Title
Recommendation to Approve the Park Street Business Improvement Area (BIA) Annual Assessment Report; and
Adoption of Resolution of Intention to Levy an Annual Assessment on the Park Street BIA for Fiscal Year 2023-24, and Set a Public Hearing for May 2, 2023 to Levy an Annual Assessment on the Park Street BIA. (Community Development 10061810)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
The Park Street Business Improvement Area (BIA)-which is managed by the Downtown Alameda Business Association (DABA)-is funded in part from an assessment collected by the City of Alameda (City) from all businesses within that business district. Every year, DABA presents a report to the City Council on the activities and expenditures that have occurred during the past fiscal year. The annual report also provides recommendations on the proposed expenditure of BIA revenues for the next fiscal year (FY).
For the past three years during the pandemic and the unprecedented challenges it placed on local businesses, DABA had requested that there be no annual Consumer Price Index (CPI) adjustment to the assessment fees. As we are now emerging from the public health and economic crises, DABA supports resuming an annual CPI adjustment, which is 4.9 percent for this fiscal year.
Staff is requesting that the City Council adopt a resolution setting a public hearing on May 2, 2023 to levy the annual BIA assessment for FY 2023-24.
BACKGROUND
In 1989, following the Parking and Business Improvement Area Law of 1979 in the California Streets and Highways Code, City Council established regulations for Business Improvement Areas (BIAs) in the Park Street and Webster Street commercial areas. This staff report is for the Park Street BIA, which is managed by DABA.
The Park Street BIA is funded from fees collected by the City from all businesses within that business district. The pooling of resources improves the business district as a whole and directly benefits business owners through the general promotion of business activities and public events, beautification and ambiance, construction and maintenance of parking facilities, and special projects benefitting the business area.
State law and the Alameda Municipal Code (AMC) require the City Council to work in collaboration with a BIA advisory board. The board prepares an annual report and provides recommendations to the City Council on the proposed expenditure of BIA revenues for its geographic area. The AMC also requires an annual review by the City Council and a yearly consideration of the assessment.
DISCUSSION
DABA’s Board of Directors, designated as the BIA’s advisory board, have prepared the Annual Assessment Report for FY 2023-24 (Exhibit 1). The report describes, in general terms, the activities and expenditures that have occurred in the Park Street BIA during FY 2022-23, considered the previous fiscal year, as well as a work plan outlining the proposed use of BIA funds for the upcoming FY 2023-24. This year, the Annual Report also contains detailed financial reports, which DABA is required to submit every other year. Community Development Department staff has reviewed the report and has found it to be complete and reasonable.
During the last three years, DABA put its major fundraising events on hold and instituted four smaller scale “stroll” events: Whiskey Stroll, Rock & Roll Beer Stroll, Autumn Wine Stroll, and the family-friendly Hot Cocoa Stroll. In FY 2023-24, DABA will be resuming its monthly business mixers and large annual fundraising events, beginning with the Art & Wine event in July 2023 and the Spring Festival in 2024. These major events will support the repayment of the $150,000 Small Business Administration Economic Injury Disaster Loan (EIDL) it received during the pandemic. DABA has maintained a ready-reserve, emergency fund in excess of $100,000 to cover unexpected expenses and lost revenue. During the past fiscal year, DABA collaborated with the City to extend the Commercial Streets program through November 2023. It also transitioned its district messaging from “Open With Care” to “Welcome Friends” and “Happy To See You” as businesses and customers return to in-person activities.
The Park Street BIA currently has over 400 members, and annual fees vary depending on the type of business and its location. The Park Street BIA has two benefit areas (Zone A and Zone B). Zone A is the core downtown area along Park Street. Zone B includes the areas north of Lincoln and south of Encinal along Park Street, several side streets, and Park Street Landing. Businesses in both zones receive the same basic services (access to the DABA website, assistance from DABA, etc.), however, when the District was established, it was determined that the businesses in Zone B do not benefit equally from DABA’s special events. Therefore, the Zone B assessment is lower than the Zone A assessment. The assessment is calculated based on gross receipts. There is a minimum and a maximum assessment for both Zone A and Zone B.
Per the AMC, the BIA assessment includes an automatic annual CPI increase based on the San Francisco Area CPI. This year’s CPI of 4.9 percent raises the minimum retail business annual fee by $16.00 to a total of $352.00 (minimum fee), in Zone A and by $8.00 to a total of $180 (minimum fee), in Zone B. The entire FY 2023-24 BIA assessment fee schedule is available in Exhibit 2.
Also included with this report is a map of the BIA (Exhibit 3) and a BIA address list (Exhibit 4).
The annual BIA assessment requires a two-step process. First, City Council must approve the Annual Assessment Report and pass a Resolution of Intent to Levy an Assessment. Second, City Council must set a public hearing to approve the new assessment. The public hearing is scheduled for May 2, 2023. At the public hearing, City Council can modify the Assessment Report or confirm the report as filed. At the public hearing, City Council may also decide not to include the annual CPI adjustment to the assessment fees. According to the AMC, Section 6-7.13(b):
During the course or upon the conclusion of the public hearing, the City Council may order changes in any of the matters provided in the report, including changes in the proposed assessments.
All BIA members will receive notification of the public hearing in addition to instructions on how to protest the BIA renewal, should they wish to do so. FY 2023-24 assessments cannot be levied and boundaries approved if protests are received by the owners of businesses in the area which will pay fifty percent (50%) or more of the proposed assessment.
ALTERNATIVES
• Approve the Park Street BIA annual report, adopting a Resolution of Intention to Levy an Annual Assessment, and set a public hearing for May 2, 2023 to levy an annual assessment for the Park Street BIA.
• Postpone the public hearing until a future City Council meeting.
• Decline to adopt the Resolution of Intention to Levy an Annual Assessment.
FINANCIAL IMPACT
BIA billing is processed concurrently with annual business license billing. Revenues from the BIA directly benefit business owners in specified geographic and benefit zones through the promotion of business and similar eligible activities. The primary financial impact to the General Fund is in the form of Finance Department staff costs to process BIA billings and expenditures, estimated to be approximately $6,500 annually ($1,856 for WABA and $4,644 for DABA) and included in the Business License Program Budget (Org 10024056).
The Community Development Department staff works closely with DABA, attending monthly board meetings and subcommittee meetings, estimated to be $2,300 annually (Org 24161823). This staffing cost has been absorbed within existing staff workloads to provide indirect financial support to the business districts.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The annual renewal of the BIA supports the goals of the Economic Development Strategic Plan (EDSP) through continued operation of the business association consistent with AMC Sec. 6-7 et seq.
EDSP Strategy 4 states: “the City of Alameda’s role is to continue to support existing shopping and dining districts by working with private property owners and business associations to improve retail spaces and the public realm”.
ENVIRONMENTAL REVIEW
This action does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378 and therefore no further CEQA analysis is required.
CLIMATE IMPACTS
There are no identifiable climate impacts or climate action opportunities associated with the subject of this report.
RECOMMENDATION
Approve the Park Street Business Improvement Area annual assessment report; and
Adopt a Resolution of Intention to Levy an Annual Assessment on the Park Street BIA for Fiscal Year 2023-24, and Set a Public Hearing for May 2, 2023 to Levy an Annual Assessment on the Park Street BIA.
Respectfully submitted,
Lisa Maxwell, Community Development Director
By:
Eric Fonstein, Development Manager
Financial Impact section reviewed,
Margaret L. O’Brien, Finance Director
Exhibits:
1. DABA’s Annual Assessment Report
2. BIA Assessment Fee Schedule FY 2023-24
3. BIA Boundaries Map
4. BIA Address List
cc: Downtown Alameda Business Association