INDIANAPOLIS — If the City-County Council approves a proposed Mile Square Economic Enhancement District and its initial $5.5 million budget next month, apartment building owners in the heart of the city will face an average annual fee of $36,000 to support cleaning projects, additional public safety and services for homeless persons and a low-barrier shelter.

When a proposal for a similar district was floated in 2019, the Indiana Apartment Association and the owners it represents were instrumental in their opposition to the plan.

Four years and a reworked ordinance haven’t changed the IAA’s position.

“We have already seen a decline in occupancy in both residential and commercial buildings downtown,” reads a statement from IAA President Lynne Petersen released following November elections for council and mayor. “This new unlimited tax is an additional financial burden that will only exacerbate the problem. The EED is even less reasonable than past efforts to raise taxes because, this time, owners were intentionally excluded from the conversation so the city would have fewer hurdles and less accountability.”

City-County Council President Vop Osili, Downtown Indy Inc. and the Indy Chamber have conducted listening sessions and conversations with downtown property owners to advise them of the proposed district ordinance.

“As this proposal moves through the council and then the legislature, we encourage city and state leadership to oppose the added tax and instead seek ways to support downtown businesses and residents rather than adding to their financial difficulties.”

Eric Gershman, Principal of Gershman Partners, which owns of several downtown properties including the Ardmore, has come out in favor of the proposed district.

“The EED is an investment in the success of downtown,” Gershman said. “We’ve seen the benefits of the targeted improvements in safety and cleanliness and believe that this long-term sustainable funding will make a difference for businesses, workers, and visitors, and encourage the continued growth of our residential population downtown.”

The proposed ordinance was introduced before the council Monday night and set for a public hearing in front of the Metropolitan Development Committee on Nov. 20 before returning for a full Council vote December 4th.

An updated ordinance proposal will include a funding formula that estimates annual fees of $250 for residential property owners, average approximate yearly fees of $16,000 for office buildings, $36,000 for apartment complex owners and an average levy of $38,500 for hotels.

The EED will be overseen by an eight-member appointed board with at least five downtown property owners.

Fees collected by the EED would be reflected in Spring 2025 Marion County property tax bills and raise revenues to pay for cleanliness and maintenance work by Downtown Indy Inc., enhanced public safety, off-duty IMPD officers and continued homelessness outreach and operations of an anticipated low-barrier shelter.

$3.7 million in American Rescue Plan Act funds has paid for 18 months of downtown maintenance and public safety and homeless services.

”We believe there are a lot more people downtown because our efforts are coming to fruition,” said DII Vice President Tim Boruff. “Since January we have picked up 300,000 pounds of trash because of over 30 street ambassadors, or as we now call them, the clean team.

“We’re able to hit those other areas that require more cleaning, more graffiti remediation as well as stickers. We’ve also done more curb painting. You’ve probably seen some of the boxes that have been painted.”

Boruff said outreach teams have provided services to persons without shelter.

”There have been about 250 occurrences or engagements with that population that is part of our downtown fabric, and so we’re able to initiate a pathway that at least gives options to our homeless.”

The ARPA money runs out in mid-2024 at precisely the time Indianapolis will invite visitors from across the nation to Lucas Oil Stadium for coverage of the U.S. Olympics Swimming trials. This winter, Indianapolis will also host the NBA All-Star Game.

Boruff said downtown stakeholders and partners are exploring stop-gap funding options to continue the momentum of a cleaner, safer Mile Square during the year after the ARPA funds expire but before the anticipated EED revenues become available.

”We’re getting a lot of positive comments from our community downtown as to the importance of having a stable financial conduit so that we can continue the great investment that we’re seeing with the ARPA funds, and the response has been very positive,” said Boruff. ”We want to keep the accelerator down and the gas moving forward. It’s important for us to showcase a vibrant downtown to those well beyond Indiana.”