In the first of two rounds of voting on a proposed expansion to Central Indiana Ethanol's tax increment financing (TIF) district, Marion City Council gave initial approval to the plan last night.

CIE is asking for its current TIF district to be expanded to include the old Omnisource property to the east of CIE's facilities on Ind. 18. 

CIE is also asking for a $3.65 million TIF bond from the city, to be paid back with the property taxes captured by the TIF district. That bond will help pay for the expansion project, which is already underway on the old Omnisource site. 

On Monday, CIE officials said phase one of the three-phase $25 million project is about 70 percent complete. The project will increase CIE's capacity and, if completed, will allow CIE to produce export-grade products.

City officials have said the project will not be completed unless the TIF is approved. 

The site is outside city limits, however, so the TIF district expansion is dependent on the Grant County Commissioners giving the City of Marion's Redevelopment Commission jurisdiction over the property.

The commissioners have tabled that request until next week.

Council member Lynn Johnson asked if it was “preemptive” to take a vote before the county decides if it will hand over the property, but Heather James of law firm Ice Miller said there was nothing in state statute preventing the council from acting before the property is under redevelopment commission control.

James emphasized that the council for now was only voting to confirm that the CIE expansion “conforms” to the city's economic development plan and to approve the earlier actions of the redevelopment commission.

The council will consider the TIF expansion again in addition to the $3.65 million TIF bond at its March 19 meeting, James said. 

“You are still in control and have the final word,” James assured council members.

Council member Steve Henderson asked whether it was an issue that there was no representative of Oak Hill United School Corporation at the table when the redevelopment commission looked at the proposal.

The CIE properties in question fall into the Oak Hill tax district, so any tax dollars captured by the TIF district would be tax dollars withheld from Oak Hill schools.

A Marion Community Schools school board member currently serves as a non-voting member of the redevelopment commission.

City Attorney Tom Hunt said Oak Hill has no legal right to participate on the city's redevelopment commission, although James said Oak Hill representatives could speak at the March 19 public hearing.

The council voted 8-0 to approve the resolution, with Council member Jim Brunner absent.

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