Various economic development programs and incentives are offered to both existing businesses and businesses new to Allen County. Some programs are authorized by state law and administered by the local government such as tax abatement and industrial revenue bonds. The state of Indiana, through the Indiana Economic Development Corporation (IEDC), has programs it administers such as the Skills Enhancement Fund, the Industrial Development Grant Fund and the Economic Development for a Growing Economy (EDGE) Payroll Tax Credit Program.
In Indiana, tax abatement is technically defined within state law as an economic revitalization area (ERA) deduction. The process begins by designating a certain piece of real estate as an ERA. Subsequent investment on that property, within state guidelines, is then eligible for tax abatement. Two types of investments can receive tax abatement - real estate and personal property improvements.
Regarding real property, the purchase of land does not qualify for a deduction; only a structure or building. Abatement is only for the increase in assessed value which means it cannot be applied to the value of existing structures. Activities eligible for abatement include the construction of new structures, additions to existing structures, and the remodel or repair of a structure that results in an increase in assessed value. Deductions for real property can be approved for a period up to 10 years, during which, new taxes are phased in. Only in the first year is 100% of the increase in assessed value abated.
Personal property abatements are for equipment or machinery used for the production, manufacturing, fabrication, assembly, or processing of other personal property. In addition, equipment used for research and development, information technology systems and on site logistical equipment are eligible for abatement. Used equipment can qualify for abatement if not previously used and taxed in Indiana. Like the real property abatement, deductions for personal property can be granted for a period of up to 10 years.
The Allen County economic development staff uses a point system to objectively evaluate applications for ERA designation and determine a recommendation for the abatement period. The Allen County Council or appropriate fiscal body makes the final determination.
Through professional service agreements, the Allen County economic development staff administers the county's tax abatement program for the cities of New Haven and Woodburn, and the towns of Grabill, Huntertown, and Monroeville. The City of Fort Wayne has its own economic development staff that administers its tax abatement program within its corporate boundaries.
Company representatives interested in applying for ERA designation are encouraged to contact the economic development staff to discuss their project and determine its eligibility. The Allen County Tax Abatement Policy can be found here.
To view the annual Tax Phase-In(formerly known as Abatement) analysis prepared by the Department of Planning Services, please click the links below:
The City of Fort Wayne has its own separate policy and application for tax abatement. Please contact the Fort Wayne Community Development Division for that information.
Links to the Allen County and Incorporated City and Town Council/Board meeting schedules are located below:
Industrial Revenue Bonds
Industrial Revenue Bonds and Economic Development Bonds provide a financing method for economic development projects. Bonds can be issued by the County Council which then loans the proceeds to a private company. The company issues a promissory note and the bonds are payable from the payment on the note only. The issuer, the County Council, has no liability.
There are state laws and procedures, as well as federal laws, that must be followed for the bonds to qualify as tax-exempt. The applicant must hire its own bond attorney to provide representation through the approval process.
The use of bonds has decreased in recent years due to low interest rates and readily available private financing which make tax-exempt financing less attractive. However, it is still advantageous for some projects. Those interested in exploring this financing method are urged to first seek the advice of a financial consultant or bond counsel to determine its suitability for the particular project.