Tax bill makes use of old school building unfeasible

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Cole appeals to county council for help

Managing Editor

TELL CITY – Randy Cole told the county council Thursday he didn’t understand why he was successful at the state and federal levels, but was being opposed by the county in attempting to put the former Tell City Junior High School building back into use.

He purchased it at auction in September 2012 for $85,500.

“The property had been assessed – the school had to do that in order to sell it – and it was given a value of $10,000,” he told the council. “It was suggested in the document that possibly a 501c3 should just be given the property because it might be more useful to the community.”

The 501c3 refers to Internal Revenue Service regulations concerning nonprofit organizations. Cole formed an organization called Mozart Inc., and obtained nonprofit status at the state and federal levels.

“I have letters from people that have used it,” Cole continued. They include Tell City Panthers junior-high girls softball head coach Maggie Schuetter.

“Our final season record was 34-7-1,” she boasted. “Part of that record includes a 14U Thunder Classic Tournament from which the girls were the tournament champions for their age division. I truly believe that part of our success is related to your facility. Without the use of the full gym for defensive practices and the upstairs area for hitting drills and exercises, the girls would not have become as strong of players as they now are.”

Chris Hollinden, Tell City Junior-Senior High School assistant principal, thanked Mozart Inc. and Cole for use of the facility each fall to host Lincoln Trail Invitational cross-country meets, which he said bring approximately 500 runners and their families. “Usage of your facilities for parking and restrooms has been a major benefit for the event and allows us to host a quality meet for other schools to participate in,” he wrote.

William Tell Elementary Principal Laura Noble offered thanks in another letter for providing space where new kindergarten playground equipment could be stored until it can be installed this summer. It was purchased at a discount that would have been lost had she not been able to find storage space, she wrote.

Tell City Junior High Soccer coach Kenny Simpson spoke for his organization and others in expressing thanks. “You have made this building into a community facility and we are all thankful you purchased it,” he wrote.

“Cannelton had an issue with their school corporation needing a gym, so they came out and used that facility and … the Cal Ripken kids just used it here a few weeks ago for their tryouts and draft procedure,” Cole said. “So you can see we’re using it for community use. The facility’s been looked at by Ivy Tech as a potential solution to their financial issues. We’ve also had Tri-County YMCA that’s been out to see it and they said, ‘wow, what a great YMCA facility this would make.’ ”

Waupaca has eyed the building as a training site, as well, he continued. “What I envisioned with this is something we could open up to our community, and whether it’s streaming in educational opportunities from outside of here that people could learn new skills … any kind of academics, whether it be a painting class, whether it be anything, we could do it. One other thing that came about in talking with Bev Minto is there are all kinds of different events that you could have.”

He displayed a brochure produced by Indianapolis organization Sports Indiana, which describes sports tourism as “a $6 billion market that provides a large return on a small investment.” It attracts athletes and their families who fill hotels and restaurants and is recession-proof, it goes on, saying also, “many families combine vacation with sports travel, which means more tourism dollars.” Minto is director of the county’s convention and visitors bureau.

Cole said Mozart Inc. received a tax bill. The organization appealed it “and we also sent an affidavit in stating we are a nonprofit operating a facility for charitable, educational uses. It was rejected and … we appealed back that to the state and we have never heard anything on the value of the building (which) went up 157 percent. For the 84 days that it was owned in 2012 – we took title Oct. 10, I believe – the value of the building went up to $134,500.”

It was reassessed again last year at $246,400, he continued, “and now we’re up to 288 percent. … We’ve done very little with the structure other than clean it up, we’ve moved some walls out of there that were temporary. Other than that, we haven’t spent any money on it to speak of.”

If it is to be burdened with tax bills, the building won’t be affordable,” Cole said. An appraiser called it a “white elephant,” saying there’s no demand for large, low-ceiling buildings, so it needs to be used for educational purposes.

Nobody’s going to say, “let me contribute $10,000 to you so you can pay your property taxes in the county,” he said. “What’s really surprising to me is that I thought my biggest battle would be at the federal level,” getting the nonprofit status. “State was fairly easy. But my biggest challenge is the local level, and they’re the ones who are going to benefit from it. That’s what brings me here today.”

He displayed a drawing showing some façade improvements intended to help entice people into the community “look around, spend a dollar, attend an event – maybe they won’t like the event – but they’re here and they’ll visit our community. Hopefully some of them may decide Tell City and Perry County are not a bad place. Maybe it’s a good place to either revisit or maybe even set roots down. That’s our goal.”

“What I’m asking for is support from the council on this,” he continued.

Councilwoman Dianne Rudolph asked who locally is Mozart Inc. battling with.

“It’s the assessor; it’s the value of it,” Cole replied. The value has skyrocketed before any real work has been done, he said, and if the façade work is done, “maybe it’ll go to a million dollars. Now, all of a sudden, we’re paying taxes on $1 million.”

Anyone who wanted to have an event there could be told, “it’ll cost you $5,000,” he went on. “So it completely shuts the facility down.”

When he bought the building, people wanted basketball goals, scoreboards and other components out of it for other communities, but he refused.

People everywhere organize groups and raise money to build community facilities, he said, “but I look at that structure and I say, ‘$85,500 – ground, parking lot, building, a relatively new heating and air-conditioning system, computer-controlled; it’s got all the safety you need for large crowds because it was a school. It’s there. Are we going to just turn our backs on it and walk away? You have to make it pay.”

“What base have you not touched that your tax rate’s not zero?” Rudolph asked.

Mozart Inc. was launched solely because “we didn’t want to see (the building) slip into some other kind of use in the middle of town that would be undesirable. That was the thought process,” Cole replied.

The group appealed the valuation to the property-tax appeal board “but never had a hearing,” he said. “We have one document, which you’ve got, that was sent to us at the end of December.”

It notes that the county assessor may suspend a tax exemption upon learning ownership of a property has changed, but must notify the owner an affidavit is required.

“We were never notified,” Cole told the News Friday.

“Our appeal on valuation has never been heard,” he told the council, and they’ve had no response to a document asserting “that we’re a nonprofit taking it from another nonprofit.”

County Assessor Mendy Lassaline was in the audience and spoke up, saying state law doesn’t say nonprofit status makes an organization tax-exempt.

“You have to apply for the tax exemption at your local property-tax board of appeals,” she explained. “On this particular application, that was denied because … he still really doesn’t know what they’re going to do with it.”

The appeals board can’t grant exemption based on potential uses, she said.

“There was no substantial purpose of what they’re going to do with it yet, so you can’t grant something when you don’t know what it’s going to be used for,” Lassaline said.

Cole said under state law, “right now, I could start a 501c3. I could buy a piece of ground … and for the first four years, I don’t have to have a building plan. After that, I’ve got to have some general ideas, and I have another four years. It gives me eight years (on) vacant ground, tax-exemption.”

“But you’re not vacant ground,” Lassaline said. “You have a building.”

“Correct,” Cole replied. “We have got a huge building. If I come in there and say … for a while it’s going to be vacant until it gets renovated.”

With a building of its size, it’s impossible to put it to 100-percent use overnight, he continued. If money is to be solicited, “you have to know you’re going to be tax-exempt on the local level.”

No one’s going to donate money if they know it’ll go toward property taxes. They’ll want to know it’s going to “something substantial, like renovating a room,” Cole said.

Councilman Stan Goffinet said he’d like to see the building used “and I would like for Perry County to work with Randy on trying to get this going.” He has driven by the building, he added, and has seen the activity there. “I know it’s a great place.”

“If there’s anything done at the facility that’s not tax-exempt,” Cole said, “we can have that exemption revoked.”

Lassaline said Cole was informed that once a specific purpose was established, he could reapply and the board would consider it. One section of the application for tax exemption contains only boxes to check for charitable, educational, religious and other purposes, and Cole checked the first two. Under another “exempt purpose” section, he typed “see attached information.” He said Friday the entire package included approximately 30 pages and described classes, arts and crafts displays and demonstrations, and offerings for people who want to start businesses or improve their skills to become more successful.

Council members said they could offer no help.

“What really is frustrating is that the opposition is at the local level,” Cole said, “the group that will benefit most.”

He has petitioned the Indiana Board of Tax Review for a review of the exemption.