TELL CITY – “The businesses we attracted with TIF money have been going gangbusters,” county attorney Chris Goffinet said in giving an annual report to the county council July 24.
TIF stands for tax-increment financing, a tool communities use to promote economic development. It allows the diversion of property-tax revenue to improve the area from which it’s collected.
Beginning last year, Perry County has three TIF allocation areas – the courthouse area, Waupaca and Webb Wheel – Goffinet said. The reports show amounts in accounts for each area.
“To remind you, the money in the TIF areas can only be used for capital needs – improvements to buildings, that sort of thing – in the area or benefiting the area,” he said. The courthouse TIF revenue was used to pay off bonds used to build it, and that TIF district extends several blocks in each direction from the facility, he explained. “It goes out to the grade-school area and quite a ways to the west, as well.”
Those bonds have been paid off.
When that TIF district was established, it had no expiration date, but Indiana Senate Bill 118, signed into law in March, designated those established before July 1, 1995 “legacy” districts and assigned an expiration date of June 30, 2025 to them.
The report shows the funds received and expended last year, Goffinet told the council.
“The funds that are accumulating here are what have been used to renovate this courthouse,” he said, noting they went toward a replacement of the roof and renovations that have been underway throughout the building. “The courthouse was built in ’94, approximately, so it’s got a lot of traffic, it had a lot of needs and we took care of them, and when I say we, it was primarily the redevelopment commission. We will continue to accumulate some funds in the future in this area” which includes the former National Guard armory, the new jail and William Tell Elementary School.
The county’s geographic-information system website at http://perry.in.wthgis.com shows the TIF district going north from 21st and Tell streets 5,500 feet north nearly to Brushy Fork Road. From there it runs east to Indiana 237 and follows that highway south, deviating along Old Indiana 237 back to Tell Street. An area-measurement tool on the site indicates the area is approximately 888 acres.
An upcoming need for the courthouse, which Goffinet said is not immediate, is possible improvements to the heating-and-air-conditioning system.
He called it “a vintage 1994 HVAC system (that’s) been worked on a lot; it’s not on its last legs or anything, but … if and when it fails at some point, it will be expensive to fix.”
The next TIF district he discussed is the Webb Wheel area.
“Last year we brought in $119,000 and we put out $595,000,” Goffinet said. Bonds for that company’s construction are funded first by TIF money “and if there’s any shortfall, which there has not been, they are backed up by a small amount of EDIT money,” he explained, referring to economic-development income-tax revenue. No need to tap that source is anticipated, he continued, and “all of the money we bring in TIF dollars for that area is being used for bonds.”
Some bonds were paid off and one that remains will expire in 2024, he added.
Councilman Ron Crawford Sr. asked about expenses being higher than revenues.
“We accumulated excess money and used that to redeem the bonds,” the attorney said.
County Auditor Connie Berger added, “in 2013, Webb Wheel was late in paying their fall taxes so we did not receive that tax money until ’14.”
The company will likely finish its bond payments early, Goffinet said, explaining, “any time you have a bond deal, you have to have revenue more than 100 percent of the bond, because you never know what’s going to happen, so you try to have 115, 120 percent coverage, which means you’ll bring in 20 percent more than you’re going to need.”
The county’s other TIF district is the Waupaca Foundry site, which Goffinet said generated about $1.2 million in TIF revenue last year “and we paid $1.4 million.” Two sets of bonds were being paid with TIF money and one was paid off in July 2013, and the other last June, both ahead of schedule.
“There are some outstanding Waupaca bonds, but those are paid out of EDIT money, not TIF money, he added. TIF revenue will continue to accumulate for another 10 or 11 years, providing funds for projects that have been identified, such as an additional entry from Indiana 66 to the plant and improvements to the water system and the industrial park, he added.
“From my personal perspective, it’s been a good thing,” he added.
“It sounds like we’re doing really well and the redevelopment commission’s doing a great job,” Councilman Stan Goffinet said.
That six-man body issues the bonds and is therefore considered to be the owner of the properties until they’re paid off.
“They work hard,” the attorney said, telling the council members they’re welcome to attend the commission’s meetings, which are open to the public.