A $135 million, 30-acre multi-use development planned for the former Wrecks Inc. property is seeking funding mechanisms for amenities to benefit all of Whitestown.
In addition to apartments and homes, developers Milhaus and Kansas-based Homefield are building a youth sports complex and an aquatic center. Whitestown has already committed $15 million to build the aquatic center. Homefield is hoping to get a boost of financing from numerous public sources including the innkeeper’s tax on room rentals.
Nathan Messer with Whitestown appeared before the Boone County Council to introduce a resolution to divert the innkeeper’s tax from the two hotels to be built on the site to back a $12 million bond for the youth sports center.
The innkeeper’s tax is a 5% tax on room rentals. The two hotels would add 250 rooms and, based on a 60% occupancy rate, would generate enough to pay back the bond. Typically, the tax revenue goes to fund the Boone County Convention and Visitors Bureau or CVB. The tourism council of the CVB approved the diversion. Now the council must vote on it.
“When we looked, early on, at this, we did a feasibility study and projected about 70,000 hotel room rentals a year,” Messer said.
Messer said other taxes could be used to help Homefield build the facility, like the food and beverage tax. But he added only the revenue generated by the development will be used. He said no money is given directly to the developer.
“We make the payment,” Messer said about the bond debt repayment. “They back it. So if their facility went under or the economy falls apart, they’re the ones backing the money. So it’s no obligation on taxpayers. They’re using those self-generated tax dollars to pay for it.”
Projection shortfalls on the investment will be made up through the tax increment financing district for the area.
The youth sports complex and recreation center will be built and owned by Homefield rather than by the town. The company is planning to build 15-20 facilities for youth or amateur sports. Homefield CEO Robb Heineman said in a previous council meeting that the Whitestown complex could be a model for the future of youth sports. Messer said the town spent a significant amount of time looking at other recreation centers owned by towns and cities.
“They are expensive,” he said. “They’re usually tax subsidized to operate.”
There is no name yet for the entire development, but Messer said the complex should be open by 2023.
The aquatic center is estimated to cost $15 million. Details have not been worked out, but Messer said the town will not manage the facility. There is still a discussion on whether Homefield or the hotel owner will manage the water park or whether a third-party management company will be brought in. But he knows the facility will pay taxes. The taxes generated by the project will pay for the cost of the water park, he said.
“We intend to use taxes generated to pay for that,” Messer said. “So it’s not pulling from current taxpayers or affecting tax rates. We’re trying to use all money generated by this project to pay for this project.”
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