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City to bolster economic development funding

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Two groups critical to Indianapolis’ economic development efforts are poised to receive additional funding to help bring more conventions and businesses to the city.

Mayor Greg Ballard is expected to make the announcement regarding the Indianapolis Convention & Visitors Association and Indianapolis Economic Development Inc. at his State of the City address Wednesday evening.

Deputy Mayor Nick Weber declined to disclose how much the two organizations might receive in extra funds, pending approval from the City-County Council. But each amount is anticipated to be about $1 million.

The money for the two groups will come from a settlement the city reached with Illinois-based Navistar International Corp., which will pay back part of an abatement after failing to retain more than 1,800 jobs it had promised. The company, which had received $18 million in tax breaks during the past decade, announced early last year that it would close its east-side diesel engine plant.

IEDI operates on an annual budget of roughly $1.1 million, and President and CEO Scott Miller said the windfall from the city potentially could top that.

“We believe that as the economy continues to grow, Indianapolis has positioned itself very well,” he said. “We think these resources will allow us to help [create more jobs].”

The additional funding would enable the organization to better market the city to prospects, Miller said, as well as become more involved in redevelopment initiatives by making direct investments in properties—something IEDI has not done in the past.

ICVA’s promotional efforts also would receive a boost because the new funds would allow it to market city cultural destinations in more cities and hire four additional salespeople, said Don Welsh, the group’s president and CEO.

One of the new hires would be located in Washington, D.C., bringing the sales staff there to four. Walsh said it is important to have a presence in the nation’s capital, given that 13,000 national associations are headquartered in the area.

The ICVA also is revamping its Web site and will unveil the new version April 1.

The money comes at a crucial time for the ICVA, which for months had implored the Capital Improvement Board for more funding. The association is operating on a $13 million budget this year, of which the CIB funds about $9 million.

ICVA needs to attract more conventions to support the expansion of the Indiana Convention Center, the construction of the 1,600-room J.W. Marriott hotel and even additional space available in Lucas Oil Stadium, Welsh said. 

“We’re extremely grateful,” Welsh said. “There’s so many other pressing requests for these funds. This is a big, big commitment to support all of this new infrastructure.”

The State of the City address is scheduled for 7 p.m. at the Tobias Theater at the Indianapolis Museum of Art.
 

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  1. Apologies for the wall of text. I promise I had this nicely formatted in paragraphs in Notepad before pasting here.

  2. I believe that is incorrect Sir, the people's tax-dollars are NOT paying for the companies investment. Without the tax-break the company would be paying an ADDITIONAL $11.1 million in taxes ON TOP of their $22.5 Million investment (Building + IT), for a total of $33.6M or a 50% tax rate. Also, the article does not specify what the total taxes were BEFORE the break. Usually such a corporate tax-break is a 'discount' not a 100% wavier of tax obligations. For sake of example lets say the original taxes added up to $30M over 10 years. $12.5M, New Building $10.0M, IT infrastructure $30.0M, Total Taxes (Example Number) == $52.5M ININ's Cost - $1.8M /10 years, Tax Break (Building) - $0.75M /10 years, Tax Break (IT Infrastructure) - $8.6M /2 years, Tax Breaks (against Hiring Commitment: 430 new jobs /2 years) == 11.5M Possible tax breaks. ININ TOTAL COST: $41M Even if you assume a 100% break, change the '30.0M' to '11.5M' and you can see the Company will be paying a minimum of $22.5, out-of-pocket for their capital-investment - NOT the tax-payers. Also note, much of this money is being spent locally in Indiana and it is creating 430 jobs in your city. I admit I'm a little unclear which tax-breaks are allocated to exactly which expenses. Clearly this is all oversimplified but I think we have both made our points! :) Sorry for the long post.

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