Chapter 3.10
BUSINESS IMPROVEMENT DISTRICTS

Sections:

3.10.010    Business improvement districts for services.

3.10.020    Authorized public services.

3.10.030    Contracts for services.

3.10.040    Term.

3.10.050    Costs.

3.10.060    Special property tax.

3.10.070    Districts – Initiation.

3.10.080    Limitation on suits and actions.

3.10.090    Waiver of objections.

3.10.100    Superior court review.

3.10.110    Retention of rights.

3.10.010 Business improvement districts for services.

A. Business improvement districts for services are authorized as specifically defined by the ordinance creating the business improvement district, subject to the provisions of this chapter.

B. A business improvement district is a geographical area designated by the council for the purpose of providing and financing special public services desired by property owners in the district which are not generally provided by the city or provided at a different level than generally provided by the city. A business improvement district must be made up of an area that is predominantly zoned commercial.

C. A business improvement district shall be a city mechanism for delivering special city services, and shall provide or contract for providing services, authorize and disperse contract funds and payments and audit the performance of contracts and use of such city funds. (Ord. 05-041 § 3, 2005)

3.10.020 Authorized public services.

A. Business improvement districts for public services may be initiated for the following public services only:

1. Maintenance, repair and upkeep of any public improvement created by a business improvement district;

2. Maintenance, including snow removal/disposal and dust suppression, cleaning and beautification and decoration of public places, areas, facilities and rights-of-way such as:

a. Streets, roads, alleys, parkways, street lighting, curbs and gutters, driveways, curb cuts and parking areas and facilities;

b. Sidewalks, trails and other pedestrian ways and facilities;

c. Parks and recreational areas and facilities;

3. Visitor and tourism public services;

4. Security services not including law enforcement services;

5. Promotion of public events within the business improvement district and promotion of the business improvement district itself as an area of enhanced public services;

6. Other public services closely similar to those listed in this subsection (A) designed to promote the vitality, stability and improvement of the business improvement district as a whole.

B. Business improvement districts shall provide an enhanced or supplemental public service(s) or new public service(s) not generally provided by the city. The establishment of a business improvement district shall not operate unilaterally or by implication as a substitute for or to reduce or eliminate the nature or extent of services provided by other means.

C. More than one category of service may be provided in a single business improvement district. Different categories of service may be of the same type of service provided at different levels. (Ord. 05-041 § 3, 2005)

3.10.030 Contracts for services.

The city may contract for services provided in a business improvement district subject to the following requirements in addition to other applicable provisions of this code:

A. All contracts for services shall specify a contract dollar amount for services to be provided.

B. All contracts for services shall require and the contractor shall provide liability insurance and indemnification of the city insuring and indemnifying the city against any and all claims arising out of the selection of the contract and/or the contractor’s performance of the contract. Such insurance and indemnification shall be in a form, amount and coverage satisfactory to the city.

C. All contracts for services shall provide that the city may audit or cause an audit of the books, records and transactions of the contractor as to any use of contract funds.

D. All physical assets acquired by a non-profit contractor providing services for a service business improvement district with city contract funds or assets shall be held, maintained and delivered to possession of the city at the end of the contract as city assets. Such assets shall include all unencumbered cash or its equivalent including services, and other assets loaned or provided to the contractor by or through the city regardless of funding source. (Ord. 05-041 § 3, 2005)

3.10.040 Term.

A. A business improvement district may be created for a specific term not to exceed ten years. Districts with a specified term may be extended beyond the end of the specified term by the property owners who would bear more than 50 percent of the estimated special property taxes for the district.

B. Business improvement districts may be dissolved with the concurrence of the property owners who would bear more than 50 percent of the estimated special property taxes for the district. (Ord. 05-041 § 3, 2005)

3.10.050 Costs.

A. Costs of administering and operating a business improvement district shall be paid entirely from the special property taxes for the district, fees, grants or donations but not by the general fund, generally levied city tax revenues, or sales tax.

B. The costs include, without limitation but by way of example, the following: the cost of acquiring property interests for and the design, plans, specifications, administration, engineering, architectural, legal expense, construction, repair, reconstruction or other improvement of all or any part of a public improvement, the cost of performing any services, the cost of any contract for services, and the cost of administering any contract for services. (Ord. 05-041 § 3, 2005)

3.10.060 Special property tax.

A. The city may fund a business improvement district through a special property tax levied and collected by the Matanuska-Susitna Borough on behalf of the city.

B. The special property tax shall be levied and collected by the borough against all real property in the business improvement district in the same manner as the borough levies taxes against other real property in the district, except that:

1. Real property in the business improvement district used solely for single-family residential and accessory purposes shall be exempt and shall not be subject to the special property tax; and

2. The tax shall be levied only against the first $1,500,000 of assessed value of a tax lot and the assessed value exceeding $1,500,000 of a tax lot shall be exempt and not subject to the special property tax.

C. The mill rate for a business improvement district may not exceed three mills; provided, that the petition to initiate a business improvement district may set a lower mill rate, which may not be exceeded. Subject to this limitation, the business improvement district committee (representing property owners who will bear more than 50 percent of the estimated special property taxes for a district) shall annually request the council to set a specific mill rate for the next year. The request must be in writing and delivered to the city clerk between July 1st and November 15th. The council shall consider the request, and then the council shall exercise its discretion and set the mill rate at a rate that best services the public interest. If the committee fails to duly request a specific mill rate, then the council will set the mill rate at zero.

D. All funds for a business improvement district shall be separately accounted for by the city. (Ord. 05-041 § 3, 2005)

3.10.070 Districts – Initiation.

A. Form and Requirements.

1. The petition to initiate a business improvement district shall be in a form prescribed by the city manager and shall include a description (by tax lot) of the proposed district to be created by the petition.

2. The petition shall specify the following for the business improvement district:

a. The maximum mill rate that may be levied;

b. The term; and

c. The services to be provided.

3. The original or copies of the petition shall be signed by all the owners of the tax lots in the district that will bear at least 50 percent of the special property tax for the district.

4. No property owner may withdraw its signature of approval for six months after the petition in proper form has been filed with the city clerk unless authorized by the council.

5. The petition, when signed, shall be filed with the city clerk. The clerk, with such assistance as may be needed, shall determine whether the petition is in proper form. If the petition is not in proper form, the clerk shall return the petition to the petitioners, explaining in writing any deficiencies.

B. Public Hearing. After the notices of the hearing required in this section are given, the council shall hold a public hearing regarding the net beneficial effect to the properties bearing the cost of the proposed business improvement district. The council or city manager shall fix the time and place of the public hearing, which may be continued from time to time as the council may decide. After hearing interested persons, including those favoring or opposing the proposed business improvement district, the council may delete from the district properties not benefited in whole or in part by the district. No change may be made resulting in a district containing petitioners of properties bearing less than 50 percent of the special property tax for the district.

C. Council Action. After the public hearing is closed, the council may adopt an ordinance determining that there is a net beneficial effect to the properties bearing the cost of the proposed business improvement district, that the petition for the improvement has been signed by sufficient and proper petitioners, and that the business improvement district is established. These findings of the council are conclusive. The ordinance must state the description (by tax lot) of the district, the maximum mill rate that may be levied, the term, the services to be provided, and that the city must keep a separate account of all income and expenses of the district. The ordinance may also include such conditions and limitations as the council deems necessary to assure fairness and equity in allocating benefits within the district. The council shall take all necessary action to request the borough assembly to establish the special property tax for the district and inform the assembly of the mill rate and exemptions.

D. Notice. Notice by publication and mail shall be given of any public hearing required in this section. Notice of the public hearing shall be published in a newspaper of general circulation in the city at least once a week for two consecutive weeks before the time fixed for the hearing. The city clerk shall send a written notice by first-class mail at least 15 days before the time of the hearing to persons whose names appear on the current assessment roll as owners of real property within the proposed business improvement district. The notice to be published shall include a summary of the business improvement district, the designation of the properties in the district, the purpose of the public hearing, and the time and place fixed for the public hearing. The notice by mail shall include a summary of the district, the designation of the addressee’s property to be included in the district, the purpose of the public hearing, the amount of estimated annual taxes against the property based on the prior year’s borough tax-assessed value, and the time and place fixed for the public hearing. Each notice shall generally inform the owners that they may object to the action to be taken at the public hearing. (Ord. 05-041 § 3, 2005)

3.10.080 Limitation on suits and actions.

No business improvement district procedure shall be contested in any civil action unless commenced within 60 days after the passage of the ordinance creating the business improvement district. If no such action is so commenced, the procedure shall be conclusively presumed to have been regular and complete. (Ord. 05-041 § 3, 2005)

3.10.090 Waiver of objections.

The irregularity or validity of any business improvement district procedure is waived and may not be contested or questioned in any manner in any proceeding whatsoever by any person not filing a written objection to the creation of the business improvement district prior to the passage of the ordinance creating the district. (Ord. 05-041 § 3, 2005)

3.10.100 Superior court review.

The decision of the council upon any objection to the creation of a business improvement district may be reviewed by the Superior Court, Third Judicial District, Palmer, Alaska, in the manner provided by law. (Ord. 05-041 § 3, 2005)

3.10.110 Retention of rights.

The city retains any right or procedure, not otherwise inconsistent with the provisions of this chapter, granted by law to a home rule charter city for local improvements. (Ord. 05-041 § 3, 2005)