Mass Ave business owners split over proposed district tax

Mass Ave business owners are divided over a proposed tax to pay for improvements throughout the cultural district in downtown Indianapolis.

Opponents have accused the advocates of rigging the proposal to ensure its passage, and they’re urging property owners to vote no on a petition that has yet to circulate.

The Riley Area Development Corp. and Mass Ave Merchants Association spearheaded the effort to create an economic improvement district, or EID, in which commercial property owners would be assessed a fee to pay for common benefits, such as streetscape improvements, maintenance and marketing.

The proposed rate is 0.15 percent of assessed value on commercial properties and half that for buildings owned by not-for-profits, such as the Athenaeum and Old National Center.

Cassie Stockamp, executive director of the Athenaeum Foundation and a member of the economic improvement district leadership committee, said the avenue needs a steady stream of income to stay competitive with other cultural districts. “Fountain Square, Georgia Street—we have to pay attention. We have to differentiate ourselves,” she said.

The EID leadership committee estimates that the fees would raise just under $100,000 a year. That figure could rise substantially with redevelopment of the Indianapolis Fire Department headquarters and former Coca-Cola bottling plant near the district’s northeast end. But the current proposal also would dissolve the EID after 10 years, Stockamp said.

The EID discussion has created a sharp divide among local business and property owners. One of the Athenaeum’s own tenants, Rathskeller Biergarten owner Dan McMichael, is strongly opposed. The Athenaeum’s leases would prevent the fee from being passed on to its tenants, but McMichael said his other properties, the Mayleeno Apartments and a parking lot, would be affected.

McMichael said an additional tax would make him reconsider plans to open another business on the avenue.

“This area’s done well on its own because of private investment,” he said, adding that he feels no threat from other restaurant and shopping districts. “I’ve watched the transition happen before my eyes. Mass Ave is one of the premier areas of the city.”

McMichael is one of 11 business and property owners who signed an opposition letter circulated last month that accuses Riley Area Development Corp. and consultant Schmidt Associates, also located on Massachusetts Avenue, of drafting the proposal to ensure its passage. Others who signed the letter include Forty-Five Degrees bar and restaurant owner Bill Pritt; Sherry and Tom Battista, whose retail and restaurant tenants include Best Chocolate in Town and R Bistro; and Three Mass Ave condominium developer Todd Maurer of Halakar Properties.  

The EID must clear two hurdles before it can be presented to the Indianapolis City-County Council. A majority of affected property owners must sign a petition agreeing to create the district, and those property owners must represent a majority of assessed value.

“RADC and Schmidt continually redraw the boundary of the district in order to reach that magical percentage,” the opposition letter states. “In a recent act of desperation, they have proposed to exclude most residential properties and include non-profit organizations. … Their main reason for pursuing non-profits is to gain the assessed value of the Athenaeum Building and the Murat Center, both of which are owned by non-profit organizations and represent millions of dollars worth of assessed value.”

Schmidt Planner Corrie Meyer said the latest proposal isn’t necessarily assured of passing because it also needs approval from a majority of all affected property owners, regardless of the value of their land and buildings.

If the petition is successful, the City-County Council would be asked to create the EID, and the fees would be included in the 2014 property-tax billing cycle.

Stockamp said the EID leadership committee will hold a meeting with property owners May 8, and the proposal could change again based on their feedback. She said she’s not sure how the petition would fare if it circulated today.

“I think it’s really close right now,” she said.