In the 1970s, a group of concerned Fremont merchants and businessmen gathered their minds and commitment and what developed was a change meant to reinforce the quaint attraction of the downtown Fremont commercial district.
They hoped to maintain the draw of the pristine area, creating an easily accessible and unique environment for patrons to explore, and that remains today.
The help arrived in the form of a tax with a fitting and representative name: the Downtown Improvement District (DID) tax. Established in 1970 and imposed only on the downtown district business owners, the tax enabled several great strides such as the convenient and free parking that Fremont residents and visitor find dispersed throughout the downtown area today. Additionally, the revenue from the tax supported business district promotions, streetscape beautification, Christmas decorations, and served the general benefit of the historic downtown.
Now almost 50 years later, another group of merchants and downtown property owners hope to continue that fortification of the business district as they further a plan, transitioning from the DID to the Business Improvement District (BID).
“Right now the city budget has tightened … and cannot provide the (downtown area) with the number of services that it used to,” said Howard Krasne, owner of Krasne’s Home Furnishing at 450 North Main Street. “If we don’t support ourselves, the downtown is going to start to deteriorate.”
Krasne also serves as a board member on both the DID and the BID and sees the transition to the new tax as a necessary step to create some needed improvements, draw investments and attract more attention to the downtown commercial area.
“The DID, as it presently exists, is not anything that will benefit this district long term,” Krasne said.
From 4-7 p.m. on Monday at the Fremont Area Art Association Gallery 92 on West 6th Street, the board members of the proposed BID will convene an informal open house to offer the public, business owners and anyone owning property in the downtown commercial district information about the proposed tax. In addition, the board members will answer questions and take feedback on various components of the plan.
According to Bob Missel, BID chairman, several years ago the Fremont City Attorney declared that the DID tax was legally unenforceable. As established in the 1970s, the DID tax was based on the “invitee” space of the business owner’s store. Invitee space consists of the general area in a store where customers mingle while they shop; the tax did not include warehouses or office space. The tax was collected and then the board convened a meeting to determine how the money would be spent.
However, and according to the current Nebraska state statutes (19-4015 to 19-4038), which permit municipalities the authority to establish downtown improvement districts, a budget must be set before the collection of any money. For that reason, the City of Fremont stepped away from enforcing the DID tax.
Despite that fact, Missel pointed out that most downtown business district owners continued to pay the tax because they understood the value it brought to enhancing and promoting the area.
Tom Coday, vice president of operations at Lou’s Sporting Goods – 523 North Main Street – also clarified that aside from the city’s inability to legally enforce the DID tax, the annual revenue generated only approached about $11,000, not a sufficient amount to cover the downtown needs.
For that reason, Coday said the BID formed and the board members spent the last five years developing a plan in accordance with Nebraska statutes. The proposed plan and budget would impose a 0.185-percent annual tax based on property values for anyone owning property in the district. The BID budget and tax would only extend five years into the future at which time a new plan would need approval and implementation
Under the current BID five-year proposal, estimates of the acquired tax revenue comes to $47,000 and $235,000 over the five-year period. Money has been budgeted for various projects and upkeep of the downtown business district. Maintenance of parking lots, green spaces, trees, purchase of Christmas decoration and marketing, represent three of the major expenses covered in the BID budget.
Not everyone who owns property in the commercial district supports the tax. Gary Pebbley, who owns properties within the commercial district expressed his opposition and outlined two primary reasons.
First, he explained that several business owners (including himself) weren’t aware of the proposed transition from the DID to the BID. Secondly, Pebbley said all property owners will fall under the same BID tax bracket, paying the same 0.185-percent regardless of location. Pebbley owns properties that reside at the outskirts of the commercial district zone of the BID. He expressed concern that those located closer to the historical downtown district will benefit more from the maintenance and other budgetary components of the tax.
“I’m not against the tax. But I don’t feel that we should be paying the same as (those) that get all the benefits from it,” Pebbley said. “It’s good to have a downtown area that is thriving … to help draw people to the downtown. It’s vital … but let’s be fair.”
Pebbley proposed making the tax a two-tier system where those properties located at the peripheries of the commercial district pay a lower rate than those situated more centrally.
Gerald Johnson, who also owns property in the commercial district added his own concerns and desire to learn more about the proposal before making a final decision.
“There’s a lot of unanswered questions. This meeting (Aug. 8) will give everybody a chance – whichever side they are on – to give their opinion and state their views,” Johnson said. “We need to have people informed about what’s going on.”
Krasne, who owns two storefronts and several warehouses, all located within the district sees promise in the tax despite the fact that under the new proposals his annual tax bill will increase. Under the old DID, the tax only impacted his stores and not the warehouses. Under the BID, the proposed tax applies to all property value.
Krasne sees the new tax as an investment on the future. When he decides to retire and sell the properties the tax may indirectly allow him to receive more profit.
“By improving this district we hope that it will improve the value of the buildings within the district,” Krasne said. “(The DID) was a great first step several years ago … our downtown looks tremendously better than it did … but we need to continue to move forward.”