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10 (/) <br /> :'41 i% �1 Department of <br /> '� ' 5 Community Investment <br /> G <br /> R <br /> 1865 <br /> Memorandum <br /> September 25, 2014 <br /> TO: South Bend Redevelopment Commission <br /> FROM: David Relos, Economic Resources <br /> SUBJECT: TIF Neutralization Professional Services Proposal - H. J. Umbaugh Associates <br /> This professional services proposal from H. J. Umbaugh & Associates is to provide services <br /> for the annual TIF Neutralization worksheets required by state law. <br /> These worksheet calculations are done for each TIF area, and are used to adjust the base <br /> value by adjusting for natural growth in property values. <br /> For example, if the base value of a TIF was originally $1,000,000, and the area had natural <br /> appreciation of 3%, or $30,000, this amount would become part of the increment captured <br /> unless the base is adjusted. <br /> After adjustment, this $30,000 would be added to the base, which would now be <br /> $1,030,000, allowing other taxing jurisdictions to maintain their tax base by capturing the <br /> natural appreciation of property. Increment captured by the TIF area should be a result of <br /> new development, not the natural appreciation in property values that pre-existed the TIF. <br /> The fee for this service is $14,500 ($12,500 for the neutralization plus $2,000 set up fee). <br /> For the last several years this annual fee has been $15,000. <br /> Additionally, with the potential of realigning certain development areas, upon approval of the <br /> TIF realignment, this agreement includes a recalculation of assessed values to allow the <br /> Auditor's office to reallocate values based on these changes. The fee for this service is <br /> $4,000. <br /> Staff requests approval of this professional services agreement in a not-to-exceed amount of <br /> $18,500. <br /> 227 W. JEFFERSON BLVD. SOUTH BEND, IN 46601 I P: 574-235-9371 I FAX: 574-235-9021 I SOUTHBENDIN.GOV <br />