West Raleigh commercial property owners face potential tax hike for new development
Hundreds of property owners in west Raleigh could have to pay higher taxes to keep up the area as new development moves in.
The city is considering designating the Blue Ridge Road corridor, where there are plans to develop around PNC Arena, as a municipal service district [MSD].
Raleigh-based nonprofit Blue Ridge Corridor Alliance is proposing that the MSD to cover 277 properties between Interstate 40, the Beltline and along Blue Ridge Road.
A proposed 5-cent tax rate increase would generate $900,000 for the district. It would apply to commercial properties and businesses. However, the tax would not apply to single-family homes in the district.
“It’s directly feeding right back into the corridor for, I think, a very nominal tax,” said Todd Hancock, the treasurer of the Blue Ridge Corridor Alliance.
The proposal would be Raleigh’s first new MSD in more than a decade.
If the Raleigh City Council approves the MSD, the tax increase would go into effect with the new budget on July 1, 2024.
West Raleigh's growth is something Hancock has seen firsthand having grown up in the area.
“There’s going to be more people working and living there. That will happen, and it’s going to happen soon,” he said.
“It’s always been an area of change, but also disjointed,” Hancock added.
Creating an MSD would pay to hire a staff to manage, maintain and market west Raleigh as a destination.
The city already has an MSD in downtown Raleigh and another along Hillsborough Street.
Creating an MSD in west Raleigh would provide services similar to the Hillsborough Street and Downtown Raleigh MSDs. It includes promoting businesses with the “Live It Up!” theme and public art. The MSD also pays for a team to clean up trash and maintain the streetscape.
“We’re kind of behind on a lot of this, and as the development happens at a rapid clip – which it surely will in the next one, two, five, 10 years – we’ve got to be proactive,” Hancock said.
Construction cranes have popped up along Blue Ridge Road, including one that is building the new North Carolina Department of Health and Human Services headquarters.
A deal to keep the Carolina Hurricanes at PNC Arena allows owner Tom Dundon to build a mixed-use development on the land around it.
“This area is going to be booming, and I’d like to ensure that we are moving forward,” Raleigh Mayor Mary-Ann Baldwin said.
At-Large City Council Member Jonathan Melton echoed Baldwin’s sentiments.
“We have an opportunity here to make this a place that is vibrant, walkable and easy to get to and from,” Melton said.
Some city council members are also concerned about the possibility of the cost being passed down to renters who live in larger apartment developments. They’re still working out the details of which properties the proposed MSD would apply to.
The city expects a public hearing on the proposed MSD next year between February and early April. The city council would then vote on the proposal in May or June.
