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Tax revenue grows in downtown district

October 11, 2014

A new report from the Legislative Services Agency shows that a special taxing district downtown captured more than $16 million in state and local tax revenue.

Much of the money flows directly to the state to pay off debt on Lucas Oil Stadium and the Indiana Convention Center, but it also goes into coffers of the Capital Improvement Board, which oversees Bankers Life Fieldhouse and Victory Field in addition to the stadium and convention center.

The Professional Sports and Convention Development Area captured $16.36 million in the 2013 fiscal year, a slight uptick from $16.35 million the prior year, during which Indianapolis hosted Super Bowl XLVI.

The 2012 Super Bowl drove significant revenue growth, 12 percent over fiscal 2011.

LSA analyst Heath Holloway said he expected to see slow growth in 2013, in keeping with the state’s overall revenue trend.

Evansville, Fort Wayne and South Bend also have established PSDAs. Because these areas cover only a few entities and facilities, revenue can easily be thrown off track by small changes.

That was evident in 2013 as the Indianapolis PSCDA collected less local income tax than the prior year, $1.8 million versus $2.5 million.

Holloway said he wasn’t sure of the reason for the decline. He said it could have resulted from a payroll reduction by a professional sports team, or it could have been a matter of a change in accounting. Local income taxes are paid to the employee’s county of residence, but tax-paying entities don’t always report accurate information to the Department of Revenue.

Tax revenue in the Indianapolis PSCDA has grown almost fivefold since 1998, when it was $5.1 million.

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