A redevelopment commission could contribute up to 15% to an educational entity in a tax increment finance district for a project benefiting the workforce.
TIF funds could also be used for a public safety entity such as fire or police.
These are just two areas members of the Kosciusko County Redevelopment Commission, members of the county council, county commissioners, plan commission, auditor's and treasurer's offices learned following the March 13 Kosciusko County Redevelopment Commission meeting. The educational presentation was given by Matt Frische with Reedy Financial Group, Indianapolis.
Lasting 1 hour, 45 minutes, the presentation covered redevelopment terms; an overview of what TIF does, how it works and the process of creating a TIF; how the revenue works; why a TIF should be created; and what redevelopment commissions can do. Frische touched on the common incentives and characteristics, noting there are factors to be considered when determining the best incentive vehicles. The three characteristics he noted were abatement with the use of TIF, economic development agreements and TIF revenue bonds.
Additionally, information was presented on what if the redevelopment commission did nothing and development occurred or didn't occur. Perhaps the most enlightening part was a comparison of the difference in county revenue if the county TIFs a development versus letting the development's assessed value go to base.
That scenario used a $56 million development coming to the county and the difference in county revenue as a TIF versus letting the assessed value go to the base fund. The example showed if the $56 million development goes to the TIF, it would have a tax rate of $1.2165, bringing in a TIF revenue of $681,240. If it went to the base, the cumulative capital development, the rate would be $0.0333, bringing in a revenue of $18,685. Without TIF, $662,592 would be lost annually. Over a 25-year TIF life, over $16,564,800 would be lost.
Following the presentation, a number of questions were raised by Cary Groninger, county commissioner; Kathy Groninger, county council; Matt Sandy, area plan director; Dan Brown, Rachael Rhodes, Doug Hanes and Jan Orban, county redevelopment members.
Among the questions were if a TIF district could be in an economic development area, could there be multiple TIF districts in a economic development area, what happens to the economic development area when the TIF life ended and how TIF money could be used within an economic area.
Strategic planning, consultation with a lawyer were noted as important elements.
“Education is half the battle,” Frische stated, reiterating the use of TIF funds are to benefit an area. It was noted the use of a comprehensive plan for areas can benefit TIF decisions as well as pruning negative parcels within TIF districts.
Other discussions on TIF included annexation and housing TIFs. Frische stated if a county TIF is annexed into a city and there is no debt in that area, the TIF goes away. But if there is debt, the county retains the TIF. As for the housing TIF's, Frische noted it could benefit schools. The influx of housing could mean the increase of students, which raises the school’s average daily member count, which is the basis of state funding for the schools.
Regular Meeting
During the 13-minute redevelopment commission meeting, commission members reviewed the 30 West and Dreyfus TIF districts in accordance with state statute. Dan Brown and Bruce Jackson were also sworn in as members of the commission.
It was noted the 30 West district has a 2025 approved budget of $410,000 with a fund balance of $412,892.12. The end date for this district is 2040 and involves the taxing units within Etna, Prairie, Plain, Wayne and Harrison townships. The taxing entities in that district include the county; solid waste district, Triton Schools; Etna, Harrison, Prairie, Plain and Wayne townships; Warsaw-Wayne Fire Territory; Warsaw Community Public Library; Warsaw Schools, Bell Memorial Public Library and Tippecanoe Valley Schools.
The Dreyfus TIF, which ends in 2036, has an approved budget cash fund of $375,000 with a fund balance of $424,748.84. The bond fund cash balance is $323,120.93 with the remaining bond payments of $878,058. The taxing entities in this district include county, solid waste district, Clay Township and Warsaw Schools.
The next meeting for the commission will be at 1:30 p.m. Thursday, May 8.