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COUNCIL OKS CREATING PROVO BUSINESS ALLIANCE

Downtown business owners will be taxed for at least three years to support a revised downtown economic development district.

The City Council voted Tuesday night to create the business alliance after members of a city-appointed committee presented its new plan for an organization to replace the disbanded Association of Involved Merchants. Ray Beckham, committee chairman, said the Downtown Business Alliance is needed to revitalize downtown Provo. Most council members agreed."If we don't get something like this going, we're going to be on our own," Councilman Karl Thalman said.

Legislation passed in 1992 gives cities the authority to create special economic development service districts. Salt Lake City, Ogden, Cedar City and several other cities have used the legislation to create special business districts.

For the next three years the Downtown Business Alliance will assess a special property tax on businesses in a 50-block area. Most business and property owners will pay between $50 and $1,500 annually to support the alliance. The tax levy will generate about $90,000 a year.

The organization will get $30,000 in community development block grant money from the city for administrative costs. The city also will provide office space for the alliance.

When a similar plan was presented several months ago, most business owners balked at the idea, saying a minimum assessment of $200 and maximum assessment of $1,500 was unfair to small companies. Business owners also complained that the organization's board of directors would mostly represent larger companies and that the district boundaries were too broad.

The plan approved Tuesday left the boundaries the same but eliminated the minimum tax and calls for broader representation on the board of directors.

"Because of a few suggestions made by downtown business persons, we opted to eliminate the minimum annual fee and to enlarge the board of directors to allow for more input," Beckham said.

Councilman Jim Daley voted against the district, saying the boundaries are too broad and that many businesses in the south part of town don't want the organization.

"I've talked to business owners in my district, and none think this will be beneficial to them," Daley said.

However, no business owners spoke against the plan at Tuesday's meeting, and a few spoke in favor of the district.

"I see this as a positive move," said Steve White, owner of Office Essentials.

The organization plans to spend about $50,000 each year on marketing and promotional activities, Beckham said. About $25,000 will go toward special events. The remaining funds will be spent on beautification and maintenance projects. The alliance also will sponsor an annual Christmas festival and hold a downtown farmers market.

Councilman Dennis Hall said the city needs to review the organization annually to determine if it is being effective and has the continued support of business owners.

"If it's not getting a result, then it needs to be pulled," Hall said.

The special tax district the council approved Tuesday, however, will be binding for at least three years - at which time the council can choose to reapprove or disband the district.