State suspends $18-million tax incentives for Ark Encounter after 'breach of contract'

State suspends $18-million tax incentives for Ark Encounter after 'breach of contract'

WILLIAMSTOWN, Ky. (WHAS11) -- The replica of Noah's Ark has the Mayor of Williamstown flooded with concerns.    

“I'm not sure what will happen next, disappointment is there,” said Mayor Rick Skinner. 

The biblical tourist attraction, Ark Encounter, has brought hundreds of thousands of people to the small town in Grant County, Kentucky, so Skinner said he had to hire more fire fighters and police officers to keep things safe. The Safety Assessment fees are not cheap. 

“The budget for this year, it starts July 1, for the added expenses was $715,000, $700,000 of that would project from the Ark. 

The plan was to take .50 cents from every ticket sold. The Mayor told WHAS 11 News days before that charge would take effect, the ark founder, Ken Ham, sold the land the Ark sits on to his own non-profit, Crosswater Canyon. for just $10.00.

 That makes Ark Encounter exempt from the safety assessment fee. It also makes Ark Encounter exempt from property taxes. 

“This year we're standing to get 45-thousand from the ark in property tax.  Of course, that would go away if they become a non-profit and elect not to pay property tax, which everyone thinks this is leading to,” explained Skinner.    

The switch from for-profit to non-profit is also grabbing the attention of the Commonwealth. The Ark Encounter was set to receive 18-million dollars from the state of Kentucky over ten years as a for-profit entity.

“When they became a non-profit entity, they became in breach of their contract,” said Laura Brooks with the Tourism, Arts and Heritage Cabinet. 

She told WHAS 11 News the state was not informed of the change, and uncovered it themselves almost a month later.  The Ark Encounter hasn't received any of that $18 million from the state yet, but Brooks says if it doesn't turn back into a for-profit attraction, they may never get it. 

 As for Williamstown, the Mayor said he expects to get paid by the ark, one way or another.

“I'm hopeful we'll get through this and negotiate something that both Williamstown and the Ark can live with, but I'm very disappointed in the whole situation,” said Skinner.

Spokesperson Mark Looy from Ark Encounter told our news partner, the Courier-Journal, in part that "We don't believe that the transfer of the property created a default, but we will comply with the concerns that the tourism department may have related to the transfer."

It's not clear how they will comply, but Ark Encounter will have 30 days to respond to that breach of contract.  

© 2017 WHAS-TV


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