Downtown resident releases list of concerns about proposed Business Improvement District

Statement from Inge Durre on the proposed Business Improvement District for downtown Asheville:

Your input is important: The Asheville City Council is said to hold a public hearing on the establishment of a downtown Asheville BID on June 12, 2012, and may vote on this matter at the same meeting. We believe that the opinion of residential property owners should be well represented at that meeting. Please review the questions and concerns stated below and indicate your support of, or opposition to, the BID on the attached petition form. Additional information can be found at http://www.ashevillenc.gov/Departments/EconomicDevelopment/ProjectsInitiatives.aspx and at http://www.downtownasheville.org/bid.html. Some of the residents who are opposed to the currently proposed BID are planning to attend the June 12 Council meeting to present their concerns and report about the results of this survey. Signed forms may be returned to Inge Durre, 100 Coxe Avenue #410, Asheville, NC 28801, or ingedurre@gmail.com. The Mayor is said to publish the City Council meeting agenda on the Friday before each CC meeting. If you are planning to attend the public hearing, you are encouraged to verify the date, time, and location by visiting http://www.ashevillenc.gov/Departments/CityClerk/CurrentMeetingAgenda.aspx , since this hearing has already been postponed once from the originally announced date of May 22.

Summary of our questions and concerns:

1. Self-imposed? The BID Formation Report, recently released by the Interim BID Board, defines a Business Improvement District as “a self-imposed way for downtown business and property owners to fund enhanced services or improvement projects within the district.” Yet the vast majority of owners of residential and commercial property downtown have not had any say in the question of whether they agree to the establishment of a downtown BID, nor have they had an opportunity to select the Interim BID Board members. In fact, the question remains how the Interim BOARD was constituted. There also has been no information published on how members of a future BID Board would be chosen. Furthermore, the Interim BID Board boasts of its endorsement by the Downtown Management Committee, when in fact, 5 of the listed committee members also serve on the Interim BID Board. And, since the final decision on the implementation of a downtown Asheville BID rests with the City Council, the BID would in no way be self-imposed.

2. The purpose of the BID and the composition of its Board are highly skewed towards favoring businesses. The BID materials that were distributed state that the purpose of a BID is to “improve conditions for business activity in downtown, recruit and retain businesses, generate jobs, and improve the quality of life for all who use downtown”. The proposed tax increase for residential and personal property would be the same as the tax increase for business and commercial property. However, residential property owners would receive fewer benefits for the additional taxes we would pay. Therefore, if the proposed BID is established, the downtown residential owners will be subsidizing the downtown business. The Interim Board claims that a BID could increase sales tax revenue by 5%. This anticipated increase would be the result of more sales by businesses and would not directly benefit residential property owners. In addition, all but one of the Interim BID Board members are business owners, and only three of the members live downtown. This is unbalanced.

3. The annual cost of the BID seems excessive and would not be covered solely by a property tax increase. The estimated cost of the BID is $800,000 annually. Approximately 63% ($500,000) of these costs would be paid by an increase in property taxes. It is planned that the additional 37% ($300,0000) would come from the city, the county, and from private businesses and potential other sources. The level of this additional funding has not been secured at this time.

4. Insufficient detail has been disclosed concerning the BID’s funding sources and expenditures. 77% of expenditures ($613,875) are for “Clean & Safe”. How is this ratio related to the primary purpose of the interim BID formation report? Where in the proposed budget expenditures pie chart fall the purposes of further revitalization, business expansion, and job creation? A complete business plan detailing three years of income and expenses would be expected in the private sector, when a business applies for funding. The City must insist on the same level of detail in the BID proposal before making a decision regarding the establishment of a BID for downtown Asheville.

5. Will the proposed tax increase be adequate to cover 63% of the BID cost? The current proposal is to increase our tax rate by $.07 per $100 of the assessed value of our property. This represents a significant increase in the taxes we now pay. The property assessments in other North Carolina BIDs range from $.05 to $.25 per $100 of assessed value. Should we have confidence that the rate of $.07 per $100 is adequate, and will it remain at that level?

6. Residential property owners should be exempt from the extra tax. Since most of the benefit of a BID favors business, it seems appropriate that residential owners be exempt from the extra tax in whatever way this can be achieved. Perhaps there is another option that can achieve the downtown improvement without increasing fees for downtown residential property owners.

7. Has an objective presentation of the pros and cons of the BID been made? While the Interim Board and its predecessors and associates have held several rounds of public meetings and produced printed and online material, all of the information provided has been in favor of the BID. Even though presenters at those meetings indicated a desire to have an open discussion before a decision is made, this desire was not reflected in the way the meetings were conducted. There has been no discussion of the possible different types of BIDs, nor their potential disadvantages for downtown Asheville. Concerns brought forth by meeting attendees tended to be brushed off rather than adequately taken into consideration.

8. Do we need another level of administration downtown? The current Interim Board thinking is to hire a sub-contractor to handle the day-to-day services. This would require office and management staff, office space, and everything necessary to operate a non-profit business. The proponents of the BID are already organized as an Interim Board with significant monetary and staff support from the Asheville Downtown Association (ADA). The ADA is a non-profit organization established primarily to support and assist downtown Asheville businesses. Why does the ADA not carry out the advocacy functions of the proposed BID?

9. What guarantees that the level of direct services the city provides to downtown will not be reduced any further? There is a proposal that would “bind city government to maintain its current level of total spending on downtown”. What is the enforcement mechanism? The percentage of property tax we pay that is returned to benefit downtown has been decreasing each year. Our taxes are intended for all the services and improvements the BID proposes to provide. Instead of increasing taxes on downtown property owners, the City should redirect part of our current taxes to fund the clean and safe services and further downtown revitalization.

All property owners within the proposed BID boundaries should be fully informed about these issues and surveyed for their opinions regarding BID options before a final decision is made by the City Council.