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TIF deal bypasses county

BY Carolyn Muyskens - cmuyskens@chronicle-tribune.com

City officials have found a way around the Grant County Council after the council’s failure to consent to the city’s bond deal with Central Indiana Ethanol last month.

The tax increment financing (TIF) deal will give Central Indiana Ethanol $3.65 million for an expansion project on Ind. 18 and provide for hundreds of thousands in annual TIF revenue to the City of Marion Redevelopment Commission from the TIF district.

The expansion project was outside Marion city limits, so the city had needed approval from the County Council to move forward issuing the bond. The County Council failed to muster enough votes for approval last month, with two members abstaining because they sell grain to CIE.

Now the city’s financial advisers have changed the bond’s terms so they no longer need the county’s consent.

“They ran into a roadblock and they figured out a way around it. I don’t begrudge them for being clever,” said County Council member Mike Roorbach, who voted against the bond financing last month. “Politics is the art of the possible … and they figured out a way to make it possible.”

A memo from Buddy Downs of Ice Miller to members of the City Council says the new deal works because it only allows CIE to spend bond proceeds inside city limits.

“Because the County Council did not consent, we simply changed the description of the project in the documents … to only permit the use of the bond proceeds within the City. Therefore, the consent of the County Council is no longer legally necessary,” Downs said.

The bond deal had needed County Council approval because the expansion project is taking place on the former Omnisource property which will be annexed into the City of Marion come Jan. 1, 2020 but is currently outside city limits.

It’s not clear yet what the money will be spent on under the new project description. Phone messages and emails to Downs and City Attorney Tom Hunt went unanswered Friday afternoon.

City Council member Steve Henderson said he’s being asked to vote on the TIF deal without all the information he wants to have.

“They are supposed to supply an impact statement. … We haven’t seen the financial statement of CIE either. If we could see that we would probably see that they don’t need the money,” Henderson said.

He also questioned the urgency of passing the TIF deal.

“Why are we hurrying this through? I don’t understand why we’re rushing to get this done,” Henderson said.

CIE officials have said the push to make the deal happen is so that the company can finish parts of the expansion in time for harvest.

“I’ve had my say so, I’ve said my piece. (The CIE bond) was not a big issue for me, but the philosophy is a big issue for me. … Those are tax dollars that should go into the tax coffers. That’s the whole problem with TIF in general,” Roorbach said.

Henderson agreed. “Where’s our loyalty at here?” he asked, saying the tax dollars could be going to fund public safety, for example.

With County Council out of the way, the City Council vote on Tuesday is the last hurdle to approval.

The CIE bond is one of several items on the council’s agenda for Tuesday’s 7 p.m. meeting, also including:

n Honoring the airport’s aviation academy for an award from the Indiana Department of Education

n A public hearing on reinstating benefits for the city’s police and fire chiefs and deputy chiefs

n A resolution allowing the city to apply for an Indiana Department of Transportation grant

n A deal with Marion Utilities to forgive the city’s $1.7 million in outstanding loans on the condition the city not consider a payment in lieu of taxes (PILOT) on the utilities for the next several years