Lexington, KY - The Downtown Lexington Corp. is hoping to collect enough signatures from downtown property owners to establish a Downtown Lexington Management District that would assess a pseudo property tax that would go to market and maintain the area.
Initially presented to stakeholders in May, the proposal would collect an assessed value on properties in an area roughly bordered by Vine and High Streets, Short Street, Broadway (including Rupp Arena) and Indiana Avenue in the direct center of downtown to establish a defined area that can be marketed and staffed by a group of paid but mostly volunteer people focusing on beautification and assistance.
"The idea behind the Downtown Lexington Management District Ö focuses a lot more on marketing, and there are some considerations for enhanced beautification and certainly coordinating with the police, but not adding to their staffing levels, and doing an ambassador program that is very common in cities to have people on the streets that can answer questions," DLC President Renee Jackson said.
Under state statute, the establishment of such a district requires that at least one third of property owners in the defined area, representing at least 51 percent of the area's value, agree to an added assessment - in this case, 10 cents for every $100 of property - for a total of $100 for every $100,000 of value. The statute requires that the district then be approved the area's legislative body - in Lexington's case, the Urban-County Council.
The DLC rolled out the plan to members at its annual meeting luncheon, after which there was still some questions in the minds of downtown businesses.
"I wish it was not so much focused on marketing as improving downtown," said Barney Miller, the third generation of his family to own the downtown business Barney Miller's. "Maybe parking, things like that. It seems like it needs to have a more crystal-clear vision before I would ever vote for it. I would need to know more about it."
The area proposed by the DLC has shrunk since originally rolled out in May. At that time the proposed district stretched to Jefferson Street and included Limestone from Avenue of Champions to Third Street, and Miller expressed concern that the emerging corridor along Jefferson Street is no longer in the district.
"It seems like the restaurants on that end of the deal would be getting as much advantage as anybody. I don't understand why they are morphing that out of the picture; that's a little bit of a concern to me. It's a one-for-all, all-for-one deal," Miller said.
According to Jackson, conversations they've had with operators of other similar districts advised them less is more when first launching a district.
Though smaller than the initial May design, the district has expanded since reported in Business Lexington's Weekly Wire in early December. At that time, it included 420 properties and around 300 owners, according to DLC Vice President of Business Development, Kathryn Minton. Since then, 20 to 25 new parcels have been added, including Rupp Arena and the Lexington Convention Center, the north side of High Street from Broadway to Rose, retail property along Old Vine to Ransom Avenue and some areas along Broadway.
Jackson said the Management District's anticipated budget would be around $350,000 to $375,000 depending on how many tax-exempt entities in the district - such as government buildings and churches - opted to contribute. Of that money, around 63 percent would go toward marketing the area, while 15 percent would go to beautification and 5 percent to an ambassador program, which would be staff mainly with volunteers. Of the remainder, 13 percent would go to management of the district and four percent would be charged by the Fayette County Sheriff's office to collect the property assessments.
Incoming DLC Chairman Woodford Webb's company, the Webb Companies, would be one of the largest contributors to the management district, and the Lexington Financial Center, the Big Blue Building, would be the single most assessed property, owing $23,000 per year given its value according to the Fayette County PVA of $23 million.
Webb said while he doesn't like the thought of being taxed more, the district could be good for his properties and the tenants.
"As a property owner, we especially don't like new taxesÖ but if you look at the research, ... we think that it will pay off. It's kind of like a homeowners association in a subdivision neighborhood, where you pool your money together and just improve and market and advertise the district as clean and safe and fun," he said.
Also differing from the original plan, this proposal calls for a five-year sunset clause: If the district were to continue beyond its initial 60-month run, the petition process would have to begin anew with the same set of guidelines for approval.
Around a decade ago, another management district was proposed for the downtown but failed to materialize. Then, according to Jackson, the district was focused on "clean and safe." Many management districts nationwide use their resources to keep streets cleared of trash and will even clear sidewalks during snowfall, as well as employing social workers who can help identify problems within the area and act as liaisons with law enforcement. But Jackson said that is not an issue that needs to be addressed in the central business district, as those issues are currently being addressed by the city.
Currently the only management district operating in the commonwealth is in downtown Louisville and has been for around 20 years.
Of the country's 75 most populated cities, Jackson said, "It's safe to say at least 90 percent of those cities have active improvement districts," and Lexington is an outlier joined by San Francisco and Indianapolis as cities that are not operating such a program.
"I believe that we have a good majority that are willing to sign the petition, but of course until we have those signatures, you just don't know," she said. "But through outreach and education, people are more familiar with them now and seem to be more comfortable with the whole idea."
As for her incoming board chair, the Webb Companies has not made a final decision on whether to support the plan.
"I think so; I think we will," Webb said when asked if the Webb Companies would sign on.
But Jackson said she would like to be able to present to council members for their approval a petition that reaches above the minimum. She hopes that will occur in February in order to allow for the launch of the district at the beginning of 2013.