Tax issues hit SportsPlex - KWWL - Eastern Iowa Breaking News, Weather, Closings

Tax issues hit SportsPlex

A proposal filed by Waterloo officials shows they failed to request tax exempt status for the Cedar Valley SportsPlex.

To build the SportsPlex, the city partnered with the non-profit Waterloo Development Corporation (WDC).

"It was always a complication of the arrangement that the city wasn't going to take title of the building," said City Attorney Jim Walsh.

Walsh said though the WDC will operate the $27.5 million facility for 8 years, it is essentially acting for the city. So, they shouldn't have to pay taxes.

"Due to this unique makeup, at some point the site failed to properly request the tax exempt status that the WDC has for its organization," city officials wrote in a letter the Black Hawk County Board of Supervisors. "As such, a property tax bill will be sent for the property for this year."

They then ask that the board cancel all property and sales taxes.

This comes at a high point for the facility. Recreational Services Manager Mark Gallagher said they've sold 800 memberships, and are 25% ahead of schedule. Also, the basketball court is nearly finished.

"So in the next couple weeks, we expect to see another big spike with people excited to play basketball and volleyball," Gallagher said.

That includes people like K'von Jefferson, who was at the facility Tuesday.

"I came in one day for a tour and liked everything about it," Jefferson said. "So I said, 'forget it, might as well get a membership, you know what I mean."

WDC president Dan Watters said officials have met with Gov. Branstad, and that he supports their exemption request.

"And [he] explained to us that one government agency doesn't tax another," Watters said. "So he understood and was going to carry the ball for us.

Still, the process could take time to be approved.

"Oh, like anything involving both state government, city government, lawyers and taxes, it's not going to be easy," Walsh said. "Nothing is easy."

According the County Auditor's office, the SportsPlex would incur $20,000 in property taxes this year.

The Board of Supervisors plan to consider the request in the coming weeks.

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