Iowa City City Council Approves First Vote of Three for SSMID

Iowa City officials are a step closer to creating a special tax district focused on the downtown.

The Iowa City City Council voted 4-0 Tuesday night in the first of three readings to approve the downtown district's Self Supporting Municipal Improvement
District (SSMID). The SSMID is an additional tax levied against businesses in the downtown district that is intended to provided funding for marketing, business retention, and overall organization for the downtown business community.

Mayor Matt Hayek and councilor Connie Champion did not vote due to conflict of interest, as they have downtown business interests. Councilor Terry Dickens was absent.

The council voted on the issue in response to a petition in approval of the SSMID, whose signature holders represented 40 percent of downtown business owners and 50 percent of downtown property value. The proposed levy, $2 for every $1,000 of taxable valuation, had the support of the Downtown Association (DTA) and the Iowa City Planning and Zoning Commission.

Karen Kubby, chairwoman of the Downtown Association, presented the petition  and spoke in favor of the SSMID.

"Our vision is that the Downtown Association would morph into the SSMID, and actually have the resources to get things done," Kubby said.

Kubby said the DTA is ready to get going on the process. She said the organization has negotiated with the University of Iowa, to use its contribution of $100,000 to get things started in January, since the $282,000 estimated to be raised by the levy if the SSMID is approved won't be available for use until next September.

Bill Nusser, owner of Hands Jewelers, said the levy would only cost him a little more than his current DTA membership dues, and those dues would disappear.

"I don't know any other way I could pay so little, and get so much (in return)," Nusser said.

Not everyone was for the proposal, however.

Downtown property owner Scott Cray said that many of the business people downtown are renters, and the only people who could sign the petition were property owners. This, in effect, makes them have to pay for something they have no way to vote for or against.

Cray said he also doesn't think the current plan to use the money to hire a business manager and assistant to market the city is the best use of the funds.

"We feel that too much of the money is being devoted to the payrolls, benefits, and office space for the business managers," Cray said.

Cray said the plan also mostly seems designed to fight downtown business vacancy, which he said he doesn't feel is currently a problem.

However, the council members all lined up in favor of the plan.

Council member Mike Wright said he thought the SSMID will be a win for downtown Iowa City.

"A SSMID, well established and well run, will probably reap benefits that we can't even foresee at this point," he said.

Susan Mims also supported the plan, and encourage current doubters to participate in the process. She also noted that it is only a four year duration for the levy currently, and it could be reassessed at that time.

"You've got four years to prove it to everyone else that this does work," Mims said.

The SSMID levy will need two more rounds of votes by the council before it goes into effect.