Downtown Sioux Falls expanding services with approval of tax increase

SIOUX FALLS — Downtown will have more money to keep the place clean, safe and welcoming.

The city council earlier this month approved removing the cap on taxes paid by downtown property owners under the Business Improvement District program.

That will allow Downtown Sioux Falls Inc. to collect nearly $362,000 more each year through the program. The organization supports local businesses with cleaning sidewalks, collecting litter, holiday lighting and other maintenance and repair.

The money will be used for two additional staff and other efforts to beautify downtown.

Residents can expect “more smiling faces” in the core business district, said Joe Batcheller, president of DTSF.

“For visitors when they come to Sioux Falls they are going to have higher level of hospitality that they can count on,” Batcheller said “That just creates better word of mouth marketing, for not just downtown, but for the entire city because downtown in a lot of ways really represents the image of Sioux Falls.”

The council’s action lifted a cap on the total amount of property taxes that can be assessed through the business improvement district. The program began in 1989 and the max amount allowed for each property was set at $1,700, based on $1 million of valuation. The changes allow additional revenue to be collected at a lower rate — 50 cents per $1,000 in value — above the $1 million mark.

DTSF said the change in the program is needed because of the expanding demand for services because of the growth of downtown businesses.

The plan moved through the approval process without problems until what was supposed to be the final council vote on Dec. 6.

At that meeting, three downtown businesses expressed concerns about the tax increase.

Representatives of Raven Industries said the changes would mean a 377% jump in their assessment.

The council delayed the final vote for two weeks to allow DTSF to address the concerns.

Raven was acquired by CNH Industrial in 2021. The transition from a publicly traded company to private ownership led to some distance between Raven and DTSF, said Eric Shuman, general manager for Raven in Sioux Falls.

Continued development of the north side of downtown, including Cherapa 2 and the Steel District, means increased traffic around the Raven building, which sits on the bank of the Big Sioux River at Sixth Street.

That has raised concerns about safety and trash collection, officials said.

The two week pause allowed for a reconnection to discuss concerns and get Raven more actively involved in the organization, Shuman said. That includes having a company representative on the newly formed safety committee.

“We are looking for good representation and equitable services for the north downtown,” said Shuman. “We want to make it clear that Raven is committed to the downtown area.”

Raven was founded in Sioux Falls in 1956. The company produces precision agriculture products and various applications for plastic sheeting.

The council approved the changes unanimously.

Among the improvements will be an expansion of the DTSF ambassador program, said Batcheller. The ambassador works on the street doing maintenance and repair but also outreach to the homeless or other people in need of social services.

The need is only going to grow as more and more people visit and live downtown, he said. The Raven location is on the river and publicly accessible, which can present challenges.

“There are people that show up for work in the morning, and there might be an unhoused person that is hanging out. An employee of Raven is not used to dealing with that kind of situation,” said Batcheller “Our ambassadors can come in and help out and engage with the folks who are using the public space in a way that it’s helpful to those people, but also helpful to the people that work at Raven.”

Contributed

Councilor Greg Neitzert said it’s important for the city’s core to remain vital. From a purely practical standpoint, the business district generates much more money per square foot than other parts of the city.

“Downtown is where it’s at and why should you care as a citizen because it generates tons of tax revenue,” he said “That tax revenue goes into our coffers and we use it to improve and build roads, provide parks and do services throughout the city.”