Committee approves sending Innovation Development District/TIF allocation changes to full council; city eyes Colfax Corner redevelopment

Caleb Bauer, executive director of Community Investment, presented a proposal to modify the River West Development Area by creating eight new allocation areas and to establish an Innovation Development District (IDD) that could capture certain incremental state sales and income tax revenues for local reinvestment.

Bauer said the IDD would set a base date effective March 15 and allow the city to retain incremental state sales and income taxes generated inside the district according to an agreement with the State of Indiana. He described a $15,000,000 annual cap on state remittances (with the first $7.5 million remitted to the local government without additional approval and the second portion requiring coordination with the state agency) and noted the contract contemplates a $225,000,000 maximum contribution over the IDD’s lifetime. The tool is intended to support downtown infill and infrastructure, including solutions for stormwater management in the combined sewer area.

Bauer described a near-term example: the Colfax Corner project, a proposed partnership between Ancora and the University of Notre Dame to redevelop the South Bend Tribune site and adjacent parcels — a $154,000,000 project expected to create more than 400 jobs. He said the IDD would help the city leverage incremental state tax capture to support infrastructure and financing for such projects.

Committee members asked about comparable IDDs elsewhere in Indiana; Bauer cited the LEAP District in Lebanon as an example and noted this IDD is novel for a downtown urban core. There were no public speakers on the item. The committee voted unanimously to send Bill 26-03 to the full council with a favorable recommendation.

What happens next: The resolution and associated TIF modifications will go to the full Common Council for final action; staff indicated some allocation areas will begin capturing increment on different timelines depending on when financings are issued in each allocation area.