Troy’s Business Improvement District was to cease operations in the new year because of a budget deficit. But in an eleventh hour decision this week, the tourism and beautification entity was saved.
BID Executive Director Olivia Clemente didn’t believe a last-minute bailout would come, but she was pleasantly surprised. Speaking with WAMC Tuesday, Clemente said the agreement follows a handful of hours-long meetings with the city.
“It was a long meeting of going through the budget, line item by line item with the mayor and the deputy mayor, and there were a lot of compromises, a lot of cuts that we needed to make for them to release this funding for us,” Clemente said. “So really was a going back and forth of a negotiation of, ‘OK, we'll eliminate that position.’ ‘We'll eliminate this.’ ‘We'll eliminate that.’ We had our accountant in the meeting, we had our lawyer in the meeting, and our accountant in real time was like making changes to our budget. So that way there was some kind of agreement that came about, but that agreement came with cuts to staff.”
The nonprofit, which presents events like Pig Out, Rockin’ on the River, and Chowderfest, and helps to beautify downtown, receives money through a local law approved by voters in 2008 that made the city’s downtown a special tax district.
The BID was in jeopardy because it needed businesses in the district and city leaders to agree to an increased tax rate. This week, that agreement was reached, with the city approving a new rate set at 7.7% -- a nearly 3% increase from the current rate. The BID, which hasn’t received an increase in tax funding in 17 years, had been seeking a 5% tax levy increase, which would have brought the annual tax paid by property owners in the special tax district to 10%.
The new deal will give the BID a budget of $286,000. Despite the tax rate increase, that budget is down from the current budget of nearly $340,000 -- well below other area BIDs – as the BID contends with lost revenue as a result of fewer planned events. In addition, the BID was dealing with a loss in private funding. Usually, it receives around $70,000 in sponsorships annually, but this year, Clemente said that number was down to about $55,000 because of cuts to federal and state grants. The nonprofit relies solely on events and taxes for its funding.
Clemente said all of this has meant the BID needed a tax rate increase to pay staff, put on remaining events, and beautify downtown.
“We went into that meeting and we had no idea how much money they were giving us, so we, like, put our 10 percent budget in front of them, which showed the $360,000 that we were asking for, and what that budget looked like,” Clemente said. “And then when they worked us backwards to make those cuts that I told you, like rocking on the river, cutting the staff, cutting, like the marketing down, that's where they came to that sweet spot number of $286,000 so it really wasn't like us. Honestly wasn't even like a negotiation. It really was, you have to make these cuts. This is what you're getting.”
Even under the new deal, Clemente said the Rockin’ on the River event and a raise for the executive director’s position have been eliminated as part of non-negotiables laid out by the city.
The deal reached this week to increase the tax rate will not break the city’s tax cap, of which there was only $41,000 left to budget before the city hit that quota. Instead, $100,000 was moved from the city’s contingency fund to the BID’s budget line item.
That funding strategy came after a labored search of Troy’s budget by Republican City Councilors Ryan Brosnan and Tom Casey. Casey, who represents District 6, says the BID is important to him and his constituents, and he didn’t want it to disappear.
“Not only were we meeting to save the BID, but you know, we had to also make sure that the BID saved itself,” Casey said. “And it was really productive, and everybody just came together and, in the end, and it was, it was really wonderful, because nobody wants to see the bid go down, and I certainly was not going to let that happen on my watch.”
Clemente wants residents to know the BID is not run by the city.
“At the end of the day, our board is the one that puts this budget together and has to vote on it going into next year,” Clemente said. “So, it's really important to always separate, like the bid is its own entity, and we represent the downtown. We don't represent the city as a whole.”
Mayor Carmella Mantello previously told WAMC that if the BID were to dissolve, the city would have taken over the management and hosting of the BID’s events.
Residents will have the opportunity to comment on the increase at a Dec. 18 City Council finance meeting at 6 p.m.
