The resolution authored by City Councilmen John Crawford and Geoff Paddock and passed by the council last week suggests public funding for the Electric Works project could come from a range of city sources:
• Dedication of $3 million from the city's portion of County Economic Development Income Tax revenue collected during the first half of the next decade.
• A $6 million loan from the Legacy Fund, to be repaid from revenue generated by a proposed tax-increment financing district.
• A grant of $7.5 million in future income from the Legacy Fund.
• A bond issued by the Redevelopment Authority, with $3 million from the Legacy Fund serving as a debt reserve. To avoid using up the city's bonding capacity, the authority might consider using a city asset such as roads to bond against. Carmel, Indiana, recently used a similar arrangement, Crawford said.
As Paddock noted, those strategies would not require reducing the size of the Legacy Fund.
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City Council took a big step forward on the Electric Works project last week – and it didn't commit a dime.
Councilmen Geoff Paddock and John Crawford were prepared to wait a week or two before putting their nonbinding resolution to a vote. But after a surprisingly short discussion, seven of the nine council members were comfortable voting to support at least the concept of reviving the now-abandoned GE complex.
This was, of course, just an early hurdle for those who want to see the project become a reality. Paddock and Crawford asked their colleagues to approve their outline of how the city might help raise the $65 million in public funds needed for the first half of the proposed $440 million transformation of the 39-acre campus into a landscaped, millennial-friendly mix of residences and educational, entrepreneurial and retail space.
The resolution calls for consideration of a combination of strategies including bonding through the Redevelopment Authority, a $6 million loan and a grant of $7.5 million in future income from the Legacy Fund, and dedication of $3 million from local income taxes collected during the first half of the next decade.
A bill to allow creation of a special, 35-year tax-increment funding district for the GE area, passed the Indiana Senate Thursday.
“This is a roadmap. This is a plan. These are possibilities that would help us get to that $65 million,” Paddock said in an interview before Tuesday's council vote. “The request was that we at least send a signal by the end of February.”
The consortium of developers has lined up $100 million worth of state and federal incentives, but the value of some of those tax credits begins to erode if construction doesn't begin by July 1.
Last week's vote will keep things on track, but will not commit the city to invest anything if the project proves unrealistic.
The developers don't need money from the city now as much as official recognition of the seriousness of their proposal. With that, they can seek commitments from the private sector that will ultimately determine Electric Works' viability.
While the developers line up potential tenants and seek bank loans, council members and local economic devlopment agencies will have the time to practice due diligence. A commitment of public funds of this scope demands time, thoughtful discussion and caution.
The community needs to hear more about the developers' own financial commitment and to fully understand each step of the renovation plan. The Allen County-Fort Wayne Capital Improvement Board's planned market study should be helpful in this process.
Interest in reimagining the GE campus has been clear at least since early 2016, when Paddock, IPFW and Greater Fort Wayne Inc. organized well-attended workshops for public brainstorming. The Electric Works concept borrows from some of those early ideas, and it seeks to mirror other mixed-use projects that preserve history – most notably the successful renovation of the former American Tobacco campus in Raleigh, North Carolina. Electric Works has the potential to revitalize neighborhoods north and south of the campus, attract and retain young, highly skilled workers, and help Fort Wayne become a destination for cutting-edge businesses. That could mean high-paying jobs and a cornucopia of new tax revenue that could eventually more than repay the local public investment. Electric Works also offers a positive way for the community to deal with a reality Fort Wayne must eventually confront in any case – a 39-acre tract with 1.2 million square feet of empty buildings on the southwest edge of downtown. Even turning the site into a vast meadow could cost tens of millions of dollars.
But now, everything depends on whether the developers can sign up enough tenants and secure private loans. Be assured, those prospective tenants will perform their own due diligence. Only then will the council and other local government entities have to commit to funding plans. If it's clear private businesses and investors are coming on board, those next public decisions should be, in some ways, even easier votes for leaders such as Crawford and Paddock to sell.