Downtown BID plan hits a snag
The math didn't work Monday for the Mitchell City Council to decide the fate of a business improvement district proposed for eight blocks of historic Main Street.
A final decision was put on hold for at least two weeks, but officials suggested it could take far longer.
The proposed district would tax 72 properties $5 per every $1,000 of their assessed valuation to raise roughly $44,000 each year for improvements to building facades and to add other amenities, like park benches.
The key issue: More than half of affected property owners must agree to impose the tax upon themselves.
Jeff Logan, president of Mitchell Main Street & Beyond, said his group counted support from 40 property owners, opposition from 27, with five undecided. His group has worked on the BID project for five years and began months ago to determine support.
The conversation changed abruptly, however, when Ken Krause, owner of Ameriprise Financial at 119 N. Main, delivered a petition from 40 property owners opposed to the BID.
Krause said he had collected his signatures over the past month. Petition signers are not happy with the status quo on Main Street, Krause said. They're not opposed to improvements, he said.
"They're opposed to this particular project," he said.
Krause said he had never been contacted by Mitchell Main Street & Beyond, and he suggested it not only refine its plan but reach out before returning with a new proposal.
Confusion overtook the discussion. Had people changed their minds? What information had they been given before making a decision?
Logan said he believed many may have decided to oppose the plan based on a mistaken belief that it contained a provision for diagonal Main Street parking. That provision had been removed from the plan more than a year ago, he said.
"This plan has changed a lot over the years," Logan said.
Some on the Council wanted to go ahead with first reading of the ordinance to establish the BID. They said the effort could be shut down later if it was determined opponents had enough votes to block it.
Most Council members indicated they were in support of creating the BID.
Council member Susan Tjarks said the city was ready to invest money in larger Main Street projects, but first, it needs to see that the businesses there are willing to shoulder some costs.
Fellow council member Mel Olson opposed the plan to approve the project on first reading solely because of procedural matters. State law requires a city to terminate efforts to create a BID, if a majority of property owners oppose it.
In view of the petition, he said, the city would be in violation of state law even approving it on first reading.
In the end, the Council tabled the issue for two weeks. Attention will be paid first to the names of property owners appearing on both the support and oppose lists.
Ultimately, the city may need to distribute a ballot to property owners, along with a neutral statement of the BID plan. Doing that would easily extend a delay far beyond two weeks.
Monday's move would have been step No. 3 in creating the BID, but it was the first opportunity for affected property owners to offer comment.
Mitchell Main Street & Beyond envisions the BID could help create an economically vibrant, community minded and walkable downtown. Organizers hope the improvements will help Mitchell attract new residents to fill job vacancies, plus attract area shoppers and tourists. The BID was patterned after other similar projects in Brookings, Rapid City and Aberdeen.
The district boundaries cover both sides of Main Street from The Depot Pub & Grill in the south to Seventh Avenue, eight blocks north. As initially proposed, the tax district would have spread out over a larger area, but officials with Main Street & Beyond determined that plan lacked support.
In March, the Mitchell City Council approved unanimously a resolution indicating its intent to create the smaller Business Improvement District No. 3. There was no discussion. The district would be in effect for seven years and could be extended an additional seven by a majority of property owners.