First Do No Harm - Impact of TIFs - Center Township & IPS

In my last post I mentioned the fairy tales that are promulgated in order to sell TIF districts.  First, the taxes that flow from the district before the TIF is set up will continue to flow to the schools and libraries and other taxing units, just like before.  Second, the project being funded is just the thing to spark other, privately funded, economic development.  This boost in economic development will spur an increase in property values that will pay for everything and we'll all be better off.

Hopefully I've put forward enough data from governmental sources to show that:

• taxes promised to continue to flow (the "base") have been shifted over to pay off TIF bonds and expenses (the "increment")  (see "Marion County's TIF Districts See Base Erode By Nearly Half a Billion Dollars in One Year"),
• tens of millions of dollars from income taxes, other TIFs, and additional property taxes have been poured into existing TIFs to shore them up  (see "Big Time Bailouts of Indy's TIFs"),
• most TIF districts have been growing more slowly than the County as a whole (see "Most Marion County TIF Districts Underperform the County As a Whole"),
• existing TIF districts cause 1/3 of the circuit breaker penalty, directly causing $43 million reduction in collectable taxes and a concomitant reduction in services (see "Frist Do No Harm - Impact of TIFs - Marion County As a Whole")

The two expansions of the consolidated downtown TIF contained in Prop 15, will have a particularly pointed impact on Center and Wayne Townships, simply because that is where they are located.

Now, there will be much handwaving about economic development - but no specifics released to the public to substantiate the claims.  I am willing to listen to substantiated claims, but find it patronizing and worse to have government officials simply wave their hands, when they are sitting on the financial analyses that will either prove or dispatch their handwaving claims.

I cannot understand why, if the handwaving is true, full disclosure of the financial underpinnings of the two expansions of the downtown TIF isn't being demanded by Council members.  If the handwaving is prop and show, then I can understand not divulging the information; facts might interfere with selling the TIF fairy tale.

The current impact of existing TIFs on Center Township and IPS are pretty staggering.  The following data are taken from the TIF Study Commission Report, Appendix 2, part two (pages 4 and 6).

for the year 2012 TIF districts

• within Center Township accounted for 33.3 % of all taxable property,
• within IPS boundaries accounted for 22.0 % of all taxable property

for the year 2012 all Marion County TIF districts caused

• an increased circuit breaker penalty to Center Township government of $214,770
• an increased circuit breaker penalty to IPS of $7,767,505

There are 21 TIF districts already in Center Townships - out of a total of 40 established TIF districts throughout Marion County and an 4 additional TIF districts created over the last year or two. Two of the 21 in Center Township are new.

Of the 19 older TIF districts in Center Township, 10 have seen their base erode to zero value. Combined, the 19 older TIFs saw their base erode this year by an additional $5.9 million - about 0.1% of the total assessed value of the base.

I do not have the computer models to discern the increased taxes paid by Center Township and IPS district taxpayers due to existing Marion County TIF districts.  But, the City does and could have provided that information to Councillors, had any been interested.

The City could also provide information to answer these questions:

• How much property value is in the base for the two expansions?
• What steps, if any, will be taken to ensure that the base is NOT reduced in future years?
• What is the cost to the public of the project at the core of the TIF district expansion?
• Why are you including parcels where private development is already slated over the next few years?  The TIF district will not be spurring those developments, they were happening already.
• Why do you need a 112 acre footprint to develop 0.8 acres in the Mass Ave expansion area and a 604 acre footprint to develop a couple of blocks in the Bush Stadium expansion area?  Are extra revenues anticipated over and above the debt service for the projects?  Does this amount to a slush fund for unnamed future projects that have not yet been disclosed?

And, that's just some of the questions that should have been asked.  But, they were not asked.

With the huge impact of non-taxable TIF district property already in Center Township and IPS, how on earth can two significant expansions of the consolidated downtown TIF district be contemplated with NO disclosure, beyond the footprints, being demanded by our Councillors?