Revival of district has many ‘furious’
Montrose Management plans to tax commercial property owners
Judy Adams, who co-owns Foelber Pottery at 706 Richmond with her husband, says she’s been “through thick and thin” in Montrose since the studio and gallery space opened in 1979.
And now, a new challenge: Adams recently received an unsigned, undated missive, addressed generically, with a return address listed as a P.O. box: “It is with great regard and hope for the future of Montrose that we present to you the reintroduction of the Montrose Management District.”
“If I didn’t know what was going on, because I’m involved, I would think this was a joke,” Adams said. “Everyone is just so furious and frustrated.”
The Montrose Management District is back, revived in December after years of dysfunction and legal wrangling led to it going dormant in 2018. And its plans to tax commercial property owners has angered some longtime small-business owners in the historic Houston neighborhood.
“All of us were stunned,” said Pat Greer, who has been serving homemade vegan cuisine at her restaurant, Pat Greer’s Kitchen at 412 W. Clay since 2005. “This is a real slap in the face.”
Daphne Scarborough, owner of the Brass Maiden, a custom metal fabricator at 2016 Richmond, said she worked against the creation of a Montrose Management District in 2011 and has been consistently unimpressed by its management as well as its services.
“It is taxation without representation,” Scarborough said. “They don’t have anything to offer our businesses. We wouldn’t run our business the way they run the district. They do absolutely nothing.”
The city of Houston includes a number of management districts
funded by taxes on commercial property owners, with revenues used to supplement standard municipal services such as landscaping, public safety and sidewalk maintenance.
As an economic development tool, they are conceptually similar to Tax Increment Reinvestment Zones, in which a portion of property tax revenues collected in the zone are used for new projects within its borders. Some Houston neighborhoods have both: Montrose, for example, has a TIRZ created in 2015.
When the Montrose Management District board voted to disband, commercial property owners who opposed it believed they’d unburdened themselves.
“I was there the day it was dissolved,” Adams said. “We all cheered. It was great. And since then, it’s been wonderful.”
But Alan Bernstein, a spokesperson for the district, says the district never went away.
“Discussions with property owners about reactivating the district have been taking place since not long after its dormancy began,” said Bernstein, who is also director of communications for Hawes Hill and Associates, an economic development agency that works with a number of Houston’s management districts. “Major developers that are relatively new to the scene stated their support for resumption of services, as did city government officials.”
Houston Mayor John Whitmire, who was inaugurated in January, did not respond to a request for comment on the revival of the district.
The new iteration of the district aims to be relatively streamlined, focused on essential tasks and allocating 60% of its budget to public safety. Its new service and assessment plan stipulates that the tax rate will drop to 9 cents per $100 of property value from 12 cents. The values are determined by the Harris County Appraisal District. And property values in Montrose and other Houston neighborhoods have risen significantly since the district went dormant.
The assessments will be levied against commercial property owners rather than small-business owners, many of whom own the properties in which they operate, Bernstein said. Residential complexes with 25 or fewer units will be exempt, as will mixed-use properties where the business portion is less than 40 percent of the total valuation. The midrise and high-rise properties that have popped up in Montrose in recent years will pay assessments based on the valuation of four floors of the complex, not the entire building.
The district has not yet begun providing services, Bernstein said. The board plans to hold a retreat to discuss its operations and procedures on April 3 at Cafe Brasil at 2604 Dunlavy; the meeting will be public, but no public comments will be taken.
The board is awaiting city approval on nominations to fill six vacant board seats, he said, There are several active board members, including Dimitri Fetokakis, owner of Niko Niko’s, the Greek restaurant at 2520 Montrose Blvd., who also served on the district’s board during its previous iteration.
That wasn’t always a pleasant experience, he acknowledged, given the tension the management district caused among his longtime neighbors. Still, he agreed to serve again after being approached several years ago. He said the district’s functions are necessary given concerns of some over public safety and trash. In addition, he said, maintenance of projects being pursued by the Montrose TIRZ will likely fall on the management district.
But Fetokakis isn’t oblivious to the concerns of his fellow business owners about the district’s revival.
"I get it," he said. "Everybody’s like, 'I already pay my taxes. Why isn’t the city doing this?’ Well, in reality, it’s not happening, so now what?”
“Montrose has always been that eclectic place in Houston, but that doesn’t mean that we have to not take care of it,” Fetokakis continued. “We have to make sure it’s clean. We have to make sure it’s safe, as much as we can. We have all these bike trails in the middle of the street that are all crooked, and missing poles and things like that. Well, guess who’s going to have to take care of that?”
He said that the revived district’s board plans to do more to address the “disconnect” the community experienced last time: “We obviously need to do a better job in communicating.”
Many commercial property and small-business owners remain unpersuaded. About two dozen residents and business owners gathered for a meeting at Cafe Brasil this week, Adams and Greer said, where many focused on what they said was underwhelming services, even as the assessments took a bite out of their margins.
“In theory I could see how it could help, and yet we already get the services that they say they’re going to provide,” Greer said. “We are not blighted. It’s Montrose.”