The Westside Health Authority and Austin Chamber of Commerce are looking to raise money to attract economic development near Chicago and Cicero Avenues, but residents and businesses located there would need to pay a little extra in taxes to do it.
The two organizations have applied to create what would be officially known as Special Service Area 72. It would include the portion of Chicago Avenue between Central and Kilpatrick Avenues, and the section of Cicero Avenue between Rice and Ohio Streets. Every property owner inside of it would have to pay an extra tax, which would be used to fund projects and initiatives that would encourage economic development.
The Chicago Finance Committee held a hearing on SSA 72 on Oct. 28. While heads of WHA and the chamber touted it as a way to improve the area, many people at the hearing expressed concerns about the impact of the extra tax.
SSAs, also known as Business Improvement Districts, have been around since the 1970s. There are currently 53 of them in the entire city, but only one of them, West Humboldt Park’s SSA 63, is on the West Side.
According to documents provided at the hearing, if approved, SSA 72 will take effect in tax year 2016 and expire in 2026. While the exact amount will vary year to year, it would be capped at 1.75 percent of the property’s equalized assessed value. For tax year 2016, that would be a total of $129,772.
According to the Chicago Department of Planning and Economic Development’s website, the money can be used in many ways. Those include hiring security to patrol the SSA, beautifying the area, funding art projects and special events, offering economic incentives to retain and attract businesses, fund facade and building improvements, and pay for marketing services, among other things.
The way the money is actually spent would be decided by a board of commissioners appointed by the mayor. A local non-profit would handle the day-to-day operations.
SSA 72 would partially overlap with the recently established Austin Economic Thrive Zone, which runs along the section of Chicago Avenue between Austin and Laramie avenues.
During the Oct. 28 hearing, Percy Giles, the Affordable Care Act director at the Westside Health Authority, said that many residents he talked to were in favor of the SSA, as was Ald. Emma Mitts (37th).
“After consulting with Ald Mitts, we all agreed that SSA will bring great enhancement to the Chicago Ave,” he said. “It seems that it has overwhelming support from businesses and residents and property owners in the area.”
Giles said that the designation would give the area a unique identity residents could take pride in and that it would help address safety issues.
Morris Reed, WHA’s CEO, said that the past ten years saw some improvements in the area and that an SSA would let the community build on that.
“We look forward to having Austin on the map and attracting more people to the community,” he said.
Amara Enyia, head of the Austin Chamber of Commerce and an Austin Weekly News columnist, said that an SSA wouldn’t be a cure-all, but it would help revitalize the neighborhood.
“We want to create an aesthetic that says that it’s vibrant and it’s going to be revitalized,” she said. “We think that it’s one of the ground-level steps we can take to revitalize this corridor and support businesses that are located in this corridor. “
But the proposal did face some opposition. DeAnne Shallcross, vice-president of Advance Equipment Manufacturing, said that the toolmaking company has been in Austin for 94 years and is currently looking to expand. The extra tax, she said, would hurt the company’s bottom line.
“It’s a struggle,” Shallcross said. “This increase in taxes will affect our business.”
Mary Bonome, the deputy commissioner of planning, later clarified that, while an earlier proposal for SSA 72 did include the land Advance Manufacturing was on, the current proposal doesn’t.
Emilia Zararia, who owns a building at 5469 W. Chicago Avenue, said that she wants to see the area improved and more support for local businesses, but the extra tax gives her pause.
“We need help to improve the area, but increasing the taxes, that’s hard for us,” she said. “We need help with low-interest loan to improve the building, to bring people there. [But] taxes, they are just killing it.”
Enyia said that, while she understands where much of the criticism of the proposed SSA is coming from, there aren’t many other immediate options for Austin to attract investment.
“The reality is that, in our community, in Austin, there are significant challenges,” she said. “In the absence of other tools we can leverage, SSA is one of the best tools we can try to work with, especially with economic revitalization.”
SSA 72 would still need to be approved by the city council — if it goes that far. According to city documents, if at least 51 percent of all voters and at least 51 percent of all property owners within an SSA sign a petition objecting to it, the SSA won’t be formed. The signatures must be collected within 60 days after the public hearing.