News From Terre Haute, Indiana

March 3, 2014

Senate considers bill to end TIF

Key downtown projects built with TIF district funding

Howard Greninger
The Tribune-Star

TERRE HAUTE — An Indiana Senate bill that would sunset the city’s first tax increment finance district concerns Cliff Lambert, director of the Terre Haute Department of Redevelopment.

Lambert testified last week before the Indiana House Ways and Means Committee that Terre Haute’s original downtown tax district, established on Nov. 14, 1985, was to fund, through the payment of a general obligation bond, and construct the city’s first downtown parking garage.

In addition, the district was used to pay for a bond to construct the Center City building, which has 33 apartment units and commercial space on the first floor. Both of those structures are now under private ownership and are on the city’s tax rolls.

“The key heartburn to me is the death star [the proposed legislation] puts on our downtown TIF. It would cause it to go from an unlimited life to a sunset in the year 2025 or whenever bond indebtedness in the district is paid off,” Lambert said Monday about Senate Bill 118.

Lambert has been lobbying Wabash Valley legislators about the impact of the proposed bill on Terre Haute. The bill was up for its third reading Monday in the Indiana House. The bill included an amendment exempting a downtown TIF district in Indianapolis. Lambert contends Terre Haute should also receive such an exemption.

Lambert said nine of the downtown district’s 12 projects were completed in the last nine years, with a 10th, a new five-story building to house Indiana State University students under a lease agreement with Thompson Thrift, under construction. TIF funds are being used for sidewalks and curbing for that project.

“These 10 projects represent a $220 million private/public investment in our downtown,” Lambert said.

After the parking garage at 622 Ohio St. and Center City at 630 Wabash Ave., TIF projects include an expansion of Clabber Girl’s manufacturing building at 900 Wabash Ave.; a new U.S. federal building at 912 Ohio St.; the Hilton Garden Inn at Seventh Street and Wabash Avenue; a multi-modal parking garage at 750 Cherry St., now owned by Indiana State University; the ISU Foundation Barnes & Noble Bookstore at Fifth and Cherry streets; Candlewood Suites hotel at 712 Wabash Ave.; the Terre Haute Children’s Museum at 727 Wabash Ave.; a new WTHI-TV building at 800 Ohio St.; the 925 Wabash Ave. commercial building; and ISU housing building at 500 Wabash Ave.

“I understand tightening up [regulations] maybe, but not to eventually eliminate something that is working,” Mayor Duke Bennett said Monday when asked about the TIF legislation.

“The downtown area with $220 million of public and private investment shows it is working,” the mayor said.

“Anybody can question any of those projects and see they have all been done equally and done in a way that is good for the taxpayers,” Bennett said. “I think TIFs work. It is one of the few economic development tools we really have,” the mayor said.

“This is a great tool. You can do multiple projects and do a little bit here and little bit there to make projects happen that might not happen otherwise. You don’t have to plunge a whole bunch of money into one thing,” Bennett said. “It gives you flexibility in the district to improve the whole district.”

Two downtown developers both said the current restoration of the downtown would not have occurred without TIF funds. A TIF district captures the assessed value, and taxes, from any new construction in the district, using that tax money on items such as sidewalks, curbs, utility relocations or payment of bonds.

Developer Greg Gibson spearheaded a project that led to the development of the Hilton Garden Inn and the Candlewood Suites. “Without a doubt, it is my feeling that those projects would not have happened without the TIF district and the help it provided to those projects,” Gibson said.

“To make those projects work, there would have been added costs that would have killed the projects. You have to get these financed, and to get them financed, they have to be viable, and every little bit helps,” Gibson said.

The TIF provided up to $1 million for site preparation, professional services, civil engineering, survey and title work, soil investigations, environmental and engineering services as well as purchasing a lot at Seventh and Cherry streets for parking.

“The TIF made it possible to keep the existing structure” for the Candlewood Suites, Gibson said. “If that TIF not been there and been a position to help with that project, the [former] Tribune-Star building would have been torn down” like the former Terre Haute House, Gibson said.

The building was gutted to its framework and the new hotel was constructed, keeping its elevator and part of its original front facade.

“Without the TIF reinvestment, the 925 Wabash building would never have happened. The Hilton Garden Inn and Candlewood Suites and the Children’s Museum, would never have happened,” said developer Paul Thrift, president of Thompson Thift.

“There are four significant game-changing projects. They were all a struggle to get financed and make happen, even with the TIF. Without the TIF, all four projects would be dead,” Thrift said.

Thrift said the 925 Wabash project did not make economic sense, “but we just willed to do it. We are pretty upside down in that building. There is no way we can get out of it what we put in it … even with the TIF investment,” Thrift said.

The downtown district, now called the Central Business District, was expanded in 2007. Terre Haute has three other TIF districts that will expire 25 years after being formed. The city’s North Central TIF expired in 2012, which was 15 years after it was formed, Lambert said.

That TIF district provided improved sidewalks, street lights and separated storm and sanitary sewers and is now an area that provides rental apartments used primarily by Indiana State University students, Lambert said.

The Terre Haute International Airport-Hulman Field has an airport development zone, which is similar to a TIF district, Lambert said.

The downtown’s need, Lambert said, is ongoing to not only give incentives to new construction, but to renovate, repair and replace aging right-of-way public sewers. There are 5.5 miles of sanitary and combined sewer lines in the downtown TIF.

“Our 1985 ‘unlimited life’ TIF revenue stream needs to remain not just for financial support of new projects but to assist in repair and replacement of our aging infrastructure to avoid fiscal calamity or at least benign neglect of it,” Lambert said in testimony last week before the House Ways and Means Committee.

Lambert added that the city is working to build a new public safety/police station, something that could be in jeopardy without the TIF district.

“We desperately need that project, but we will not be able to bond for a new project like this if this bill passes,” Lambert said Monday.

“Also, if a private developer comes in and wants to have a collaborative private/public partnership in building a new facility downtown Terre Haute, we will not be able to incentivize those kinds of projects,” Lambert added.

Reporter Howard Greninger can be reached at 812-231-4204 or