taxes & incentives
Warren County has established three TIF economic development areas near West Lebanon.
Tax Increment Financing (TIF) provides for the temporary allocation to redevelopment or economic districts of increased tax proceeds in an allocation area generated by increases in assessed value. Thus, TIF permits cities, towns or counties to use increased tax revenues stimulated by redevelopment or economic development to pay for the capital improvements needed to induce the redevelopment or economic development.
The use of TIF is initiated by the declaration of a tax allocation area by a county, city or town redevelopment commission. Property tax assessments are frozen at predevelopment levels in the allocation area. Municipal bonds are then issued to finance the public improvements. As property values in the allocation area increase as a result of new development, the increment in tax revenues is used to meet debt service on issued bonds. Once the bonds have been paid off, the taxes collected from the allocation area are distributed to the remaining taxing districts.
Bonds payable from TIF may be used to finance the cost of redevelopment and the construction of public improvements in the redevelopment area or for projects that directly serve or benefit that area. Proceeds may also be used for training.
Bond amounts are determined by the size of the project and the amount of the increment available.
Real and Personal Property Tax Abatement
Property Tax Abatement is authorized under Indiana Code 6-1.1-12.1 in the form of deductions from assessed valuation. Any property owner in a locally designated Economic Revitalization Area who makes improvements to the real property or installs new manufacturing equipment is eligible for property tax abatement. Land does not qualify for abatement. Used manufacturing equipment can also qualify as long as such equipment is new to the state of Indiana. Equipment not used in direct production, such as office equipment or distribution equipment, does not qualify for abatement.
Tax abatement can be granted on a one to ten year declining percentage schedule on real property improvements such as buildings.
Personal property tax abatement is a declining percentage of the assessed value of the newly installed manufacturing equipment, based on a one to ten year time period and percentages as determined by the local governing body.
Tax abatement changes allow local units of government to grant tax abatement
For assistance regarding application for abatements, contact the Warren County LEDO.