West Lafayette Splits $500M in SK hynix Tax Revenue, Advances $85M Sewer Expansion

The West Lafayette City Council voted 8 to 1 on October 5 to approve an interlocal agreement splitting roughly $500 million in projected local tax revenue from SK hynix's $4 billion semiconductor plant in Tippecanoe County over the next 30 years, with 52% going to Tippecanoe School Corporation and the rest divided between the city and county. The council also gave initial approval to an $85 million expansion of its Water Resource Recovery Facility, raising capacity from 10.5 to 15 million gallons a day, with about $22 million of SK hynix's one-time $45 million infrastructure payment backing the bonds. Councilor David Sanders cast the lone no vote, citing a lack of transparency from the Indiana Economic Development Corporation.

SK hynix is effectively funding utility rate relief for West Lafayette residents years before its plant opens in 2029, and the agreement guarantees that cash flow even if the plant never opens. But the city's negotiated 20% local revenue share, above the state's 12% statutory floor, is not written into law. It is an arrangement with the IEDC that a future change in leadership could revise without a city council vote, and a resident lawsuit challenging the SK hynix rezoning has a trial date set for December 2026. This follows our earlier look at NIPSCO's TDSIC cost recovery fight and the SK hynix project's broader utility questions.