For the first time in Portage history, five new residential TIF districts received their stamp of approval Tuesday by The Portage City Council.
The votes to affirm actions already taken by the Plan Commission and Redevelopment Commission mean the only remaining action is for the RDC to hold a public hearing and give final approval to the TIFs on Nov. 6.
Tax increment financing districts have been used for years to give developers an additional incentive to locate or expand in a community. In a TIF district, a redevelopment commission captures the additional property taxes generated by new development and uses them to pay for infrastructure needs and a few other purposes.
What sets residential TIFs apart is that Indiana communities are now allowed that extra revenue to address public safety needs, including operations, as well as buildings and equipment.
In Portage, Redevelopment Director Dan Botich added an extra twist – the developers of the five subdivisions participating in Portage’s plan will provide annual payments to the city, starting Feb. 1, that equal the amount the city is expected to get when the subdivisions are fully built out. Those annual payments end when building permits have been issued for 80% of the lots in a subdivision.
There’s enough additional revenue to pay those raises this year, and next year’s budget factors in those raises without the benefit of the $622,000 bonus the residential TIFs will bring, Mayor Austin Bonta said Tuesday.
