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Kannapolis Creates Downtown Business District (MSD)

June 30th 2015

 KANNAPOLIS, N.C. — City council has approved creating a municipal service district — also known as a business improvement district — to allow officials to pursue special obligation bonds that can be used to pay for revitalization efforts in downtown Kannapolis.
Officials said that the district would not impact any established zoning in the area.
A municipal service district could eventually allow the city to levy an additional property tax within the district, which would be in the downtown area, but officials are currently not planning to levy an additional tax for the proposed district.
That is an option that could be used at a later date and would only affect those in the district. Officials said if they were to levy an additional tax that it should only impact commercial properties in the district.
The boundaries for the business improvement district are slightly larger than downtown Kannapolis in order to give officials the ability to use special obligation bonds to fund projects, such as gateway signs on main roads in the district as well as street improvements. Funds generated from special obligation bonds can only be used in the district. If an additional property tax is later levied for the business improvement district than those funds could also only be spent in the district.
“We wanted to ensure the district was large enough to be able to spend those funds in those areas,” said Mike Legg, Kannapolis city manager. “That is the only reason property owners are included beyond just the core of downtown. Really, it has no affect on any individual property owners.”
The need for the district stems from the City of Kannapolis looking to purchase the downtown Kannapolis properties from billionaire David H. Murdock.
In March, the City of Kannapolis announced it had come to an agreement with Murdock — owner of the downtown area and creator of the North Carolina Research Campus — to purchase 46 acres of property in downtown Kannapolis for $5.55 million.
The municipal service district would allow officials to pursue bonds to help on needed improvements of the downtown properties and surrounding area, such as water/sewer lines which are more than 50 years old.
The special obligation bonds could be used for improvement to water mains, electric power distribution lines, street lighting, streets and sidewalks, construction of public buildings, restrooms, docks, visitor centers and tourism facilities, sponsoring festivals and markets in the downtown area to promote business investment, construction of bike paths and other uses.
“Let’s say we want to put in a gateway improvement at North Main Street and North Loop Road [and] we want to do something at that intersection to improve it as the entry way into downtown. To be able to use those funds we have to have it in the district,” Legg said. “I don’t see it as their being a huge amount of those opportunities in the short term but we wanted to ensure we had that ability to do that.”
The district was discussed at Monday’s meeting, where officials also opened a public hearing regarding the purchase of downtown properties.
The public hearing was continued to a special called meeting next week where the public will be allowed to provide input on the proposed purchase. That special called meeting is set for 6 p.m. Monday, June 29 at the Kannapolis Train Station, 201 S. Main St., Kannapolis. Officials are also scheduled to talk about the 2015/2016 fiscal budget at Monday’s meeting. The council is currently discussing a 3-cent tax increase.
The current tax rate is 60 cents per $100 valuation and if approved would go to 63 cents. This means the average home valued at $150,000 would pay an additional $45 or $945 annually in property taxes. The increase stems from the purchase of downtown Kannapolis.
Contact reporter Michael Knox at 704-789-9133.

Source Independent Tribune

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