A decision made this morning could be a game-changer for efforts to sell the former College Football Hall of Fame building in downtown South Bend.
The potential property tax bill that a private buyer would pay was reduced by some 60-percent, or perhaps by more than $100,000 per year.
“I think it would be a good thing to, for any serious entity that’s looking at the hall to know that the assessed value is $2.45 million rather than $6 million plus so they can help plan for, a tax paying entity, which we hope it is for future tax bills,” said Dave Relos with South Bend’s Department of Community Investment.
The building in question has never generated a dime in property taxes. It has been owned by the city and occupied by a non-profit museum.
Nonetheless, the city appealed the building’s assessed value in the hopes of selling the building to a private, for-profit owner.
“Part of the (St. Joseph County) Property Tax Assessment Board’s purpose, it’s a process available to taxpayers where if you dispute what the assessed value of your property is, there’s a procedure, file your appeal, present your evidence in a competent manner, as the city did here, and, and you get a fair result, I think,” said Frank Agostino, an attorney who represents the tax board.
It’s an odd situation to have an entity dedicated to the preservation of history, to become history itself.
“You have the Center for History, you’ve got the Snite Museum, none of those are for sale or have been for sale,” said Agostino.
That made it hard to figure out what the former hall building was actually worth for the purpose of assessing property taxes.
Today, the tax board decided that indeed, the grass at the hall just isn’t as green since the museum moved out.
“The building is vacant, it’s not generating an income, so if you do it based it on in come approach, the value is essentially zero,” said Attorney Agostino.
The board reduced the building’s assessed value of $6 million to $2.45 million. “I think the board did a good job by lowering the assessed value to a reasonable market rate so you're not going to scare off a potential user,” said Rick Pitts, an independent appraiser hired by the city to handle the appeal.
At an assessed value of $6 million, the annual property tax bill for the hall property could have gone as high as $180,000 (using Indiana’s constitutional 3% tax cap on commercial property).
At the new assessed value of $2.45 million, the annual tax bill would be capped at $72,000 which is a reduction of more than $100,000 per year, or a decrease of some 60 percent.
“There's likely going to be cost and a lot of hard marketing needs to be done but it's a good building, great location,” said Pitts, “It’s just a special use, and it needs to be looked at realistically.”
The city earlier put out a call for offers on the former hall building. Three proposals were received at the end of July. The city has yet to share details about any of the offers and it doesn’t plan to until October