Jasper adopts tax finance district
Two people spoke at the public hearing before the Jasper Redevelopment Commission approved a resolution to create a tax increment finance (TIF) district.
The proposed district described as covering nearly a third of the city and 90 percent of its industry has been a point of contention among elected officials until it was approved unanimously in December by the common council. The holdouts on the council stated they were swayed by promises from the Jasper Redevelopment Commission to work with the council on any future decisions on how taxes in the district would be spent.
Those funds are created by the new taxes from the higher assessed values of industrial and commercial properties in the area created by improvements to the real property. The base assessed value for the area is now set at the assessed value as of March 2014. New improvements will create tax revenue that can be captured in the TIF fund managed by the redevelopment commission.
Although the commission lacks the authority to issue bonds, it can spend money on projects that impact the district defined in the declaratory resolution passed Tuesday night.
Prior to the hearing, Redevelopment Commission President John Bell explained the steps to adopting the district began in 2010 when the city updated the comprehensive plan. The administration at the time identified TIF as a way to pay for future development in the city.
“It [the comprehensive plan] mentioned the redevelopment commission several times and our involvement as the potential of TIF being an asset to make means to accomplish the goals of the comprehensive plan,” Bell said about the plan created under then-mayor Bill Schmidt’s administration.
After Mayor Terry Seitz took office in 2012, the redevelopment commission began to study incorporating tax increment financing into the development plans for the city.
During the public hearing, Steve Messmer, who recently announced his candidacy for Jasper mayor, told the commission he was surprised they felt the new district was necessary to continue the growth and success the city has enjoyed over the past 100 years. He pointed out the growth of companies in Jasper historically has occurred without the assistance of TIF.
“At the December 17th meeting, one proponent made the statement that with the TIF district, Jasper can become an attractive city to draw people,” Messmer said. “Jasper has been and continues to be a major draw for people and business. In 1985, the population of Jasper was 9,571 people. In 2000, 12,062; an increase of 26 percent. In 2013, 15,309. Another 27 percent increase. These numbers are unprecedented for a rural area.”
Messmer stated the one issue not discussed during the proceedings involving the proposed district was the impact on the taxpayer. He pointed out that the district will cause taxes to increase for all taxpayers.
“This will definitely put the burden on the taxpayer,” Messmer said. “Remember, the first concern should be the taxpayer.”
Jasper resident Adrian Engelberth told the commission he supported the economic development for the city that could come from the use of TIF, but he was concerned with the dangerous debt it could create. He pointed out the growth he witnessed while living in Chicago as the city utilized TIF for development. “There was growth, growth, growth but what followed was the city getting into debt and the county getting into debt,” he said. “TIF could actually drive some of that.”
Engelberth stated the Chicago schools were massively in debt and the city was struggling to find money to pay for everything. “Property taxes in the area have doubled. They don’t have caps,” he said. “Thank God Hoosiers have caps.”
He pointed out that TIF can drive economic growth and that he thought all but 10 counties in the state have adopted tax increment financing. “All but two counties in Indiana are in debt,” he said. “There’s give and take.”
Engelberth pointed out that the commission has to consider the entire county in the decisions it makes. “Eventually the taxpayers will hit their tax cap and the schools and county will suffer,” he explained.
In the end, Engelberth asked the commission to be careful with how it proceeds with the new district.”Is it an infrastucture or just something nice to have? Is it really something that will bring people here,” he asked the commission to consider when funding projects with TIF.
After the public session was closed, Bell stated that the commission members are volunteers on the commission because they love the city. “All of our intentions are good. We will be working with all the city entities and not be making decisions unilaterally,” he said. “We love our city and want to see it grow and prosper.”
The approved TIF district is now active. The city can consider TIF as a part of any future economic development. City Attorney Renee Kabrick indicated after the meeting that a company is already considering an expansion that would be affected by the new tax district.
In regards to the transparency of the proceedings leading to the adoption of the resolution, Mayor Seitz said, “Here we have gone through a 4-year learning curve and a 9-month process since April discussing a state-approved financing tool. Then the redevelopment commission made the request in November to delay [the vote] until this time to allow more public process. I think our citizens were very well served.”
“As happy as I am with the vote, I am equally happy with how we got here,” Mayor Seitz said.
