City proposes new rules for CIDs

During discussion of an Uptown Theater/Uptown Shoppes Community Improvement District, the city manager proposed new regulations for the special taxing districts.

posted by Mary Jo Draper

With 31 proposals for community improvement districts (CIDs) under consideration at City Hall, City Manager Troy Schulte says it’s time for the city council to consider establishing guiding principles for their establishment. According to the city website, property owners (usually business owners) can tax themselves for improvements that would benefit the community. Traditionally, CIDS like those in downtown Kansas City and on Main Street use the proceeds to provide additional security, maintain public areas, and for various other purposes.

Kansas City currently lists 11 CIDs that are operating across the city. Some of the earliest CIDs in Kansas City were funded by property owners agreeing to assess an additional property tax on their own property. Many of the newly proposed CIDS would rely on either on a sales tax of up to 1 percent levied on customers of those businesses, or a combination of property and sales taxes.  A petition by a majority of the property owners is required to establish a CID.

The discussion of developing a policy on CIDs came up during the City Council discussion of a proposed CID for the Uptown Theater and Shoppes (previously the Valentine Shopping Center), located at Valentine Road and Broadway.  While those proposing the Uptown district deny it can be called a single-owner application, City Manager Troy Schulte said the city is seeing a proliferation of requests for CIDs, including a number of single owner CIDs.

“So what we’ve got to do is try to figure out some policies that should govern their establishment because what you are doing is taking the one-cent taxing capacity, taking that scarce taxing capacity that the city has in terms of resources. I think we need to be cognizant of the long-term financial impact this is having if we continue to accelerate these throughout the city and what impact this has for the city in the ability to levy sales taxes or property taxes for other public needs as they arise for the future,” Schulte said in a recorded broadcast of Thursday’s council business session.

Schulte said his office has developed a draft policy for the council to use as a starting point for deliberation. The Midtown KC Post has requested a copy of that document.  According to Director of City Planning and Development Bob Langenkamp, there are 31 pending applications for CIDs right now. Of those, eight are single-owner applications.

What do you think? Does there need to be a wider conversation about CIDs in Kansas City?

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