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HomeMy WebLinkAbout2003-09-22 City Council (8)TO: City of Palo Alto City Manager’s Report FROM: DATE: SUBJECT: CITY NL4~NAGER DEPARTMENT: CITY 1VL4~NAGER SEPTEMBER 22, 2003 CMR: 436:03 8 RECOMMENDATION TO ADOPT A RESOLUTION TO APPOLNT THE AD HOC ADVISORY COMMITTEE MEMBERS AS THE FORMAL ADVISORY BOARD THAT WILL PREPARE THE REPORT AND RECOMMENDATIONS TO CITY COUNCIL ON A DOWNTOWN BUSINESS IMPROVEMENT DISTRICT (BID); DIRECT THE DOWNTO’~ BID ADVISORY BOARD TO PREPARE THE REPORT TO THE CITY COUNCIL TIL~kT IS REQUIRED BY BID LAW; ~ND SET THE PLACE AND TIME FOR A PUBLIC M_EETING (OCTOBER 27, 2003) AND PUBLIC HEARING (NOVEMBER 17, 2003) ON THE ESTABLISHMENT OF A DO’~VNTOWN BID RECOMMENDATION Staff recommends that the City Council: 1. Adopt the resolution, which appoints the Ad Hoc Advisory Committee Members as the Advisory Board that will prepare the required Report and Recommendations to City Council on a Downtown BID. Direct the Downtown BID Advisory Board to prepare the report to CiW Council required by BID law and provide recommendations that will include: Expenditure of revenues derived from the levy of assessments Classification of businesses Method and basis of levying assessments o Set October 27, 2003 at 7:00 p.m. (or as soon thereafter as is practicable) in the Council Chambers as the time and place for a public meeting on the proposed BID. The Council may also consider approval of the Report of the Advisory Board on the BID and Resolution of Intention to Establish a Downtown BID on that date. 3. Set November 17, 2003 at 7:00 p.m. (or as soon thereafter as is practicable) in the CMR:4:6:0~Page 1 of 7 City, Council Chambers as the place and time for a public hearing to hear conzrnents, protests and testimony on the estabIis!mnent of a downtown BID. BACKGROUND Downtown Merchants have been exploring the possibility of a BID for Downtown Palo Alto. The BID will assess businesses provide a variety of services to enhance the economic viability of Downtown Palo Alto. The formation of a BID and the levy of assessments against businesses in the BID to finance improvements and activities benefiting the businesses are authorized by state law (California Streets and Highway Code Section 36500 and fo!lowing). The purpose of a BID is to promote and improve a specific geo~’aphic area for the benefit of the businesses in the identified BID area. A BID Advisory Board makes recommendations to the City Council on the expenditure of revenues derived fi’om the levy of assessments on the classification of businesses and the method and basis of levying the assessments and prepares a report, including a budget, for each year that assessments will be levied BIDs have been established in over 200 business areas in California including Mountain View, San Jose and Burlingame. Activities that can be funded with BID proceeds include: Enhanced Downtown maintenance Promotional events to draw customers to the Downtown Provision ofbamaers, directional markers, etc. Paying for a staff person to coordinate Downtown activities Coordination of business, City and community interests Provision of business information, marketing materials and maps to higNight Downtown businesses DISCUSSION Downtown Palo Alto has long been known as a thriving, dynamic business district. To the credit of many local merchants, the success of the Downtown has been attained through the efforts of volunteers such as those who participate in the Downtoum Marketing Committee of the Palo Alto Chamber of Commerce. While the efforts of these volunteers have made a positive impact on the area, it is clear that many opportunities to increase the viability of the Downtown are missed because business CMR:436:03 Page 2 of 7 owners and operators cannot successNIly run businesses and provide the marketing and other ser~ices needed to strengthen the Downtown. For this reason, fl~e Downtown Marketing Committee of the Chamber (Cormni~ee), representing both members and non- members of the Chamber, identified the need for a Downtown BID. On December 2, 2002, the representatives of the Committee formally presented a petition signed by over 50 downtown businesses during City.. Council oral communications. The petition requested that the City Council agendize the discussion of the Downtown BID and consider passing a Resolution of Intention to t!stablish a Downtown BID at a subsequent meeting. On March 17. 2003, City Council appointed an Ad Hoc Adviso~ Co~rmaittee for the BID. At the time of the appointment, the group was identified as an ad hoc committee to explore the feasibility of creating a BID and to make recormnendations to the City Council. The BID law requires a formal Advisory Board to be established that will submit ammal reports and recorranendations to City Counci! with respect to the BID assessment and expenditures. The BID law authorizes appointment of the Adviso~N Board prior to establishinent of the BID. As the Ad Hoc Conmaittee has been meeting regularly since March and has provided the leadersNp for this initiative, staff recommends that this committee be formalized and named as the Advisory Board to prepare the annual reports and recon~anendations to City Council on a Downtown BID. In July and August of 2003, an intern was hired by the City to develop a database of businesses located in the BID area. The intern walked the district several times and identified every address and business in the district. Her findings supported prior work on the BID database of businesses and resulted in the identification of 913 businesses. To be certain that all businesses in the BID were infornaed and could become involved hi the planning of the BID, the Co~rmaittee sent letters to each business owner in the proposed area, identifying the proposed BID boundaries, benefits of the BID, activities that could be accomplished and an estimate of revenues that could be anticipated from the collection of a downtown BID assessment. Multiple discussions at monthly Downtown Marketing meetings and several additional meetings were held to discuss the BID for Downtown Palo Alto with affected merchants. Meetings were held on the following dates and times: August 21 gain August 28, 2002 6pro September 18, 2002 8am Cardinal Hotel Blue Chalk Cafe Cardinal Hotel CMR:436:03 Page 3 of 7 September 18, 2002 6pro November 20, 2002 July 30, 2003 9am Blue Chalk Cafe Chamber Mixer @ Zibibbo Restaurant Cardinal Hotel For the meeting that was held on July 30, 2003, a flyer was taken to eve~, business within the proposed BID boundaries to inform eac!~l business of the date, time and location of the business outreach meeting and invite them to bring any concerns or comments for further consideration. An additional business outreach meeting is scheduled for October 8, 2003 at 9:00 am at the Cardinal Hotel to once again hear any comments and answer any questions concerning the proposed BID. A noticed public meeting set and attended by the Ci~ Council is also required according to BID law. The attached resolution sets the public meeting to hear comments on the proposed establishment of a BID on October 27, 2003. Following the public meeting, Ci~, Council may approve the report of the Adviso~ Board and may consider adopting a Resolution of Intention to Establish a Business Improvement District. The Resolution of Intention to Establish a Downtown BID must include the following: ¯Description of the boundaries of the area and identification of any separate benefit zones. ¯Name of the proposed area. ¯Type or types of improvements and activities to be funded by the levy of assessments. ¯Statement that, except where funds are otherwise available, an assessment will be levied annually to pay for all improvements and activities in the area. ¯Identification of the proposed method and basis of levying the assessment, in sufficient detail to allow each business owner to estimate the amount of the assessment to be levied against his/her business. ¯Dete~Tnination of whether new businesses will be exempt from the lexa] of the assessment for a period not to exceed one year from the date the business commenced operating, pm-suant to Streets and Highways Code Section 36531. If the City Council chooses to adopt the Resolution of Intention, the follo~ving actions must be taken: CMR:436:03 Page 4 of 7 A public hearing (noticed according to BID law) must be held not less than 20 or more than z0 days after the adoption of the resolution of intention. (The attached resolution would set this hearing for November 17, 2003). At the hearing, the Ci~ Council must consider the testimony of all interested persons for and against the establislvnent of the BID, the extent of the area within the BID, and on the famishing of specified t37pes of improvements or activities by the BID. ~4my interested person may make protests orally or in writing. Wri~en protests must be filed with the Ci~ Clerk at or before the time fixed for the public hearing. If written protests to the establislv-nent of a BID are received from the owners of businesses in the proposed area, which wi!l pay 50% or more of the total BID assessment, no farther proceedings to create the business improvement area or to levy the proposed assessment shall be considered for at least a year. At the conclusion of the public hearing to establish the BID, the City Counci! may adopt, revise, change, reduce or modi~ the proposed assessment or the improvements and activities proposed. If the City Council, following the public hearing, decides to establish the BID, it will adopt an ordinance to that effect. The ordinance will contain information requh’ed by BID law incIuding the manner of collection and levy of assessments. In subsequent years the Advisory Board will file an a~mual report ma~ng reconv-nendations on the following: c Expenditure of revenues derived from the lex,,-y of assessments o Classification of businesses <)Method and basis o~ le’v-ym~ assessments The attached resolution sets the place and time for the public hearing on the proposed BID to hear conm~ents, protests and testimony on the establishment of the business improvement area and the levy of assessments in the BID. At that time. the effect of protests made by business owners against the estab!ishinent of a BID, the extent of the area and activities proposed shall be described. RESOURCE IMPACT The ]Economic Development Division in the Ci,ty Manager’s Office has provided staff support to the Advisory Conmaittee. Economic Development staff have overseen the creation of a business database and cross referenced it with Reference USA, an electronic database, to ensure that all downtown businesses within the BID boundaries are identified. In addition, staff have assisted in the preparation of the budget identifying proposed BID activities, prepared a comprehensive reference bootdet for distribution to C~,IR:4~6:0~Page 5 of 7 businesses and worked with a consultant to develop the cost benefit analysis and assessment formula for BID assessments. Staff will also prepare and mail individual notices to each business located in the BID prior to the public meeting. The City Attorney’s office has provided legal oversight and direction regarding the noticing and scheduling of required BID actions. There are still a number of issues to be resolved before a Downtown BID could become operational. For example, since the City collects the assessment, impacts to the Administrative Services Department must be considered. The City of Palo Alto does not have a business license tax, so there was not an existing database available for the collection of BID assessments. Now that the City has created a database of downtown businesses, a methodology for the collection of rite BID assessments must be developed. City staff from affected depamnents will reconcile these issues, gauge impacts to City resources and make recorrmaendations to the Ci~ Council. These impacts and reconvnendations will be a part of the staff report to City Council at the time of the Downtown BID public hearing. BID law provides that costs for the establishment of the BID may be recouped. Staff has not made a recorrwnendation regarding the reimbursement of costs that the City has incun’ed. This will be discussed in more detail at the time of the Public Hearing. POLICY IMPLICATIONS The estabIishinent of a Downtown BID is consistent with Comprehensive Plan Policies and was a part of the reco~mnendations for Downtown Palo Alto identified in the Retail Strategy for the City of Palo Alto prepared by Sedway and Associates in June 2000. The establishinent of a BID supports the following Comprehensive Plan Policies: Policy B-4 Nurture and support established businesses as well as new businesses Program ]9-1 Initiate assessment districts or other programs to facilitate neighborhood shopping center improvements such as landscaping, par’king and access to public transportation. Policy B-11 Encourage the use of public/private partnerships as a means of redeveloping and revitalizing selected areas. Policy B-20 Support and enhance the University Avenue/Downtown area as a vital mixed use area contah~ing retail, personal service, office, restaurant, and entertaimnent uses. Recognize the importance of an approp,~iate retail mix, including small local businesses, to the continued vitality, of Downtown. CMR:436:03 Page 6 of 7 ENVIRONMENTAL REVIEW This action by the Ci~ Council is not considered a project under the California Environment Quaii~ Act. PREPARED BY: S@an ~-pan, Ecdnomilz Development Manager CITY MANAGER APPROVAL: CMR:436:03 Page 7 of 7 RESOLUTION NO. RESOLUTION OF THE CO~CiL OF THE CITY OF P~$O ~TO APPOINTING AN ADVISORY BOARD, DIRECTING THE PREPARATION OF A REPORT FOR FISC~ YEAR 2003-2004, AND DIRECTING THAT NOTICE BE GIVEN OF A PUBLIC MEETING ~TD PUBLIC HE~RING IN CONNECTION WITH THE PROPOSED ESTABLISHMENT OF THE DOWNTO~ BUSINESS IMPROVEMENT DISTRICT 9_ND THE PROPOSED LEVY OF ~]q ASSESSI~NT AGAINST BUSINESSES WITHIN SUCH DISTRICT Z~[EREAS, the City of Pa!o Alto (the "City") is a charter city organized and existing under the laws of the State of California; and ~EREAS, it is in the public interest to promote the economic vitality and physica! maintenance of business districts within the City in order to prevent erosion of the business districts and to attract and retain businesses; and WHEREAS, the Parking and Business Improvement Area Law of 1989 (California Streets and Highways Code Sections 36500 et seq.) (the "Law") provides that the City may establish a Parking and Business Improvement Area for the purpose of providing improvements and promoting activities within a business district and may levy an assessment against businesses within a Parking and Business Improvement Area to fund improvements and activities; and WHEREAS, downtown business merchants have been exploring the possibility of a business improvement district for downtown Palo Alto; and W~EREAS, the City has received a petition signed by the o%~ers or authorized representatives of over fifty dob~tob~ businesses requesting that the City initiate proceedings for the formation of a Parking and Business Improvement Area for the downtown area; and WT{EREAS, the City wishes to initiate proceedings for the formation of a Parking and Business Improvement Area for the do~ntown area pursuant to the Law; and 030917 s)~a 0100126 W~EREAS, the Law requires the City Council to appoint an advisory board which shall make recommendations to the City Co~ci! on the expenditure of revenues derived from the levy of assessments, on the classification of businesses, as applicable, and on the method and basis of levying the assessments; and ¼<~EREAS, on March 17, 2003, the City Council appointed a Dov,~town BID Ad Hoc Committee to review options and make recommendations to the City Counci! in connection with a proposed Business Improvement Area for the do~to~ area; NOW, THEREFORE, the Counci! of the City of Pa!o Alto does RESOLVE as follows: SECTION i. The Council hereby appoints the Do~towm__ BID Ad Hoc Committee to serve as the advisory board for the proposed Do~,~to~m_ Business Improvement District (the "District") pursuant to Section 36530 of the Law (the "Advisory Board"). SECTION 2. The Council hereby directs the Advisory Board to prepare and file with the City Clerk, in accordance with Section 36533 of the Law a report for fiscal year 2003-2004 in connection with the proposed establishment of the District. SECTION 3. The Counci! hereby sets October 27, 2003 as the date for a public meeting on the estab!is~ment of the District and the levy of assessments and November 17, 2003 as the date for a public hearing on the establis~hment of the District and the levy of assessments. Both the public meeting and the public hearing wil! be held at 7:00 p.m., or as soon thereafter as practicable, in the City Council Chambers at 250 Hamilton Avenue, Pa!o Alto, California. SECTION 4. The City Clerk is directed to give notice of the public meeting and the public hearing as required by law. // // // // // // // // 030917 s3na 0100126 2 SECTION 5. The Council finds that this is not a project under the California Enviro~menta! Quality Act and, therefore, no envirom:mental impact assessment is necessary. INTRODUCED ~ PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST:APPROVED: City Clerk APPROVED AS TO FORM: Senior Asst. City Attorney Mayor City Manager Director of Administrative Services 030917 syn 0100126 3