New Midtown CIDS spark council discussion of CID policy

The city council gave preliminary support to a Community Improvement District at 51st and Main last week. During the debate, the council and mayor discussed the proliferation of CIDs and some concerns about their future impact.

When it comes to community improvement districts – extremely localized sales and/or property taxes mainly to help pay for development – how much is too much?

City Council members debated CID creep last week as they took the first step in creating two of them for Plaza area projects.

One would go for infrastructure improvements for a six-story residential and retail building going in at 51st and Main streets. It would add a one-cent sales tax for 30 years onto business done in 8,500 square feet of retail there.

The money raised would help pay for infrastructure, aiding the developer at no city cost. People buying goods or meals there would pay one cent more sales tax.

In that respect, mayor Sly James told the developer, “I don’t have a problem with it and I’ll tell you why – we’re not paying you a dime.”

But he noted that more and more developers and others are asking for such improvement districts. What happens, he asked, if the streetcar system extends down there and adds one more cent of sales tax for a transportation district? And state officials are talking about imposing an additional one-cent sales tax for transportation statewide.

“At some point it is going to be a problem and we’re approaching that now,” James said. “Frankly, we’re going to have more CIDs than houses…”

(City officials say 33 CIDs have been approved since 2002, many in the last five years, and seven more are pending.)

Councilman Russ Johnson said, “I really think we’re getting into the habit of saying if you’re going to build…put a CID on it.”

It’s bad public policy, he said. “I think we’re moving in the wrong direction.”

Councilman John Sharp said he supports CIDs but “I just have a little pause when we do it for just one building.”

Councilwoman Jan Marcason said the infill development by Van Trust Real Estate was a difficult infill project with neighborhood support. Councilman Jim Glover also spoke in support and said the 176 expensive apartments that come with it could attract new tax-paying residents.

Marcason agreed. “Johnson County people like living around the Plaza,” she sid.

At any rate, James told the developer, “I’m not sure you should be punished for our late enlightenment.”

The action creating the CID ordinance passed 9-2, with Sharp and Johnson voting against it.

Only Johnson voted against the second CID for the Plaza Vista project, which used to be called the West Edge project.

The West Edge effort fell apart among legal battles and was stalled for years before VanTrust came in to resurrect it as Plaza Vista, and officials the city promised a CID for it long ago.

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