10-26-15 Common Council Meeting Minutes

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REGULAR MEETING October 26, 2015 66-15 THIRD READING ON A BILL OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, APPROVING A RESOLUTION OF THE SOUTH BEND ECONOMIC DEVELOPMENT TARGET AREA, FORMER CHASE TOWER AND ADJACENT PARKING LOT Councilmember Dr. Varner made a motion for the passage of Bill 66-15 as amended. Councilmember Derek Dieter seconded the motion which carried and the resolution was passed by a roll call vote of seven (7) ayes. RESOLUTIONS 15-95 A RESOLUTION OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 211 WEST WASHINGTON STREET AS AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A TEN (10) YEAR REAL PROPERTY TAX ABATEMENT FOR APARTMENTS LOCATED AT THE TOWER AT WASHINGTON SQUARE LLC. Councilmember Gavin Ferlic Chairperson, Community Investment, reported that they met this afternoon on this resolution and it is sent forward favorably. th Chris Fielding, Community Investment with Offices on 14 Floor- Presenter: This is a request for a designation resolution for tax abatement purposes. This is the fourth and final tax abatement for the Chase Tower. This is the portion that required the EDC resolution prior to bringing it forward because it is residential in nature and is a part of the larger 37.1 million dollar project. That will create eighty-six (86) apartments above the retail and commercial and hotel space. The total taxes over the ten (10) year period would be 1.69 million dollars. Total taxes to be paid would be $702,701, the total taxes to abate would be $988,000. Also, I want to remind you this is under a special exception to the ordinance. One (1) for the modified schedule and one (1) for the modified time period to complete the project. Mark Neal is here representing Washington Square if you have any questions. Council President Tim Scott asked for Council questions. Councilmember Henry Davis Jr.- Question about the overall tax abatement policy we have in place. Have we looked at how a tax abatement affects our schools? Do we look to see if it will switch or flip the tax structure and will our schools receive more funding or less funding? Chris Fielding Community Investment, Presenter: In ninety-nine percent (99%) of our tax abatements we do, they are not an abatement of the current taxes. It has no impact on any of the other taxing units. This is a phase in on future taxes they would make. If they invest a million dollars the taxes are there to offset, so, in this case if they invest 17 million dollars into the residential of eighty-seven (87) units, they would like to but they won’t be able to fill all eighty- six (86) apartments right when they open. But the taxes will immediately begin to generate on those units and will automatically be a loss in revenue. The tax actually phases in on that 17 million dollars that they invested. There is no abatement for the current existing taxes of the building. They will pay those no matter what, it’s abatement of future taxes and will have no effect on the other taxing units including the school district for taxes under the local ordinance. Councilmember Henry Davis Jr.- I think we need to look at that, it does shift the burden somewhere else. I am not clear on where it falls out at but I know our school corporation gets more of that tax from the state than we do to operate. The reason why I am asking those questions is because over this weekend a resident asked me would it be in the interest of the Council in the coming years to put a line item on the form so when these corporations or whomever is seeking a tax abatement that they could donate money back to our schools. I thought it was a tremendous and wonderful idea. In the future years, I want to suggest that idea becomes part of the tax abatement forms. We can have a conversation about computers and more 8