By Lindy Thackston
INDIANAPOLIS, IN (February 23, 2015) - A controversial proposal from Angie's List goes before the city's Economic Development Commission Monday.
Angie's List is asking for $18.5 million in taxpayer money to renovate the old Ford plant on the east side. Angie's List would sink $40 million into the project, which would consolidate the company's operations and add 1,000 jobs.
Angie's List has only turned a profit twice in it's 20-year history. The most recent was the fourth quarter in 2014. The announcement was made last week and the stock prices soared. Angie's List cited a growth in ad revenue and a huge drop in marketing expenses.
But the company is saddled with three prior quarters of deficits so Angie's List was in the red on the year, reporting a $10.4 million loss to close out 2014.
Marian University Professor of Finance and Assistant Dean of the School of Business said the request for funds is a red flag.
"Even though their employment and their sales may be growing, it`s just that it's not growing rapidly enough to cover those costs."
District 16 City Councilor Zach Adamson (D) lives near the site.
"If they don`t meet these goals, we get a certain percentage of these funds back to us," said Adamson. "If they don`t meet their goals and they get sold or they go bankrupt, there are a number of protections for the city. But this is a risk. It's like any kind of investment. To be an investment, there's usually some type of risk involved. This one has potential to be pretty substantial."
But Angie's List is confident the cash would help both the company and the community grow.
When news broke of the proposal in January, Angie's List released a statement saying, "There are also protections in the proposals to ensure taxpayer money is protected. Thinking long term, if the project is approved, Angie's List will be paying taxes on two properties, the Ford Building and the parking garage, where no or minimal taxes are being paid now."
The proposal goes before the committee at 5:30 p.m. at the City-County Building.
PROPOSAL NO. 374 - authorizes the issuance of one or more series of economic development tax increment revenue bonds in an amount not to exceed $18,500,000 for Angie’s List, Inc. to provide for the acquisition of the existing 176,000 square foot former Ford Manufacturing site; relocation of the Indianapolis Public Schools facility currently on the property; design, construction, renovation, improvement and equipping of a multi-story parking garage facility; and all acquisition, construction, demolition, renovation, excavation, utility relocation, and equipping of such projects, including streetscaping and landscaping (District 16)