Downtown businesses will have approximately $340,000 to spend on marketing and improvements for downtown and the North Side Marketplace next year following an Iowa City City Council vote Tuesday night.
Though initial proposals for a self-supporting municipal improvement district were met with concerns from some downtown business owners, the Iowa City City Council voted 4-0 on the ordinance’s final approval Tuesday night. Councilors Terry Dickens, Connie Champion, and Matt Hayek abstained because they operate businesses in the district.
Karen Kubby, the head of the municipal-district committee of the Downtown Association, said she believes the district will be important for central businesses.
"It’s really exciting that downtown entities are willing to pull together like this. It’s hard for us to all be on the same page at the same time," she said. "In putting the municipal district together we’ve, created that same atmosphere."
The levy — which will take effect in January 2012 — calls for a $2 tax from businesses for every $1,000 in taxable value. The University of Iowa also has agreed to contribute $100,000 to the district.
A petition with signatures from 40 percent of property owners supporting the municipal district was initally submitted to council in August.
But some downtown business owners are still against the levy.
"It’s just going to suck money out of us," said Joe Murphy, owner of TCB, 114 E. College St. "We’re going to have to come up with another $3,200 a year."
He also said he does not believe the municipal district will help his business.
"Buses don’t run until 2 in the morning — busing will do nothing for us," Murphy said. "They want to put in parking. We don’t encourage people to drink and drive, so that’s not going to help us.
Marketing downtown Iowa City and bringing businesses downtown is going to raise the cost of being in business in Iowa City with a higher tax and is not going to bring people to Iowa City."
In order for the proposal to be dismissed, a protest petition must be signed by 40 percent of property owners with 40 percent of the assessed value and is submitted before the ordinance passes.
If the tax proves unsuccessful, it is set to expire in four years.
A protest petition was submitted with 17 percent of signatures, which fell short of the 40 percent required for immediate dismissal.
Councilor Regenia Bailey, a longtime supporter of the municipal district, iterated the importance of drawing residents to the central area.
"I really want to highlight how significant shopping local is. It’s important to vitality and all incredible stuff we have downtown," she said. "The fact that business owners downtown have organized themselves and said ‘tax us more’ is a testament to their commitment to downtown, so why wouldn’t we as a community want to grow that and support that?"
