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Middlebury officials to review downtown tax: Some merchants concerned with levy

MIDDLEBURY — The Middlebury selectboard has unanimously approved a seven-year renewal of the community’s Downtown Improvement District (DID), though officials said they’re open to adopting a new revenue source for funding the associated upgrades to public property within that special zone.
It was in 1996 that a majority of downtown property owners petitioned to create the DID, which roughly encompasses the core Middlebury Village area. Owners of non-residential property within the DID agreed to a special tax of $100 per $100,000 in property value to help fund improvements to public amenities within the district.
The approximately $34,000 generated annually by the special tax has leveraged other revenues — including state grants — that together have paid for approximately $1.7 million in downtown repairs and amenities, including historic streetlights, better curbing, sidewalks, signs and park infrastructure.
It’s clear the DID continues to enjoy strong support among a majority of affected property owners; individuals representing 83 of the 119 affected parcels signed the latest seven-year renewal petition, which will ensure the district’s continuation through June 30, 2024.
But some of the DID-based business owners are suggesting it might be time to find a different source for district revenues.
Swift House Inn owner Dan Brown said he’s a big fan of the district’s work, but decided not to sign the petition this year. He said while the roughly $1,200 he pays for the DID each year is relatively minor compared to his overall, $50,000 property tax bill, it adds to the growing costs of doing business in Middlebury.
“I think it’s important for every business in the town to have a vested interest in what happens in the town and what it looks like,” Brown told selectboard members at their Nov. 14 meeting. “I think a majority of businesses agree with that. But this is just another thing we have to pay for out of pocket.”
The Swift House Inn’s $1,200 contribution to the DID is the sixth-highest among the 119 affected properties that pay the tax, according to Brown. That $1,200 is around one-30th of the total $34,000 generated. The Swift House Inn is located within the outer fringe of the DID.
Brown suggested the DID instead be funded through a line item in the municipal budget.
“Why does this not come out of the (town’s) general fund?” Brown asked. “Why can’t this be something that becomes a line item in our property taxes, and make all property owners — who benefit from what goes on in the downtown area — help fund this also?”
While the selectboard unanimously approved a seven-year renewal of the DID, they promised to consider Brown’s advice — which was echoed by DID Commissioner Amey Ryan. Ryan recently joined the DID commission and said she’s been wondering why the district parameters were drawn they way they were,
“To me, a healthy downtown and a healthy Exchange Street and a healthy East Middlebury and a healthy Route 7 South — all those things are equal components to a healthy and vital town,” said Ryan, who is also president of the Better Middlebury Partnership. “And if the tax is not spread beyond this arbitrary line of businesses that are in the ‘downtown,’ it’s seemingly unfair.”
She said a different funding plan would make more sense.
“I would be in favor of a more broad-based tax,” she said. “Part of it is, people don’t see tangible benefits to having spent that money on a tax bill. Whereas a board-based tax, if we could have some measurable results and show people ‘this is what your tax dollars are bringing you,’ I think you get more buy-in from more people and it just seems fair.”
Selectboard members want to resolve the issue soon, in view of recent debate in town about potentially creating other assessment districts to help fund projects in other parts of town — such as the Exchange Street/industrial park area.
Absorbing the current DID tax levy into the town budget could prompt property owners in other parts of the community to lobby for special improvements to their respective neighborhoods, noted to Selectwoman Laura Asermily.
“I’m just thinking about (setting) a precedent for that,” Asermily said.
Selectman Victor Nuovo said he understood the call for spreading the DID tax assessment over a broader base, but he recalled the origins of the district. Local businessman Charlie Kireker spearheaded the effort 21 years ago.
“The DIDC was formed by the local downtown businesses, to improve the downtown,” he said. “Obviously, over the years, it seems to me (the district tax) has done some very good things. So it was more of a voluntary operation rather than a town-funded one.”
That said, Nuovo said a different DID revenue sources is “worth considering.”
Becky Dayton is chairwoman of the DID Commission and owner of the Vermont Book Shop. She believes it’s time to re-evaluate to the DID and its financing, noting it has become more difficult to leverage funds with the small annual yield of the special tax. But she is pleased the selectboard agreed to extend the DID while its future is being sorted out.
“I, like Amey, share Dan Brown’s view that the activities of the DIDC benefit the entire community, not just the owners of commercial properties in the rather arbitrarily defined district,” she said. “Perhaps the time has come to reconsider the source of the funds that support these activities and projects. So, yes; I support the renewal of the ordinance and pay my assessment without complaint, but I am plenty willing to explore alternatives. Whether I would endorse a new tax is another matter.”
Reporter John Flowers is at [email protected].

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