Montpelier wrestles with new downtown tax process
MONTPELIER — City officials are facing several complications as they move to put into practice a voter-approved special assessment on nonresidential downtown properties to raise $75,000 for improvements and marketing of the city's core.
The March vote authorizing a downtown improvement district could create a mini grand list of between 150 and 200 properties requiring an additional tax bill and grievance process, said City Assessor Stephen Twombly.
His office has been assigned to review all of the properties in the district and determine what portion, if any, should be subject to the additional levy. It is a complicated and time-consuming task.
“What we have are some buildings downtown where you have a restaurant or retail on the first floor, offices on the second floor and residences on the third floor,” Twombly said. “It's pretty easy if they're all the same square footage. But we've also got buildings that have mixed uses on upper floors, and in these cases we're reaching out to the landlords to find out how much square footage there is in each category.”
The district will have the same footprint as the current designated downtown district. About half of the $75,000 to be raised is intended to improve the cityscape with banners, planters, benches and parks. The other half will be used to market the city through website development, ad buys and funding to help attract Canadian visitors.
City Manager William Fraser was out of his office and unavailable for comment but noted in his weekly report, “We are trying to resolve the operational issues relating to this new district. This includes identifying the involved properties and their proportion of residential vs. commercial. We are also looking at the tax billing methodology and the underlying ordinance dealing with handling of the money. It is more complicated than may have been understood during the winter.”
Among the questions is whether building owners in the downtown improvement district should receive separate bills from their regular tax bills, and whether the assessment should be payable in one lump sum or quarterly. For the city assessor's office, it could become even more complicated because of the potential use of the grievance process to lower taxes.
For example, Twombly said, if improvements were made to a building that was assessed for the special district, it would undergo a reassessment for the regular grand list — which, if successfully grieved, could cause the special assessment tax to need adjustment.
Mayor John Hollar said Tuesday that it was his understanding it would take the assessor's office an additional 100 hours to create the list of properties and the portion of each subject to the special assessment. He said he expects those hours will be folded into the current level of city staffing and not require any additional hands.
“All of the $75,000 will go directly into the downtown improvement district,” he said. “It's part of our city program. And in terms of the administration I don't think it is going to be a significant amount of time.”
Under the plan, the money will be administered by an Improvement District Committee appointed by the City Council and falling within the structure of Montpelier Alive, a nonprofit community organization made up of business people and volunteers.
City Councilor Alan Weiss expressed unhappiness with the way the downtown improvement district funding unfolded, saying he believes the City Council was mistaken in even letting the article go before the voters without going through the traditional petition process.
“The council waived that process because people didn't want to take the time to collect voter signatures,” he said in an interview Tuesday. “Now there are lots of questions: Does the city have to send out special tax bills? What happens if an owner decides they don't want to pay? This was a very poorly conceived idea.”
Assistant City Manager Jessie Baker said Tuesday she hoped the city would have a draft ordinance to present to the City Council for a first reading at its next meeting in May.
“I do want to point out that this is very much a work in progress,” she said. “We're just starting to do the heavy lifting right now.”
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