Indiana Administrative Code
Title 50 - DEPARTMENT OF LOCAL GOVERNMENT FINANCE
Article 8 - TAX INCREMENT FINANCE
Rule 2 - Determination and Use of Tax Increment
Section 2-10 - Apportionment; real and personal property example
Current through September 18, 2024
Authority: IC 6-1.1-39; IC 36-7-14; IC 36-7-15.1
Affected: IC 6-1.1-39; IC 8-22-3.5; IC 36-7-14; IC 36-7-15.1
Sec. 10.
(a) This section addresses the apportionment to restore the base assessment that might be required as described in section 8 of this rule. (This is required only if the percentage of credit on taxes on the current base assessment individual components differs from the percentage of credit on taxes on the captured assessment individual components.) This section deals with a tax increment finance program that includes both real and personal property. (See section 2(b) of this rule concerning the limited circumstances under which personal property may be included in the program.) For purposes of this subsection, it is assumed that the redevelopment commission has adopted a resolution to include twenty-five percent (25%) of depreciable personal property in the tax increment finance program under section 2(b) of this rule and that the base assessment date precedes March 1, 1988. The inclusion of personal property requires consideration of additional factors in the computation of the potential captured assessment. As described in section 9 of this rule, if the assessed values of some of the parcels of allocation area real property are higher than they were on the base assessment date, then the increases may be apportioned, if necessary, to restore the base assessment. Any increases that are not used to restore the base assessment become part of the potential captured assessment.
(b) With respect to each personal property return that includes allocation area personal property, the assessed value of the property on the return as of the base assessment date must be compared to the assessed value of that property on the return as of the assessment date of the current year. If seventy-five percent (75%) of the assessed value as of the current assessment date is equal to or greater than the assessed value as of the base assessment date, then the full remaining twenty-five percent (25%) may be apportioned, if necessary, to restore the base assessment. If seventy-five percent (75%) of the assessed value as of the current assessment date is less than the assessed value as of the base assessment date, then any positive remainder obtained by subtracting the assessed value as of the base assessment date from the assessed value as of the current assessment date may be apportioned, if necessary, to restore the base assessment. In both cases, any amounts available to restore the base assessment that are not used for that purpose become part of the potential captured assessment.
(c) Restoration of the base assessment is required when the following amount is less than the base assessment:
Example
| Column 1 | Column 2 | Column 3 | Column 4 | |
| Parcel A | $10,000 | $24,000 | (1) $14,000 | (1) $10,000 |
| B | 20,000 | 5,000 | 5,000 | |
| C | 12,000 | 18,000 | 6,000 | 12,000 |
| Personal Property | ||||
| Return X | 12,000 | 16,000 | (2) 4,000 | (2) 12,000 |
| Y | 9,000 | 6,000 | (3) -0- | 6,000 |
| Z | 10,000 | 12,000 | 2,000 | 10,000 |
| $73,000 | $81,000 | (4) $26,000 | (3) $55,000 | |
| Column 5 | Column 6 | Column 7 | ||
| Parcel A | $14,000 × .6923 = | $9,692 | (1) $19,692 | (1) $4,308 |
| B | 5,000 | |||
| C | 6,000 × .6923 = | 4,154 | 16,154 | 1,846 |
| Personal Property | ||||
| Return X | 4,000 × .6923 = | 2,769 | (2) 14,769 | 1,231 |
| Y | 6,000 | |||
| Z | 2,000 × .6923 = | 1,385 | 11,385 | 615 |
| $18,000 | $73,000 | (2) $8,000 |
Column 1
March 1, 1986 AV of all parcels of allocation area real property and returns of allocation area personal property. The total of Column 1 is the base assessment.
Column 2
March 1, 1988 AV of all parcels of allocation area real property and returns of allocation area personal property.
Column 3
Column 4
Column 5
From each amount in Column 3, a percentage is used for restoration of the base assessment. The percentage is the amount to be restored (the total of Column 1 minus the total of Column 4) divided by the amount available for that purpose from Column 3 ($18,000/$26,000 = 69.23% or .6923).
Column 6
Note: With respect to each parcel and each return, the amount listed in Column 6 is the amount of the 1988 AV that is taxable by the taxing units in which the allocation area is located. (3) The total of Column 6 is the restored base assessment.
Column 7
