Consultants outline Rock Run business district, say 1% sales and hotel taxes would apply only inside the boundary

Caitlin Johnson, senior vice president with SB Friedman Development Advisors, briefed council and staff on a proposed business district to support redevelopment at the Rock Run Collection, near the intersection of I-55 and I-80.

"One of those incentives was a business district that is a 1% sales tax on businesses or sales of goods within the proposed area, as well as a 1% hotel tax on rooms within the area as well," Johnson said, describing revenue sources that could be used to support bonds or other redevelopment incentives. She emphasized that the taxes would apply only to businesses operating within the defined district boundaries.

Johnson said the district boundary is intended to include undeveloped parcels and existing commercial uses that are expected to contribute to and benefit from redevelopment, and that funds collected would be restricted to use inside the district. In response to council questions about industrial parcels that do not collect sales tax, Johnson said those parcels are currently exempt from sales taxes, but if land-use changes occur in the future a council could pursue an amendment; she said the standard term for a business district is 23 years and that expansion is possible through the eligibility and public-approval process.

Council members asked clarifying questions about the boundary, whether taxes would apply to all retail within the footprint, and options if industrial parcels converted to retail in future years. Johnson said amendments are possible but would require meeting eligibility criteria and a public process.

The presentation was a staff/consultant briefing to preview an item on the full council agenda; no ordinance adoption or vote occurred at the pre-council meeting.