Iowa City Downtown District plans for its next 10 years

IOWA CITY — The Iowa City Downtown District is one step closer to renewing its Self-Supported Municipal District after the Iowa City Council unanimously approved the petition for renewal of the SSMID last month.

The renewal proposal updates property tax levy rates, expands the district’s boundaries, and charts a path for the district’s future through 2036.

The council must approve two more readings of the resolution and, once approved, the new SSMID will take effect next summer.

A SSMID — or, self-supported municipal improvement district — is an area where taxpayers have given permission for the city to levy an additional tax on property owners to raise money for specific purposes within the district’s boundaries. In the case of the Iowa City Downtown District, it provides funding for downtown beautification efforts, business support and additional marketing.

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Expanding the downtown district’s boundaries

The district is looking to expand the current boundary to include the University of Iowa Health Care Downtown Campus — formerly Mercy Hospital — at 500 E Market St. The proposal also includes an expansion to the south. Currently, the downtown district ends just south of Burlington Street, but under the proposed changes, it would expand to the railroad tracks south of Prentiss Street.

Proposed Iowa City Downtown District boundary changes

Iowa City Council will vote on the SSMID renewal proposal at a city council meeting next month.

Source: Iowa City Downtown District

The renewal committee, a group of stakeholders within the district, considered four different boundary plans before landing on the current proposal.

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“We are very specific about being conservative with the growth. If you go too big now you're just trying to represent everyone, and the revenue gained, it does not make sense,” Betsy Potter, executive director of the Iowa City Downtown District, said of the district’s boundaries. “This was something that we thought the revenue gained could adequately provide the services that we foresee needing for not just the expanded boundary, but also increase services that are needed in the core of downtown.”

Part of the boundary conversation included expanding the taxing district to closer represent the public’s perception of downtown. Potter mentioned businesses such as Encounter Cafe or the Green House that aren’t within the district’s current boundary, but are considered part of downtown.

The Downtown District currently has five full-time staff members, the fifth added earlier this year. The district still is in the process of figuring out how to expand its current offerings, such as the downtown ambassadors program and district events, to serve businesses included in the new boundary.

“A lot of what will happen in the next year, year and a half, maybe two years, is right sizing the organization to represent the boundaries. We don't know fully what all the workload will be until we're in it,” said Potter.

District staff members have already begun preliminary work such as updates to the website and expanded committees in preparation for a larger district.

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Renewal for another 10 years

The Downtown District has been operating since 2012 and is overseen by a board of directors that includes property and business owners. The first iteration of the district was for four years, then the board decided to increase it to 10 years in 2016.

Under the proposed renewal, the district would operate from July 1, 2026 until June 30, 2036.

“In 10 years from now, a lot of things change. We wanted the ability to change our boundaries, our levy, all of those things. But also, we wanted the ability to check back in with property owners. … 10 years is a lot in the way that you don't constantly have to be worrying about renewal. But also it's not long enough that people are like, wait, I don't want to sign this because this is forever,” said Potter.

For the first seven years of the renewal, the property tax levy will stay the same, at $2.50 per $1,000 of taxable assessed value. During the last three years, the district’s board of directors has the option to increase the levy to $2.75 per $1,000.

The board of directors always has the option to decrease the levy annually, but cannot raise it more than what’s detailed in the petition.

As a part of the renewal process, the district had to collect signatures from property owners that represent both 25 percent of assessed value in the district and 25 percent of unique property owners.

Comments: megan.woolard@thegazette.com

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