Sunday, July 8, 2007

TIF Talk

Taxing districts' overuse debated
Taxpayers may be hit, but development touted

"Some critics of the development question the increased use of special taxing districts because if they are overused, other property owners are forced to pay higher taxes for basic services. Even supporters of Harrison Square say while they are comfortable with the current amount of property in the districts, the city should be mindful how often it uses the incentive program."

"According to the city, taxes on $320.2 million will be collected by eight TIF districts this year. This equals about 3.3 percent of the total amount of taxable property in the city. Outside Fort Wayne – and not including New Haven – an additional $112.6 million worth of property is captured by TIF districts."

"People can’t just look at the TIF numbers in a vacuum, said Karen Goldner of the Fort Wayne Redevelopment Commission. It may be easy to say without TIFs, people would see a 3 percent reduction in property taxes, but the issue is far more complicated, she said."

"According to the city’s proposed bond terms for Harrison Square, it will set aside almost $42 million in taxes from Jefferson Pointe and almost $16 million in taxes from the hotel, condos and retail to finance the project."

"While critics of the tool say it raises property taxes for homeowners, there are other ways to look at the issue, said John Stafford, director of the Community Research Institute at Indiana University-Purdue University Fort Wayne. When looking at aggregate taxes, the amount of taxes saved by homestead credits dwarfs those saved by TIF districts or tax abatements, he said."


John B. Kalb said...

Tracy must be on vacation - Ben actually did some research on this subject! Thank you, Ben
That said, when did the set-aside of $42 million the from Jefferson Point TIF fund come up? Seven weeks ago, at the Redevelopment Commission public hearing, Karen Goldner asked "what part of the estimated $50 million from Jefferson Pointe in the future fund would be from Jefferson Point?" and she was told $25 million - leaving $25 million for use in rebuilding the Jefferson Road railroad overpass. Now, only seven weeks later we are down to only $8 million - That's a 68% reduction or about 10% per week - at that rate, Dave Ross will never be able to accomplish the elimination of this bottleneck without another bond issue!

As far as "TIF-godsend" Stafford's comment about comparing Homestead Credit with TIF & tax abatements - how in heaven's name can these be listed together? What possible relationship is there in regard to the property taxpayer - one is a positive and the others are negatives? John B. Kalb

Jeff Pruitt said...

Also note that the 3% number is pre-Harrison square...

Anonymous said...

John Stafford's comment is disappointing because it draws anew from the seemingly bottomless (and apparently shameless) well of logical and rhetorical fallacies invoked by Harrison Square proponents. The argument being made in the column is whether or not TIFs shift tax burdens away from their direct beneficiaries onto other, less benefitedtaxpayers. Mr. Stafford' s response, as John Kalb observes, is to equate the beneficiaries of TIFS to those of homestead credits, as if all tax adjustments were created equal. Having posited this equality as a fact, he then goes on to imply that residential property owners represent a greater burden to the tax base than TIF beneficiaries. This argument seems disturbingly cynical to me. If this is representative of what Harrison Square proponents mean by "doing a better job" of selling the benefits of the project, they've still got much work to do.