Residents question if tax break violates law

Greenwood officials and a developer say a tax break for the proposed Greenwood Iceplex is necessary, but some residents are questioning if the city is acting outside the boundaries of state law.

Minor-league hockey team Indy Fuel owners Jim and Sean Hallett have proposed the Greenwood Iceplex with up to four ice rinks to be built on 6 acres at Freedom Park. They have requested a five-year, $450,000 property tax break, and the city has also offered to lease the land for $1 a month for 60 years.

In order for a tax abatement to apply to the property, the land must be deemed undesirable or impossible for normal development, according to state law.

City officials say that definition fits the property. Nearby residents opposed to the ice rink complex being built at that location disagree.

The city justifies classifying the property as undesirable on one of the documents filed by the city: “The area has become undesirable for normal development and occupancy due to its location within an existing city park,” a tax break document said.

Greenwood resident Vince Matthews, who moved into the Brighton Estates neighborhood west of Freedom Park about a month ago, questioned how the land where the ice rink is proposed, a portion of which would overlap with tennis and basketball courts, could be considered undesirable.

City officials have declared the site to be shovel ready and primed for development. Past plans at one time included a YMCA being constructed there, with the nonprofit also running the city’s new multi-million dollar water park.

Infrastructure, including utilities such as sewer lines, is already in place at the site, Greenwood Capital Projects Manager Kevin Steinmetz said.

Having some type of recreational facility was always in the plans for this location, Greenwood Mayor Mark Myers said.

Shortly after the Greenwood Iceplex was proposed, Sean Hallett said land at Freedom Park made perfect sense for the ice arena he was wanting to build on the southside.

“When we took a look at Freedom Park, the infrastructure, success of the water park, we thought it would be a great central location to do a project like this,” he said.

Hallett said the tax break is necessary because of the size of the project and the fact that it is being privately financed themselves through equity and debt. During the five-year tax break, the Halletts will pay about $300,000 in property taxes while saving $450,000. The tax break application states that the facility will create five full-time and 40 part time jobs with total salaries of $600,000.

Because the property is park land and zoned only for recreational use, it is a situation that makes it difficult for normal commercial development, Greenwood city attorney Krista Taggart said.

Myers said the tax break is in line with Indiana law, saying the deal is necessary for development to happen on the property.

Courts tend to give cities leeway in making decisions such as awarding tax breaks, so long as the government’s decision isn’t arbitrary or capricious, Franklin attorney and Indiana State Rep. John Young said.

Young said he couldn’t speak to the specific project in Greenwood, as he would need to learn more about it to give a legal opinion, but said that cities tend to have a great discretion on what counts as being impossible to develop normally.

“These issues are fact specific, and bodies that have authority to make these decisions are given a lot of discretion,” Young said.

If a tax break were to be approved and residents wanted to contest it, that would be a civil issue for the courts to decide, he said.

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Jacob Tellers is a reporter at the Daily Journal. He can be reached at jtellers@dailyjournal.net or 317-736-2702.