Consultant recommends consolidation of two downtown development groups

Wednesday, June 18, 2008 | 5:11 p.m. CDT; updated 7:32 p.m. CST, Friday, February 19, 2010

COLUMBIA — Columbia’s downtown organizations are looking to overhaul the way they do business and might eventually propose a new sales tax to finance priority projects.

The two organizations, the Special Business District and the Central Columbia Association, hired consulting agency Progressive Urban Management Associates, or PUMA, to examine what role those organizations should play. PUMA President Brad Segal presented the results of that study to representatives of the groups on Tuesday and Wednesday.

Segal’s plan would bring the two organizations together under one nonprofit business league. The umbrella organization would have a board that meets regularly, while each organization would have a board that meets less often. It also recommends turning the Special Business District into a Community Improvement District, which would have the authority to collect a sales tax in addition to property taxes and business license fees. Segal’s plan calls for a one-quarter to one-half percent sales tax.

The Community Improvement District would be somewhat similar to a Transportation Development District. In Columbia, eight Transportation Development Districts — including Columbia Mall, Grindstone Plaza and the Shoppes at Stadium — collect a one-half percent sales tax. The money collected goes toward transportation projects made necessary when the shopping districts were built.

“You could argue that you need this to compete,” Segal said of the proposed Community Improvement District for downtown. “You’re at a competitive disadvantage if other shopping districts have this and you don’t,” he said.

The Special Business District and the Central Columbia Association work separately on different projects.

The Central Columbia Association, which primarily is responsible for special downtown events and promotions, is funded by membership dues, sponsorships and revenue from events. The Special Business District works on beautification efforts, downtown business recruitment, economic development and historic preservation. It is funded by property taxes and business license fees.

The two organizations operate with the aid of a single two-person staff.

The two groups operate jointly with an annual budget of about $270,000, about half of which comes from property taxes. A one-half percent sales tax would generate about $500,000 in new revenue each year that could go toward the projects of both companies. To create a Community Improvement District, more than 50 percent of property owners within the district’s boundaries must sign a petition supporting the effort. Then, the City Council would have to adopt an ordinance establishing the district, and any property and sales taxes would have to be approved by registered voters within the area.

Segal said about 140 people live within the Special Business District; most are students.

Segal said the sentiment of residents would be a “wild card,” but he said he thinks they could be swayed by an educational campaign focusing on the benefits a sales tax could bring to them.

Carrie Gartner, executive director of the Special Business District and Central Columbia Association, said the sales tax is something that will be considered in the future, though not immediately.

“We’re talking about it now because we don’t want anyone to be caught off guard,” she said.

The PUMA plan also would streamline the organizations’ committee setup. Currently, the two organizations have nine committees between them. The PUMA plan would reduce that to three committees focusing on economic development, operations and marketing.

Segal also recommended better communication with city government, including monthly memos and participation in city projects to develop downtown.

PUMA, whose eventual fee is not to exceed $30,725, put together the report after interviews with about 50 property and business owners and a survey of downtown property owners, business owners, residents and other stakeholders. The consultants also examined budgets and studies of downtown that have already been completed, and they studied downtown management organizations in other cities, including Boulder, Colo.; Cedar Rapids, Iowa; Lincoln, Neb.; Springfield; and St. Louis.

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