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County Planners back airport TIF, Poparad opposed, says TIFs drive up taxes

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By JEFF SCHULTZ

What would be Porter County’s first unincorporated tax increment financing (TIF) district was endorsed not quite unanimously on Wednesday by the County Plan Commission.

Planner and County Council Member Robert Poparad, D-at large, was the lone objector, on the grounds that any new TIF districts would impact taxpayers adversely by pushing tax rates closer to the caps. “I am becoming very disillusioned of TIF zones and what they do to the county,” he said.

Commission Attorney Scott McClure opened the meeting by telling members that the County Redevelopment Commission has officially adopted a declaratory resolution for an economic development area around the Porter County Regional Airport. While acknowledging that not all public officials are sold on TIF, McClure said that the Plan Commission’s role is to decide whether the RDC’s proposal conforms to the zoning principles for the entire property.

The TIF area would be comprised of the commercial and industrial areas around the airport on the northeast side of U.S. Highway 30 and Ind. 49 in Washington Township. It would also contain the industrial areas around Washington Township School and the Porter County Expo Center, RDC Member Bob Thompson said.

Planners could either reject the resolution--which the RDC could then modify--or they could recommend it to the County Board of Commissioners for review.

Poparad voted nay on the motion. His argument: that as the amount of AV captured by redevelopment accumulates, tax rates would have to increase to compensate for the capture.

Poparad asked the RDC’s hired financial advisor, Dan Botich of Cender and Company, whether the economic plan he prepared included a tax analysis of the impact on all taxing units. Botich said the plan looks at the taxing units in the immediate area but for every $50 million of new AV captured by a TIF, taxpayers in the county would see their rates increase minimally, by just a few cents.

With figures obtained from the County Assessor’s Office, Poparad said that approximately $660 million of the county’s total AV is tied up in TIF districts located in Valparaiso, Portage, and Chesterton. And if it weren't for TIF zones, Poparad contended, Porter County’s tax rate would be about 8 percent lower.

“The concept of TIFs has been abused under the guise of economic development,” Poparad said. “There are ways to do economic development other than TIFs but this always seems to be the preferred method.”

Instead the airport could bond for projects, Poparad suggested. The state allows local taxing units to issue bonds in amounts not to exceed 2 percent of their total assessed value. “The county has a way to make these improvements without TIF-ing,” Poparad said.

Poparad added that he had no objections to his colleagues’ approving the measure but advised that, the quicker property owners hit the tax caps, the more pressure county officials will feel to raise income taxes, which Poparad said he opposes. TIFs only accelerate the state’s attempt to shift the burden of running local government from property tax to income tax, Poparad maintained.

There are ways in which redevelopment commissions can pass on new AV to other taxing units, Botich said. The proposal for the Airport TIF includes a pass-through of 40 percent, as agreed to by representatives of the East Porter County School Corporation.

Botich said RDCs can also make grants to educational institutions, which means another 15 percent can be distributed. “There are ways to make these funds whole for the community.”

A TIF district can be a marketing tool for the county, Botich said. When companies are looking to build, they often ask a county or city about the availability of TIF areas because it means they can develop more quickly.

Other Views

Members Rick Burns and Dick Maxey said they favored the plan for the chance of attracting new manufacturing or high tech industries. “I like the redevelopment possibilities,” Burns said. “I have no problem with this.”

Maxey asked Thompson and Botich who would be responsible for developing a marketing plan for the area and how it would be paid for.

Thompson responded that the Porter County Economic Development Alliance has shown interest in promoting development there. The PCEDA is comprised of officials from Valparaiso, Portage, Kouts, Hebron, and the Duneland Chamber of Commerce among others, Thompson said.

County Surveyor Kevin Breitzke expressed concern over the potential annexation of the land by the City of Valparaiso and the issues such a move would raise. There have been annexation rumors circulating, Thompson replied, but the RDC has heard of no official plans.

Botich, for his part, said that he’s under the impression that, if the city were to annex the land, it would share in the vision of the County RDC’s development plan.

Planner Mitch Peters voiced his support for a TIF district at the airport rather than at Porter Regional Hospital, where the RDC initially proposed one. In particular Peters said that he would like to see the airport developed with a north-south runway and its east-west runway extended.

Vote

Voting in favor of the motion was President and County Commissioner Nancy Adams, R-Center, Maxey, Burns, Breitzke, Peters, Lyndsay Ploehn, and Luther Williams.

Member Ken Williams was not in attendance.

 

Posted 2/14/2014