To take advantage of programs to provide incentive for businesses to locate in blighted areas, a community must first declare that slum, blight and poverty exist.
The Commerce City Council plans to do just that at a called meeting on Monday night, Sept. 24, at the request of its Downtown Development Authority.
The issue was on the agenda for this past Monday night’s city council meeting, but attorney John Stell convinced the council to delay action until he goes over and makes a few changes in the resolution presented by the DDA.
The DDA voted in a called meeting last Thursday night to ask the council to declare the entire DDA district — plus an extension out Homer Road to the former Bi Lo Shopping Center — an “enterprise zone.”
The move is supported by data showing that the affected area suffers from poverty and blight. Actually, reported Denise McKay, executive director of the DDA, the entire city meets federal criteria for high poverty rates.
Mayor Clark Hill and the city council on Monday night appeared supportive. The resolution states that the selected area “suffers from pervasive poverty that is widespread throughout the nominated area,” and the DDA provided data to support that statement from the U.S. Census. The resolution further states that the area “suffers from general distress and adverse conditions as evidenced from the data collected in the City of Commerce Comprehensive Land use plan dated 2009.”
McKay submitted a package for the council that included 30 photos showing run-down or vacant buildings in the area — including several currently occupied by businesses.
But the end game is to attain for the same area the state designation as an “opportunity zone,” one requirement of which is that the area be declared an enterprise zone or be part of an urban redevelopment plan. In an opportunity zone, a new business can get a $3,500 state income tax credit per year for five years for each full-time job over and above two full-time positions and can carry the benefits another five years if they’re not used up during the first five.
The city will apply to the Department of Community Affairs for that designation, McKay said
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“There is no other program that would benefit small business more,” noted interim city manager Tom Berry in an interview last week. Berry pointed out that there are no opportunity zones in nearby communities. “It’s a big competitive advantage,” he said.
“The area has to meet a certain poverty ratio,” McKay told the DDA board. “Our whole city meets that criteria.”
That led the DDA to consider seeking enterprise zone status for the entire city, but DDA member Johnny Eubanks, who is also the Ward 5 city councilman, thought that might be too much to ask of the council.
“This is a lot for the city council,” he advised the DDA on Sept. 6. “You are saying our city is a slum and a blight… We’ve got to get by the initial fact that we’ve got slum and blight in the city. We all know that, but we’ve (the council) got to vote that.”
In the end, Chris Bulls made a motion, seconded by Claudine Smith, to submit the proposal to declare the DDA district — which runs from the former Harber House Bed and Breakfast on the north, through town, to CMC Consulting on the south — basically the whole downtown.
Enterprise Zone
In the enterprise zone, the city can — but is not required to — provide incentives to job-producing businesses by exempting businesses from property taxes (excluding school taxes), and could waive occupational taxes, building permit fees, sign permit fees, planning and zoning fees, engineering fees and other local fees. Such decisions would be made on a case-by-case basis.
Hill on Monday night called the declaration “something I’ve been really excited about. …creating some areas where we can incentivize businesses to go in and develop blighted property.”
“This gives us a definite advantage over other areas,” added mayor pro tem Keith Burchett.
