Petaluma calls hearing on merchants' self-imposed tax

Downtown Petaluma merchants concerned about a self-imposed tax meant to encourage visitors to spend money in the historic business district will have an opportunity to make their feelings known next month.

On Monday night, the City Council scheduled a public hearing for Feb. 24, when merchants will be able to voice their opinions about the 13-year-old "business improvement district" and how its funds are spent.

Late last year as the district's new budget was being prepared for 2014 -#8212; typically a routine event each year before the City Council -#8211; several business owners challenged the tax.

They said the levy, enacted in 2000 by a vote of downtown merchants, was being administered behind closed doors and wasn't benefitting many of the member merchants.

They said the money wasn't helping keep their streets and sidewalks clean, nor providing the additional security they wanted. Some pointed the finger at area bars, whose patrons often vomit or urinate in or near other businesses on weekend nights.

The tax was enacted when downtown business owners sought a way to raise funds for their special interests -#8211; security, beautification and marketing -#8211; and convinced the council to approve the self-imposed "business improvement district."

The Petaluma Downtown Association administers the annual tax proceeds of about $50,000.

Since the merchants went public with their concerns in December -#8211; even threatening to work to dissolve the district -#8211; representatives from the PDA and merchants have met several times to try to resolve problems.

A proposed budget and spending details will be sent this week to the approximately 600 downtown businesses, roughly centered at Petaluma Boulevard and Western Avenue and radiating outward about a half-mile. Businesses are levied from $41 and $500 a year depending on size, location and type of business.

Revenues from the annual fee are administered with no City Council intervention other than approval of a budget the PDA submits.

The submitted budget can only be modified by a written protest of a majority of the assessed business owners.

You can reach Staff Writer Lori A. Carter at 762-7297 or lori.carter@pressdemocrat.com.