05-13-19 Council Minutes - Laserfiche WebLink

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REGULAR MEETING May 13, 2019 head where that resides. But it is, of course, transparent public information and I will get back to you. Councilmember Jo M. Broden followed up, And, for the benefit of the public, what is a tax abatement and how do they work? Just a quick version, for the benefit of the Scouts. Mr. Buckenmeyer replied, For the example, we will take a real property tax abatement. There is an empty field on the northwest side of town. You can imagine that empty field right now, with the corn growing, pays very low taxes. When somebody comes in and then puts a gorgeous building on it, that land has a tremendous increase in tax value for the community, increasing the tax rolls and what the City can invest back into the community. What a tax abatement does is it gives the investor, when they build a building like this, helps ramp into the cost of it and not have to pay all of the taxes right away and focus on investing in our residents and what they need to build their business first. It essentially gives them a ramp up period where they don't pay the full amount of that tax in year one(1),two (2) or three(3)but it ramps up slowly and by the end of the abatement,they will be paying that full tax amount, as they should be,but again,the City has done our part in terms of assisting. It can go many different ways. If it is a residential project,it can help offset the cost of getting new tenants into those apartments. In the case of the next two (2) we are going to talk about,they are what we call spec buildings. So,we've got investors building buildings without an existing tenant. They don't have anybody who is going to pay rent in the immediate future. So, we want to give them the ability to have an incentive and the ability to ramp into that without having a huge cash outlay immediately to help them be successful in our community. This being the time heretofore set for the Public Hearing on the above bills, proponents and opponents were given an opportunity to be heard. There were none. Councilmember Gavin Ferlic made a motion to adopt Bill No. 19-21. Councilmember Regina Williams-Preston seconded this motion which carried by a roll call vote of seven (7) ayes. Councilmember Gavin Ferlic then made a motion to adopt Bill No. 19-25. Councilmember Jake Teshka seconded this motion which carried by a roll call vote of seven (7) ayes. 19-29 A RESOLUTION CONFIRMING THE ADOPTION OF A DECLARATORY RESOLUTION DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS NE CORNER OF ADAM ROAD AND U.S. 31 BYPASS, SOUTH BEND, IN 46628 AS AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A SIX (6) YEAR REAL PROPERTY TAX ABATEMENT FOR GLC PORTAGE PRAIRIE IV, LLC Council Vice President Karen White stated, This is also a confirming resolution, but we've asked for a brief overview in regard to what is actually happening. There is a lot of misinformation or assumptions in regard to the proposed Amazon Building that will be coming to the City of South Bend. We want to make sure there is clarity in regard to the action we will be taking tonight but also the role of the Council at this particular time. We welcome your opening comments in that regard. Dan Buckenmeyer, Director of Business Development for the Department of Community Investment with offices located on the 14th floor of the County-City Building, South Bend, IN, served as the presenter for this bill. Mr. Buckenmeyer stated, So, yes, there is apparent confusion out there about who this particular tax abatement is for. There is confusion that this may be for Amazon.That is not the case.This,as I stated before,is a spec building.The petitioner can confirm that there is not an anticipated tenant for this. They don't have anyone they have even talked to because it is still an empty field. As it relates to Amazon, Amazon is going into, as we understand it, has signed a lease for what used to be a spec building. This is how spec buildings work. They are built without tenants. New tenants come in. So, a spec building that was given a tax abatement 4