A committee of the Indianapolis-Marion County City-County Council last week postponed until Feb. 2 a vote on whether to allow the city to issue $98 million of tax-increment financing bonds.
The delay gives the Economic Development Committee time to digest changes made to the initial financing proposal. The changes would not allow the city to pay more than 6.5%, down from the original 8.5% cap, and give the City-County Council authority to review Indianapolis’ role in the project after it gets started, according to local news reports.
Under the current plan, Indianapolis would float up to $98 million of TIF bonds to fund construction of a new campus for pharmaceutical giant Eli Lilly & Co., which is the city’s largest private employer.
The so-called North of South development would feature a boutique hotel, a new YMCA, apartments, and retail space. The full project would cost $155 million and feature financing from a variety of private and public sources.
JPMorgan would be senior underwriter. Horwath LLP is financial adviser and Barnes & Thornburg LLP is bond counsel.
The debt would feature a pledge of revenue from Indianapolis’ sprawling and lucrative downtown TIF district. The city does not expect to have to tap existing revenue.
The deal would also carry a moral obligation pledge from the triple-A rated municipality.
The developer is expected to make most of the debt-service payments from income generated by the project.
