The Batesville Redevelopment Commission presented the first annual state-mandated meeting June 26 to explain Tax Increment Financing (TIF) impacts.
While representatives of local government, school and library units affected by TIF were invited, very few attended. In addition to most commission members, attendees included two city council members, one candidate, economic development director Sarah Lamping and Adams Township trustee Randy Ashcraft.
President Andy Saner noted, "We're an extension of economic development where we can redeploy new revenues from new businesses and find the best way to utilize those revenues to sustain the economy." He said open to the public meetings are held on the fourth Wednesday of each month at 6:30 p.m. in the Memorial Building's first floor conference room.
The commission's duties are to investigate and review opportunities for economic development or redevelopment, create or modify economic development areas, areas needing redevelopment and TIF districts. Members can purchase or sell property for the benefit of development or redevelopment.
"We don't have to go through as many loopholes" as other government groups to buy property. "We don't take that opportunity lightly." He recalled BRC purchased acres on behalf of the city to get water from a Franklin County aquifer to Batesville.
BRC works with the Batesville Economic Development Commission, Lamping and other city administrators. According to the president, "We partner very closely with our economic development group. It just works better when we're doing things in tandem."
"Why are TIF districts important?" Saner pointed out Tax Increment Financing is "another way to get some economic development done in your local community. The impact on the school corporation is less than it once was. Where we have found it to be valuable is allowing us to capture those revenues ahead to use as incentives to either maintain current businesses or attract new businesses." He provided recent examples. Thrive Market and Wood-Mizer both received incentives based on taxes they're paying. "When we look at our math ... we like those to come out in our favor." The initial incentive should be less than future tax revenues coming to the city.
Saner said, "We try to maintain a three- to five-year forecast" of revenues. "We haven't committed to large projects, but found novel ways" to use TIF money.
A TIF district lasts 25 years once debt begins being accrued against it. "That sounds like a long time. We subsegment our TIF districts" so the impact is less. For instance, there is a Thrive Market TIF district within the much larger I-74 expansion district. Assessed values from new commercial developments in the TIF districts are captured by BRC and used to fund projects. Residential and nonprofit properties are not included in the TIF areas.
He imagined future growth. With four TIF districts (I-74, I-74 expansion, Thrive Market and Wood-Mizer) already established, if Hillenbrand or Hillrom officials want to construct new buildings or make upgrades to existing ones, more TIF revenue would be generated off of those investments.
Documents detailed 2018 revenues. The 2018 I-74 allocation area beginning balance was $126,049. After receiving $125,576 in annual TIF revenues from Franklin and Ripley counties, there were expenses totalling $63,064 to pay: contract with Administrative Resources association, Columbus, $4,099; legal services, $88,965; and The Sherman incentive payback, $50,000 (four annual payments totalling $200,000). That meant the 2018 ending balance was $188,560.
The 2018 Thrive Market allocation area beginning balance was $36,049. After receiving $986 in annual TIF revenues, there was one expense, a $20,295 bond incentive given to Thrive Market. The 2018 ending balance was $16,739. According to him, the company has been "a great local community partner. They donate a lot to our food pantries, they help out with a fun run."
The 2018 Wood-Mizer allocation area beginning balance was $61,127. After receiving $85,238 in annual TIF revenues, there was one expense, a $45,869 bond incentive given back to the company. The 2018 ending balance was $100,496. Saner said, "They've got a lot more equipment in that building that gets taxed. We reimburse Wood-Mizer about $45,000 a year. We're taking in" almost double that amount.
The total TIF 2018 beginning balance for all three areas was $223,224. With $211,800 in revenue and $129,229 in expenses, the year-end balance was $305,796.
He noted, "There is an impact for our schools. We never want to take that for granted, especially in Batesville," which has an outstanding school system. The $13,000 captured by TIF last year instead of the Batesville Community School Corp. is "not minimal ... but it's not superimpactful for the benefit we hope we're creating."
Also affected by receiving less property taxes for 25 years (about $21,000 in 2018) are the city, two counties, Batesville Memorial Public Library. Southeastern Indiana Recycling District and Adams, Laughery and Ray townships. According to the president, "We believe we're using that for more productive, long-term needs to sustain our economy," which could result in more students attending schools, more families buying homes and paying taxes and other benefits.
If the commission doesn't use enough TIF revenues for economic growth projects, "those dollars revert to kind of a general fund" and get less restrictive in what they can be used for.
Long-term plans were listed on the presentation's final page. "Our primary focus right now is around our shell building and new industrial park" on Merkel Road. Once that structure is sold or leased, BRC must fulfill all bond payments to the two companies, eye economic or redevelopment growth opportunities and consider adding or modifying TIF districts.
In the future, TIF revenues could be used to better roads, utilities and Batesville's two industrial parks.
Debbie Blank can be contacted at firstname.lastname@example.org or 812-934-4343, Ext. 113.