Subscriber Benefit
As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe Now
The Carmel City Council allocated more than $27 million Monday to support developer-backed bonds for four redevelopment projects and to cover a $1.4 million tax shortfall.
Carmel-based developer Lauth Group and Indianapolis-based developers Kite Realty Group, Onyx+East and KennMar each received their requested slice of a total $26.5 million in bonds.
Those developers won unanimous support from the councilors in attendance and are now on track to spend a cumulative $138 million to build offices, condominiums, apartments, public plazas, parking and retail throughout the city.
KennMar’s request for $2.5 million in bonds to assist in its $6 million redevelopment of the Brookshire Village Shoppes garnered 129 letters of support from the community.
“I think that might be the record for the number of comments we’ve gotten at a council meeting,” council member Sue Finkam said.
Central to that project is KennMar’s 10-year lease with Needler’s Fresh Market. The grocer has committed to filling a portion of the 67,000-square-foot retail center last occupied by an O’Malia Food Market in 2017.
Though KennMar’s project garnered the most community support, Kite Realty’s proposed mixed-use development on the southwest corner of 116th Street and Rangeline Road secured the largest bond of the evening.
The council approved a $14 million bond for Kite Realty’s planned $69 million luxury apartment and retail project. Currently, the project is designed to include a 364-space parking garage and 278 apartments above 25,000 square feet of retail space.
Council member Tim Hannon questioned whether there’s enough demand in Carmel to warrant so many luxury apartments before taking issue with 100% of the project’s increased assessed value going back to the developer.
Carmel Redevelopment Commission Executive Director Henry Mestetsky said available tax increment financing isn’t what is drawing developers to Carmel. It’s the housing demand, he said.
“The fact that developers are ready to put in millions of dollars is evidence that the demand is healthy,” Mestetsky said.
Lauth’s planned $35 million mixed-use development at the northeast corner of Rangeline Road and Main Street, in Carmel’s Arts and Design District, also got the $6.5 million bond it needed to move forward.
The developer plans to build a 60,000-square-foot, three-story office building topped with four condominiums on the high-profile site. The project might also feature 70 apartments wrapped around a 325-space parking garage, with about 240 of those spaces available for public use.
Finally, the council approved Onyx+East’s request for a $3.5 million bond for its $29 million residential development just south of City Center, at the intersection of Veterans Way and Monon Green boulevards.
Dubbed Melange, the project is slated to bring 57 multistory brownstones and single-story townhouses to the Monon Trail to offer residents a new supply of for-sale housing.
Also at Monday’s meeting, the council approved a resolution to cover a $1.4 million tax increment finance revenue shortfall.
In April, Gov. Eric Holcomb issued an executive order forgiving late property tax payments for up to two months due to the COVID-19 pandemic. As a result, Carmel collected about $13.5 million in June—roughly 8% less than what it might typically receive.
To cover $13.4 million in June and July bond payments, the council voted to borrow up to $1.5 million from the Carmel Redevelopment Commission’s supplemental fund. Once property taxes are collected, those funds will automatically be deposited back into the supplemental account.
“This is why this fund was put in place, this exact purpose,” Finkam said. “This was good planning on our part to have this here in case something unusual happened.”
Please enable JavaScript to view this content.
Was there any affordable or workforce housing being provided in any of these projects?
Wouldn’t that be nice? Our city leadership attends meetings and says they are in support of affordable options but never actually support this with their votes.
Mestestky and Brainard have insisted there is no risk to the taxpayer when TIF bonds are established. Now they said there is not enough money in the CRC bank account to make the bond debt payment. Therefore they are borrowing against future tax receipts to make current payments. There is obvious financial problems at the CRC. The big question is why the Developer involved in these bonds make up the shortfall? Was the tax money collected on these TIF bonds spent on something else? Carmel has become the City who does anything they want with taxpayer money with no questions asked or accountability.
The estimated dollar increase in Carmel’s total outstanding debt as the result of Monday’s city council actions totals $40.5 million.
Approving $26.5 million in new borrowing would cost an estimated $14 million in interest based on city reports to the Indiana Department of Local Government Finance (IDLGF).
Since January first, Carmel’s total debt listed by the IDLGF increased $26.2 million. The combined new debt now is estimated at $66.7 million ($40.5 million plus $26.2 million).
And all this at a time of unprecedented economic uncertainty.
He’s your great mayor Carmel will be 1 billion in bond debt soon if not already and it will default on its commitment !