What is the BID?
Commercial and nonprofit landowners in the district will pay an annual assessment of 9 cents per square foot, of either the lot or building size, whichever is greater, plus $4.95 per linear foot of lot frontage. Residential property owners with townhouses or condominiums would pay a flat annual fee of $150 per unit.
After a rocky few weeks, the Chattanooga downtown Business Improvement District is back on track to assess its first fee on upcoming property tax bills.
City council members on Tuesday voted 5-4 on first reading of an ordinance that would allow the city treasurer to provide collection services for the controversial district, which requires property owners to pay an annual assessment of 9 cents per square foot, of either the lot or building size, whichever is greater, plus $4.95 per linear foot of lot frontage in exchange for safety and visual improvements.
Initially, the fee was supposed to be collected by the county trustee, per an agreement with the Hamilton County Commission. The commission later reversed that agreement with the city of Chattanooga to provide fee collection services, citing legal concerns, leaving the district without a means of assessing the fee.
Commissioners who opposed the county’s involvement expressed concerns over legal liability, citing a lawsuit filed against the city to stop the Business Improvement District just two days after the agreement was first approved.
While the city moved to have the lawsuit dismissed, claiming the plaintiffs “failed to allege any colorable basis for the challenge to the ordinance,” the resolution stirred familiar qualms from council members who fear legal liability if they get involved in matters of the district.
At Tuesday’s voting meeting, Vice Chairman and District 1 Councilman Chip Henderson introduced an amendment to require the treasurer collect no less than a 2% fee on the roughly $1 million collected in the agreement. The amendment also included a one-year mandatory review of the agreement and stated that the city would not pursue liens or other enforcement actions on the collection of the fee.
Council members Erskine Oglesby, Henderson, Anthony Byrd, Jerry Mitchell and Carol Berz voted in favor of the amended agreement, while members Ken Smith, Russell Gilbert, Demetrus Coonrod and Darrin Ledford were opposed.
“On behalf of the administration, I appreciate the thorough questions that [council members] have brought to the table,” the mayor’s chief of staff, Stacy Richardson, said at the meeting. “I think we have a better ordinance because of your diligence.”
Though the lawsuit and final vote still hang in the balance, Kim White, president of River City Co., a local economic development nonprofit that spearheaded the Business Improvement District, was confident after the city discussion that the district would manage to collect its fee this year.
“It was disappointing since we had been talking to the trustee since the very beginning and that’s what he does, bill for other entities, but we’re moving forward with putting together a nominating committee and the [Business Improvement District] board,” White said last week. “We’re on a pretty quick timeline to get it up and running. We’re going to find an alternative. [Not assessing the fee this year] is not even a consideration.”
The final vote on the city’s collection ordinance will be next Tuesday at 6 p.m.
A hearing on the lawsuit is set to be heard in Hamilton County Chancery Court on Sept. 9 at 1:30 p.m.
In other business, the city council announced during the strategic planning meeting Tuesday afternoon that the Oct. 1 business meeting will be held at 4 p.m., instead of the usual 6 p.m., to allow council members to participate in local National Night Out events.
The strategic planning and agenda sessions will meet at their regular times that day.
Contact Sarah Grace Taylor at 423-757-6416 or at firstname.lastname@example.org. Follow her on Twitter @_sarahgtaylor.
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