TIF Districts: Part I, What is a TIF district?

There has been a lot of debate recently in many communities over something intended as an economic development tool, called "TIF Financing" or "TIF Districts".  This is a debate that has raged in Carmel, Indianapolis, and more recently, Fishers.

But what is this thing called "TIF"?  That is an abbreviation for "Tax Increment Financing".   Basically, the appropriate element of government in charge of economic development establishes a "TIF District", that is supposedly in need of either economic development, or re-development.  It was originally intended for blighted areas, but the actual use has expanded far beyond urban blight.

The way it works, is say ABC Developer wants to build a $50 million dollar project, but they want help from the local government as an incentive to build in an particular community, or area of the community.  The local government can sell bonds to help the developer.  These bonds are repaid by the taxes on the increased value of the TIF district, above what the base value was prior to the development.  In fact, the taxes on the increased property value go ONLY for repayment of that debt, until it is retired.

And that is one of the controversial issues with TIF Districts.  In this case, economic development DOES NOT ADD TO THE TAX BASE, and doesn't go to other units of government that depend on the tax base, such as schools.  And many of those bond issues are pretty long-term.  So if TIFs are over-used, one of the negative side effects is to harm school financing.

Complicated, isn't it?  And the Town of Fishers has actually posted a pretty good short brochure about TIF financing, which you can get here:  http://www.fishers.in.us/egov/docs/1326921651_105590.pdf

As communities compete for economic development, TIFs are one of the tools they use.  But they can be quite controversial.  An IBJ article this week shows the strong arguments that have arisen in Carmel over use of economic development incentives in general, and TIFs in particular.  http://www.ibj.com/carmel-panel-refuses-to-back-midtown-redevelopment-plan/PARAMS/article/41626.   Similar arguments have waged for some time in Indianapolis, and are of more recent discussion in Fishers, which will be the subject of a future article in this series.

So what is the proper role of government in using incentives for economic development, and TIF districts in particular?  There are many differing views, and some of those will be explored in this series.  I hope this provides food for thought in readers concerned about their community's development.

Susan Brooks challenged by Tea Party

Recently, Carmel businessman David Stockdale announced he would seek the Fifth District Congressional seat currently held by freshman Representative Susan Brooks (R-Carmel).   Stockdale's candidacy is being openly promoted on the Indiana Tea Party's Facebook page.

What is remarkable about this is that in reality, it is impossible to find a member of Congress further right than Susan Brooks.  She has voted the GOP party line on 157 of 158 votes, 99.4% of the time.  This is despite her constituents telling her during the election last year that they wanted her to work across party lines to solve problems in Washington.  But the reality is, in her short time in Congress, she has not done what the voters who spoke to her expected.

So WHY is the Tea Party challenging Brooks?  They cannot possibly object to her voting record.  Perhaps it is her relative silence in parroting Tea Party rhetoric.  Or her willingness to actually have a dialogue with those with whom she disagrees.  Brooks recently met with a women's group who advocates more and better gun background checks for example.  But Brooks has an "A" rating from the NRA, which is violently opposed to such checks.  Curious.

A note, I also saw a sign for "Lugar for Congress", meaning Fishers realtor Jack Lugar, who ran in the last cycle as well.  Is this a sign of another wide-open GOP primary in 2014?  Time will tell.

Do Hamilton County voters care about local issues?

Yesterday, voters went to the polls in the Noblesville and Hamilton Southeastern School districts to vote on approval of bond issues, and accompanying tax increases to pay for them.  One would think, given the passion often shown for school activities, that this would have large-scale voter involvement and high turnout at the polls.  Right?

Wrong.

Voter turnout yesterday was a meager 10.4% of the eligible voters.  Only 10,547 souls out of a possible 101,390 bothered to cast a ballot.

Given the issues, borrowing tens of millions of dollars and resulting in higher property taxes, one would expect, regardless of position, that interest would be high.  But it was not.  Obviously.  Worse, the two political parties struggled to fill poll worker positions.  In my own experience, more than half the usual workers that I recruit in Fall Creek Township declined for one reason or another.

Sadly, this is not new.  In the 2011 municipal elections, only 15.85% of eligible voters participated in the fall election.  Since many offices went with light or no opposition due to the one-party dominance in Hamilton County, one would think the primary at least would have had a high turnout.

Wrong again.  Primary turnout in 2011, despite some hotly-contested races, was only 14.62%.

And here are some more depressing turnout figures from past local elections:

• 2009 HSE Schools referendum, 18.46%
• 2007 municipal elections, 20.20% (much of that in Carmel, where every race was contested)
• 2003 municipal elections, 24%

Not only do people not appear to care, it appears to be getting worse.  And I don't have a clue what to do about it.  This is a pretty affluent, and well-educated county.  People should care, and get involved.  But few enough do, and the others watch, or not.   

Not good enough.  There are more reasons than I can list to pay attention, get involved, and vote.  But people are NOT paying attention to the government closest too them.  That is sad, and bad for us all.