The Cary Town Council approved the first step in creating the South Hills Municipal Service District on Thursday.
The council voted to direct staff to prepare a report. Staff will then make the report available to the public before holding a public hearing.
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The decision came as questions lingered about the next steps for the town's oldest mall, South Hills. Property owners requested additional property tax to help pay for the mall’s revitalization and additional services.
Cary Assistant Town Manager Scot Berry told WRAL News the property owner, NP South Hills LLC, petitioned the Cary Town Council to create the South Hills Municipal Service District late last fall.
In a letter to Berry, South Hills property owner said the goal of the service district is to “foster the revitalization of the area that consists primarily of outdated and underutilized industrial, retail and general commercial buildings."
It goes on to say South Hills is particularly suited for the district “because it will bring a distressed area back to life from the ground up.”
Berry said there are more than 60 districts like this one across the state.
“They are mostly focused in areas like downtowns. An area like South Hills that will have additional infrastructure [and] additional people could be interested in having one of these to provide additional services,” he explained.
Raleigh has two municipal service districts: Hillsborough Street and Downtown Raleigh.
Based on the reports that are readily available, the Hillsborough Street district generated more than $609,500 dollars in revenue back in 2016. About a decade later, the district reported $1,420,000 in revenue.
With the creation of a new Municipal Service District, the town of Cary can charge an additional property tax to help pay for South Hill’s revitalization and services like maintenance and security.
In the letter, the South Hills owner said the money generated from the district could be used for several services, including extra security, cleaning, water infrastructure improvements and even ride share management.
Drainage projects and off-street parking facilities also need to be improved as the project develops, according to the letter.
The petition comes after voters rejected a bond package in 2024 that would have helped pay for a new sports venue at South Hills.
However, Berry said an additional property tax under the South Hills Municipal Service District would not apply to most.
“It would only apply to the 40ish acres that are in the outline service district,” Berry said. “That's the area around South Hills, the majority of it owned by the developers who have asked for the district.”
The letter lists 22 properties to be included in the proposed district; fourteen of them have different listed owners aside from South Hills.
WRAL Investigates got an inside look at what’s next for the development: renovating an old car dealership into a fine arts and shopping space.
The Carolina Ballet will own about half of the 70,000 square feet. CEO Zalman Raffael told WRAL News the ballet will convert its space into studios, administrative offices and storage.
Construction is expected to begin at South Hills in 2027.
The building is expected to be open and running in 2028.
