PROVO — Old friends buttonholed Cindy Richards as she stopped in at her favorite downtown Provo shops Wednesday morning, besieging their City Council representative with dismay about the future of the downtown.
The previous night, Richards joined four other council members in a 5-2 vote that terminated the downtown business fees that have funded the Downtown Business Alliance for the past six years.
Richards explained that while the business improvement district will be disbanded next month, the council did not abandon the alliance. Lost in the shock over the apparent setback, she said, was the council's unanimous decision to fund the alliance from city coffers through September while everyone tries to figure out what to do next.
The initial concept was to have the alliance sign a contract with the city to continue its efforts to beautify, maintain and market the downtown through hybrid funding from the city and businesses willing to contribute.
But Council Chairman George Stewart said Thursday he would consider reinstituting the improvement district if its fees could be made more palatable to the business owners who protested paying a flat rate.
Owners of 27 percent of qualified downtown property protested the fees because businesses on Center Street saw more benefit from alliance activities than properties on the district's edges. The opposition was three times larger than in 2004, when the improvement district was renewed.
In contrast, less than 1 percent of downtown Salt Lake City property owners protested in March when their fee was renewed, said Camille Winnie, program manager of the Salt Lake Downtown Alliance.
"What I saw was unfair and not equitable," Stewart said. "From my standpoint, I would prefer to see them reformulate their district and create the tax based on benefit. If not, I don't mind it being a public/private partnership for a while."
Two experts who spoke to the Deseret Morning News said their advice would be to bring back the district with reformulated fees.
Provo's decision to terminate its improvement district and associated fees is "infinitesimally" rare, said David Feehan, president of the International Downtown Association.
The three or four cities to do so among the 1,500 downtown improvement districts in the United States, Canada, Europe and Africa have subsequently reinstated them, Feehan said. One is Victoria, B.C.
"There may be in Provo a need to readjust, to create a different formula to assess fees, maybe to improve the services for the people on the edges of the improvement district, but this sounds like a throwing-the-baby-out-with-the-bathwater situation to me," Feehan said.
Provo's City Council has visited downtown Pasadena, Calif., to learn about successful revitalization, and the former director of the Old Pasadena Management District said it uses a formula instead of a flat-rate fee.
"The businesses pay a fair share based on assessment formulas," said Maggie Campbell, now CEO of the Arlington (Texas) Downtown Management Corp. "There are fee zones so businesses on the main street pay more for seeing the most benefit. That makes the fees more defensible. Those on Colorado Boulevard in Pasadena paid a higher percentage. And we cleaned Colorado Boulevard with much more frequency than the other streets."
Campbell said business improvement district groups should have to defend their fees and activities before city councils and to property owners in the districts.
"I have heard of districts that have been undone and then reinstituted," she said. "They had a better product in the end."
Provo Mayor Lewis Billings estimated that funding the alliance through September will cost the city $42,000. An ongoing public-private partnership beyond that would be even more expensive.
Feehan said that route historically leaves the council open to criticism for using city funds to replace money that a majority of downtown property owners were willing to pay.
E-mail: twalch@desnews.com