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Meramec Funding Sources

Community Improvement District

Community Improvement District

Aug. 1, 2019
By WSU EFC

Story summary:

  • A Community Improvement District is a special purpose district whose property owners voluntarily tax themselves to fund public improvements or services to support the community and promote economic development

Quick Facts

Benefits of a Community Improvement District
Proceeds collected can be used for a broad range of public purposes – including stormwater infrastructure

Focus costs only on those benefiting from the services

Allows local residents to obtain expanded services they want at a price they are willing to pay 

Drawbacks of a Community Improvement District
Adds another layer of government

Adds another layer of taxes and taxing districts

May deter businesses or customers

Can seem redundant to business and property owners

Some report oversight is lacking

About

A Community Improvement District (CID) is a non-profit corporation or separate political subdivision that delivers specific public services within a defined boundary. A community improvement district can levy taxes, issue bonds, charge fees, and apply for grants.

The purpose of establishing a CID is to improve the community through infrastructure investment and creating conditions that attract new growth. Community improvement projects supported by the CID may include capital improvements, beautification, community safety, business retention and economic development. Each CID has its own goal and focus.

Public improvement, public services and blight removal within the boundaries of the district can be financed by the CID. Stormwater, flood-reduction and other healthy watershed projects can be financed through CID funds.

 

A CID is created by ordinance of the local municipal governing body. To get a CID approved the must be a petition signed by property owners owning 50% of the assessed value of the real property and more than 50% per capita of all owners of real property in the district. State law (Sections 67.1401-67.1571 RSMo) provides detailed directions for establishing CIDs.

The petition must include a detailed 5-year plan (CID purpose, services, proposed improvements, costs), description of the governance structure, maximum rates of property taxes of special assessments, a statement about whether or not sales tax will be sought, a statement about the borrowing capacity and revenues, and the length of time that the CID will exist. 

In Missouri, a CID can be one of two types:

  1. Political subdivision – funded by public money via sales tax
  2. Nonprofit – funded by property tax or special assessment

 Consult your municipal attorney prior to moving forward with CID opportunities.

 Project Examples

City of Pacific, MO

Pacific, MO has three Community Improvement Districts, that each impose a 1-cent sales tax on retail sales at businesses in the districts. They were developed to generate revenue for road improvements in each district. More Info

More Info/Resources

Consult your community’s attorney and financial advisors prior to moving forward with any of these funding options. Any reference in this website to any person, or organization, or activities, products, or services related to such person or organization, or any linkages from this website to the website of another party, do not constitute or imply the endorsement, recommendation, or favoring of companies or organizations.
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