An influential Park City business group on Thursday formally outlined its opposition to a strategy under consideration at City Hall to fund the development of an arts and culture district, a strong statement that was submitted to Mayor Andy Beerman and the Park City Council at a crucial time in the difficult talks about the future of a district.

The Historic Park City Alliance, which represents businesses in the Main Street core, raised a series of issues in the two-page letter, which was signed by three of the organization’s officers and a former president of the group. The Historic Park City Alliance is especially concerned about the prospects of monies raised through a sliver of the tax charged on most purchases inside Park City, known as the resort communities sales and use tax. Park City voters in 2012 approved a 0.5 percentage point increase to that tax. City Hall wanted to use the monies from the increase to fund Main Street improvements, conservation acquisitions and infrastructure upgrades in Old Town like street improvements and work on storm drains. Officials, notably, earmarked some of the monies to assist with the funding of City Hall’s $64 million acquisition of the Treasure acreage in a conservation deal.

There is concern on Main Street that City Hall could also use funds from the increase to the tax for the arts and culture district, which is planned to stretch inward from the intersection of Kearns Boulevard and Bonanza Drive. City Hall acquired the land for the purpose of developing an arts and culture district, but the discussions have become difficult in recent months as cost estimates for the municipal portion of the project hit nearly $90 million and amid the continuing economic worries caused by the spread of the novel coronavirus.

The letter from the Historic Park City Alliance, sometimes called the HPCA, indicates the organization wants City Hall to continue to put funds into the improvements on the shopping, dining and entertainment strip, saying “Investing in Main Street has a proven ROI,” using an acronym for the phrase return on investment.

“The members of the HPCA unanimously disagree with use of the Resort City Sales Tax funds as currently proposed for the Arts and Culture District and ask the City Council to identify an alternate funding source for the project,” the letter says.

The letter claims more than $7.8 million that was raised from the increase and was anticipated to be put into improvements in the Main Street core was not spent in the way the organization initially expected. It says City Hall has put monies into capital projects elsewhere “while HPCA’s projects are delayed.”

The input from the Historic Park City Alliance could presage further friction between the organization and City Hall as officials move forward with the talks about the arts district. Leaders say the project is designed in a way that it would not directly compete with Main Street, which has one of the state’s largest concentrations of art galleries. But Main Street could see any commercial development within the arts district as competition of sorts after having already been impacted by commercial projects in the last 20-plus years inside Park City and in the Snyderville Basin.

The letter says the Historic Park City Alliance in April plans to talk about updating an improvement plan for the Main Street core that will consider the upcoming 15 years.

“The businesses feel it is important to continue to fund and improve Main Street, especially given the significant amount of sales tax funds it provides for the City,” the letter says, alluding to a City Hall document that guides growth in the community. “And, as the General Plan states, it is a critical priority as the heart of our town.”

The mayor and the City Council have held a series of lengthy, difficult discussions regarding the funding of an arts and culture district. They have not finalized a strategy and more discussions are pending. The Kimball Art Center and the Utah offices of the Sundance Institute are envisioned to anchor the district. Workforce or otherwise affordable housing and transportation infrastructure are also planned.

The supporters of the district see the project as something that would advance Park City as an arts and cultural destination as well as a project that could be a step in diversifying an economy that is heavily reliant on the ski industry. Critics have expressed worries about the cost.