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Zionsville, school district make $5.7M land deal with Dow

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Zionsville Community Schools and the town of Zionsville are teaming up to purchase and develop a prime piece of real estate owned by Dow Chemical Co.

The cash-strapped school district said Tuesday that it plans to use funds remaining from a 2005 bond issue to buy 126 acres for $5.7 million from Dow. The company’s Dow AgroSciences LLC division is located south of the property at 106th Street Parkway east of Zionsville Road.

Under the proposal, which needs to be approved by both the school and town boards, the school district will use 10 acres to build a warehouse and maintenance facility, which the district said it intended to do in 2005 until the economy derailed the project.

The town, in turn, will take title to the remaining property and subdivide it for commercial development. It will install underground utilities and make payments to the school district through 2028 on its portion of the property, resulting in no net cost to the school district.

“This partnership is a creative way to benefit taxpayers while expanding assessed valuation by creating a market-ready economic development opportunity, said Dax Norton, executive director of the Boone County Economic Development Commission, in a prepared statement.

The Zionsville school district has been hit by a double-whammy in recent years: The introduction of property-tax caps and a new school-funding formula that favors districts with a significant commercial-property tax base, something Zionsville sorely lacks.

In addition, the district’s annual debt service payments were scheduled to rise just as the housing-market meltdown drove down tax revenue.

Last May, Zionsville voters approved a $4.7 million tax increase to avoid teacher layoffs.

Dow was unwilling to subdivide the tract into smaller parcels, which made the purchase too costly without the agreement between the school district and the town, the school district said.

And several business owners have scoped out the property in recent years but passed because it was too costly to purchase as a single parcel, town officials said.
 

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  • Sweet Deal for Rockland
    Rockland makes out like an absolute bandit by conveying their right to the ZCS and onto the RDC to buy the land. They have to buy nothing. They need to sell no bonds. Yet buy ZCS and Zvl RDC agreeing to a deal granting them “an Exclusive Development Agreement” they will spend nothing but abundantly profit. 1.Rockland will be granted Exclusive Development Rights 2.Rockland will perform the following roles --- and we can assume they won’t do it pro bono Advise the Owner (the RDC) how to manage and develop the real estate Create Marketing materials Negotiate for and on the behalf of the owner Create layouts for infrastructure Perform the role of the construction manager for any infrastructure construction Work w owners legal counsel to develop easements, restrictions & covenants 3.Compensation for the Developer: As a taxpayer in Zionsville, you will absolutely love this: SALE of any portion of real estate – Rockland receives 3% of Gross Sale Price LEASING: of any portion of real estate – Rockland receives 3% of Gross Rent Payments to be paid during the term of the lease CONSTRUCTION – Developer (Rockland) shall be paid by Owner (RDC) a construction management fee of 2% of construction costs … for all Owner’s construction work related to the Real Estate 4.Owner Covenants – Owner agrees to Separately contract and pay for the services of all engineers, architects, attorneys, financial advisors, environmental consultants and other professionals necessary in Developer’s opinion for the development, sale and/or leasing of the Real Estate. There ya got it --- How ‘bout that. Pretty sweet deal for Rockland wouldn’t you say? Is your blood boiling yet? Keep in mind, Rockland Development LLC has already agreed to purchase the property from Dow for $5,7M. The deal is scheduled to close by Dec 12th, 2012. Why wouldn't the Zionsville RDC just let them buy it. If they proceeded to do so, Rockland would have to perform these same activities and provide these same services and not be compensated for them.
  • TAX & SPEND Schoolboard
    1. The land being purchased from DOW is probably in a TIF district so any commercial development on that property wouldn't benefit the taxpayer. 2. Darth, what is there to understand? Zionsville has a tax & spend school board that only seems to answer to the teacher's union.
  • Not a prudent use
    They have $5.7million? And Vacant land already owned by the soccer fields, the baseball fields, the "old" union school, and at least two other parcels. Taxes will go up to pay for this either for the infrastructure or to pay interest on the bond money spent which are currently in the bank earning interest. Use this money to pay down the bond balance in 2015. Let Dow find their own buyer not the taxpayer
  • I have an idea!!
    Lets all post our thoughts based on limited information on subjects we don't understand or have little to no information about.
  • I thought the town wanted a bigger tax base
    Instead of using the limited land that Zionsville does allow to be commercial to increase the tax revenue base with industry they want to lock it out of tax revenue and make it a tax burden on the community?
    • Smells Bad
      The school system GAVE away land for a fire station that was next to one of the middle schools, that would have been a close location, they have a building and land moth-balled from a closed elementary school but since they have a lot of taxpayer cash now that the town passed a referendum to be used for more teachers and smaller classroom crowding, they all of the sudden have money to buy more land and new buildings and do not midigate spending by using existing assets???

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