Elkhart council approves $8 million forgivable loan for River District parking garage and mixed‑use project

The Elkhart City Council on second and final reading approved a proposal to use $8 million in Casopolis Street tax‑increment financing (TIF) funds as a forgivable loan to help build a 200‑space public parking garage wrapped by a $38 million mixed‑use development at 225 East Jackson.

Mike Hubert, director of development services for the City of Elkhart, told the council the River District implementation plan envisions “a thriving urban mixed use walkable community that is a downtown destination emphasizing the rivers and recreational amenities.” The proposed project, he said, is intended to leverage public investment to attract housing, office and retail to the Delta neighborhood and support the aquatic center and downtown hospitality businesses.

The developer’s plan calls for a 1.3‑acre site redevelopment including about 70 residential units and roughly 12,000 square feet of office/retail space wrapped around the parking structure. The developer was awarded about $9 million in Ready 2 state funds; Hubert said the city’s $8 million contribution would fund the parking structure while the developer would provide approximately $30 million for the private wrap‑around portion and contribute roughly $5 million in state and private sources toward the project’s cost.

Councillors questioned details on parking allocation and long‑term operating costs. Councilman Henke pressed for a clearer public accounting of how long it will take taxpayers to recover the $8 million investment and whether future TIF receipts could be strained by maintenance obligations. Hubert responded the city expects to retain the new TIF generated by the private development and estimated that the 225 Jackson project would generate roughly $5,710,000 of additional TIF increment over time; he also said the Casopolis Street TIF currently had an unencumbered balance of “over $11,000,000” and generates about $4.5 million annually.

On resident parking, Hubert said the city intends to manage a district‑wide inventory — combining the new 200‑space garage with existing off‑street and on‑street spaces — as public parking, with overnight resident parking limited to residents. He said the city would prohibit long‑term event parking overnight so residents could return home, and that developers still must meet on‑site parking requirements under the zoning ordinance.

During the public hearing, Howard Turner, a resident, urged the council to assign parking to building residents: “If I lived in the apartments of this new parking garage and I work third shift … I may not have a parking place where I live,” Turner said.

Hubert said the city is finalizing a parking easement and a parking garage management agreement that will specify access, maintenance and management terms; he told the council those agreements must be approved before any loan funds are disbursed. He also said the Redevelopment Commission and the local Economic Development Commission had approved related economic development agreements earlier and recommended the council approve the loan under the state EDC statute.

Supporters on the council said the project will sustain momentum in the River District after more than $250 million of recent investment, including the $65 million aquatic center; Hubert said the district has seen over 500 new residential units built in recent years and attracts visitors and hotel room nights tied to major events. Skeptical members urged caution given state funding and property tax changes affecting city budgets.

The ordinance authorizing the funding and other actions related to taxable economic development revenue notes, series 2025, was adopted after roll call (Yes: Holt, Curry, King, Fish, Heinz, Crabtree, Henke, Dawson; No: Michelin). The loan agreement and related recorded documents must be completed and the parking‑use and management agreements approved before disbursement.

The city indicated the garage will be deeded to the city on completion and included in the city's public parking inventory in the River District. Officials also said the city is exploring a private management contract for maintenance and operations to limit immediate costs to taxpayers.

If implemented as presented, city staff said the project is expected to help facilitate additional redevelopment in Zones 2 and 3 of the River District and to preserve capacity for aquatic center events while managing day/night parking demand.