Incentives, long-term leases urged for airport development

The Indianapolis Airport Authority board on Friday is set to approve a long-term land-use plan that will help steer future development in and around Indianapolis International Airport and its five smaller fields for decades to come.

Last year the authority hired international aviation consultancy Landrum & Brown to develop the plan, with input from local government and business leaders.

Those leaders during meetings last month raised a number of issues, including the need for some types of financial incentives to compete with those offered by other communities, such as tax abatements.

Another theme was that the authority, when it leases land for development, grant long-term leases–in some cases 55 years–so developers can better secure financing and boost investment interest, according to a memo prepared for Friday’s meeting.

“It is the intent of the IAA to lease, not sell, land development sites and to look to the private sector development community to assume financial risk on future development opportunity,” said the memo.

The resolution the board will consider Friday states that “wherever and whenever practicable” the authority will return designated airport real estate, developed for non-aviation purposes, to the tax rolls.

For years jurisdictions such as Decatur Township have complained that the expanding airport land holdings, which are tax-exempt, has hurt its tax base.

The ordinance also states that the authority may consider offering incentives for real estate development, including incentives in cooperation with other government entities.

Preliminary portions of the report released last fall were not particularly revolutionary, echoing existing development trends over the last several years. For example, the site of the old airport terminal, just west of Interstate 465, is recommended for airport-centered usage, given its close proximity to runways.

The potential for development themes that take into consideration high-speed rail or commuter rail connections with the airport are also explored.

On the south side of the airport, the plan notes that the authority has long-term future plans for a third parallel runway, and notes the potential for air cargo-related businesses to cluster there.

What may be more interesting are extensive revenue and cost projections for the next 30 years, which will be included in the final version of the report.

Airport officials today declined to release a copy of the final plan to be considered by the board Friday, saying it was still being amended.