Downtown investment fee up for renewal

The Rochester Downtown Alliance will collect about $323,000 from downtown businesses and the next year through a special service district fee. Here are some of the largest payers. (Figures are approximate.)

• Mayo Clinic, $91,000.

• City of Rochester, $75,000.

• Chafoulias Cos., $34,000.

• Sunstone Hotel Properties, $33,000.


• Wells Fargo, $10,000.

By Jeffrey Pieters

The Rochester Downtown Alliance is backing a proposal to reauthorize a special service district fee charged to downtown businesses.

The fee collects more than $300,000 per year to run the RDA, an organization that coordinates efforts to strengthen and promote the downtown.

The fee will expire after 2010 if it’s not reauthorized before June 30. It was instituted in 2006.

Positive economic trends and anecdotal evidence both suggest the fee is having its intended effect, said Gary Smith, an RDA board member and president of Rochester Area Economic Development Inc., the Rochester economic development agency.

"There’s basically been $70 million in capital investment downtown since the start of all this," Smith said.


In addition, previously existing downtown properties added $56.7 million in market value since 2006, a rate of 9 percent annual growth.

Consumer spending in the downtown market has grown by $21.3 million, or about 3 percent per year, since 2006, Smith said.

The figures correlate to about $55 in added market value, $70 in capital investment and $21 in added consumer spending for every dollar so far spent on the RDA, Smith said.

"We told people this is what we expected," Smith said. "We can look them in the eye and tell them we’re making good on the promises that we made. We still have a ways to go."

Downtown slipped in one area. It represented a 14 percent share of all of Rochester’s consumer activity before the start of the RDA’s work, and it’s down to 13 percent now.

"We should see that gap maybe begin to stop and close up in the future," Smith said.

The way people have begun to feel about downtown is just as important as the hard numbers are, said Smith and others.

Finished projects, like the renovated Peace Plaza, ongoing projects, such as City Centre and the Biobusiness Center, and projects still in the discussion stage all lend to a sense of optimism, they said.


"I haven’t talked to anybody who doesn’t think what’s happening downtown ... hasn’t been a positive change," Smith said.

Board members voted unanimously on Thursday to support reauthorizing the downtown fee. Organizers are required to collect signatures of support from downtown businesses, and the city council will make the final decision.

At the time it was instituted, the fee assessed $1 for every $24.09 of net tax capacity. Next year, the rate will be slightly higher, $1 per $23.43 of net tax capacity.

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