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Land purchase now has potential for great return

Fairly judging the recent purchase of more than 170 acres of real estate located just east of Interstate 74 will take time.

The $4.1 million price tag seems hefty for what is now farm land. But city and county officials have a vision – one that could be both profitable in the long term and essential to keeping Shelbyville in growth mode.

The land purchase deftly moved through several recent city and county meetings with little resistance. The Shelbyville News’ John Walker has been at every meeting to follow the process. In Thursday’s edition of TSN, I tried to simplify the deal and add poignant commentary from both Shelbyville Mayor Tom DeBaun and Brian Asher, Executive Director of the Shelby County Development Commission. 

I even drove out to the property in play and parked on the “stub road” which was created in anticipation of Krone NA building its new corporate headquarters last year on 40 acres at the site. That deal crumbled but the road did not, leading southeast into the 140-plus acres before promptly stopping at a pair of orange and white barrels.

What DeBaun, Asher and many more government officials believe is this property can quickly develop into some sort of industrial park that would bring strong-paying jobs and tax dollars.

And as soon as the contractual language of the deal is hammered out – Krone NA will be paid $400,000 for the 40 acres of land it purchased while First Presbyterian Church will receive $26,000 per acre for the remaining 132 acres of land it owns – Asher will have a large chunk of desirable real estate under one ownership group to pitch to companies.

“We are continuing to get looks but we feel we will get more looks if it’s under one ownership,” said Asher. “When site selectors and companies come in looking at areas, the more owners that are on there, the more trouble they know they will have to purchase that land. Having control of it, city-county owned or the Redevelopment Commission owned I should say, would put that to rest.”

The land has been shown multiple times but dealing with three separate owners (Krone NA, First Presbyterian Church, and the City of Shelbyville, which already owned 10 acres) has been a stumbling block, according to Asher.

Ideally, there would be an announcement soon for a tenant on that property. There is great interest, according to Asher, for the land that will be re-zoned for industrial use.

I know there is a great desire for more shopping and restaurant options in Shelbyville. So I asked Asher if an outlet mall wanted a chunk of land, could that be an option?

“The city and county would take any opportunity to talk to someone,” explained Asher. “Anything can be re-zoned to be whatever you want. But it is geared toward industrial as of right now. That is the most bang for your buck as far as the tax base goes.”

Factories and plants bring strong jobs and a healthy tax base. But I want a big box store (think Lowe’s or Menard’s), a multi-option shopping venue (Target or Kohl’s), and a couple more restaurants where families can have dinner for less than $60.

“An outlet mall is not going to be spending a $360 million investment and ultimately paying taxes on it. It’s going to be much less than that,” said Asher. “And retail jobs pay much less than industrial jobs.

“This investment is geared toward getting more investment in town, which will bring people and bring jobs and, most importantly, increase the tax base, not increase taxes, but increase the tax base. So we get a company come in with a $300 million investment, that’s a great tax base to have. Maybe we don’t get any tax dollars for five years because we’re giving a 100 percent tax abatement, but after five years, you are going to get a hefty amount of taxes coming in.”

And that means more money to spend locally for improvements to infrastructure, parks, emergency services, etc.

Is it a risk for the city and county to purchase this land? It does not appear so. The land can still be farmed until construction on a new facility is needed.

Is it a lot of money? Definitely. But taxpayers are not being asked to foot the bill. Both the city and county have funds available to see this through to fruition. 

For now, each has a healthy chunk of farm land. In the future, each hopes to have a healthy return on their investment.

“This is an asset we’re going to have after 10 years,” said Asher, of when the land purchase will be paid off. “It will be an asset we have or we will have businesses with jobs and tax dollars coming in.”