RM 10-05-79 - Laserfiche WebLink

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South Ben Redevelopment Commission Regular M eting - October 5, 1979 6. NEW BUSINESS h. Mr. Szarwark continues... he building, and I believe it meets the general guidelines which are set down in the statutes for tax abatement. These buildings which now exist on the land are in bad shape and they are in a part of the town which South Bend is trying to redevelop and make more pr fitable. For these purposes we wo ld like to encourage the Common Co ncil to approve the abatement measure. The abatement will essentially provide the additional stimulus to investors to invest in new buildings and to complete it so that it would be a viable project. The abatement procedure does not mean that this project will be a complete write -off. What the statute basically says is this... as far as the property is concerned, we are going to continue to pay taxes for the full v.a ue of the property, underlying ground itself, it is just that as far as the additional increase in the value of the property due to the new structure that, as far as the additional increase in the va ue of the property due to the new structure that is going to be completed, we will only have to pay taxes on a portion of the additional value for the first ten years. For the first year the tax base will not be in reased at all by the value of the building, and there is a decreasing formula so that by the end of the fifth year the abatement is only 50°, and by the end of the tenth year, it is only 5%." Mr. Nimtz: Mr. Butler, what is our legal position wi h the HUD regulations concerning this project wi hout a formal resolution? Mr, im gi:N abz deN Butler: I don't believe the HUD regulations are )lved, but I believe that the abatement statute ?s the authority for designating an area an :ement area, (it is referred to as an urban �lopment area in the statute) to the Common Council. -10-