Blue Elk developer seeking town’s support for grant application

This map from the Indiana Department of Natural Resources shows the Blue Elk parcel, as of July 2014, and surrounding area. The blue shaded portion is the floodplain. The beige shaded area is the floodway. This map does not reflect changes that Blue Elk owner Steve Alexander would like to make to Salt Creek.

The owner of 72 acres near Nashville that’s been envisioned for apartments, a hotel/conference center, a water park and other uses is seeking the town council’s help to apply for about $600,000 worth of state and federal grants to alter Salt Creek.

Steve Alexander and Kitty Hawk Development plan to apply for Lake and River Enhancement Fund and Clean Water Act Section 319 grants in early 2017.

However, they need a government or nonprofit to sponsor the applications.

If awarded, money would be used to develop and implement a watershed management plan for the North Fork of Salt Creek which winds through the property — which is better known as Blue Elk — at Old State Road 46 and Clay Lick Road.

The plan also would affect Clay Lick Creek and Greasy Creek further downstream.

The focus would be “to determine any issues in the watershed including, but not limited to, E.coli caused by failing septic systems, pesticides, petroleum products, solid waste, sediment and nutrient loading,” says the letter of intent to apply for the Clean Water Act grant.

The project might also include creating water retention or receiving ponds. Part of the Alexander property is in the “oxbow” of Salt Creek, where the creek surrounds the land on three sides.

Alexander has owned the property for 20 years. One of the reasons he has not been able to develop it is because it’s in the floodway and the floodplain — the area likely to be inundated during a historic flood.

Alexander said before he develops buildings, he knows he needs to address flood flow concerns and floodwater storage capacity, and the grant projects are opportunities to plan those solutions and improve the natural area as well.

Eric Spangler of Hoosier Aquatic Management, who plans to work with Alexander, went before the Nashville Redevelopment Commission in March with a similar request and proposal for grant sponsorship. The commission told him to ask the town council, and to bring Alexander and more details with him.

At the June 16 council meeting, they talked about the benefits the project could bring to people living along the creek, the potential for economic development and about creating scenic fishing and plein air painting spots.

No drawings were given to either board showing exactly where changes might be made to the land or the creeks. The council asked Alexander and Spangler to come back to the July council meeting with more details.

What the council did see was a notice of intent to apply for the Clean Water Act grant listing 15 local entities as “committed/anticipated partners,” including the Town of Nashville.

In addition, the town is listed as the grant sponsor.

None of the partners listed have formally committed, Spangler said.

The letter listing all of them was sent to IDEM June 1.


Council member Arthur Omberg said it read as if the town had committed to applying — which it hadn’t. He said appeared they were assuming the council would be a “rubber stamp.”

“Our name is sort of taken in vain here,” said council member Jane Gore.

Omberg and town Clerk-Treasurer Brenda Young also brought up concerns about the amount of work that sponsoring the grant would bring upon town staff.

Young’s office would have to handle thousands of dollars more than it normally does and keep track of those invoices, she said. If Alexander’s group were to win more than a half-million dollars in grant money, that also would trigger a federal audit, Young said.

The town would not have to put up any money to apply for the grants, Alexander said. He said the 20 percent match required on the LARE grant and the 40 percent match on the Clean Water Act grant would come in the form of volunteer work and in-kind donations from the community, or cash from his Kitty Hawk group if needed.

The town and other partners would be involved in a steering committee, which hasn’t been formed yet, he said.

Omberg questioned what would happen if the town did sponsor the grant and was awarded the money, but work was not completed as planned. He brought up the fact that none of the developments Alexander has talked about putting there have appeared yet.

Alexander said this is a reimbursement grant; the money is only paid upon completion. His group would have to pay for work upfront, he said.

About the delay in development, Alexander said the lending market hasn’t been right for this large of a project in this size of community. He mentioned a cost figure of $14 million.

“I don’t know if anyone has been going around the country pitching Nashville to lenders as much as I have,” he said.

“I told the council and the plan commission in 1996 that I’m going to be patient. I don’t know how long it’s going to take to convince lenders that this is a community worth investing in or that there’s a market here, but I’m going to keep working on it.”

Council members and redevelopment commission members questioned whether another local entity might be a better fit to sponsor this than the town council.


Alexander has faced several hurdles to developing the property, and the vision for it has evolved.In 1995, the land was going to contain a church, medical offices, roads and parking, as well as three lakes.

In 2009, he was looking at building 62 apartments, costing an estimated $8.8 million.

He tried at least twice to apply for tax credits from the state. His project was not picked. A different developer, RealAmerica, used some of those tax credits to build Willow Manor, Hawthorne Hills and Forest Hills apartments in Nashville and Gnaw Bone.

In 2013 and 2014, the land was pitched as site for a three-story senior apartment building, a four-story hotel and conference center, clusters of homes, an assisted living community and several lakes. When the Nashville-Brown County Stellar Communities bid failed in 2014, Alexander lost a potential way to get more than $7.5 million in state tax credits for the $8.7 million senior apartments project, which was included in the Stellar vision.

In 2014, with the sponsorship of the town, Alexander won a grant to study the feasibility of building a combination hotel-conference center-water park. The report, completed in 2015, recommended an environmental study, but overall rated the site as “very good.” It did not determine how successful the hotel might be in the Brown County market.

Alexander also has talked about eventually developing the “oxbow” portion of the land into a shopping area along State Road 46, which runs along the south side of the property.

Because the land is in floodplain and floodway, Alexander also would have to ask the Indiana Department of Natural Resources for permission to build on it and would have to raise the land several feet, to roughly the elevation of State Road 46.

Sara Clifford has been raising a family in Brown County since 2005 and leading the Brown County Democrat since late 2009. In addition to editor, she is the beat reporter for town government and writes columns, features and general news stories.