Over the course of a decade, Greenwood has spent millions to help advance projects or attract developers to a prime piece of real estate at Interstate 65 and County Line Road.
Ultimately, those investments attracted five developers, but four withdrew their projects. Now comes Cummins Inc.
The money for those investments — taxpayer funds taken from the city’s eastside tax-increment financing district — has been spent on infrastructure work including widening a significant north-south corridor, and financial and legal teams to draw up proposed incentives for developers.
The city has courted and planned for five different developments, starting with a much celebrated Cabela’s outdoor store and indoor water park 12 years ago.
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Click here to purchase photos from this galleryMost recently, developers planned a massive sports complex and movie theater among other restaurants and retail at the site, but those plans crumbled last year.
Since 2007, the city has lost just shy of $1 million of its investments in the property. Here is where that money went:
- $750,000 on infrastructure improvements to the site in anticipation of Cabela’s, which was in the works for more than two years, such as adding water lines and a retention pond. A portion of that work has to be redone.
- $130,000 to draw up plans for an $18 million loan the city offered Cabela’s as an incentive.
Other taxpayer funds have paid for improvements that remain at or near the site.
After the Cummins incentives are paid, and including the city’s cost to purchase the land and infrastructure improvements that were completed years ago, taxpayers will have invested about $25 million in the site or for a road nearby.
Of that $25 million, $11 million paid for the Graham Road expansion from Main Street to County Line Road, which opened up other land for development, such as the Ulta distribution center and the OrthoIndy medical center.
Every proposed development has fallen through for a variety of reasons. City officials are confident that won’t happen with Cummins, a homegrown diesel engine and electrification company that is expanding in three cities, with Greenwood slated to receive the most expansive of the company’s recently announced growth.
They have promised a total of $41.3 million in taxpayer incentives to five different companies or businessmen, most of which the city never paid out due to protections that were in place and, in some cases, timing.
How the Cummins deal stands out
The most recent deal with Cummins is the biggest incentive package yet, but it also includes more protections for the city than any of the previous deals. For example, if the company does not produce the 500 jobs it promises immediately, the company must reimburse the city the income tax those jobs would have generated. About 500 jobs with average annual salaries of $100,000 is expected to generate about $100,000 annually for the city.
Those additional protections are in place because the city has learned its lesson with this property, Myers said last week ahead of the Cummins announcement.
The city has agreed to invest more money in Cummins than most of the previous projects slated for that property.
Incentives include selling land valued at $5 million for $10, up to $3 million for infrastructure, a $1.8 million reimbursement for the construction of a parking lot and a $1 million donation to the Central Nine Career Center.
Just last year, the city leaders decided in order to improve its chances of developing the property it would pay for all of the infrastructure work that was needed with tax dollars. It is an important piece of land for the city because of its location off the interstate as a gateway for people coming to Greenwood from Indianapolis.
Part of Greenwood’s incentive package for Cummins includes up to $3 million for road improvements and utility installation. That work includes adding sewer and water lines, electrical wires, access roads and traffic signals.
This time, the city bought the land from County Line Partners LLC, which has owned it for years, so that city officials could deal directly with Cummins. They set aside about 10 acres to develop with high-end restaurants, boutique stores, entertainment venues and hotels they’re expecting once Cummins is open.
All along, the city needed some sort of anchor to help spur development east of the interstate, which, for the most part, has not happened naturally.
Ebbs and flows, highs and lows
First came Cabela’s. The outdoor retailer got the most taxpayer incentives and got farther along than any of the other proposed developments. The company went as far as purchasing the property. The city lost $130,000 on that deal by drawing up plans for an $18 million loan it offered the company, and lost another $750,000 on infrastructure improvements such as installing water lines and a retention pond in anticipation of the store. Those water lines must be redone, city officials said this week.
The city also invested $11 million to widen Graham Road, an infrastructure improvement that was needed for any sort of development in that area. That investment remains, regardless of what development occurs on the property. About $640,000 of that road work was specifically for Cabela’s.
Cabela’s proposal, which included a hotel with an indoor water park, was in the works for more than two years before the company backed out and decided to open a store in Noblesville.
Five years passed before another developer showed serious interest in the property.
In 2014, GoodSports Enterprises Global announced plans for a hotel and fieldhouse for indoor volleyball or basketball tournaments and a fitness center, but couldn’t come up with the $22 million needed to fund it. The city offered $2 million for infrastructure improvements. That proposal survived six months.
A year later, Gershman Properties announced plans for the Greenwood Town Center, similar to the Hamilton Town Center in Noblesville. The $90 million project lasted for two years before morphing into something else, with no real explanation why. Again, the city offered $2 million for infrastructure improvements.
In June 2017, Gershman’s plans for the property changed. It was now proposing a movie theater, entertainment venue, a few stores and restaurants valued at about $15 million, alongside Indy Fuel’s newly proposed $25 million sports complex, which the city promised $8.5 million in incentives for, over half of which would have gone toward infrastructure improvements to the site and nearby intersections.
By fall, Gershman’s plans dissolved and the city was left with the proposed sports complex, also known as the IcePlex due to its plans to include skating rinks.
But in June 2018, Indy Fuel owners backed out as well because they could not reach a deal with Indianapolis Power and Light, the property’s utility provider, regarding their request for a $2.7 million rebate on a $5 million energy-saving system. IPL offered $150,000. Duke Energy offered more, but does not service the property at I-65 and County Line.
That was a deal breaker, they said.
What’s at stake?
Fast forward another year.
The recent deal with Cummins is arguably the most promising deal the city has made. Cummins is a perfect fit because it also gives Greenwood something else city leaders have wanted for a long time: high-paying, white-collar jobs, city leaders said.
If this deal falls through as the others did, Greenwood will own the property, which taxpayers paid a total of $7.7 million for. But without some sort of anchor, development of the site isn’t likely, city leaders have said.
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The city has offered a variety of financial incentives for a series of developers interested in the property at Interstate 65 and County Line Road, but none of those projects were built.
While some infrastructure improvements were completed, incentives to the companies were not paid.
Here is an overview of the proposals:
2007: Cabela’s announced plans for a Greenwood store and indoor water park as part of a 100-acre retail and entertainment project. Greenwood agreed to give Cabela’s an $18 million loan for the project, and spent $130,000 to draw up plans for the loan. The city spent another $750,000 on infrastructure improvements to the property, and $640,000 on Cabela’s-related improvements to Graham Road. In total, the Graham Road expansion from Main Street to County Line Road cost $11 million
2014: Greenwood agreed to pay up to $2 million for infrastructure improvements as an incentive to GoodSports Enterprises Global for a $22 million hotel and sports complex.
2015: Greenwood agreed to pay $2 million for infrastructure improvements as an incentive to Gershman Partners for the Greenwood Town Center, a $90 million, 700,000-square-foot shopping center.
2017: Greenwood agreed to pay $8.5 million for infrastructure improvements as an incentive to Gershman Partners and Indy Fuel hockey team owners Jim and Sean Hallett for a $40 million shopping center and sports complex with ice rinks, turf fields and basketball courts.
2019: Greenwood announces deal with Cummins Inc. The city buys the property for $7.7 million, and sells more than 30 acres to the company for $10, with space set aside for a second identical development. The city also agrees to up to $3 million for utility and road improvements, a $1.8 million reimbursement for the construction of a parking lot and a $1 million donation to the Central Nine Career Center.
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A look at the taxpayer-funded investments for the east-side property
$750,000: Infrastructure work at the site for Cabela’s. Some of that work remains; some must be redone.
$130,000: Preparation of legal and financial documents for a potential loan for Cabela’s.
$11 million: Expansion of Graham Road from Main Street to County Line Road. Of that, $640,000 was specifically for the Cabela’s property.
$7.7 million: City’s purchase of 85 acres for Cummins and other developments.
$1 million: Gift to Central Nine Career Center to expand its information technology program at Cummins’ request.
$3 million: Incentive to Cummins to pay for infrastructure work at the site.
$1.8 million: Reimbursed to Cummins after it builds a parking lot
TOTAL: $25,380,000
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