Downtown Kendallville EID Revived

By Steve Garbacz  (Article shared with permission from KPC Media).

KENDALLVILLE — A year after a downtown organization couldn’t even get half of building owners to vote on a voluntary tax and the city’s Economic Improvement District looked doomed to fold, the 25-year district is getting revived.

Revived by a slim margin, but revived nonetheless.

After a more-than-month-long balloting period, the current EID board announced Wednesday that it believes enough building owners have voted affirmatively to reauthorize a voluntary tax assessment that provides revenue for services, most notably downtown snow removal during winter.

The district has been functioning on life support in 2019, after the board failed to secure enough support to reauthorize the voluntary tax for another five years at the end of 2018. The board, with new leadership, has continued in an acting capacity — utilizing available funds in savings from past collections, approximately $51,000 at the start of 2019 — but hasn’t collected any new revenue this year.

The small .3-cent per $100 of assessed value assessment added a few hundred dollars of cost to the average downtown building owner’s tax bill, but in total created a revenue stream of about $18,000 per year for the EID in 2018.

The organization utilizes that money to contract with a snow removal service to clear downtown sidewalks each winter, and also pays for other services including tree trimming, holiday decorations, as well as offering some limited financial support to downtown events.

The goal of the board was to organize a vote once again in an effort to reauthorize the collections, needing 60% of building owners to assent.

That was a tall order, considering only 22 people – about a third – responded in 2018 and of those, the majority voted “no” on reauthorization.

According to current EID President Joe Sells, there are 66 buildings in the district, with some owners owning multiple buildings. Since each owner only gets one vote regardless of how many properties it owns, that left 58 eligible voters.

To get 60%, the EID needed to get 35 owners to say yes.

It got 37 “yes” votes, Sells said.

Three people voted “no” and the remainder did not return ballots.

“Based upon those numbers, I’m convinced we got the job done,” Sells said.

Next up, the city clerk-treasurer and city attorney will need to verify the number of eligible voters and the votes before the voluntary tax can be reinstated. Sells said it’s likely the EID won’t get any collections in 2020 because of the timeline, so the district will be operating on reserves only for the foreseeable future.

Sells said the district board had been prudent with its money because of the expectation that it will have to go another year or longer without new revenue. The expectation is that at current spending levels, the bank account will be nearly drained by the time next tax dollars come in.

Sells said it’s a good time for the tax to get back in place because downtown is on the verge of some major improvements with a $1.1 million streetscape project on tap for Main Street in 2020.

Downtown events, like the Fairy, Gnome and Troll Festival in May and successful Food Truck Friday events brought thousands downtown during 2019.

“There’s a lot of good things going on downtown,” Sells said. “It’s a great time to invest, because it’s a pendulum and it’s going to swing back.”