Iowa City zoning commission backs effort to support South District businesses

IOWA CITY — Members of Iowa City’s Planning and Zoning Commission enthusiastically supported a proposal to create a self-imposed taxing district in the city’s south side brought forward by the South District Neighborhood Association.

The seven-member commission unanimously approved a proposal Thursday evening to create a self-supported municipal improvement district, or SSMID, that looks to revitalize local businesses in the Pepperwood Plaza south of Highway 6.

Commission members expressed their excitement before the vote, praising the work of the neighborhood association, including president and co-founder Angie Jordan. Jordan said this proposal also is about neighborhood revitalization.

Board chair Michael Hensch, a South District resident since 1993, said it’s “very concerning” when liquor and tobacco stores thrive but local businesses don’t.

"This may be an opportunity to try to get the scale rebalanced for retail and businesses in general in the South District,“ Hensch said. ”This district is positioned in exactly the right place to be wildly successful in the future, but it's going to take … the right moves.“

With a SSMID, property owners volunteer for a tax to be collected and invested back into the defined area for revitalization. Such districts have been established in the Iowa City Downtown District, downtown Cedar Rapids and Czech Village/New Bohemia.

The South District SSMID would include properties south of Highway 6 in the Pepperwood Plaza between Broadway Street and Keokuk Street.

The petition lists three main uses for the tax: supporting marketing and business retention, enhancing the appearance of the district and hiring an executive director.

Map of proposed South District SSMID

The South District SSMID would cover properties south of Highway 6 in the Pepperwood Plaza.

The SSMID would generate about $104,000 annually, said Wendy Ford, the city’s economic development coordinator. The rate would be $5 per $1,000 assessed value.

The tax levy would begin on July 1, which is the start of fiscal 2023, and last five years unless it is renewed.

The city received nine emails supporting the South District SSMID, including from business and economic development leaders. People also expressed their support during Thursday’s meeting.

Kate Moreland, president of Iowa City Area Development, said the South District SSMID is a “critical economic development tool” and thinks it will be “transformational” for the area. Kim Casko, president of the Iowa City Area Business Partnership, added how benefits also will reach other areas of the city.

Marlen Mendoza, who spoke on behalf of LULAC Council 308, said the SSMID proposal is exciting because it will bring people out to explore the South District and support businesses in the area.

Mendoza noted the neighborhood is “one of the most highly dense and diverse” areas in the city. Earlier this year, Mendoza and Jordan helped organize the area’s first “Diversity Market” to support businesses and entrepreneurs.

“This is beautiful to see,” Mendoza said. “ … You have this in the midst of a pandemic, in the midst of everything that we're going through, people are coming together and saying we're going to come out of here stronger.”

Vice Chair Mark Signs, a South District resident, said the collaboration among residents, business owners and economic developments groups is “what’s going to make this succeed.”

The Iowa City Council will set a public hearing, and the city will notify all property owners by mail. After 15 days, the council can hold a public hearing on a SSMID ordinance, according to the city.

For the ordinance to pass, three readings and approval from three-fourths of council is required.

Comments: (319) 339-3155; izabela.zaluska@thegazette.com