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Small pool of voters to decide fate of proposed CID sales tax

Justin Addison Editor/Publisher
Posted 8/19/20

A select group of voters will have the opportunity to make a big decision for downtown Fayette. The Fayette city council in June gave unanimous approval to establish the Historic Downtown Fayette …

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Small pool of voters to decide fate of proposed CID sales tax

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A select group of voters will have the opportunity to make a big decision for downtown Fayette. The Fayette city council in June gave unanimous approval to establish the Historic Downtown Fayette Commercial Community Improvement District (CID) in downtown Fayette. Now it’s up to a select group of voters to determine the mechanism for how the District will be funded.

The CID board is asking to levy a 1-cent sales tax on purchases made inside the District. Ballots have been mailed to qualified voters who both reside inside the district and are registered to vote here. The ballot asks for approval of the tax, which will be added to the existing sales tax. Funds collected would finance the CID and future downtown improvement projects. All such projects must be approved by the CID board.

Election Day is August 25, 2020, for those qualified voters.

In the spring of this year, a community survey was conducted in Fayette and the surrounding area regarding the historic square and business district. Overwhelmingly, the results indicated that the downtown district is a critical part of Fayette. Of those respondents, 99.2% said that the square is an important icon in Fayette. However, 94.1% of the respondents indicated that they are not satisfied with the current status and appearance of the square. More than 96% said they would support a financial investment in the square, with 91.6% indicating favor of an additional 1% sales tax within the (then) proposed district.

Survey takers answered a series of questions about dining, shopping, and other business transactions, and related support of downtown businesses if the square were improved. The responses, again, overwhelmingly championed improvements to the downtown area.

The CID, once funded, will exist to fulfill a variety of financial incentives for owners of local businesses and buildings. Possible projects include the financing of engineering estimates to improve downtown historic buildings, helping business owners improve facade appearances, refurbish downtown sidewalks and crosswalks, improve the function and appearances of streetscapes, and provide support for Fayette Main Street, Inc.

Proponents of the CID suggest that while financial investments made will be in the downtown area, the improvements will improve the overall quality of life throughout the entire town of Fayette and surrounding areas.

“Fayette is a vibrant town with so much to offer our citizens, CMU students and families, and visitors to our town. An attractive and vibrant downtown is important to each of us that live, work, and visit Fayette. A fully funded CID will assist in keeping Fayette strong,” said Mike Dimond, Executive Director of Fayette Main Street.

But while the petition to install the CID drew the required backing of more than 50% of property owners inside the district, significant opposition does exist. Critics suggest that the additional sales tax could not possibly generate enough revenue to adequately help save Fayette’s downtown buildings, most of which were built more than a century ago. Several downtown buildings are in terrible states of disrepair, and the costs associated with making necessary restorations would likely far exceed any financial assistance provided by the CID.

Other objections surround the funding of private business improvements with the use of sales taxes. Further plans to fund the CID would likely come by way of property tax abatements, which would funnel a portion (likely 50%) of property taxes paid by owners inside the district to the CID. Property taxes fund such entities as schools, libraries, fire departments, and ambulance districts, which locally would see reductions in revenue.

However, proponents suggest that new businesses and property improvements brought here because of the CID would eventually offset those revenue shortfalls, and, in the long term, provide an overall greater tax base. CID’s have been used by several towns across the state.

“We’re doing this to create generational lasting change downtown,” said Michael Bugalski, President of the Moberly Area Economic Development Corporation, during a presentation before the Fayette R-III Board of Education in May of last year. “Once you put these programs in place you’ve created a mechanism that rewards investment in buildings.”

“We know what the last 20 years have looked like for the downtown district, “Bugalski explained. “What do we want the next 20 years to look like? Downtown Fayette has been on a trajectory of decline steadily.”

Other cities such as Moberly, Marceline, and Excelsior Springs have implemented such programs to successful ends, he explained.

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