Fountain Square tax plan passes committee after lengthy debate - 13 WTHR Indianapolis

Fountain Square tax plan passes committee after lengthy debate

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INDIANAPOLIS -

Plans for the city's first-ever Economic Improvement District (EID) have come under fire as a council committee decides whether to give it the go-ahead.

Monday's hearing, which drew a big crowd, lasted more than two hours before the plan passed out of committee by a 6-1 vote. It now moves to the full council. 

An EID allows non-residential property owners to impose a tax on themselves to pay for area improvements.

Several business owners in Fountain Square have been pushing for an EID to fund things like advertising, more bike racks and security cameras, but the plan has attracted growing opposition and well beyond the district's boundaries.

Linton Calvert a leading proponent is frustrated by the pushback.

"We all hate paying taxes," Calvert said. "I don't look at it as a tax, but a fee, and it's only for five years unless we vote to take it farther. It's not the city's money, but our money in our checking account and we then spend it."

Under the proposal, building owners along Virginia Avenue and parts of Prospect and Shelby streets would all pay a tax based not on their property's assessed value, but their linear footage. They would pay $12.28 per foot of sidewalk frontage.

Calvert, who owns the Fountain Square Theater Building and businesses within, would pay on 300 feet, or more than $8,400 a year, more than just about any other property owner.

The average property owner would pay about $1,500.

Calvert says 63 percent of property owners signed on to the tax, more than the 50 percent required by state law. Hardware store owner Larry Kaseff wasn't one of them.

Kaseff said, "Our property taxes went up 40 percent six months ago and then you add on another $1,000 you pay or whatever? Secondly, if you have many tenants, you can easily hide that among the tenants. You can raise rents and rents will go up."

Plans for the Fountain Square EID are also drawing opposition on Mass Avenue, where some business owners have considered pursuing the same tax. Bill Pritt, who owns 45 Restaurant on Mass Avenue said, "I'm not opposed to paying more if it benefits the community, but I want to ask a lot of questions."

Pritt said he feels the process has been too closed and driven too much by community development corporations and non-profits versus the property owners. He was among a group of Mass Avenue business owners planning to speak out against the Fountain Square plan Monday night.

Democratic councilor Brian Mahern, a sponsor of the EID for Fountain Square was also having second thoughts.

"I'm increasingly troubled by the information I'm receiving," he said. "(EIDs) may hold great promise for us doing economic development in the city, but we need to make sure we don't set a bad precedent."

Dawn Kroh, who heads the Fountain Square Merchant's Association, hoped the council committee would approve the plan saying there would be a "ripple effect," which would benefit more than the business district.

"The more opportunities we have for employment, for places for people to work, eat and play, the better it is for people who have lived here a long time and for the new folks moving in," Kroh said.

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