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(' L cif �Ur�e Community & Economic Development 1200 County -City Building, 227 West Jefferson, South Bend, Indiana 46601 -1830 Phone 574/235 -9371 Fax 574/235 -9021 To: South Bend Redevelopment Commission From: Don Inks Subject: Project Assignment with Crowe Horwath re: TIF Neutralization Worksheets Date: November 2, 2012 Attached for your review is a Project Assignment with Crowe Horwath to prepare the Tax Increment Financing (TIF) Neutralization worksheets. Crowe is proposing to provide this service for a fee not to exceed $15,000 for their professional services. In addition, incidental expenses will be billed at cost. The proposed $15,000 fee is the same as last year, and incidental expenses have historically been very small or, as was the case last year, nothing. These worksheet calculations are required by State law to be done every year. The purpose of these worksheets is to adjust the base values for each TIF area by adjusting for the natural growth in property values. For example, if the base value of a TIF area was originally $1,000,000 and the property in the base had natural appreciation of 3% or $30,000, this amount would become part of the Increment captured by the TIF, unless an adjustment to the base is made. After adjustment the base is revised to $1,030,000. This adjustment allows the other taxing jurisdictions to maintain their tax base by capturing the natural appreciation of property. Increment captured by the TIF area should be due to new development, not by capturing the appreciation in value of property that pre- existed the TIF. This is being presented to the Redevelopment Commission with a favorable recommendation for your approval in an amount not to exceed $15,000, plus incidental expenses at cost. Crowe Neutralization Calcs 11.02.12.doc What We Do Today Makes A Difference!