.6 million, and they are expected to, Cobalt will pay for the rest, Fritts said.
If the TIF plan is approved in March, the city will begin more detailed environmental testing on the site this year to find out how much cleanup work the site needs, Fritts said.
McCue said the current plan is for a large retail store, with smaller satellite restaurants or shops on the property, but that could change with time. He said he’s discussed other options with the developer, such as a business related to airport operations.
“It’s a very unique parcel of land,” McCue said, “and with its proximity to the airport, we hope to attract a good tenant.”