Downtown Iowa City tax district approved

IOWA CITY - The City Council Tuesday night approved a downtown tax district that supporters hope will help revitalize the downtown retail market.

The council voted 4-0 on the third and final vote needed to adopt a self-supported municipal improvement district, or SSMID, covering downtown and the Northside Marketplace. Members Terry Dickens, Connie Champion and Mayor Matt Hayek abstained because they own downtown businesses.

The district, which the council took up after being petitioned by downtown property owners, will require commercial property owners within its boundaries to pay higher taxes.

The levy will be $2 per $1,000 of taxable value, taking effect in July 2012 and lasting four years. It could be amended or renewed through a similar petition process.

That will generate an estimated $282,000 a year, according to the city. The tax-exempt University of Iowa will contribute another $100,000 annually.

The money will be used to hire a business development manager and assistant manager for the downtown, market the area and undertake beautification projects.

Support has not been across-the-board, however. A counter-petition garnered the signatures of 24.5 percent of the property owners representing 19.5 percent of the property value in the district, though it was not enough to derail the proposal.

Detractors have said taxes are high enough already, the cost will be passed on to tenants and some people have questioned the district's proposed budget. No one spoke against the idea at Tuesday's meeting.

The district will be led by a board of directors with 14 to 19 members, most of them large and small property and business owners in the area.

A five-person committee will pick the initial board. That committee is made up of Nancy Quellhorst of the Iowa City Area Chamber of Commerce, Joe Raso of the Iowa City Area Development Group, Doug True of the UI, Jeff Davidson of the city and Josh Schamberger of the Iowa City/Coralville Area Convention and Visitors Bureau.

Nominations to serve on the board are due by 5 p.m. Dec. 23. For more information, email Schamberger at Joshua@iowacitycoralville.org. (The nomination form is embedded below.)

Although the levy won't take effect until July, district organizer Karen Kubby, a downtown business owner, said the first board meeting could be Jan. 12. The UI said it would start its financial support in January to fund the early effort, she said.

SSMID Nomination