Carmel parks, redevelopment officials take steps to resolve differences on use of park impact fees


As local officials clash over the fate of park impact fees in court, leaders of the two departments staking claim to them are aiming for better communication and collaboration regarding their use moving forward.

The Carmel City Council’s land use committee met Jan. 19 to discuss a proposed amendment to the Unified Development Ordinance that would transfer authority to waive park impact fees from the Board of Public Works to the council. A park impact fee of $4,882 is tied to each new dwelling unit constructed in the city and — if it’s not waived — is used by Carmel Clay Parks & Recreation to expand the park system for a growing population.

In the last decade, the BPW – an appointed board – has granted more than $25 million in park impact fee waivers, with approximately half of that total approved in December 2023. In doing so, an equivalent amount of funds has gone to the Carmel Redevelopment Commission for the addition of urban park amenities, such as Midtown Plaza or the Palladiscope, or as cash payments into the CRC’s urban parks fund for yet-to-be-identified projects.

Henry Mestetsky
Henry Mestetsky

At the Jan. 19 land use committee meeting, CRC director Henry Mestetsky said he and CCPR Director Michael Klitzing have historically worked well together on projects involving both entities, and he is committed to ensuring that becomes the norm again.

“There was a period at the end of the last (mayoral) administration where a bunch of agreements went through BPW,” Mestetsky said. “I was not working in concert with (Klitzing) like I could have been, and that won’t happen again.”

In December 2023, just before the BPW approved the latest round of waivers, a judge declined to grant an emergency restraining order sought by CCPR to prevent the BPW from waiving additional impact fees. CCPR is actively seeking an injunction in Hamilton County court but agreed to extend the timeline for the City of Carmel to file its response to give both sides time to negotiate and minimize legal fees, Klitzing told Current.

At the committee meeting, Mestetsky said the waiving of park impact fees is often a crucial negotiating tool in landing quality redevelopment projects.

“I don’t want to put park impact fees into (CRC) projects, I want them to fund park infrastructure, but there are cases where we need flexibility,” he said. “I don’t want to go fund (amenities like pavers) just for fun to help a developer. I want to put it in the urban parks fund so we can fund (projects like) the Japanese Garden. Some of the developments just won’t happen without all the assistance they can get.”

Mestetsky said developers won’t fully commit to a project until it receives council – which he described as “political” – approval, which happens when the council OKs bonds early in the process. Typically, redevelopment projects do not come back to the council after that occurs. Specifics regarding associated park impact fees are typically determined a year or more later, meaning a looming second council vote might become a deterrent to developers, Mestetsky said.

To increase transparency and council oversight, Mestetsky suggested including information about how park impact fees are expected to be used as part of the information presented to the council when it votes on bonds but leaving the vote with the BPW. For projects that aren’t set to use all the park impact fees dollars generated, he proposed the excess amount go to the urban parks fund and that the city council vote on how they are spent. Currently, only the CRC has authority to spend urban park fund dollars.

The committee did not vote on Jan. 19 on the UDO amendment. That is expected to occur at a meeting set for 6 p.m. Feb. 7. The full city council will have the final vote on the matter.