Council to Consider Broadway Tax Zone

A proposal by business owners along the Broadway corridor to charge themselves in order to pay for cleaning, security and promotional services awaits City Council approval.

Miracle on Broadway, a nonprofit organization formed to oversee restoration of the historic corridor, began working on the “business improvement district” concept two years ago. The 900 business owners along Broadway between 2nd and 9th streets would each pay a yearly assessment based on the type of business and its annual gross income.

The city would collect the assessment when business licenses are renewed and would turn the money over to Miracle on Broadway. The district would collect about $500,000 annually, according to Miracle on Broadway estimates.

But the City Council must hold a public hearing on the proposal and vote on whether to establish the tax district. A hearing date has not yet been set.

Broadway business owners came up with the assessment district idea when they realized that, with widespread budget cuts, local governments can no longer pay for the public improvements required, said Harold Rosenberg, a member of the business improvement district steering committee.

“We realized that we’re running out of (city) money here, and we wanted to do something about it,” Rosenberg said.

Rosenberg, who owns two jewelry stores on Broadway, said he will be taxed twice, and figures he will pay an assessment of about $2,000 for one store alone.

“It will be exactly as if these businesses were in a mall; these would be the same kind of common-area fees they would be charged in their leases for parking, security, promotions,” said Estela Lopez, Miracle on Broadway executive director.

“The only way to get more is to pay for it. When you pay taxes, they go into a general fund which benefits the city as a whole; they are not earmarked for a specific district. These funds are returned to the district from which they were collected.”

But Lopez acknowledged that assessment districts haven’t had much support in Los Angeles, and she is still unsure if there is enough support for the concept among Broadway merchants.