Goshen News, Goshen, IN

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May 22, 2013

GOSHEN CITY COUNCIL: Standards defined for future tax breaks

GOSHEN — Goshen City Council members took the first step in what could soon be a universal approach to the way tax phase-ins are handled throughout Elkhart County.

During Tuesday’s meeting, the council approved a new ordinance establishing a tax phase-in policy for the city that sets specific rules and requirements for how tax phase-ins will be granted moving forward.

According to city attorney Larry Barkes, the move is a result of several years of discussions and meetings between representatives of nearly every city and town within Elkhart County looking to come up with some kind of uniformed policy that all entities can use when granting tax phase-ins.

“What you have in front of you is a policy that is the result of representatives from the city of Elkhart, Elkhart County, Middlebury, Bristol, Nappanee, Wakarusa, and perhaps even Millersburg, to discuss and try to get a uniform approach to the tax phase-in policies that each of those communities have been using over the last several years,” Barkes said. “As a result of those meetings, there were several items that were in agreement that have been incorporated into this ordinance.”

Included among the items listed in the new policy were application fee guidelines that require all property tax phase-in applicants pay a non-refundable filing fee of $750 for each real property, personal property or vacant building tax phase-in application filed.

Next to be mentioned was the application form section, which requires all applicants to file the uniform tax phase-in application used by Elkhart County governmental entities to receive, process, review and approve property tax phase-ins.

“As a result of this process we would have a single application for the entire county,” said Mark Brinson, community development director for Goshen. “I think that will simplify things for the companies and also for the people that are working with this in economic development.”

Also included within the new policy was a section on wages. Under this section, the policy stipulates that property tax phase-ins will not be approved unless at least 70 percent of the new jobs created by the economic development project are above the Elkhart County median wage benchmark for all occupations as determined by the most current Indiana Department of Workforce Development occupational employment statistics.

While supportive of the overall concept of the new policy, councilman Ed Ahlersmeyer said he thought the 70 percent requirement for higher wage jobs might be going too far, suggesting that it could limit the ability of start-up companies with smaller budgets from settling within the county.

“I understand as a community it’s important to have high-paying jobs, but to require it in any way is something that I disagree with,” Ahlersmeyer said. “Some companies just starting out, they may only be able to provide low income jobs if they’re smaller and looking for an opportunity.”

In response councilman Jeremy Stutsman pointed to a section of the new policy entitled “exceptions,” which allows the council to deviate from the new policy norms in the event it feels it would be beneficial to the city.

As written, the policy states that the council may grant specific exceptions to the stated policies in the new ordinance if the council determines a project will do any of the following: diversify the current economic base; encourage entrepreneurial activity; and/or produce jobs at a time when the Elkhart County unemployment rate exceeds 10 percent.

“The reason I really like this is this council and the previous council were very friendly... I don’t think there was one phase-in that we didn’t pass,” Stutsman said. “I think if a company is getting public money, it’s OK to have some stricter guidelines for us to look at. But it’s also a policy. If we’ve got a company that we really like for some reason that doesn’t fit into this, we can make that exception. So this doesn’t tie our hands, but it does help to show people we’re looking for slightly higher paying jobs to get this area a little stronger.”

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