Zionsville Times Sentinel

February 7, 2013

Wal-Mart could boost town’s tax revenue

By Matt Werner
Staff Writer

Zionsville — While the Board of Zoning Appeals and Plan Commission debate plans for a proposed Wal-Mart in Zionsville, the numbers show the superstore could have a significant tax impact in the community.

As part of its filing with the town, Wal-Mart has submitted an economic and revenue impact analysis, which was completed by Arizona-based Applied Economics. The study shows the proposed Wal-Mart would generate an annual economic impact of $19.5 million in Zionsville and $20.3 million county-wide in both direct and indirect tax revenue.

TAx Revenue from project

“In terms of revenues to the town, the project would directly generate approximately $677,000 in property tax revenues to the (Tax Increment Financing) district,” the report states.

The report states that direct property tax revenues are based on “the value of new construction, value of fixtures and equipment, as well as the increase in land value.”

Sarah Murley, a partner with Applied Economics, explained how the property taxes are calculated.

She said to determine the assessed value of the property she took the $22 million of construction costs, added $5 million for land improvements and then added $2.4 million, which is 40 percent of $6 million in furniture, fixtures and equipment.

She then took $29.4 million and entered it into the Indiana Department of Local Government and Finance tax calculator, which showed a tax rate of 2.3 percent.

The study also shows an indirect property tax revenue, which is generated by supported employees and their families living in the community.

According to the report, “indirect income taxes are calculated by multiplying total personal income times an 80 percent county residency rate times the one percent local income tax rate.”

The report then outlines how much tax money would go to each of the taxing entities based on the tax rate.

“Indirect income tax revenues of $16,000 per year include the city’s share of local income taxes from direct and indirect employees living in Boone County,” the report states. “An additional $28,000 in indirect local income taxes would be distributed to the county and library district.”

See Wednesday's Times Sentinel for more on this story.