11-27-18 Personnel and Finance - Laserfiche WebLink

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11 CITY OF SOUTH BEND OFFICE OF THE CLERK Committee Chair White requested Dr.Mueller to follow up with Ms.Kesim outside of the meeting. Bill Dunn, 1620 Southwood Avenue, stated, Listening to this and looking back over the number of years it has been discussed, I think James and Tim made a good point about changing our stance on how to use TIF funds. Now it is a more aggressive approach to abatements. I end up with two (2) questions. One(1)is what metrics, if any, are we keeping to tell us of the success? I know that is a complicated question just based on tax values, assessments and what not. But what are the metrics that tell us whether or not we have achieved our goal? Secondly, assuming we had something like that in place, have we ever done a project that we wish we hadn't done? Dr. Mueller replied, I will start with the last one (1) and it is probably yes. I don't know exactly off hand but yes, absolutely,there are projects that don't wear as well with time. I think sometimes we go back and maybe we should have known better but with the information at the time it seemed like a good thing. Mr. Dunn interjected, And that goes back to my question about the metrics. One (1) of the most damning statements in the world of investments is, gee, it seemed like a good idea at the time. But when we figure out that maybe it wasn't a good idea, it seems like the value in that is to learn the lesson and where it went wrong from where we anticipated. Now that doesn't necessarily mean reading the tea leaves on the next deal,but there have to be some lessons learned from this process. Dr. Mueller replied, There are good metrics. We talked about property tax and when we look at development we look at return on a project. We can look at that. The challenge is, in our current system, we don't have any control over the assessments. So there are other things we can track in the annual tax abatement report. We track what we can there in terms of what was promised and what was delivered. Mr. Dunn interjected, But see,that would tell us. The fact we have no control tells us,well, we are making our estimates now. We should look ahead for, what, four (4), five (5), six (6), ten (10) years under abatements. Surely there is something that would tell us whether or not the assessments panned and their portion would be more conservative or more transient. Dr. Mueller replied, Yeah, we can run those numbers but the assessments are all over the place. If it was predictable we could adjust to that but it is not obvious how it will turn out. Ms. Kesim interjected, I have one(1) more. Committee Chair White replied, Ok I will let you ask but Councilmember McBride has to go back to work and she has some questions too. Ms. Kesim stated, One (1) more comment. In reading the reports we mentioned with Ball State, Purdue and all that, I don't feel like the City has been good at separating TIF and abatement. They recommend that you don't give abatement to TIF areas because you are cutting yourself off at the knees. Dr. Varner pointed out sixty-four(64) abatements that at zero (0) dollars for ten(10) years cuts us off at the knees for ten(10)years.The abatements are way too extensive and they shouldn't be given in a TIF area. You either give one (1) or the other. Give TIF dollars or abatements but don't give both. Then there is the Enterprise Zone. I really feel there needs to be a better tracking EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD574.235.5567 www.southbendin.gov 21