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5-2 City Council vote OKs economic target area
For what is believed to be the first time in the post-IBM era in Greencastle, a parcel of land targeted as an economic development area was met with a split vote of the Greencastle City Council.
During the July meeting of the Council, a 1.245-acre tract along Tennessee Street, being developed by Chris Harcourt of C&R Quality Rentals as Willow Grove as a four-building, eight-duplex project, was the subject of Ordinance 2024-9, declaring the 815 Tennessee St. site a target area for economic development.
The property had been vacant for several years after a real estate firm had it rezoned commercial and expected to build its headquarters on the site. It took Harcourt two years to get it rezoned for multi-use residential use, and then last month the Greencastle Economic Development Commission voted 3-0 to pass a favorable recommendation on to the City Council, making the residential property eligible for tax abatement. Only twice previously has that occurred in Greencastle with a new state statute allowing abatement for residential growth.
While abatement was not the issue at the July City Council session, it was the elephant in the room as Councilman David Masten took exception to language in the ordinance stating that the real estate in question “has become undesirable for normal development and occupancy because of lack of development, cessation of growth, deterioration of improvements or character of occupancy, age, obsolescence, substandard buildings or other factors that have impaired values or prevent a normal development or use of the property.”
Just “a stone’s throw” from the Harcourt property, Masten said, is a $7 million development “that is probably worth more than that.”
Councilman Vince Aguirre, who joined Masten in voting against the target area ordinance in a 5-2 outcome on first reading (Mark Hammer, Darrel Thomas, Stacie Langdon, Katherine Asbell and Tina Nicholson all voting in favor), said, “It’s just not undesirable for development,” later referring to abatement as “corporate welfare” even though he said he is “not anti-abatement.”
Economic development strategists explain that abating real estate taxes on a property on a sliding scale for 10 years is a trade-off for receiving the more-lucrative income taxes that result from additional employment. It’s uncertain if that will hold true for abating property taxes for housing developments since that is a new aspect of the economic development equation.
The council vote was not about whether or not the city should grant a future abatement to the project but the creation of the target area, as addressed several times by Mayor Lynda Dunbar, City Attorney Laurie Hardwick and Greencastle/Putnam County Economic Development Director Kristin Clary.
“This is a corner lot that was zoned commercial,” Clary clarified. “It took two years to get rezoned and is rezoned Residential 2 for multi-use family housing. We are asking you approve that it is eligible for a tax abatement. We are not asking you to approve tax abatement at this time,” Clary summarized, explaining that with consideration on second reading next month will come a resolution for tax abatement.
Masten suggested “the point is, this opens the floodgates” for potential tax-abatement requests.
“You and I know there are four or five (developers) sitting here watching this,” Masten said, addressing his comments to Clary and suggesting the city is about to see “a parade of folks“ because of the precedent being set. “We have so many things hitting us (at once).”
Masten contends that the abatement “puts the burden on the people who can least afford it,” which is lower-income households like he and Aguirre serve in the First and Fourth wards. They would, in effect, be subsidizing tax breaks for developers, he noted.
Clary countered that the property in question is all new assessed value and that more housing options will mean added people locating here for jobs and contributing to the schools and tax base.
“The more gainfully employed people we have coming into our community with available housing,” Clary said, “the more those taxes go directly to this unit of government to do your budget.”
Councilman Hammer, who made the motion to approve the project at the Economic Development Commission meeting, said the EDC looked at the lack of development on the site. “There’s never been anything on it,” he said. “It used to be a railroad track went through there.”
Masten also took exception to the perception of an ongoing local housing crisis. “We’re on the back side of the cycle,” he asserted.
“Everyone says it’s a crisis ... No, it’s not. It’s a cycle and you work your way through the cycle,” Masten said, citing that Greencastle is “close to critical mass” on becoming a rental community. Latest figures show that 42.3 percent of such property is rental-occupied housing, he said.
Adamantly disagreeing, Clary said whenever she talks to potential employers, the No. 1 need is employees and the need for available housing in Greencastle.
“There’s still help wanted signs all over town,” Clary continued. “We are talking about rental housing and I am not making a statement that we want to turn into a complete rental community, because I don’t believe that we do, but I will say rentals are still in great demand.”
From the Essential Services Committee to the Plan Commission to the Zoning Board and now the City Council, Dunbar reminded the group that Harcourt had to “jump through a lot of hoops” to build on the land. He had to spend extra money along the way for engineering and design to fit the four buildings on the oddly-shaped site.
“They’ve done a lot of extra work to make this be able to have four duplexes on there,” Dunbar said. “It was difficult for them to build on.”
Meanwhile, Clary acknowledged developers and new industry will gladly look elsewhere if they do not get local tax breaks.
“If we don’t want Greencastle to grow, and we’re happy with the status quo and where we are,” Clary countered, “then maybe that is the route we need to take.”
Masten, however, argued that when everyone begins to say, “‘Why would we do something like this? This makes no sense, let’s pull back’ ... and we are no longer attractive because it’s so stinking expensive to live here.”
Trying to accentuate his point, he quoted the mayor and city attorney from the EDC meeting, saying, “They’re coming, guys, get used to it.”
That doesn’t have to be the case, Masten concluded.