Incentive could hinge on punctuation

The use of a specific punctuation mark in state law could determine whether Greenwood can legally give a nearly half-million dollar tax break to a developer wanting to build an ice rink complex in Freedom Park.

Minor-league hockey team Indy Fuel owners Jim and Sean Hallett have proposed the Greenwood Iceplex with up to four ice rinks 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.

The Greenwood City Council voted 5-4 Monday night to give its first approval for the tax break. The council will need to vote twice more to approve it, but whether the tax break can legally be awarded could hinge on the legal difference between a semi-colon and a period in state law.

The city will have a clause in its agreement with the Halletts in which the city would agree to give the Halletts $450,000 though other means, such as through the Greenwood Redevelopment Commission or Greenwood Parks and Recreation Board, if the tax break is challenged and the city is not allowed to award it, city attorney Krista Taggart said.

Indiana law allows cities to provide tax breaks to businesses, but it lists a dozen categories of businesses that are not allowed to receive property tax breaks. Included on that list are facilities such as racetracks, golf courses and ice skating facilities.

After the 10th item on the list, which covers retail facilities, there is an exception noted that allows a tax break to be given if the facility is located in an economic development target area.

The $450,000 question: Does the exception apply only to the 10th item on the list, or does it apply to items one through 10?

Greenwood city attorneys and officials say the exception applies to every item above it on the list, and that giving a tax break to an ice rink complex β€” the fifth item on the list β€” is acceptable so long as the land is in a economic development target area.

However, Michael Duffy, the attorney for the Indiana Department of Local Government Finance, said that because of the punctuation used in the list, this exception doesn’t apply to ice skating facilities or other businesses on the list. The exception only applies to retail, food and beverage or automobile sales.

Because the economic development target area exception is connected with item 10 with a semi-colon, it applies only to those uses, and doesn’t apply to the remainder of the list, he said.

Duffy declined to give an opinion on whether the specific tax break for the iceplex would follow state law, noting only that under his interpretation of the law, the state legislature doesn’t allow cities to give tax breaks to ice skating facilities. The department of local government finance doesn’t approve local tax breaks, but was contacted by a Greenwood resident who wanted to know if a tax break for the iceplex was legal.

When Duffy’s interpretation was first brought up Monday evening by Greenwood resident Seth Garrett, Taggart dismissed it as being unreliable.

“I have not consulted Michael Duffy on this,” Taggart said. “We have had statutory interpretation issues where we have differed in the past and the attorney general has sided with the city over Michael Duffy.”

Duffy’s response: “She is entitled to her interpretation and to advise her client.”

Tuesday afternoon, Taggart declined to respond specifically to Duffy’s interpretation of the state law or to discuss any issues related to the iceplex before the city has had a chance to talk with the Halletts, who weren’t in attendance at the meeting.

Taggart said the city has consulted with the Barnes & Thornburg law firm, which has said the city council can legally award the tax break if it chooses to do so.

Garrett wanted to know if the law firm had put that opinion in writing. When asked Monday evening after the meeting, Taggart declined to say whether Barnes & Thornburg had made their determination in writing, citing attorney-client privilege.

However, even if ice rinks can be given tax breaks if they are in an economic development target area, council member David Lekse questioned whether park land can qualify for that designation.

In order for a property to be listed as an economic development target area, the land must be deemed undesirable or impossible for normal development, according to state law.

Given all of the development happening in the area, such as the construction of homes, Freedom Springs Aquatic Center and the new Greenwood Middle School, the idea that the area is difficult to develop is is disingenuous, Lekse said.

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

“It’s disingenuous to say we set aside this piece of public property for public use so it won’t be developed and point to that paragraph and say, ‘that’s why it hasn’t been developed,'” Lekse said.

The important question is whether development would happen without the tax break. If the answer is no, then the city can give out a tax break, Taggart said.

Author photo
Jacob Tellers is a reporter at the Daily Journal. He can be reached at or 317-736-2702.