City Council Chairman Indicates BID Board May Reverse Action On Charging Non-Profits; Charges Range From $3,060 For United Way To Over $14,000 For Y

Wednesday, February 19, 2020 - by Joseph Dycus

City Council Chairman Erskine Oglesby indicated Tuesday night that he thinks the downtown Business Improvement District Board may reverse its action of charging four non-profits within the district.

At the close of the council meeting, attorney Charles Paty lambasted the BID board for charging St. Paul's Episcopal, Second Presbyterian Church, the United Way and the Downtown YMCA. All had asked to be exempted from yearly payments.

Attorney Paty, who earlier fiercely opposed having the family's Patten Parkway property in the BID district and wound up filing suit, said the action would harm the four non-profits.

Chairman Oglesby told attorney Paty he may be pleased about a future action of the BID board on the subject based on the group's meeting with the council earlier on Tuesday at the council's strategic planning meeting.

These are the annual assessments for the non-profits:

St. Paul's Episcopal - $7,865.15 for building, $2,085.12 for parking lot

Second Pres - $4,200.55 for building, $2,010.24 for parking lot

United Way - $3,060.02 

YMCA - $14,288.94

 

Annual BID assessment rates are calculated at $0.09 per square foot (of the greater of lot size or building size) + $4.95 per linear foot of lot frontage.

Steve Hunt and the BID board were at the sessopm for reasons that we not immediately clear to the council. Councilwoman Carol Berz was the most vocal of the council, asking, “Why are we putting our imprimatur in anything they do? What am I missing? My point is, if they next year wanted an increase, they’d have to come to us. But this isn’t about an increase, so why are they here?”

Councilwoman Demetrus Coonrod said, “To my understanding, when we voted on it, they’d have to pay the assessment for 2019, so you’re paying the money for 2019, and they’re submitting the funds for this year.”

Councilwoman Berz pointed out that she still did not understand why the BID board was presenting to them. Under the agreed upon terms, the BID board simply needed to get the council’s approval for the budget at the end of each fiscal year.

The council itself has no control over what the BID does with its various tax-like assessment fees, as the BID is not a governmental agency. Because it is not a tax, the council itself cannot enforce or punish entities that fall under the BID’s authority in downtown Chattanooga, it was stated. City Attorney Phil Noblett said the approval was simply a transfer of money, and it was not technically part of the city’s budget.

“The ordinance clearly states that they were to come to us, showing what they did this year and what they may need for the following year,” said Councilwoman Berz. “Since it hasn’t been a year, I was trying to figure out why they were even here.”

She also emphasized the independent nature of the BID. The only reason the City Council is a “pass-through” for the BID is because state law requires it, she said.

“They don’t have a track record, and we don’t have power over them,” said Councilwoman Berz. “They’re an independent entity, a 501C3, and other than collecting their fees as a pass-through, and nothing more, that’s our only contact with them. So I was wondering if this was a year premature.”

The BID board also discussed its $912,000 budget, how it is divvied up, and the requirements for a non-profit in the area to be considered exempt from the assessment fee.

At the recommendation of Councilman Ken Smith, the March 3 council meeting will be bumped all the way up to 4:00, a two-hour difference from the normal start time. March 3 is “Super Tuesday,” which is when states hold primary elections for the presidential race.

“It would allow us to get our business done, and then it would afford some of us the opportunity to make it to some different events on that night,” said Councilman Smith.

All were in favor of the idea, and it was approved unanimously.


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