Oops! Greensburg short $3.6 million in development taxes

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Human error is being blamed for a $3.6 million shortfall in tax-increment finances in Greensburg, the southeastern Indiana city where Honda Motor Co. is building a $550 million plant to assemble its Civic compact car.

The Tax Increment Financing Board based its anticipated revenue on current assessed value of property in a TIF district where a Wal-Mart is located, according to the Greensburg Daily News. Instead, the revenue should have been calculated based on an increase in value of the property.

The period affected by the mistake spans 2003 to 2006.

For 2007, the TIF fund will receive $500,000 instead of the expected $1.7 million.

The mistake was brought to light by the accounting firm H.J. Umbaugh, which tracks the finances. “Human errors are made all the time but something of this magnitude is very unique,” said Umbaugh representative Todd Umbaugh.

It wasn’t immediately clear whether the shortfall will affect commitments to develop the Honda project.

The plant, one of the most coveted economic development projects in the country when it was announced last summer, is expected to employ 2,000 when it opens in fall 2008.

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