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Wilmington unanimously approves $70-million financing for potential Thermo Fisher campus purchase

The ThermoFisher building, formerly the PPD headquarters.
Benjamin Schachtman
The ThermoFisher building, formerly the PPD headquarters.

Last night, Wilmington city council unanimously approved a plan for financing the city’s potential purchase of the downtown Thermo Fisher building and the surrounding properties. However, there are still several more steps before the city closes on the property.

The city will issue up to $70 million dollars in limited obligation bonds for the purchase. Some of those can be paid back early, which would reduce the city's long-term debt balance.

In order to pay off those bonds, the city plans to raise property taxes by 1.5 cents per $100 of ad valorem property tax. That’s an additional $15 dollars in annual taxes on every $100,000 of property value.

If the city were to take over the Thermo Fisher, some of the city's debt — and thus the long-term tax increases — could be mitigated by proceeds from selling existing city property as various departments move into the building.

Related: Deep Dive — City of Wilmington considering $68-million purchase of Thermo Fisher building

The plan still hinges on a due diligence process and will have to receive approval from the Local Government Commission on May 2; the LGC is an agency in the State Treasurer's office that evaluates major local government financial transactions. If the LGC approves, council would then take a final vote (or votes) on the sale in the summer, actually issue the bonds, and use the proceeds to buy the Thermo Fisher campus.

Councilmembers Kevin Spears and Luke Waddell asked staff to look into what the financing would be like without a tax increase as the deal goes forward.

The increase may also depend on how many former properties the city is able to sell off — and any potential new leases for parts of the Thermo Fisher building the city doesn't use. The city is eyeing roughly five floors of the building, but hasn't decided which floors yet, pending an appraisal.

Several speakers at the public hearing voiced opposition to the tax increase. Some others raised concerns about the viability of the commercial real estate market.