Thursday, October 11, 2012

Amherst/Hamp ReBID

Amherst BID website (nice header photo)

On August 7 Governor Patrick signed into law a change affecting Business Improvement Disticts, a tweak that will have a profound impact on a minority of businesses located within the target area, namely those who originally "opted out" of the enterprise (thus avoiding the increased taxation assessment, but also the benefits).

And neither Amherst or Northampton are grandfathered from these changes.

Now a BID, rather than being given a lifetime operation permit at inception, has to be renewed every five years by a simple majority vote, and businesses originally allowed to opt out can no longer avoid paying the higher surcharge if the majority votes in favor. 

In other words, you are in whether you like it or not.

 Alex Krogh-Grabbe addresses Amherst Select Board mid-July (hence the sandals)

According to Amherst BID Director Alex Krogh-Grabbe, "Twenty one of 92 property owners within the district opted out initially, representing 17% of the property value & 15% of the properties within the district."

The increased tax burden falls on the property owner not the business renting the commercial space, although any increase in overhead for an owner is usually passed on to tenants.

 UMass and Amherst College, as tax-exempt property owners in the downtown district, cannot be assessed fees but have volunteered to pay $15,000 each annually plus assist with in kind contributions such as providing interns and distributing promotional materials to students.

The Amherst BID is still in its rookie year of operation, so they are in no great hurry to take a revote (which can happen anytime within five years of the 8/7/12 change in the law).  Krogh-Grabbe states the Amherst vote will take place sometime in early 2013,  "after all affected property owners understand what the change means".

In Northampton the BID was bitterly opposed by reclusive entertainment mogul Eric Suher, so it will be interesting to see his reaction to this heavy handed change in the rules that will cost him thousands of dollars annually.

At least in Amherst, businesses have a few months to get used to it.

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