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Ark Transfers Land Back To For-Profit Entity After Tax Breaks Removed

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WILLIAMSTOWN, Ky. (Herald-Leader) -- After state tourism officials took back an $18 million tax incentive from the Ark Encounter, the group has sold their parcel back to the original owner and for-profit entity.

According to the Lexington Herald-Leader who broke the story, the sale took place Monday and cost $10, which is what the owners sold the parcel for initially. 

The issue started in late June after Ark Encounter LLC sold the parcel to its non-profit affiliate, Crosswater Canyon for $10. The deed continues to describe the property as worth $18 million even though the Grant County PVA has assessed the land for $48 million.

Ark Encounter officials have declined to say why they sold the property in the first, but the move in June coincided with their refusal to pay a safety assessment tax levied by the city of Williamstown. The move was believed by city officials to be an attempt to move toward a non-profit status which would exempt the religious park from property taxes.

The park is accused of breaking the agreement for state funding by transferring the property to its non-profit, Crosswater Canyon, without any notification. A notice of breach of tax incentive agreement letter stated that the Kentucky Tourism, Arts, and Heritage Cabinet became aware of the quit claim deed transferring the Ark project land on July 10. The letter says the execution of this quit claim deed was on June 28.

The Ark Encounter released a statement reading, "We have been in contact with the counsel for the Tourism Department regarding the recently received letter. We don't believe the transfer of the property created a default, but we will comply with concerns that the Tourism Department may have related to the transfer. We are appreciative of the support we have received from the governor and tourism officials, and look forward to maintaining a positive relationship with the state long into the future."

On Tuesday, Mark Looy from Answers In Genesis released a statement on the safety tax:

"Unfortunately, much misinformation and many falsehoods have been disseminated by reporters and bloggers about the Ark Encounter and its relationship with the Williamstown city council and a safety tax the council imposed on the Ark. The Ark has never stated it would not pay into the fund. In frequent discussions with the city over the last three months, Ark Encounter leadership had proposed that the fee be capped, and recently suggested a maximum of a half million dollars per year. Ark representatives made it clear that it had concerns about the fairness of the city ordinance, for it makes the Ark Encounter bear almost the entire load for the increased funding to cover Williamstown's budget for police, fire, and EMS. This is a city of 4,000 residents. Ark Encounter leadership has agreed to meet the requirement of the ordinance. Since July 1, the Ark has been adding 50 cents to each ticket purchase, to meet the requirement of the ordinance. Ark officials have tried to negotiate what they believed was a fair approach, rather than an open-ended one to the safety tax, and still meet the city's needs. The filing for an exemption as a religious non-profit (as permitted in the ordinance), was done in an attempt to get the county to change the wording as it currently stands, which would exempt the Ark Encounter. It was not to avoid paying its fair share, as some articles have suggested. "The Ark was offering to pay up to $500,000 a year into the safety fund. The city rejected the offer. To date, more than one million guests have visited the Ark, yet thankfully, calls for emergency services—to both Williamstown and Dry Ridge—have been few in number, averaging about 2 per week.It should also be noted that a user fee is often charged to an individual's personal insurance for the cost of local medical emergency services' response to the Ark. There has been much false speculation about the matter over a deed. The Ark Encounter, LLC, operates as a non-profit because it is wholly owned by a non-profit (the LLC is a pass-through entity for tax purposes), which is in turn owned by non-profit Answers in Genesis. To resolve any issues over the recent change in title for the Ark Encounter property, the property has been conveyed back to the Ark Encounter, LLC, and that deed has been recorded. Grant County has benefitted enormously from Ark tourism. In Dry Ridge, many hotels, restaurants, and other tourist-related businesses are flourishing. In a spirit of cooperation, we encourage the city of Williamstown to work with more hotel developers and restaurant brands to build in the area. For its part, when Ark staff attend various civic functions, they frequently encourage entrepreneurs to build in Williamstown. Summary: The safety-tax matter has been highly misrepresented. The Ark has always been willing to pay into the safety fund, suggesting a yearly cap of a half million dollars per year."

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