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Consultant presents 2024–25 TIF performance and projections; Senate Bill 1 expected to reduce some revenues
Summary
Baker Tilly presented the annual tax-increment financing (TIF) report to the Redevelopment Commission, reviewing multiple allocation and economic development areas, outstanding debt, project illustrations and estimates that incorporate statewide changes from Indiana Senate Bill 1.
Greg Balzano of Baker Tilly Municipal Advisors delivered the city’s annual TIF presentation Tuesday, reviewing performance and forecasts for multiple allocation areas and outlining how Indiana Senate Bill 1 will affect future revenues.
Balzano showed maps and multi-year collections estimates for areas including Elkhart Aeroplex Business Park, Cosopolis Street Corridor, Technology Park, consolidated South Elkhart and downtown allocation areas. He noted the presentation accounts for Senate Bill 1 provisions that phase in assessed-value deductions and homestead credits between 2026 and 2031; the firm’s projections therefore include modest revenue declines in most areas over the next five to six years unless new development increases assessed value.
The Aeroplex area, created in 2002 and expanded in 2007, was estimated to produce about $643,000 in tax increment in taxes payable 2024 and a small uptick to $652,009 in 2025 before projected declines. Balzano said different allocation areas have different statutory lifespans depending on the law when they were created; for example, newer residential areas that capture homestead properties have a 20-year limit.
Balzano reviewed outstanding bond obligations tied to downtown allocation areas, including bonds issued in 2015 and 2017 used for infrastructure and a 200-unit apartment project; he said debt service on those bonds totals roughly $1.1 million to $1.2 million annually, leaving approximately $1.3–$1.67 million for other uses in recent years. For one downtown development, 500 Main, Balzano said the developer guarantees any shortfall under a minimum taxpayer agreement rather than the TIF bearing the loss.
The presentation included illustrative budgets and potential projects for several allocation areas — examples included sewer and water extensions, airport maintenance and hanger improvements at Aeroplex; a downtown parking structure and River Walk improvements in the Cosopolis corridor; pedestrian improvements and brownfield remediation in the Technology Park; and South Main streetscape phases and a quiet zone in South Elkhart.
Balzano also walked commissioners through how TIF captures incremental assessed value and showed a sample taxing district analysis (Concord Township taxing district) to illustrate how $10 million of incremental assessed value could generate roughly $300,000 in TIF revenue after circuit breaker caps, while its removal from a TIF area and flow back to the general tax base would slightly lower tax rates and increase gross levies for some outside funds.
Commissioners asked clarifying questions during the presentation. Balzano said estimates assume no further changes in assessed values beyond the 2025 tax roll; any new development would change projections and would be updated in future presentations.
