Judge rules against state agency denying tax incentive to Ark Encounter

Posted | Contributed by LostKause

A religious group building a massive Noah's Ark tourist attraction in Kentucky has won a legal battle over the state's withdrawal of a potential tax incentive worth millions. A federal judge ruled Monday that Kentucky officials violated the ark builders' First Amendment protections by blocking it from the sales tax tourism incentive that could have been worth up to $18 million.

Read more from AP via WCPO/Cincinnati.

rollergator's avatar

IMO, tax incentives should be based upon documented community impact (jobs created, employee wages, community engagement, philanthropic efforts, etc.). Otherwise, it's just more shoveling money uphill in the hope that it will trickle down...

You still have Zoidberg.... You ALL have Zoidberg! (V) (;,,;) (V)

By "documented community impact" are you talking about historical (as in actually happened) or as in a paid for study says good things will happen in the future for the community if the project moves forward?

Jeff's avatar

The interesting nuance to me is the difference between using tax money to fund something like this, and not collecting it to fund something like this. They're damn near the same thing to me, because either way it affects the state's income.

Jeff - Editor - CoasterBuzz.com - My Blog - Phrazy

On its face, the tax incentives bother me. But looking at how they would actually work, I am less concerned about them. And I prefer this type of incentive over the local municipality issuing bonds to pay for the project. If the AIG folks build this project and no one shows up, the Commonwealth of Kentucky isn't out any money. And if they do show up, Kentucky still gets 75% of the sales tax revenues from the park (and 100% of the additional sales/bed tax revenues from restaurants, hotels, gas stations, etc paid by visitors to the park) which otherwise would have been $0. Some of the money would have presumably been spent in Kentucky on other forms of entertainment so its not a zero sum game. Though presumably this type of project would bring like minded folks from other states to visit who would not otherwise visit Kentucky.

Bonds that were issued would need to be repaid even if the project never sees one admission. Tax revenues required to pay off the bonds could have been used for other purposes/benefits.

Jeff's avatar

Yeah, I tend to agree with you. I am still troubled by the idea that the state can pick a business to benefit from the arrangement, while openly discriminate on the basis of religion. Is it state sponsored discrimination? Not exactly, but they seem like an accessory in the process.

Jeff - Editor - CoasterBuzz.com - My Blog - Phrazy

rollergator's avatar

GoBucks89 said:

By "documented community impact" are you talking about historical (as in actually happened) or as in a paid for study says good things will happen in the future for the community if the project moves forward?

Happened. Past tense.

I'm not paying *my* 2016 tax bill in April.

But if the project actually needs the tax incentive to work economically, how can it get built/completed without knowing if it would get the tax incentives until after its built/completed and has shown some type of track record of community benefit? And what happens if that community benefit isn't established?

Job discrimination is problematic (at least on its face). But religious affiliated organizations have some leeway with respect to hiring. They also get certain tax benefits (non-profit status, access to government benefits such as roads, sewer systems, etc).

It may be that I am biased by living 40+ years in Ohio. But if a business is willing to bring a project to the state which will bring jobs with something that isn't illegal and taxpayers don't need to spend any money to get it (other than foregoing a portion of sales tax revenue it wouldn't otherwise get without the project), I tend to be in favor.

Years ago, I remember when the federal government was looking to close several processing centers. A proposed list of locations to close was circulated. Cleveland was on the list. It was something like 50 jobs. Or maybe 100. But definitely not 5000 or more. When state and city leaders convinced the Cleveland location to be spared, folks in the area celebrated. Channel 5 even led the nightly news with the story. At the same time, San Francisco was lobbying to get its location included on the list because they had a better use for the location. I get that the jobs meant a lot to those who had them. But the difference was telling.

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