Making Connections with Making Connections with Community Improvement Districts Community Improvement Districts in Missouri in Missouri Presented October 22, 2008 by Presented October 22, 2008 by Joe Lauber Joe Lauber 200 NE Missouri Road, Suite 200 200 NE Missouri Road, Suite 200 Lee Lee ’ ’ s Summit, MO 64086 s Summit, MO 64086 (816) 251 (816) 251 - - 4646 4646 P P ROVIDING ROVIDING L L EGAL EGAL S S OLUTIONS OLUTIONS FOR FOR L L OCAL OCAL G G OVERNMENTS OVERNMENTS
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Making Connections with Making Connections with Community Improvement Districts Community Improvement Districts
in Missouriin Missouri
Presented October 22, 2008 byPresented October 22, 2008 by
Joe LauberJoe Lauber200 NE Missouri Road, Suite 200200 NE Missouri Road, Suite 200LeeLee’’s Summit, MO 64086s Summit, MO 64086(816) 251(816) 251--46464646
Economic Development Economic Development Tools in MissouriTools in Missouri
Chapter 100Chapter 100–– Can issue industrial development bonds to finance Can issue industrial development bonds to finance
the costs of warehouses, distribution or R&D the costs of warehouses, distribution or R&D facilities, and office industriesfacilities, and office industries——property financed property financed by IDD bonds is tax exempt while the bonds are by IDD bonds is tax exempt while the bonds are outstandingoutstanding
Chapter 353Chapter 353–– Up to 25 years of tax abatementUp to 25 years of tax abatement–– To remedy blight that creates economic and social To remedy blight that creates economic and social
liability, pursuant to a redevelopment planliability, pursuant to a redevelopment planTIFTIF
–– Blight remediation costs reimbursed by incremental Blight remediation costs reimbursed by incremental increases in property and economic activity taxes increases in property and economic activity taxes achieved through developmentachieved through development
MODESAMODESA–– Missouri Downtown Economic Stimulus ActMissouri Downtown Economic Stimulus Act–– Basically an enhanced version of TIFBasically an enhanced version of TIF–– Applicable only in a blighted central business Applicable only in a blighted central business
district of a city.district of a city.
NIDNID–– A specified area in which the A specified area in which the
city is authorized to impose city is authorized to impose special assessments to pay for special assessments to pay for public improvements that confer public improvements that confer a benefit on property that is a benefit on property that is located within the districtlocated within the district
TDDTDD–– Special taxing district authorized Special taxing district authorized
to levy sales tax, special to levy sales tax, special assessments and/or property tax assessments and/or property tax to pay for transportation to pay for transportation projectsprojects
CIDCID–– Special taxing district authorized Special taxing district authorized
to levy sales tax, special to levy sales tax, special assessments and/or property tax assessments and/or property tax to pay for a wide variety of to pay for a wide variety of improvements and services improvements and services within the boundaries of the within the boundaries of the districtdistrict
CID ConceptsCID Concepts
““OnOn--paperpaper”” CID, designed as a funding mechanism CID, designed as a funding mechanism in connection with other economic development in connection with other economic development tools such as TIFtools such as TIFEnhanced homeowners associationEnhanced homeowners associationSpecific purpose entity designed to meet a specific Specific purpose entity designed to meet a specific need identified by the district property ownersneed identified by the district property owners
CIDCID--Eligible Improvements and ServicesEligible Improvements and Services
ImprovementsImprovements–– Pedestrian or shopping malls and Pedestrian or shopping malls and
plazas.plazas.–– Parks, lawns, trees and any other Parks, lawns, trees and any other
aquariums, aviaries and meeting aquariums, aviaries and meeting facilities.facilities.
–– Sidewalks, streets, alleys, bridges, Sidewalks, streets, alleys, bridges, ramps tunnels, overpasses and ramps tunnels, overpasses and underpasses, traffic signs and underpasses, traffic signs and signals, utilities, drainage, water, signals, utilities, drainage, water, storm and sewer systems and other storm and sewer systems and other site improvements.site improvements.
CIDCID--Eligible Improvements and ServicesEligible Improvements and Services
ImprovementsImprovements–– Parking lots, garages or other Parking lots, garages or other
facilities.facilities.–– Music, news and childMusic, news and child--care care
facilities.facilities.–– Any other useful, necessary or Any other useful, necessary or
desired improvement.desired improvement.–– In addition, within a In addition, within a ““blighted blighted
areaarea””, the district may pay costs , the district may pay costs of demolishing, renovating and of demolishing, renovating and rehabilitating structures.rehabilitating structures.
CIDCID--Eligible Improvements and ServicesEligible Improvements and Services
ServicesServices–– With the municipalityWith the municipality’’s consent, s consent,
prohibiting or restricting vehicular and prohibiting or restricting vehicular and pedestrian traffic and vendors on pedestrian traffic and vendors on streets.streets.
–– Operating or contracting for the Operating or contracting for the provision of music, news, childprovision of music, news, child--care or care or parking facilities, and buses, miniparking facilities, and buses, mini--buses buses or other modes of transportation.or other modes of transportation.
–– Leasing space for sidewalk cafLeasing space for sidewalk caféé tables tables and chairs.and chairs.
–– Providing or contracting for the Providing or contracting for the provision of security personnel, provision of security personnel, equipment or facilities for the equipment or facilities for the protection of property and persons.protection of property and persons.
CIDCID--Eligible Improvements and ServicesEligible Improvements and Services
ServicesServices–– Providing or contracting for cleaning, Providing or contracting for cleaning,
maintenance and other services to maintenance and other services to public and private property.public and private property.
–– Promoting tourism, recreational or Promoting tourism, recreational or cultural activities or special events.cultural activities or special events.
–– Promoting business activity, Promoting business activity, development and retention.development and retention.
–– Providing refuse collection and Providing refuse collection and disposal services.disposal services.
–– Contracting for or conducting Contracting for or conducting economic, planning, marketing or economic, planning, marketing or other studies.other studies.
CID Funding MechanismsCID Funding Mechanisms
Sales TaxSales Tax–– 1/8% increments up to 1% on all retail sales made 1/8% increments up to 1% on all retail sales made
within the boundaries of the districtwithin the boundaries of the district–– Available only to political subdivision CIDsAvailable only to political subdivision CIDs
Property TaxProperty Tax–– Available only to political subdivision CIDsAvailable only to political subdivision CIDs
Special AssessmentsSpecial Assessments–– Available to all CIDsAvailable to all CIDs–– May not assess exempt property, unless the owner May not assess exempt property, unless the owner
–– May charge for use of the CIDMay charge for use of the CID’’s real or personal s real or personal property (other than public right of way)property (other than public right of way)
Business license taxesBusiness license taxes–– Only in SpringfieldOnly in Springfield
Forming a CID: Setting the StageForming a CID: Setting the Stage
Contact your local municipal officials to Contact your local municipal officials to determine their familiarity with CIDsdetermine their familiarity with CIDs–– Community Development DepartmentCommunity Development Department–– Elected officialsElected officials–– City Administrator City Administrator –– City ClerkCity Clerk
Application fees and/or formsApplication fees and/or formsPolicy requirementsPolicy requirements–– Ratio of private investmentRatio of private investment–– Encouraged/discouraged practicesEncouraged/discouraged practices–– Funding agreement requirementFunding agreement requirement
Forming a CID: TimelineForming a CID: Timeline
Prepare PetitionPrepare PetitionFile petitionFile petitionProvide mailed and published Provide mailed and published notice of public hearingnotice of public hearingPublic hearingPublic hearingAdopt ordinance establishing Adopt ordinance establishing districtdistrict
Enter into cooperative agreement Enter into cooperative agreement Hold first CID Board meetingHold first CID Board meetingAdopt resolution to impose funding Adopt resolution to impose funding mechanismmechanismHold election to approve funding Hold election to approve funding mechanismmechanismCollection of funds beginsCollection of funds begins
Forming a CID: Petition RequirementsForming a CID: Petition Requirements
1.1. Signed by owners of more than 50% per capita and by assessed valSigned by owners of more than 50% per capita and by assessed value of ue of land within proposed districtland within proposed district–– Tax records of the county clerkTax records of the county clerk–– As of the As of the ““last completed assessmentlast completed assessment””
2.2. Legal description and mapLegal description and map–– Need to work with GIS department of City or County or a surveyorNeed to work with GIS department of City or County or a surveyor–– Must include all possible targets of CID fundsMust include all possible targets of CID funds–– Cross reference tax parcels and tax mapsCross reference tax parcels and tax maps
3.3. Type of DistrictType of District–– Political subdivisionPolitical subdivision–– NotNot--forfor--profit corporationprofit corporation
4.4. Name of DistrictName of District–– Must include the words Must include the words ““community improvement districtcommunity improvement district”” in the titlein the title
5.5. Notice that the signatures of the signers may not be withdrawn lNotice that the signatures of the signers may not be withdrawn later ater than seven days after the petition is filed with the municipal cthan seven days after the petition is filed with the municipal clerklerk
Forming a CID: Petition RequirementsForming a CID: Petition Requirements
6.6. A fiveA five--year plan stating a description ofyear plan stating a description of–– the purposes of the proposed districtthe purposes of the proposed district–– the services it will providethe services it will provide–– the improvements it will make andthe improvements it will make and–– an estimate of costs of these services and an estimate of costs of these services and
improvements to be incurred improvements to be incurred
Forming a CIDForming a CID-- Petition RequirementsPetition Requirements
7.7. A statement as to whether the district will be a political A statement as to whether the district will be a political subdivision or a not for profit corporationsubdivision or a not for profit corporation–– if it is to be a not for profit corporation, the name of the notif it is to be a not for profit corporation, the name of the not for for
profit corporation;profit corporation;–– Not for profit corporations are subject to Chapter 355, RSMo.Not for profit corporations are subject to Chapter 355, RSMo.
8.8. A statement as to whether the district will be governed by a A statement as to whether the district will be governed by a board board electedelected by the district or whether the board will be by the district or whether the board will be appointedappointed by the municipalityby the municipality–– Political subdivision CIDs onlyPolitical subdivision CIDs only–– If Board will be elected, petition can state the names and termsIf Board will be elected, petition can state the names and terms of of
the initial board membersthe initial board members
Forming a CIDForming a CID-- Petition RequirementsPetition Requirements
9.9. The number of directors to serve on the boardThe number of directors to serve on the board–– 55--30 permitted30 permitted–– Political subdivision CIDs only (notPolitical subdivision CIDs only (not--forfor--profits governed by Ch. 355)profits governed by Ch. 355)
10.10. The total assessed value of all real property within the proposeThe total assessed value of all real property within the proposed d districtdistrict
11.11. A statement as to whether the petitioners are seeking a A statement as to whether the petitioners are seeking a determination that the proposed district, or any portion of it, determination that the proposed district, or any portion of it, is a is a blighted area;blighted area;
12.12. The proposed length of time for the existence of the districtThe proposed length of time for the existence of the district–– Can be maximum, minimum or definite number of yearsCan be maximum, minimum or definite number of years
13.13. The maximum rates of real property taxes that may be submitted The maximum rates of real property taxes that may be submitted to the qualified voters for approvalto the qualified voters for approval–– Springfield CIDs can do business license taxesSpringfield CIDs can do business license taxes
Forming a CIDForming a CID-- Petition RequirementsPetition Requirements
14.14. The maximum rates of special assessments and respective The maximum rates of special assessments and respective methods of assessment that may be proposed by petition methods of assessment that may be proposed by petition
15.15. The limitations, if any, on the borrowing capacity of the The limitations, if any, on the borrowing capacity of the district district
16.16. The limitations, if any, on the revenue generation of the The limitations, if any, on the revenue generation of the district district
17.17. Other limitations, if any, on the powers of the districtOther limitations, if any, on the powers of the district18.18. A request that the district be established; and A request that the district be established; and 19.19. Any other items the petitioners deem appropriateAny other items the petitioners deem appropriate
Forming a CIDForming a CID-- The Public HearingThe Public Hearing
Notice requirementsNotice requirementsPresentation by Presentation by applicantapplicantPresentation by city Presentation by city staffstaffPublic commentsPublic commentsDeliberation by the Deliberation by the citycity’’s governing s governing bodybody
CID Board First MeetingCID Board First Meeting
Adopt bylawsAdopt bylawsAppoint CID officersAppoint CID officersRatify organization of the CID, past actions and authorize Ratify organization of the CID, past actions and authorize reimbursement of formation costsreimbursement of formation costsAdopt Sunshine Law PolicyAdopt Sunshine Law PolicyResolution to adopt funding mechanismResolution to adopt funding mechanismResolution to adopt cooperative agreement with cityResolution to adopt cooperative agreement with city
CID Sales Tax ElectionCID Sales Tax Election
Election process issues Election process issues Registered voters vs. Registered voters vs. property ownersproperty ownersNotice to election Notice to election authorityauthority
–– Is Is ““reducedreduced”” notice notice necessarynecessary
MailMail--in ballots vs. in ballots vs. ““realreal””electionelection
Sunshine Law complianceSunshine Law complianceAnnual budget submittalAnnual budget submittalAnnual meetingAnnual meetingReport to municipal clerk and Report to municipal clerk and Dept. of Economic DevelopmentDept. of Economic DevelopmentReport to State AuditorReport to State Auditor’’s offices officeBoard member Board member elections/appointmentselections/appointmentsCooperative Agreement Cooperative Agreement compliancecompliance
The issue:The issue: How to synergize the additional flow of customer How to synergize the additional flow of customer traffic created by the development of the Branson Landing area traffic created by the development of the Branson Landing area so that this development would not adversely affect the so that this development would not adversely affect the Historic Downtown Branson shopping districtHistoric Downtown Branson shopping district
The solution:The solution: Offer transportation that will allow customers Offer transportation that will allow customers parking in the Branson Landing parking areas the ability to parking in the Branson Landing parking areas the ability to easily reach the Historic Downtown Branson shopping areaeasily reach the Historic Downtown Branson shopping area
The new issue:The new issue: FundingFunding transportation that will allow transportation that will allow customers parking in the Branson Landing parking areas the customers parking in the Branson Landing parking areas the ability to easily reach the Historic Downtown Branson ability to easily reach the Historic Downtown Branson shopping areashopping area
ChallengesChallengesGetting the petition signedGetting the petition signed
–– Coordination and education Coordination and education of 90 owners of property of 90 owners of property having $6.9 million in having $6.9 million in assessed valueassessed value
–– Basis of authority of signersBasis of authority of signersTrustsTrustsLLCsLLCsTransfers of propertyTransfers of property
–– Obtaining a list of all Obtaining a list of all owners and assessed values owners and assessed values to determine valid petitionto determine valid petition
Success!Success!All involved are pleased with the All involved are pleased with the outcomeoutcomeSales tax is producing enough Sales tax is producing enough revenue to adequately cover costsrevenue to adequately cover costsFares were never needed as a Fares were never needed as a funding sourcefunding sourceThe trolleys have become an The trolleys have become an attraction on their ownattraction on their ownCID and DBMA have formed a CID and DBMA have formed a critical partnership for promoting critical partnership for promoting the downtown areathe downtown areaBridge financing was paid off Bridge financing was paid off nearly 18 months earlynearly 18 months early
PROVIDING LEGAL SOLUTIONS FOR LOCAL GOVERNMENTS
Missouri Community Improvement Districts
Contact Information:Contact Information:Joe LauberJoe LauberWilliams & Campo, P.C.Williams & Campo, P.C.200 NE Missouri Road, Suite 200200 NE Missouri Road, Suite 200LeeLee’’s Summit, Missouri 64086s Summit, Missouri 64086(816) 251(816) [email protected]@publiclawfirm.com
