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8/2/2017 6:23:00 PM
Marion grapples with tax abatements

Navar Watson, Chronicle-Tribune

Nearly every member of the city council, as well as the Mayor, Chief of Staff and building commissioner, showed up at Tuesday night’s Marion City Council compliance committee meeting, resulting in what appeared to be the first instance of city officials and council members sitting down and troubleshooting issues together in a long time.

“The point of the compliance committee is to get the discussion going,” Henderson said, something that “has worked out very well” so far.

During the committee meeting, Councilwoman Lynn Johnson appealed to her colleagues about a proposed resolution that would do away with considering new tax abatements next year, presenting council members with data showing how much the city might save in doing so.

Though the proposed resolution was met with much opposition from fellow council members and city officials, the discussion that ensued launched the group into deeper thinking of tax increment financing (TIF) oversight and abatement handlings in the future, according to Henderson.

“I was pretty sure that this (abatement moratorium) was a dead issue,” Henderson told the Chronicle-Tribune, “but it was an issue that was used to bring the topic to the focus.”

According to Johnson’s research and calculations, tax abatements are costing the city $3.1 million in 2017 alone, including $339,880 from abatements the council approved this year so far. That $300,000-plus, Johnson said, could pay for a lot of city’s expenses.

“We can’t really stop abatements,” Johnson said. “All we can do is stop issuing abatements right now for a short period of time to actually see how this is going to impact our bottom line.”

Alumbaugh opposed the idea, recommending instead that the council consider abatements on a case by case basis and with a more critical eye.

Businesses, he said – including longtime, faithful Marion businesses – will continue looking for abatements, especially when it comes to help in financing equipment.

“I think that’s going to be a constant,” he said. “The cost of equipment is astronomical compared to the old days. Everything is technology now, and it changes rapidly, so that’s going to be an issue for a business trying to grow.”

Other council members expressed concern about how a moratorium on tax abatements might affect the city’s appeal to potential incoming businesses.

Councilwoman Deb Cain said “we don’t know what a month from now will hold,” or six months or 12 months. A major company might show up and consider building in Marion, she said, only to be driven away to Kokomo or Muncie when the city can’t provide any financial help.

“I don’t want to take that chance,” she said.

The abatement discussion continued into the regular city council meeting an hour or so later when a couple of local business owners showed up to oppose a temporary stop on abatements.

Jim Gartland, chairman of the Atlas Foundry Company, which is coming up on 125 years of operation in Marion, said he believes an abatement moratorium would do more harm than good, causing setbacks for manufacturers looking to develop.

Randy Miller, CEO of Randall Miller & Associates, then passionately urged council members to talk with business-owning constituents before making such a decision – people whom the moratorium would heavily impact.

“You can’t micro-look at the issue,” he said. “It’s larger than that. … (The impact) is huge. It trickles down. … It has an effect on everyone.”

Though the council didn’t make any votes Tuesday, members pitched ideas during the committee meeting about how to approach abatement requests with more discretion.

Henderson, for example, discussed maybe granting some businesses 50 percent on tax abatements rather than the full 100 percent, requiring them to “get some skin in the game.”

Despite some of the members’ disagreements, Alumbaugh noted Tuesday night that council members seemed to be communicating with each other better than previous council members had in the past. Henderson agreed.

“The ability to sound, talk and work out issues is getting better,” he said. “We’re moving forward with being able to work together as a council and as a city.”

Related Stories:
• Marion's TIF troubles languished as officials didn't meet

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