AUBURN — Changes to the city’s tax incentive districts made Monday night will restructure how ice arena property taxes get paid.
Councilors voted 5-2 Monday to take Auburn’s new Norway Savings Bank Arena out of a larger tax increment finance district and put it in one of its own.
According to the deal, the 8.5 acres around the arena become TIF District 18. That money, about $150,000 per year, will be refunded to developer George Schott.
“But it does not help George Schott one cent,” Economic Development Director Roland Miller said Monday. “What it does is help the city because it lessens our monthly payments.”
The ice arena opened partially last month. It is just off of Turner Street near the Auburn Mall and overlooks Shaw’s Supermarket and Center Street. It’s surrounded by 380-space parking lot. The second ice surface should be finished in January with the second floor mezzanine, with warm areas for spectators, offices and concessions, opening in February.
A grand opening is tentatively set for early February.
Schott built the ice arena to the city’s specifications on land he owned behind Shaw’s. According to plan, the city leases the facility from Schott. Rink revenue is expected to cover most of the costs.
Under the lease, the city is responsible for paying the property taxes, either rebating back to Schott in a TIF agreement or in monthly installments.
“He even agreed to float the payments for 10 days, so we don’t have to pay interest on that,” Miller said. “The way this is structured, he goes in and writes us a check for the property taxes and 10 days later, we rebate that back to him.”
Miller said the rink is operating as a private business, despite Schott’s involvement.
“It was built as a public facility and it’s being operated as a public facility,” Miller said. “It’s not meant to generate a profit but to support itself. But if there is a profit, that money can go into an enterprise fund that will support the city and pay for the facility and other things the facility might need.”
Councilors approved the change by a 5-2 vote, with Councilors Belinda Gerry and Tizz Crowley opposing it. Crowley said she should rather collect the taxes from Schott, putting them in the city’s general fund.
“To me, it’s a benefit to have taxes paid by the people using the facility that would show up in the rental cost,” Crowley said.
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