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State approves Ark Encounter tax incentives

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By Jamie Baker-Nantz

The Ark Encounter received good news last week when the Kentucky Tourism Board gave approval to $18 million in tax incentives.
The board unanimously voted on July 26 to approve sales tax incentives for the theme park, which is being constructed off Ky. 36 in Williamstown.
The Ark Encounter is another development of Answers In Genesis, a conservative Christian non-profit that also operates the Creation Museum in Boone County.
The project will feature a full-scale replica of Noah’s Ark as well as the Tower of Babel, a bird aviary, a marketplace and a large, outdoor amphitheatre.
Keith Williams, finance board chairman, said the tourism board evaluated the project like any other that comes before the board and approved the incentives based on an analysis of the project’s economic impact which showed benefits for the state.
Approval of the tax incentives was good news for local officials and developers of the project.
“There are exciting things ahead for Williamstown and Grant County,” said Williamstown Mayor Rick Skinner.
A few days after the tourism board approved the tax incentives, House Speaker Greg Stumbo said it was not appropriate for the state to provide tax incentives to the project “because it erects a monument with the help of state money theoretically that is recognized by a majority religion in this country.”
Stumbo said he believes the board’s approval will mean legal challenges against the incentives and if the state loses that lawsuit the taxpayers will have to pay those legal fees.
However, there are others in state and local government that disagree with Stumbo’s stance.
Rep. Brian Linder, R-Dry Ridge, expressed disappointment over Stumbo’s comments.
“While Kentucky continues to lose jobs to places like Ohio, Indiana, Tennessee and Texas, Speaker Stumbo chooses to attack an economic development project in my community by encouraging lawsuits on tax incentives,” Linder said. “I believe Stumbo’s comments appear to tell those who want to bring economic opportunity to the Commonwealth that Kentucky is closed for business, which only serves to further drive other businesses out of our state.”
Kentucky Senate Majority Floor Leader Damon Thayer, R-Georgetown, has also been a supporter of the incentives for the park. He, too, questioned Stumbo’s remarks.
“Speaker Stumbo does not seem aware that the First Amendment contains two provisions regarding religion, the first is the government may not ‘establish a religion’ and second, nor may it prohibit the ‘free exercise’ thereof. With the Grant County project, the tax incentives are not being used for either purpose.”
Skinner said he has concerns about a lawsuit over the tax incentives, especially because it could delay construction on the $73 million first phase of the project.
“They’ll collect the sales tax and turn that money over to Frankfort and then get 50 percent of it back in the form of a rebate, but the park has to be successful for that to happen,” Skinner said.
“As far as the Ark Encounter, everything the developers have told us has been true,” Skinner said. “There were some issues with financing and the Army Corps of Engineers but I’ve developed a good working relationship with Mike Zovath and I trust him,” Skinner said.
Thayer said the tax incentives were awarded based on the same criteria as any other project, including the number of jobs created and the projected amount of tax dollars the project will generate.
“This project will not only bring jobs to Grant County through employment opportunities at the park, but it will create jobs through new businesses like restaurants, hotels and other businesses not only in Williamstown, but the Northern Kentucky region as a whole,” Linder said.
“Numerous leaders, including Gov. Steve Beshear, are supporting this project because they understand the huge economic benefits it can bring to the Commonwealth, yet Speaker Stumbo would rather stir up issues instead of considering the opportunities this project will provide to Kentucky families,” Linder said.
The finance board will make a decision on whether to grant final approval on the incentives in the next couple of months. The board is waiting on the final analysis of the project by a consulting firm.
The tax incentives, if approved, are good for 10 years. They can be revoked if the project fails to generate sufficient economic activity in the area.
The Ark Encounter had been approved for tax incentives for the entire project in May 2011. It had three years to begin construction of the project, under the program’s rules.
When financing didn’t materialize as developers projected and expected, they withdrew the application and re-applied for just the first phase.
Construction of the other phases on the 800-acre site is planned over the next 12 years.
Zovath spoke briefly to the Grant County Chamber of Commerce members at the July 21 breakfast meeting.
“We’ve been working three years with the Corps of Engineers to get final approval. It seems like we’ve been talking about this with Grant County for a million years but we should be able to move dirt in about a month,” Zovath said.
A community question and answer session is being planned sometimes in the next few months, Zovath said.
The excavation contract has been awarded and approximately 1 million cubic yards of dirt will be moved for the project. That work is expected to begin at any time.
A pre-bid conference was held on July 31 at Williamstown High School cafeteria with more than 120 companies attending.
The projected date for the park to open is June/July 2016.
For Skinner, the project can’t get underway fast enough.
“It is moving,” Skinner said. “It sure has been a long time coming. When it does open, it will bring a number of visitors to the city and I really believe it will re-vitalize downtown.”