HALLOWELL — The City Council unanimously voted Monday night to reject a controversial proposal to extend a tax break agreement with the Camden National Bank Ice Vault.

Councilors then unanimously voted for the city finance committee to work at its Wednesday meeting on a revised version of the agreement that would not negatively impact taxes.

Facility owner Peter Prescott originally applied for a 20-year, 100% tax increment finance and credit enhancement proposal after the building’s roof collapsed in 2011. The council, at that time, agreed to reduce the agreement to 10 years with an option for renewal after its May 2022 expiration.

The proposed renewal of that credit enhancement agreement would have returned 95% of taxes paid for the first six years, before tapering off to 85%, 75%, 65% and 55% in the final four years.

Hallowell officials must now request that the Maine Department of Economic and Community Development  extend the TIF deadline from March 1 to March 31. The council will then need to hold another public hearing and make a final decision prior to this date.

Monday night’s vote came after a roughly hour-long public hearing and an additional hour of discussion among councilors, Prescott and attorneys.

Out of about a dozen public comments, residents were fairly split on the issue, with slightly more coming out against the amendment.

Eric Nason, who served on the city’s police department for 33 years and who has lived in Hallowell for 50 years, said the arena is a major community asset. Nason said one of its goals was to make youth hockey and figure skating more affordable via fundraisers and donations, and that the Prescott family has donated to youth hockey and figure skating, and also paid out of pocket to help build the arena.

Because of financial hardships following the roof’s collapse, Prescott paid roughly $2 million out of pocket to help cover loan debt associated with rebuilding.

Community member Patty Hewett said she grew up in Hallowell and frequented the arena throughout middle and high school, and that later in life her older son frequented the rink and took public skate lessons, adding that she recently took her 4-year-old son ice skating there for the first time.

“I wholeheartedly support the amendment of the TIF,” she said. “Unfortunately, inflation is hitting everybody. Gas, food, electricity, everything is going up, with the average standard of living in decline. It’s important that we keep the cost of what resources we have affordable for all children and families.”

Andy Couture, who runs a bowling alley and restaurant next to the ice arena, said the restaurant lost 30% to 40% of its business immediately after the arena’s roof collapsed in 2011. Altogether, he estimated that the bowling center and ice rink probably bring 4,000 to 6,000 people each week through the winter.

He said the arena’s presence helps his business, and the community as a whole. “I think we need to do whatever it takes to keep the ice arena going,” he said. “It’s a vital part of central Maine communities and the Hallowell community.”

Hallowell resident Patricia Connors spoke out against the amendment.

“Why are we here tonight discussing whether to give Peter Prescott another half million dollars of tax forgiveness?” Connors asked the council. “He has been in business for over 40 years. If he hasn’t learned how to make a profit yet, why are we subsidizing him for another half a million dollars?

She said that all businesses provide some service to the community, and accused Prescott of claiming that the arena’s services for children’s sports and the food bank make the city indebted to him.

Connors was joined by Phillip Davis of Gardiner, who then shared some research on TIF agreements in Maine. Davis said the 10-year agreement approved by the council in 2011 was among the only TIF agreements in the state returning 100% back to the developer, adding that it occurred at a time when the state average was a 50% return.

“Rather than building in distressed towns as envisioned by TIF law, businesses have used credit enhancement agreements to make well-to-do towns compete for developers by offering bigger and bigger tax breaks,” he said.

Hallowell resident Michelle Truman said that while she appreciates everything the ice arena does for the community, public funds should not be used as a “personal slush fund” for an individual or business.

Prescott also attended the meeting, where he spoke of the facility’s history and responded to some of the negative comments.

He said the ice arena opened Dec. 19, 1973, and operated for 37 years until the roof collapsed in March 2, 2011. In all of those years, he said the taxes were consistently paid, adding that they would have never requested tax agreements if the roof hadn’t collapsed.

And when he and 12 others built the arena, Prescott said it was done not to make a profit, but to break even.

In a 2012 Kennebec Journal interview, Prescott said that back in the 1960s and early 1970s he and others in the area would often drive their kids down to Portland to play on the ice.

“We’d drive to Portland, let them play and drive back and we did it on our own,” he said in 2012. “Gas was 30 cents a gallon and that was a lot of money, so we got the bright idea that we’d build our own.”

Without the TIF and CEA extension, Prescott said the future of the facility is unclear, particularly in light of current issues like the COVID-19 pandemic. Even with the TIF, he said the arena won’t come close to breaking even, but without it, he said more money would be put into the facility, which would result in less financial support given to other community organizations.

“Regardless of what everybody decides,” Prescott said, “we are very thankful for the help we have got up until this time.”