Loading...
HomeMy WebLinkAbout02-10-03 Community & Economic Development - Amended t uCommitft Ittport Community anti Commit t1)tiopmtnt tommUUta AMENDED The February 10, 2003 meeting of the Community and Economic Development Committee was called to order by its Chairperson, Council Member Karl King at 4:47 p.m. in the Council Informal Meeting Room. Persons in attendance included Council Members Varner, King, Kirsits, Aranowski, Pfeifer, Kelly, Coleman, Kuspa and White; Community & Economic Development Director Jon Hunt, Michael Beitzinger, Patrick McMahon of Project Future, Mark Eagan of the Chamber of Commerce, Don Inks, Bill Schalliol, Terry Bland of the §ouch Oentr Zttrtbun¢ and Kathleen Cekanski-Farrand, Council Attorney. Council Member King called for a presentation on Bill No. 03-17 which would approve an interlocal agreement between St. Joseph County and the City of South Bend for the use of certain grant money. Mr, Bill Schalliol, an Economic Development Planner, made the presentation. He noted that St. Joseph County received a grant in the amount of$44,687 from the Indiana Development Finance Authority for evaluating potential environmental contamination in the area east of 514 West Ireland Road. The city's Department of Community and Economic Development would serve as the grant administrator. The work under the grant is to be completed by April 1, 2003. Mr. Schalliol provided a drawing of the subject property. He noted that a similar resolution will be acted upon by the County Council on Tuesday evening. No one in the public spoke in favor or against the proposed Resolution. Following discussion, Council Member Kelly made a motion, seconded by Council Member Kuspa that Bill No. 03-17 be recommended favorably to Council. Council Member King noted that a letter dated February 10, 2002 (copy attached) has been received asking that Bill No. 03-18, which would have authorized the Mayor to submit an application to EPA for a Brownsfield Job Training Grant, be withdrawn. The Bill will be struck from the agenda this evening. The Committee then reviewed Bill No. 5-03 which would amend Chapter 2,Article 6 of the South Bend Municipal Code addressing "Tax Abatement Procedures". Council Member King, the sponsor of the Bill, made the presentation. Council Member King stated that the Bill has been under discussion for the past two (2) years. A great number of Community and Economic Development Committee meetings have taken place and a great deal of research has gone into the project. The City Administration and the public have provided input throughout. The proposed ordinance reflects "new thinking" on tax abatement incentives. The Bill sets forth the goals which all parties have agreed upon, namely that it would encourage private sector entities to invest and rehab resulting in higher economic values and would encourage other actions for the right to receive other public benefits. Council Member King noted that there was a strong interest in tightening up the relationship and partnership between the city and the parties who receive abatements through strong contractual agreements. The City would use Memorandum of Agreements (MOA) modeled after the successful programs in the City of Indianapolis. He further noted that the tax abatement program Community and Economic Development February 10, 2003 Page 2 would address quality and would not reward those who"have a record of poor citizenship or are delinquent on paying property taxes". He noted that several changes directly resulted from the many changes in the governing state law. Council Member King noted for example that instead of utilizing the 3-6-10 year categories for tax abatement, that state law now authorizes tax abatement from 1 to 10 years. The new program would have a "base abatement" and a tiering concept for adding on additional years if the party meets the proper thresholds. He then referenced Sec. 2-76.2 Abatement Tiers Sec. 2-76.3 Base Abatement Sec. 2-76.4 Add-On Abatement which set forth how points would be awarded. He noted that he asked Don Inks to look backward on projects which received abatement under the current ordinance to see how they would fare under the under the new ordinance which will be addressed layer. The MOA would set forth commitments, rights and entitlements and what the Council would be entitled to do if there is non-compliance. Council Member King stated that such publications as the Wall Street Journal have reported on how successful Indianapolis has been in enforcement their MOAs. Disqualifications from eligibility would include the applicant being delinquent or in default;a record of violations showing a consistent pattern. Don Inks of Community and Economic Development stated that he reviewed data primarily from 1998-2001. During that period of time 122 years were abated. Under the new regulations 113 years would be abated. He concluded his remarks by stating that there is a good basis for the proposed base and add-on abatement program. Mike Beitzinger of Community and Economic Development stated that the City will be using the Indianapolis MOA as a guide. He noted that it was used once for the Honeywell agreement. The Council Attorney noted that there was good "give and take" during the negotiation process of the Honeywell agreement. Jon Hunt, Director of the Department of Community and Economic Development stated that there are some projects currently in the pipeline, but with an effective date of August 15, 2003 that that time table is workable. Council Member Pfeifer inquired if a company asked for four(4) years of abatement and did not qualify, they would not come before the Council. Mr. Beitzinger stated that was correct. Dr. Varner noted that the "safety valve"or enlargement of powers of the Council addressing those areas not specifically anticipated is still in place. Council Member King stated that the language in that area is identical to that which has been in place for the past several years Council Member Coleman noted that a tremendous amount of work has gone into this Bill. However, he sees the language on page 37, § 2-84, 9 B as a"back door" to getting an abatement. He noted that this has often been called a"special exception"and is reluctant to have such a"catch- all". He stated that he would prefer an amendment to the ordinance. Council Member King asked if there were questions on the ordinance. There were none. Community and Economic Development February 10, 2003 Page 3 Under the public portion, Pat McMahon of Project Future, complimented the Council for addressing complex issues. He believes that this ordinance will be a model for other communities to emulate. He noted that the ordinance explains what is important to the Council. He then asked about personal property tax abatement, noting that AM General got a ten (10) ear property tax abatement. He suggested that enlargement of personal pro b personal considered especially for very large projects. PertY abatements be Mark Eagan of the Chamber of Commerce stated that the proposed ordinance addresses many concerns which will serve the community well. Abatement is often a key ingredient for development. No one from the public spoke against the Bill. Council Member King then asked Don Inks about the personal property tax abatement question which was raised by Mr. McMahon. Don Inks stated that that would be a policy decision and perhaps guidelines could be establis addressing projects of$50 million or greater. hed Council Member Coleman stated that he wanted to bring this concern to the attention of the Council and that he hoped it would be addressed at a later date. Council Member Pfeifer stated that she shares the same concern as Council Member Coleman. Following discussion, Council Member Kelly made a motion, seconded by Council Member Kuspa that Bill No. 5-03 be recommended favorably to Council. The motion passed. Under miscellaneous business, Council Member King noted that he would like a correction made to the January 27th Committee meeting minutes, noting that he is referenced and that he was not present. There being no further business to come before the Committee, Council Member Kin the meeting at 5:20 p.m. g adjourned Respectfully submitted, Council Member Karl King, Chairperson Community and Economic Development Committee KCF:kmf Attachments