By Andrea McCann
At a Friday, May 10, meeting of the Zionsville Redevelopment Commission, RDC attorney Andy Buroker announced a May 23 closing date has been set on the Dow property the town will purchase — if all the final details come together.
After hearing a tax increment financing revenue analysis, followed by extensive discussion, the commissioners approved a resolution for the property acquisition, as well as an exclusive development agreement with Rockland Development LLC. Commissioner Luke Phenicie presented highlights of the TIF analysis, stressing that the analysis, done by Crowe Horwath, has been updated and revised several times and is strictly a basis to provide parameters with which to work.
“It gives us a tool to make decisions,” he said.
Phenicie’s purchase- and cost-basis analysis started with a $37,000-per-acre purchase price on the 91.3 acres, or $3,378,100 total. Zionsville Community Schools will purchase almost 9 acres at the same price, so less their portion, the RDC would need $3,046,358. Improvements, such as water, sewer, roads, surveys and other expenses, were estimated at $1.5 million, bringing the total cost to $4,546,358.
“It’s hard to determine what to do because we don’t know what companies will be in there,” he said while discussing infrastructure development costs.
Looking at the return to RDC, Phenicie said not all the acres can be developed, so assuming 50 acres can be developed, the land must be sold at $90,000 per acre for the commission to break even on its investment. At an average sale price of $120,000 per acre — a $29,073 per acre gain — the RDC could earn nearly $1.5 million just on land sales.
Using a “base case” scenario and a “conservative” scenario, Phenicie showed his fellow commissioners the estimated TIF buildup from the project and the expected total return. All told, the total gain to RDC could be $5,290,851.