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Some anticipate delay in council decision
Asheville City Council is scheduled to consider the proposed Business Improvement District plan at a public hearing Tuesday, though a city official said Thursday that it’s likely council would delay its decision.
The district plan — often shortened to BID — is a special municipal service district that uses an additional property tax to provide certain services within a designated area.
Asheville’s Downtown Management Committee and an Interim Board of Directors, which are both mainly comprised of downtown property owners, submitted a report on the BID to the city council on May 10. Since then, residents, organizations and business owners in and around downtown have expressed vocal support or opposition to the plan, which essentially encompasses what is now known as the Central Business District.
On Tuesday, City Council may choose to take action on the proposal or delay action to a later meeting. An approval by the council would only define the boundaries and tax rate for the district, said Project Manager Sasha Vrtunski, with the city’s Office of Economic Development. Other decisions would come later.
However, there is a “good chance” the board will delay making a decision on Tuesday in light of recent public criticism of the BID proposal, she said, adding that her opinion was a personal one, not an official staff position.
One major point of contention in the BID proposal has been the establishment of a 17-member, self-appointed Board of Directors.
Some council members and community members have expressed concern at a self-appointed board, and Vrtunksi said she expected there to be some shifting in that proposal.
“There are different models in every city,” she said. “They should be tailored to your community, how your community functions.”
According to the project’s Formation Report [PDF], there are 50 existing Business Improvement Districts in North Carolina, including in Western North Carolina towns, specifically in Chimney Rock, Hendersonville, Rutherfordton and Waynesville.
In the Asheville proposal, of the 13 voting seats on the board, nine seats are specifically reserved for downtown property owners. Five of those nine seats are reserved for owners of property with an assessed tax value greater than $1.5 million, which make up 50 percent of the BID share, according to the proposal.
Approximately 10 percent of the $800,000 needed to fund the district would go toward administration and 13 percent would go toward advocacy and coordination efforts. The majority — or 77 percent — would go toward projects related to the district’s “clean, green and safe” goals.
But the project’s funding model has also drawn heavy criticism.
The BID proposes funding its projects through a combination of an additional 7-cent levy on every $100 of assessed property value within the district, city and county contributions and, in the future, through collecting a portion of sales tax collected from special tax districts in Buncombe County.
The proposal estimates collecting about $500,000 through the new tax, with about $300,000 from the city and county making its start-up budget. Starting the second year, Buncombe County would contribute approximately $130,000 from its sales tax revenue each year to the BID.
The project proposal states that increased sales tax revenues inside of the BID would offset any county revenue directed toward it.
As mandated by North Carolina General Statutes, City Council must approve the boundaries and tax rates for the district before July 31 for the additional levy to take affect this upcoming fiscal year, which starts July 1. And, Vrtunski said, the city must draw a contract with the BID Board of Directors, which would include how the board will be appointed, if it approves the plan.
The owners of Firestorm Café & Books, on Commerce Street, have launched some opposition to the plan, calling the project’s funding proposal a “misappropriation of public funds for private gains” in a public statement released May 29.
Supporters had hoped that, if approved Tuesday, the services mentioned in the proposal could begin as early as fall of this year, Vrtunski said.
But she added that there is currently no money earmarked for the BID in Asheville’s budget, meaning funding wouldn’t be available until the deadline for property taxes in early January 2013.
The public hearing will take place at 5 p.m. in the Council Chamber on the second floor of City Hall, and will include a period for public comment.