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HomeMy WebLinkAboutED BID Annual Levy Assessment 2013CITY OF Agenda Item No: 5. h Meeting Date: March 18, 2013 SAN RAFAELCITY COUNCIL AGENDA REPORT Department: Economic Development Prepared by: StephonieLoveUo City Manager Economic Development Mana SUBJECT: Resolution declaring Council's intention to amend the existing Downtown Parking and Business Improvements Area and levy an assessment. RECOMMENDATION: Adopt resolution. BACKGROUND: State law provides for the establishment of Business Improvement Districts to promote the economic revitalization and physical maintenance of commercial districts. B0'sprovide amechanism for businesses to assess themselves in order to provide services in addition to those provided by local Son Rafael established u Parking and Business Improvements Area in 1979. codified as Municipal Code Chapter 10.08, for retail businesses around Fourth Street from E Street to Lincoln Avenue. Approximately 125 retail businesses are in the District; financial inotitutiono, service businesses and professionals are not included. Members pay anassessment fee ofone half nftheir business license fee, and the assessment generates approximately $15.OU8to$18.000annually. This was augmented with a contribution from the Redevelopment Agency and with revenue generated by the operation of parking lot atthe PG&E site. With the termination of the Agency and the pending development of the parking lot, these funds are nolonger available. |naddition, the additional event support, street cleaning and general advocacy efforts provided bythe Agency have ended. Several years ago, in conjunction with Economic Development staff, the B|[] began exploring ways to provide financial stability to the BID. It was determined that expanded services, a larger area, greater diversity cfbusinesses, and a different assessment process could result in a revitalized and improved District. The BID has now incorporated as o non-profit organization and developed o proposal for amending the existing BID nama, area, mennbernhip, services provided and assessment formula. An information package was developed and distributed to all businesses within the proposed area. In addidon, all prospective members were invited to e BID informational meeting on February 28. The majority nfthe comments received by the BID were positive. Thoroh)no. the BID has requested that the City proceed with amending the existing BID. Technically, the name of the existing area is "Downtown Parking and Business Improvements Area", and the request is to change that ho"Downtown San Rafael Business Improvement District". The proposed area would extend from the Miracle Mile to Hetherton Avenue, from Fifth to Third Streets, and extend down B SLnsot to Second Stneet, and o map is attached as Exhibit Ato the proposed resolution. All businesses in the area would be members, with the exception of residential uses and home occupations. Voluntary memberships of businesses outside the District boundaries would be allowed. The assessments would beaflat fee bytype ofbusiness and location in two different benefit zones. The Standard and Premium Benefit Zones aro shown on the Exhibit Amap, and the assessment fees and Exhibit Ctothe proposed resolution and are oofollows: FOR CITY CLERK ONLY File No.: SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2 Downtown San Rafael Business Improvement District Annual Assessment Formula The B0 estimates that there would be approximately 700 members and an annual assessment of approximately $95.000 would be generated. The assessment would continue to be paid on an annual basis espart ofthe business license process. The proposed services are consistent with the uomo of revenue as stated in ebaba |uw, are included as Exhibit B to the proposed resolution, and are as follows: A. General promotion ofbusinesses activities within the BID; B. Promotion of public events which benefit businesses within the @|D and which hake places in public places within the BID; C. The aoquioition, cunsbuotinn, installation and maintenance ofany tangible property including but not limited to benches, trash receptacles, decorations and landscaping; D. Activities which benefit businesses located and operating in the District. The BID would set specific programs within these parameters in on annual budget which must be accepted by the City Council. A general description of the program areas and the percentage of the allocation of funds to each area under consideration are as follows: Hospitality (20%)—Actions bopromote asafe and welcoming Downtown, and hu provide additional street enhancement services, such as sidewalk cleaning and beautification. K4orknting. Promotions and Communication (2896)—Actions to promote Downtown through marketing, advertising and branding utilizing |ono| media outlets and social medie, market Downtown authe prime location in San Rafael for retail businesses, strengthen the "Shop Local" campaign, and distribute routine member newsletters and e-mail communications. Special Events (2O96)—Actions to promote special events that create fun, vvo|cnminA activities that draw residents and visitors into Downtown, build a sense of community, bring visibility and business to Downtown retailers and raataunants, and appeal to the broadest demographics of San Rafael and Marin County residents. Administration and Advocacy (4k]96)—Organizational administrative functions, represent the interests of its members, establish an effective relationship with the Citv, work with community groups, serve as a resource for members to cultivate a successful business, improve the work -day experience for Downtown offioea, advocate for parking policies that support a strong retail envirnnment, advocate for City policies that support Downtown business inharooto, business recruitment and retention activities to attract solid businesses that will strengthen the mix of retail, restaurant and entertainment venues. ANALYSIS: B|Os in general, and the existing BID have proven hobaan effective mechanism hoimprove and enhance business areas. They provide improvements and oervices, especially advocacy actions, which go beyond those which can be provided by the Qty. In addition, the funds are directed to areas where those businesses that pay the assessments want them (ogo. The BID ascurrently formed cannot provide the services proposed. The proposed name change is consistent with the name commonly used in reference tothe District. The expanded area includes the core ofDowntown and encompasses an area that in more representative of Downtown and can beassisted bythe proposed programs and activities. Annual Assessment Type mfBusiness Standard Premium Retail, Restaurant, Personal Services, Financial Institutions $175 $225 Offices, Professionals $75 $100 Personal Services Sole Practitioner $50 $75 Non -Profit Organization $50 $50 The B0 estimates that there would be approximately 700 members and an annual assessment of approximately $95.000 would be generated. The assessment would continue to be paid on an annual basis espart ofthe business license process. The proposed services are consistent with the uomo of revenue as stated in ebaba |uw, are included as Exhibit B to the proposed resolution, and are as follows: A. General promotion ofbusinesses activities within the BID; B. Promotion of public events which benefit businesses within the @|D and which hake places in public places within the BID; C. The aoquioition, cunsbuotinn, installation and maintenance ofany tangible property including but not limited to benches, trash receptacles, decorations and landscaping; D. Activities which benefit businesses located and operating in the District. The BID would set specific programs within these parameters in on annual budget which must be accepted by the City Council. A general description of the program areas and the percentage of the allocation of funds to each area under consideration are as follows: Hospitality (20%)—Actions bopromote asafe and welcoming Downtown, and hu provide additional street enhancement services, such as sidewalk cleaning and beautification. K4orknting. Promotions and Communication (2896)—Actions to promote Downtown through marketing, advertising and branding utilizing |ono| media outlets and social medie, market Downtown authe prime location in San Rafael for retail businesses, strengthen the "Shop Local" campaign, and distribute routine member newsletters and e-mail communications. Special Events (2O96)—Actions to promote special events that create fun, vvo|cnminA activities that draw residents and visitors into Downtown, build a sense of community, bring visibility and business to Downtown retailers and raataunants, and appeal to the broadest demographics of San Rafael and Marin County residents. Administration and Advocacy (4k]96)—Organizational administrative functions, represent the interests of its members, establish an effective relationship with the Citv, work with community groups, serve as a resource for members to cultivate a successful business, improve the work -day experience for Downtown offioea, advocate for parking policies that support a strong retail envirnnment, advocate for City policies that support Downtown business inharooto, business recruitment and retention activities to attract solid businesses that will strengthen the mix of retail, restaurant and entertainment venues. ANALYSIS: B|Os in general, and the existing BID have proven hobaan effective mechanism hoimprove and enhance business areas. They provide improvements and oervices, especially advocacy actions, which go beyond those which can be provided by the Qty. In addition, the funds are directed to areas where those businesses that pay the assessments want them (ogo. The BID ascurrently formed cannot provide the services proposed. The proposed name change is consistent with the name commonly used in reference tothe District. The expanded area includes the core ofDowntown and encompasses an area that in more representative of Downtown and can beassisted bythe proposed programs and activities. SAN RAFAEL CITY COUNCIL AGENDA REPORT / Palie: 3 State law requires that BID assessments be levied on the basis of the estimated benefit to the business. Businesses can be categorized for the purpose of determining their relative benefit, and the area itself can be divided into zones based upon the relative benefits of different locations. The Standard and Premium Benefit Zones proposed reflect this different benefit provided to different areas as the centrally located Premium area is expected to receive a larger degree of benefit that the more outlying areas. The assessments are scaled to the type of business and assume that retail, restaurants, personal services (spas, hair and nail salons) and financial institutions (banks) will receive more benefit from the BID activities, especially marketing and promotions. Offices and professionals will benefit to a lesser extent, but the BID will still bring more potential customers to Downtown and office and professionals will benefit from a safe and clean environment. Lower assessments are charged to personal services sole practitioners (individual operators in spas, hair and nail salons) as there are multiple operators in a personal services facility, and the facility also pays as a business. The spread of assessments between the types of businesses and the zones of benefit are typical of business based BID throughout California. The process to amend the BID starts with the adoption of a Resolution of Intent by Council, which must show the area and the benefit zones, the name of the District, the types of activities proposed to be funded with the assessments, a statement that the assessment is annual, the method and basis for calculating the assessment by each property owner, and the time and place for a public meeting to take testimony and the time and place for a public hearing where protests may be heard. The attached resolution of intention includes all these items. Within 7 days of adoption, the resolution must be mailed to all business license holders in the proposed area on record with the city with a notice for both the public meeting and the public hearing. These are proposed to be on May 6 and May 20 respectively. At the May 20 public hearing, Council shall hear all protests on the amendment. Protests may be oral or written, but only written protests for business owners in the proposed District will be counted in determining if the amendment should be approved. If written protests are received from businesses that will pay 50% or more of the assessments, the amendment cannot be approved. If the protests are for a specific element of the amendment, adjustments to the proposal can be made. The District is then amended by the adoption of an ordinance. FISCAL IMPACT: Adoption of the resolution and any resulting amendment to the BID will have no direct impact on the City budget. The BID assessment is a funding mechanism that generates funds that must be expended on the activities of the BID. To the extent that the BID activities enhance the area and its business climate, area will generate increased sales tax revenue. Administration of BID related actions, such as the assessment billings and annual renewals and processing of the annual assessment levy will require some ongoing staff time from Economic development and the Finance Department. ACTION REQUIRED: • Adopt the proposed Resolution of Intention • Direct staff to discuss specific changes with the current BID and return with a revised proposal • Deny the Resolution of Intention ATTACHMENTS: Letter of request Resolution Td 415420-5591 Fax: 415-454-7039 PO BOX 131050 San RafkcL CA 94915-1050 The Honorable Gary Phillips, Mayor of San Rafaet and Members of the San Rafael City Council San Rafael City Hall 1400 Fifth Avenue LZ7ubjW Retiluest to amen lt+ri imitt -hit classifications sublect I IIII � I Ii I I I I 117 11 1 it IiIE '[111E PUW-537—edTY,-0li I I I I'll, I'lli to the City, representing the interests of the downtown retail and restaurant owners I ivo r*,,tcens to the Citv on Through 2012, the BID relied on subsidies from the now defunct Redevelopment Agency 0-t t J tin I se gi-er - approximately $16,000 per year generated by assessments on approximately 125 downtown retail and restaurants. With the elimination oRDA PG f the•and the &E lot in jjWVjf t:oaiiiii -oliver substantivi services to the Downtown is severely curtailed. I support among its memoers ano proVF=- af�Voz nt 11 the existing BID Ordinance as follows: I A) Expandthe geographic boundary of the BID: From Heatherton on the East, to the intersection of Fourth and Third on the West; the South side of Fifth on the North 111IMIV11*11 Q Revise the schedule of assessment from a percentage of the business license fee to a flat fee based upon the type of business and the location of the business within the district-4dentified as being located in either the "Premium" area or 'Standard' area. geographicallyA) Businesses located traffic and jarkinp demands, pay a proportionally higher assessment than businesses that are located on the outskirts of the core • a s that attract a potential pool of customers are assessed at a higher rate than professional office -based businesses who do not rely on foot -traffic, but who nevertheless benefit from their choice to locate in the downtown for the promise of amenities and conveniences delivered by a thriving shopping, dining and cultural center. arilzati�ons. as they represent an essential component to the downtown economy and are valuable $ A two-tiered system of "Premium" and "Standard" rates based upon location, and further anticipated benefits received by paying into the district, The composition of the board of directors, with a broad representation by type of business and location, ensures that the allocation of services is fairly distributed across the district. Proposed Funding$ Success houtthe state and is based upon the current economy and anticipated tolerance of our downtown businesses to support an imposed fee. While base operating funds will create a foundation for the BID, the key • success will rest on the establishmentoperating into the community for volunteers who care about the vitality of downtown and are willing to tend their time and talents to contribute to revitalizing the heart of their city. "Main Street i Following the tried and true organizational structure for downtown revitalization and crt"TWO for substantive and demonstrable gains in reestablishing Downtown San Rafael as the heart of the City, wher The 0 Board Joel Rebound Boo - Greg Gener — First C GibbsStan John issey — Fourth Street Press Club Mike Lam*xte — HaKyle Hjxon — Fenix Supper r• Riley Art Sa Jaime Ortiz — Bank of RESOLUTION NO. 13519 RESOLUTION OF THE SAN RAFAEL CITY COUNCIL DECLARING COUNCIL'S INTENTION TO AMEND THE EXISTING DOWNTOWN PARKING AND BUSINESS IMPROVEMENTS AREA AND LEVY AN ASSESSMENT WHEREAS, the California Streets and Highways Code Section 36500 et seq. authorizes cities to establish parking and business improvement areas for the purpose of promoting economic revitalization and physical maintenance of business districts in order to create jobs, attract new businesses and prevent erosion of business districts; and WHEREAS, the existing San Rafael Business Improvement District has requested the City Council to amend the existing Parking and Business Improvements Area instituted in 1979 in the commercial area on and around Fourth Street in San Rafael. NOW THEREFORE BE IT RESOLVED by the City Council of the City of San Rafael as follows: Section 1. The City Council does, at the request of the existing San Rafael Business Improvement District, and pursuant to the California Streets and Highways Code Section 36500 et. seq., declare its intention to amend the existing "Downtown Parking and Business Improvements Area" by changing the name to "Downtown San Rafael Business Improvement District" (the "BID"); expanding the existing area boundaries; changing the activities to which the assessment will be used; including all businesses except residential uses and home occupations in the District; and changing the assessment to a flat fee by type of business in two zones of benefit. Section 2. The boundaries of the entire area to be included in the BID, and the boundaries of each separate benefit zone within the BID, are set forth in the map and boundary description, Exhibit A, attached hereto and incorporated herein by reference. A map of the BID is on file with the City Clerk. Section 3. The types of improvements and activities proposed to be funded by the levy of assessments on business in the BID are in Exhibit B attached hereto and incorporated herein by reference. Section 4. The City Council intends to levy an annual benefit assessment on businesses in the BID, except where funds are otherwise available, to pay for selected improvements and activities of the BID. Section 5. All funds of the BID shall be expended on improvements and activities within the BID. Section 6. The method and the basis for levying the benefit assessment on businesses within the BID are set forth in Exhibit C attached hereto and incorporated herein by reference. Section 7. New businesses shall not be exempt from payment of the fee. Section 8. A public meeting for the purpose of allowing public testimony on the proposal to amend the BID shall be held before the City Council on May 6, 2013, at 7 p.m. in the Council Chambers, 1400 Fifth Avenue, San Rafael, California. At the public meeting the testimony of all interested persons, for or against the amendment of the BID or of any of the matters included in the amendment, will be heard. Section 9. A public hearing to amend the BID shall be held before the City Council on May 20, 2013, at 7 p.m. in the Council Chambers, 1400 Fifth Avenue, San Rafael, California. At the public hearing the testimony of all interested persons, for or against the amendment of the BID or of any of the matters included in the amendment, will be heard and all protest collected. Section 10. A protest against the amendment of the BID, or any aspect of the amendment may be made orally or in writing. To be counted as a part of a majority protest against the amendment of the BID, a protest must be in writing and from a business in the BID. A written protest may be withdrawn from record at any time before the conclusion of the public hearing. Each written protest shall contain a written description of the business in which the person signing the protest is interested, sufficient to identify the business, and its address. If the person signing the protest is not shown on the official records of the City of San Rafael as the owner of the business, then the protest shall contain or be accompanied by written evidence that the person is the owner of the business. Any written protest as to the regularity or sufficiency of the proceedings shall be in writing and clearly state the irregularity or defect to which objection is made. Section 11. If at the conclusion of the public hearing there are of record written protests by businesses owners within the BID that will pay fifty percent (50%) or more of the total assessments of the entire BID, no further proceedings to amend the BID shall occur. New proceedings to amend the BID shall not be undertaken again for a period of at least one year from the date of the finding of the majority written protest by the City Council. If the majority written protest is against a specific activity, inclusion of a specific area or type of business, or a specific assessment amount, adjustments may be made to the amendment proposal. Section 12. Further information regarding the proposed Downtown San Rafael Business Improvement District may be obtained from the Office of Economic Development at 1313 Fifth Avenue, San Rafael, CA 94901; by telephone from the Office of Economic Development at 485- 3326; or email at SRdowntown,c cityofsanrafael.org. Section 13. The City Clerk is directed to give notice of said public hearing by causing this Resolution of Intention to be published once in a newspaper of general circulation in the City of San Rafael, at least seven days before the hearing; and by mailing a complete copy of this Resolution of Intention to each business owner in the District within seven days of the adoption of this Resolution by the City Council. I, ESTHER C. BEIRNE, Clerk of the City of San Rafael, hereby certify that the foregoing Resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of the City of San Rafael, held on Monday, the 18th day of March, 2013, by the following vote, to wit: AYES: Councilmembers: Colin, Connolly, Heller, McCullough & Mayor Phillips NOES: Councilmembers: None ABSENT: Councilmembers: None ESTHER C. BEIRNE, City Clerk I a RE F� EXHIBIT A Lo to, o LU EXHIBIT B Downtown San Rafael Business Improvement District Use of Assessment Revenue The revenues derived from the assessments shall be used for the purposes as stated in Streets and Highways Code Section 36501 et seq. for the specific benefit of assessed businesses which may include: A. General promotion of businesses activities which provide a specific benefit to assessed businesses within the BID; B. Promotion of public events which provide a specific benefit to assessed businesses within the BID and which take place in public places within the BID; C. The acquisition, construction, installation and maintenance of any tangible property including but not limited to benches, trash receptacles, decorations and landscaping which provide a specific benefit to assessed businesses within the BID; D. Activities which provide a specific benefit to assessed businesses within the BID. EXHIBIT C Downtown San Rafael Business Improvement District Annual Assessment Formula Annual Assessment Type of Business Standard Premium Retail, Restaurant, Personal Services, Financial Institutions $175 $225 Offices, Professionals $75 $100 Personal Services Sole Practitioner $50 $75 Non -Profit Organization $50 $50 EXHIBIT B Downtown San Rafael Business Improvement District Use of Assessment Revenue The revenues derived from the assessments shalt be used for the purposes as stated in i Streets and Highways Code Section 36501 et seq. which may include: A. General promotion of businesses activities within the BID; B. Promotion of public events which bei, places in public places within the BID; t businesses within the BID and which take C. The acquisition, construction, in allation and maintenance of any tangible property including but not limited to benches, trash receptacles, decorations and landscaping; D. Activities which benefit businesses located and operating in the District. CITY OF SAN RAFAEL INSTRUCTIONS: USE THIS FORM WITH EACH SUBMITTAL OF A CONTRACT, AGREEMENT, ORDINANCE OR RESOLUTION BEFORE APPROVAL BY COUNCIL / AGENCY. SRRA/SRCC AGENDA ITEM NO. 5.h DATE OF MEETING: March 18 2013 FROM: Katie Korzun DEPARTMENT: Economic development DATE: March 13, 2013 TITLE OF DOCUMENT: RESOLUTION OF THE SAN RAFAEL CITY COUNCIL DECLARING COUNCIL'S INTENTION TO AMEND THE EXISTING DOWNTOWN PARKING AND BUSINESS IMPROVEMENTS AREA AND LEVY AN ASSESSMENT Departnhent Head (signature) (LOWER HALF OF FORM FOR APPROVALS ONLY) APPROVED AS COUNCIL / AGENCY APPROVED AS TO FORM: AGENDA ITEM: City Manager (signature) City Attorney (signature) Maxwom