The city of Kokomo is preparing to offer incentives via tax increment financing districts and forgivable loans to a slew of newly-announced housing and commercial developments.
FORGIVABLE LOANS
The city is in the process of offering forgivable loans to new residential developments, including Fortune Companies Inc.’s redevelopment of the old Cozy Lounge building, the expansion of University Apartments near Indiana University Kokomo and a mix of townhomes and apartments near the two electric vehicle battery plants.
Fortune’s redevelopment includes 10 new apartments at the southeast corner of North Buckey and West Mulberry streets. According to the resolution, the development marks a nearly $1.7 million investment by Fortune, and the city is chipping in $300,000 in the form of a forgivable loan.
The forgivable loan will be paid out of the city’s TIF No. 6, the largest TIF in terms of assessed value and revenue and includes downtown, the Kokomo Casting Plant and Kokomo Transmission Plant and the commercial and industrial areas around the two plants.
In July, local and state officials announced the expansion of University Park apartments. The two-phase project is an approximately $30 million investment from Peru-based 6G Properties LLC that includes around 250 units, commercial retail space and pickleball courts.
The commission approved a forgivable loan of $4.2 million to come from TIF No. 6 for the expansion. The project is also receiving $3.75 million through the state’s READI 2.0 grant program.
Phase one, which includes constructing 112 units and the three commercial retail spaces, is expected to be complete in summer 2026.
Wes Reed, director of development for the city of Kokomo, said the $4.2 million forgivable loan is for both phases of the development, even though the project is only in phase one at the moment.
“Our forgivable loan is a little bit bigger than typical for a project this size, but it’s because we’re doing all the infrastructure up front to go ahead and do phase two later on,” Reed said. “It just doesn’t make sense to run sewer and stop and then run sewer again.”
Lastly, the city is offering developer Rocky Singh, of Carmel, a forgivable loan of $4.6 million for a multifamily development, dubbed Project Harmony, that includes both townhouses and apartments north of East Morgan Street and just south of the StarPlus energy electric vehicle battery plant and South Korean supplier Jaweon Industries.
NEW TIF DISTRICTS
In addition to the forgivable loans, the city is also in the process of establishing three new, site-specific TIF districts for some of the aforementioned projects.
A TIF district is a type of economic incentive tool where property tax revenue on new assessed value is captured for reinvestment in the TIF area for the life of the TIF district or used to pay off bond debt instead of going to the taxing entities.
The site-specific TIFs are for Project Harmony, University Park and Mirae Trails, a $100 million mixed-use development of apartments, commercial space, a possible hotel and townhouses and duplexes proposed for the former Delco Park that was announced late last year With the TIFs, the city is seeking to issue bonds in the sum of $16 million; $15 million; and $17.4 million, respectively, that will help subsidize the construction of the projects.
The bonds will be paid back through TIF revenue generated by the proposed developments.
The Redevelopment Commission is scheduled to hold a public hearing at 9 a.m. Sept. 17 in the Louk’s Conference Room on the first floor of Kokomo City Hall, 100 S. Union St., regarding the proposed bonds and forgivable loans.
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