Lexington will soon become the second city in Kentucky with a downtown management district, and supporters say it will make downtown cleaner, more welcoming and safer.
The Urban County Council voted 12-2, with one abstention, during Thursday night's council meeting to approve the new district, bordered by Midland Avenue, High Street, parts of Second Street and Newtown Pike.
"We are very excited that the council has seen the value in this and the benefits it will bring to the city of Lexington," said Drew Fleming, chairman of the Downtown Lexington Corporation, after Thursday night's vote.
The Downtown Lexington Corporation has been spearheading efforts to get the management district started.
Joe Terry, former chairman of the Downtown Lexington Corporation, said he was pleased with the "overwhelming council support."
Under the proposal, property owners inside the district will pay a tax of 10 cents per $100 of assessed value. For example, for a property worth $300,000, the tax would be $300 annually. Initial estimates show taxes on the 567 parcels within the district would generate about $362,000 a year. That money could be used for additional cleaning, trash pickup, the removal of graffiti and additional signs.
There are about 1,200 such districts in the country. Louisville has had a downtown management district since the early 1990s. It has been expanded several times since it was created.
A similar effort to create a management district in Lexington died in 2013. The proposal did not have enough votes to make it out of an Urban County Council committee. But this year, the district had more support from taxpayers within the district.
State law requires that to set up a management district, backers must have the support of 33 percent of all owners in the district, who must represent 51 percent of the assessed value. The group had the signatures of 51 percent of all property owners in the district representing 62.5 percent of the assessed value
A 15-member board will oversee the new management district. It must come up with a budget and hire a group to provide the services, Terry said. That will take time to set up.
It's unclear when new district will start. It could be January at the earliest, Terry said. The new assessment will likely go on the 567 parcels as early as January. Tax bills, however, typically aren't due until the fall, he said.
Council members Ed Lane and Jennifer Scutchfield voted against the district. In previous meetings, Lane had expressed concerns that adding a tax on downtown properties would only make it more difficult to attract businesses to downtown. Scutchfield previously expressed reservations that not all taxpayers within the district had agreed to the new assessment.
Councilwoman Amanda Mays Bledsoe abstained. Bledsoe said after Thursday's meeting that she supported the concept of making downtown more inviting but was unsure whether a new taxing district was necessary.
"I think if this vote would have come after we finished our budget discussions, I would have felt more comfortable," Bledsoe said.