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Tax abatement given to Aldi; County Council member raps TIFs

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By JEFF SCHULTZ

While the topic at hand was whether or not to grant a 10-year tax abatement on the planned 100,000 sq. ft. addition to the Aldi Indiana L.P. warehouse and distribution center in southeast Center Twp., at least one member of the Porter County Council grabbed the chance to speak against the concept of tax increment financing (TIF) allocation areas on Tuesday.

However, no TIF has been proposed for the Aldi warehouse, nor do the County Commissioners plan to put one at that location on the northwest corner of Division Rd. and Ind. 49.

“The infrastructure is already there. There is nothing there for us to TIF,” said Commissioner Nancy Adams, R-Center, from the floor.

Council members voted 4-1 in favor of the tax abatement request.

Member Sylvia Graham, D-At Large, said she believes that tax abatements are a good tool for economic development, but a recent financial report completed by Cender and Company on the TIF area being considered around Porter Hospital worried her.

The hospital was also granted a 10-year tax abatement by the Council and the County Redevelopment Commission is considering creation of a TIF area that would allow capture the tax abatement for infrastructure improvements or payment of bonds.

“We’re losing money to these TIF districts,” said Graham, who also has a seat on the RDC.

Other Council members sharing Graham’s view like Jim Polarek, R-4th, another RDC member, smiled when Aldi’s attorney Todd Leeth of Hoeppner Wagner & Evans rendered his opinion that TIFs and tax abatements “do not mix well together” and that they are “opposite concepts.”

“It’s not well advised. I don’t think that’s what economic development experts would recommend you do,” Leeth said.

The Council asked Commissioner Adams if there has been talk of a TIF district in the area. She said no, but there is consideration of putting a TIF around the commercial areas near the Porter County Regional Airport, a mile or so northeast of the Aldi property. She does not anticipate it will extend to the Aldi facility or the Expo Center across the street to the east.

Leeth had to repeat to the Council his request is not about a TIF area but a tax abatement.

Council President Robert Poparad, D-At Large, tried to get the conversation back on track.

“We have some differences with the redevelopment commission. You just got caught in the crossfire,” Poparad said to Leeth.

Leeth requested the abatement on behalf of Aldi. The planned upgrades would allow the company to create 15 new jobs over the next three years, not including the contract laborers who would also be able to find work with the project. Currently the center employs a staff of 138 at its 345,000 sq. ft. facility.

Leeth said the abatement would only be for the new development. The taxes will be restored at a rate of 10 percent per year.

The facility already gets its water from the City of Valparaiso and other utilities are already available so the building would benefit in no way from being in a TIF, Leeth said. It’s a fully developed site and no new roads are needed, he added.

Council member Jim Biggs, R-1st, who cast the sole opposing vote, said he was impressed with operations when he toured the facility. Regardless, Biggs said he would have a difficult time granting an abatement because the county is struggling to keep up with recurring expenses, even though the County holds millions of dollars in its reserve funds.

“I don’t think I can justify it,” Biggs said.

Giving a different view, Poparad said that he “appreciates” the fact the business has been there for more than twenty years and should be rewarded.

Leeth said the company specializes in providing grocery products to more than 50 stores in the Chicago and Northwest Indiana area.

Poparad voted to approve the measure as did Graham, Polarek, and Council member Jeremy Rivas, D-2nd. Absent Tuesday were members Dan Whitten, D-At Large, and Karen Conover, R-3rd.

 

Posted 4/25/2013