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Township official warns proposed residential TIFs could reduce overlapping taxing-unit revenue
Summary
A Portage Township advisory-board official told the council that proposed residential tax-increment finance (TIF) districts for Bauer Farms and Sandy Trails could reduce revenue for overlapping taxing units and questioned whether the developments meet the state “but for” standard; the mayor described legal review and outreach to the township.
A public commenter identified as the president of the Portage Township advisory board told the Portage City Common Council on April 1 that two proposed residential tax-increment finance (TIF) districts — for Bauer Farms and Sandy Trails — could “have an undeniable negative impact on the overlapping taxing units,” including the township’s budget for services such as assistance programs, parks, the Bonner Senior Community Center and cemetery maintenance.
The speaker said she attended the Redevelopment Commission’s March 20 meeting and was unable to comment there because the RDC does not allow public remonstration at its meetings. She asked the council to consider the legal standards for TIF, particularly the state requirement that a TIF be used where infrastructure financing is necessary to induce development that would not occur “but for” the TIF.
“Given that Bauer Farms currently has approximately 10 or 12 homes already built … where is the evidence to support that either of these developments would not have happened but for the establishment of the TIF district?” the speaker asked, adding concerns that promises of grant funding to make overlapping units whole were not backed by binding contracts guaranteeing continued payments over the potential 20-year life of a TIF.
Mayor Austin Bonta responded to the concerns, saying the residential-TIF proposals reflect a change in Indiana law from February 2023 and that the RDC and city are working with legal counsel and the school system on the process. He said the proposals will be reviewed in legal detail and will come to the council with required public hearings and formal approvals. Bonta offered to meet with township leaders and suggested staff would coordinate with the trustee’s office to address potential impacts.
The council did not take action on the TIFs at the April 1 meeting; the RDC proposals remain under study and will require future public hearings and council approval before any districts are established.
Key points raised by the township speaker: - Concern about lost tax revenue to overlapping taxing units (township services, parks, senior center, cemetery). - Doubt that the Bauer Farms and Sandy Trails projects satisfy the “but for” standard because parts of the development are already underway. - Concern that verbal promises or grant programs are not binding guarantees over a 20-year TIF life.
Mayor Bonta said the city will continue legal review, meet with the township, and follow the statutory process for any TIF creation, which includes public hearings before the council.
