News From Terre Haute, Indiana

Local & Bistate

June 23, 2014

TIF use: Spending vs. lending

SBA considering if city can use TIF funds to pay immediate expenses

TERRE HAUTE — A State Board of Accounts official said Monday that his agency is not likely to present its findings on a complaint over control of Terre Haute’s redevelopment funds until an ongoing routine audit is complete.

But that same official, Todd Austin, SBA director of special districts, said that generally state law permits the lending from one city account to another city account. That, he said, would include redevelopment dollars — called tax increment finance (TIF) dollars.

And state law also clearly limits how TIF money may be used, he said. Also, TIF money loaned to another area of the city would have to be fully repaid within the budget year.  

“It’s kind of a complicated issue, it really is,” Austin said in a telephone interview Monday afternoon. “It’s still being discussed.”

Cliff Lambert, executive director of the Terre Haute Department of Redevelopment, said he believes that the administration of Mayor Duke Bennett has used Redevelopment Commission TIF dollars to pay immediate city expenses, such as payroll. Lambert contends that’s not allowed under Indiana law.

In early June, the Tribune-Star contacted the SBA’s office supervisor, Charlie Pride, to ask whether Indiana cities may legally use TIF money to meet immediate expenses if TIF accounts are later replenished. That question remained unanswered as of Friday.

On Monday, however, Austin said the basic answer to that question is “no” — that state law limits how TIF money is allowed to be spent. Just saying “no,” however, “would not be telling the whole story,” he said.

The SBA has taken the view that “virtually any local government fund can loan money to virtually any other fund. The statute isn’t crystal clear, … but we’ve taken the view that any fund can loan to another fund” as long as the loan is repaid by the end of the year, he said. That includes TIF funds, he said.

“Think of it this way,” Austin said. “You can spend money and you can loan money.” The law limits how you can spend TIF money, but “there’s another statute that would allow money not to be spent but to be loaned.”

Lambert, reached late Monday, said borrowing money implies an agreement to lend, something the administration did not receive from the Redevelopment Commission, the five-person body that oversees TIF funds.

“They (the city administration) didn’t request to borrow the money,” Lambert said. “They arbitrarily took it.”

Lambert believes Leslie Ellis, city controller, has transferred about $4.9 million from Redevelopment Commission bank accounts since April. A public records request last week showed that on May 15, $600,000 was transferred from one TIF account to a city payroll account.

Messages were left for Mayor Bennett Monday evening. Controller Ellis referred a request for comment to Bennett.

In early June, Lambert filed a formal complaint with the State Board of Accounts. That complaint will be handled like any other received by the SBA during an audit, Austin said. The SBA will not discuss the ongoing Terre Haute audit with the media, but local officials may publicly discuss matters as they are resolved and clarified, he said.

“If we, through the course of the audit have discussions with officials and clear up matters, you may be able to glean some information by talking with them. But, from us directly, I think we’re going to have to let our audit do the talking.”

Austin would not say when that audit would be complete.

Reporter Arthur Foulkes can be reached at 812-231-4232 or

Text Only | Photo Reprints
Local & Bistate
Latest News Poll
AP Video
Raw: Massive Dust Storm Covers Phoenix Raw: Bolivian Dancers Attempt to Break Record Raw: Big Rig Stuck in Illinois Swamp Raw: Air Algerie Flight 5017 Wreckage Kerry: No Deal Yet on 7-Day Gaza Truce Raw: Palestinians and Israeli Soldiers Clash Raw: Israel, Palestine Supporters Rally in US 12-hour Cease-fire in Gaza Fighting Begins Judge Faces Heat Over Offer to Help Migrant Kids Kangaroo Goes Missing in Oklahoma More M17 Bodies Return, Sanctions on Russia Grow Gaza Residents Mourn Dead Amid Airstrikes Virginia Governor Tours Tornado Aftermath Raw: Deadly Tornado Hits Virginia Campground Fox Dons 'Bondage Strap' Skirt at Comic-Con Cumberbatch Brings 'Penguins' to Comic-Con Ohio State Marching Band Chief Fired After Probe Raw: Air Algerie Crash Site in Mali Today in History for July 26th Raw: Iowa Police Dash Cam Shows Wild Chase
NDN Video
Big Weekend For Atlanta Braves In Cooperstown - @TheBuzzeronFox Chapter Two: Becoming a first-time director What's Got Jack Black Freaking Out at Comic-Con? Doctors Remove 232 Teeth From Teen's Mouth Bradley Cooper Explains His Voice in 'Guardians of the Galaxy' Deja vu: Another NYPD officer choke-holding a suspect 'Fifty Shades of Grey': Watch the Super Sexy First Trailer Now! Reports: Ravens RB Ray Rice Suspended For 1st 2 Games Of The Season Air Algerie plane with 119 on board missing over Mali Diamond Stone, Malik Newman, Josh Jackson and others showcase talent Free Arturo - The World's Saddest Polar Bear A Look Back at Batman On Film Through The Years LeBron James -- Dropped $2k On Cupcake Apology ... Proceeds To Benefit Charity Snoop Dogg Says He Smoked Weed at the White House Raw: Fight Breaks Out in Ukraine Parliament Chris Pratt Interrupts Interview To French Braid Intern's Hair Shirtless Super Mario Balotelli Dances While Ironing - @TheBuzzeronFOX Whoa! Watch "Housewives" Star Do the Unthinkable LeBron apologizes to neighbors with cupcakes Justin Bieber In Calvin Klein Underwear Shoot

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
  • -


    March 12, 2010