The Chesterton Redevelopment Commission has formally created a new tax
increment financing (TIF) district for Urschel Laboratories Inc.
At a special meeting Monday night, members put their stamp of approval on
what was essentially a two-step process: carving out 157.41 acres from the
existing TIF district in Coffee Creek Center, then designating that acreage
a new TIF district in its own right.
The commission took each of those steps separately—the carve-out and the
designation—by voting 5-0 to adopt one “confirmatory resolution,” then 5-0
to adopt the other.
At a public hearing which preceded each vote, no one spoke in favor of the
given confirmatory resolution and no one in opposition to it.
It was necessary to create a new TIF district for the company because the
old one—established nearly a decade and a half ago—is due to expire in about
18 years. The financing arrangement, however, has a lifetime of 20 years and
that clock will begin ticking only after the actual construct of the
company’s new corporate headquarters and manufacturing facility has been
The financing will work this way:
Urschel Laboratories will pay all costs associated with the
project—including the acquisition of property, the construction of the
facility, and the installation of infrastructure—with its own liquidity,
that is, with cash which it has on hand.
Then the company will recoup a portion of the total costs—up to $25.86
million of them—through a 20-year, 85-percent break on the real and personal
property taxes which the company will pay as a property owner in that TIF
The town still expects to receive, over the 20-year lifetime of the
arrangement, an estimated $4,566,455 in property taxes from the company.
The Redevelopment Commission took one final action on Monday with respect to
Urschel Laboratories: it voted 5-0 to pledge TIF revenues for the repayment
of the tax-exempt economic development bonds—up to $25.86 million of
them—which the town is issuing to the company and which are, under Indiana
Code, the basic mechanism for the deal.
In fact, what that move means is this: over the 20-year lifetime, Urschel
Laboratories will dutifully pay its annual personal and property taxes to
the Town of Chesterton; then, each year, the Redevelopment Commission will
make back to the company 85 percent of those taxes. In that way Urschel
Laboratories will recoup a portion of its investment equal to no more than
As the town’s contracted financial consultant, Ted Somer of London Witte
Group, explained to the Chesterton Tribune after the meeting, the
mechanism appears complicated but is specifically mandated to work that way
under state law. And, Somer added, it’s less complicated than other
financial instruments with which he’s familiar.