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Kosciusko County redevelopment group debates TIF treatment for South Shore multifamily units
Summary
County redevelopment participants discussed whether the South Shore projectmultifamily rental buildings (4—6 buildings, ~200+ units) should fall under the existing residential TIF or require a commercial TIF so the RDC can capture increment for infrastructure; staff will consult counsel and bring options before the RDC in August.
Staff member for the county told the redevelopment group that South Shore Development is moving forward with a developer in place and Syracuse has committed to provide water service, but negotiations continue over higher-than-expected tap fees and how to capture tax-increment financing (TIF) on multifamily rental buildings.
The staff member said the project includes 4 to 6 multifamily buildings totaling “upward of 200 and some units,” and flagged that Indiana TIF guidance typically treats structures of three stories or more differently than single- or two-story residential buildings. "We need to look at, is there a way to...capture that income from those commercial buildings," the staff member said, urging the group to determine whether the existing residential TIF will cover those rental units or whether a commercial TIF is required.
Committee members pushed for clarity because the developerper the staff memberuses an 80/20 TIF payback structure (the developer applies 80% to bond payments while 20% remains in the local TIF fund). The staff member said retaining that 20% is important to finance local road and infrastructure improvements and recommended consulting counsel and financial advisors.
An advisor and other commissioners reviewed how TIF increments are captured and how assessed-value growth and TIF lifecycles affect schools and other taxing units. The group discussed annexation scenarios if Syracuse were to annex the developed area; staff said that would require negotiation over debt or transfer of obligations if the county has invested in infrastructure.
The staff member said they will contact Adam Turner for legal/financial guidance and asked to return findings at a working meeting before the county RDCwith the aim of presenting action items at the RDCso that, if necessary, the county can take steps to capture appropriate TIF revenue prior to the developerwho hopes to break ground by November.
The staff member framed housing and utility benefits as part of the countytown partnership: the project would add roughly 330 water customers (Syracuse's water utility is currently about 80% underused), and the added housing could help the county long-term under changes stemming from SB 1.
Action items: staff will consult Adam Turner, copy RDC members on the communication, and return recommendations to the RDC at a preparatory meeting prior to the Aug. 11 RDC meeting. No formal motion or vote was recorded in this meeting.
