This Forum piece is written by Don Frankenfeld, a founding member of the Friends of Rapid City Parks, former Pennington County legislator and 1990 Republican nominee for Congress.
Some say a giraffe is a horse designed by a committee. The good news is that the Rapid City Square pocket park proposed by the hard-working Destination Rapid City committee calls this cliché into question. Even a small park is a good idea, and this small park is a thoroughbred. The bad news is that, in proposing to partly finance the park with a Business Improvement District (BID), the committee has labored mightily and brought forth a giraffe.
It appears that the park's acquisition and construction costs of $6 million or $7 million will be borne half by city taxpayers in the form of 2012 sales tax revenue, and half by private contributions from businessman Ray Hillenbrand and other public-spirited citizens. So far, so good, but there may be a shortfall of funds to operate and maintain the project.
Enter the BID, which according to Destination Rapid City president John Brewer will generate $160,000 annually. The current BID proposal evolved in haste, and has not yet been reduced to writing. As described, the BID embodies so many compromises and concessions that, in its current form, it is ungainly, poorly structured, and ultimately unfair.
If adopted as proposed, the BID will grant coercive taxing power to a small group of downtown property owners appointed by the mayor. Such a huge delegation of power from elected officials to unelected citizens should be done only with great care. The BID, or some alternative financing scheme, will be with us for a long time. There is still time to get it right.
Eager to learn the details of the proposed BID, I recently visited with John Brewer, who has worked hard on this project. He was statesmanlike, but would not or could not answer a number of pointed questions. Will BID funds be used only for operations, I wondered, or will they be available for capital expenditures? (Answer: "We will be governed by statute.") What is the BID's budget? (Apparently none exists; or if it does, it reflects the larger dollar amount that was earlier contemplated.) Does the BID have a sunset date or will it last forever? (There is no sunset; it will last as long as needed.) What oversight mechanisms exist to assure accountability for public funds? (This will be worked out later.) Why are only selected property owners eligible to serve on the BID board, when their tenants ultimately will pay the taxes? (No answer to a question Mr. Brewer may have regarded as rhetorical.)
The mission of the BID is unclear. Mr. Brewer asserts that the pocket park is merely the first of many useful projects, some day to be scattered throughout the downtown area. Yet of the two BID zones, the high-tax zone surrounds the pocket park. This geographic targeting is inconsistent with balanced citywide development.
The BID's most glaring defect is a tax cap of $3,000 that applies only to the wealthiest property owners. This violates the fundamental precept of value-based taxation.
For example, the Rushmore Plaza Holiday Inn, certain to be a huge beneficiary of the pocket park, will pay tax at one-third the rate of a mom and pop competitor. Such discrimination is morally wrong, and probably unconstitutional.
Mr. Brewer asserted to me that "without the BID, there will be no park." Yet there are a number of constructive financing alternatives, not the least of which is to support the park from the general funds of the city, just as other Rapid City parks are supported.
But if the city council should conclude that a BID is the only viable way to complete the project, I hope the council collectively takes a deep breath, returns to the committee room, and renews their efforts to build a BID that is both viable and fair.
Posted in News, Opinion, Columnists on Saturday, November 7, 2009 2:30 am | Tags: Opinion, Rapid City, Bid
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