- "Coverage from tax increment revenues is strong as a result of continued growth in the City of Indianapolis-Marion County's (the city) downtown tax increment district, as well as expansion of the boundaries of the district." (emphasis added)
- "The district is highly concentrated, with 45% of revenues coming from the top 10 taxpayers."
- "The allocation area is commercially diverse and includes residential and office buildings, luxury hotels, retail, wholesale and manufacturing facilities. It has benefited from convention business, sports-related development and commercial activity over the last 20 years resulting in a revitalization of downtown Indianapolis."
- "A significant portion of this revitalization has occurred since the opening in 1995 of the Circle Centre Mall, occupying two city blocks, as well as significant expansion of Eli Lilly's headquarters and the opening of luxury hotels. The most recent development activity includes the construction of a new $450 million JW Marriott Convention Center headquarters hotel which opened in 2011."
- "Total assessed value (AV) for fiscal 2013 is almost $2 billion, of which base valuation makes up only $38 million or a small 1.9%. AV grew a robust 17% in 2012 and 21% in 2013 as a result of the JW Marriott project coming online, as well as other development in the area."
- "The top 10 real property taxpayers represented a high 45% of 2013 net real AV in the allocation area. The largest taxpayer is Eli Lilly and Co. (Fitch IDR 'A', Outlook Negative) at 11%. Additionally, tax increment revenues generated from personal property tax, which represent 30% of combined real and personal property estimated tax increment revenues in 2013, are primarily payable by Eli Lilly and JW Marriott."
- "Additionally, tax increment revenues generated from personal property tax, which represent 30% of combined real and personal property estimated tax increment revenues in 2013, are primarily payable by Eli Lilly and JW Marriott."
- "The bonds are limited obligations of the bond bank, payable solely from tax increment revenues and funds pledged under the indenture. The bond bank has no taxing power. The bonds are additionally supported by a standard debt service reserve fund, which the city has pledged its moral obligation to replenish."
- "According to the ordinance governing the city's moral obligation, if revenues are projected to produce a shortfall in debt service requirements and cause a draw on the reserve fund, the chairman of the bond bank will certify the deficiency to the city council within 90 days of such projection, or prior to December 1 of the fiscal year when the deficit is expected to occur, whichever is earlier."
- "The bond bank covenants that it will take all actions required or permitted to certify any deficiency to the city council within 90 days, regardless of whether the deficiency was anticipated in the annual budget. The council could then choose to appropriate the funds necessary to replenish any deficiencies in the bonds' debt service reserve fund."
- "The bond bank currently has a TIF Stabilization Fund funded at $10 million and an Appeals Reserve Fund funded at $22.2 million which could be applied towards any outstanding bond bank tax increment supported debt."
- $16 million in bond debt issued in 1992 will mature in February, 2014.
Tuesday, August 06, 2013
Fitch Affirms AA Credit Rating For Mass Avenue TIF Bond Issue, Confirms Enormity And Growth Of Downtown TIF District
Fitch announced today that it has assigned a "AA" rating to the nearly $30 million in new bonds being issued by Indianapolis' Local Public Improvement Bond Bank for the redevelopment of the current site of the Indianapolis Fire Department, fire station and firefighters credit union along Mass Avenue. The credit rating agency has also confirmed the "AA" rating for other bonds issued by the bond bank, indicating a stable outlook for the City's finances, notwithstanding the Ballard's dire claims of the city facing a $55 million budget deficit next year. Several comments Fitch makes about the Consolidated Redevelopment Project Allocation Area are worth noting, shining light on the enormity of this TIF district and the negative impact on local government property tax collections it has.