DeKalb downtown business owners grill city over proposed special taxing area

DeKALB – A concept proposed by 6th Ward Alderman Mike Verbic for creating a special service tax for downtown DeKalb was met this week by opposition from a group of downtown business owners.

Several downtown business owners took to the podium, expressing concerns about the proposal.

Bobbi Hays, the owner of Barb City Bagels and Robin’s Nest Bookshoppe, said this is a “shameful attack on small businesses” in the community.

“This council, unable to balance its budget, has decided to penalize these small businesses and property owners through this excessive and punitive downtown special service area, which in realistic terms is nothing more than a tax on small business,” Hays said.

A special service area would levy an additional tax on businesses within the downtown are to reimburse annual labor and maintenance costs over a 12-month period.

The measure could be used to help pay for a number of things, including snowplowing, sidewalk snow and ice removal, street sweeping and catch basin cleaning, city documents show. The area would include east of First Street, south of Oak Street, west of Seventh Street and north of Grove Street.

The City Council this week directed city staff not to do anything further with the proposal beyond have a discussion, however. No special tax was approved.

DeKalb Chamber of Commerce Executive Director Matt Duffy urged the council to dismiss the proposal.

“The introduction of an SSA may deter prospective businesses from establishing themselves in our downtown area,” Duffy said. “The prospects of additional taxes or fees could dissuade entrepreneurs and investors, ultimately hindering economic development and job creation.

“We have some openings in downtown DeKalb. As we strive to attract new businesses to our community, it’s essential to maintain an environment that fosters innovation, entrepreneurship and prosperity. Empty storefronts in the downtown area shows the opposite effects of the work that you’ve done recently to make DeKalb the place we all want it to be.”

Several city leaders – including Mayor Cohen Barnes, 1st Ward Alderwoman Carolyn Zasada and City Manager Bill Nicklas – tried to distance themselves from the idea that they were behind the proposal.

Verbic said the proposal was his idea. He said Monday that he never intended for the concept to be considered beyond a proposal for council discussion. Verbic said he would have preferred inviting business and property owners to weigh in on the matter before any council vote.

Verbic said the special tax could be used to help pay for downtown improvements.

“If this is dollars that the property owners have a voice in using, this amount of money that I would see would be the voice of the owners, the voice of the merchants,” Verbic said. “We want to have more special events. We want to have more planters. We want to have more beautiful landscaping. How do we get there?

“So, it was asked of me by property owners and others downtown, how do we get there? What are our tools? Certainly, you’ve seen us utilize [tax increment financing] for improvements downtown. Sorry about all the construction and all the disruptions that caused, but I believe that’s truly important progress downtown.”

Seventh Ward Alderman John Walker defended Verbic, saying that he wants what’s best for the city like everyone else.

“I honestly think Alderman Verbic, his heart was in the right place,” Walker said. “I think he went about it a little different. I can’t speak for him. … I honestly think he likes how DeKalb looks. He wants to keep it up to par. Maybe he didn’t go about it the right way. However, I do believe his heart was in the right place. I think that maybe going forward we go about it a different way without trying to take money out of your pockets.”

A public hearing and council vote would be required before the special tax is imposed downtown, city documents show.

The City Council would need to set the levy for the special service area every year during its budget process, city documents show.

If 51% of downtown property owners oppose the special tax, it cannot be imposed.

Nicklas said he wants it to be clear that what was before the council was merely a proposal.

Barnes, who is a downtown property owner and business owner of Sundog IT, 230 E. Lincoln Highway, said he could imagine a special service area in the city’s downtown area sometime in the future.

“I just think it’s way too early,” Barnes said. “We’re not there yet. I know you all struggled through multiple downtown revitalizations.”

The downtown area already is situated in a TIF district. The city also has two existing special service areas, including the Ridgebrook and Market Square SSAs.

Leslie Conklin, owner of Found. Home and Vintage Marketplace and downtown resident, said she feels this proposal needs to be put to rest.

“I think we can find other ways to do this other than to take it out on the people who, I feel, have stuck with it through thick and thin,” Conklin said. “Now, I think you think it’s thick, and now we’re expected to pick up that bill.”