KOKOMO — With the expected closing of the Mounds Mall on April 1, there will be a number of businesses either looking for a new location in Anderson or deciding to close.
Local economic development officials are hopeful that those businesses will choose to remain in Anderson with several vacant storefronts available in the downtown area and at local shopping centers.
Facing a similar situation, the Howard County Commissioners for five years used economic development income revenues to offer incentives for businesses to either start up or relocate in Kokomo, Greentown or Russiaville.
As of Friday there were some — but not many — vacant storefronts in downtown Kokomo. The central Indiana city over the past few years has constructed a new YMCA, a parking garage with high-end apartments on the top level and numerous downtown housing projects.
The program which offered a one-time grant of $5,000 to pay rent ended this year. The commissioners decided to invest $150,000 per year for 10 to 15 years toward the development of a downtown Kokomo hotel and convention center.
Jim Papacek, a member of the Howard County Council and a member of the Greater Kokomo Economic Development Alliance which oversaw the county funding, said from 2013 through 2017 a total of 24 businesses received grants. He said 18 are still operating.
“It was very successful in getting businesses in our downtown storefronts,” he said. “It accomplished what we were hoping.”
Madison County Commissioner John Richwine said Friday he wasn’t aware of the success of the program in Howard County.
“I would entertain any idea that encourages new businesses and expands the tax base,” he said. “I would consider it. We would have to work hand in hand with the county council.”
Richwine said a similar program in Madison County would get a few interested business owners on a yearly basis.
Greg Winkler, executive director of the Anderson Economic Development Department, said the city is aware of the Howard County program. He said a collaborative program with Madison County would assist in attracting businesses to downtown.
“The city has been fully funding incentives for downtown businesses through the food and beverage tax,” he said. “Right now we’re reviewing the programs we have in place to develop a consistent policy.”
Winkler said no talks have taken place with the county on a collaborative program for small business incentives.
Kokomo Mayor Greg Goodnight said the rent abatement program through county government was an important part of the downtown revitalization.
“Converting all the streets to two-way has probably had the biggest impact,” Goodnight said. “The savings from removing every traffic signal was also a big part of the transformation.”
Howard County Commissioner Paul Wyman said with good parameters in place to protect tax dollars, any city can accomplish what their goal is by offering incentives.
“We focused on the downtown,” Wyman said. “The city has done phenomenal things and it was our way to partner with the city. It was natural for us as county government to help with the downtown development.”
There is a true connection between offering tax incentives and job creation, he said.
Wyman said the goal was to fill the vacancies in Kokomo's downtown buildings.
“It worked extremely well," he said. "We had a number of small businesses that took advantage of the program.
“The program had other positive effects. There were businesses that took advantage of the vacant spaces and improved the buildings."
Wyman said in order to receive the county grant, no property taxes could be owed on the building. He said that requirement brought in more than $50,000 in back taxes.
“The program was administered by the Alliance,” he said. “Businesses received a monthly payment from the Alliance. This way if a business didn’t stay for the year they didn’t receive the entire amount.”
The businesses were required not to relocate for three years or a portion of the funding had to be repaid.
“Even when the businesses didn’t stay, in many cases, the buildings were upgraded and were ready for the next tenant,” Wyman said. “With a program like this you will experience businesses that don’t make it, but we created enough of a buzz that it helped to fill up the vacancies.”
Wyman said in 2017 the program concentrated on restaurants and retail establishments.
“The majority of the storefronts are full, so now we’re shifting those dollars to the hotel and conference center, which is the next big key to the development of the downtown,” he said. “That will support all the businesses in the downtown.”