Title
Recommendation to Approve the Webster Street Business Improvement Area Annual Assessment Report; and
Adoption of Resolution of Intention to Levy an Annual Assessment on the Webster Street Business Improvement Area of the City of Alameda for Fiscal Year 2025-26, and to Set a Public Hearing for May 6, 2025. (Base Reuse and Economic Development 10061810)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
The Webster Street Business Improvement Area (BIA); which is managed by the West Alameda Business Association (WABA); is funded from an assessment collected by the City of Alameda (City) from all businesses within that business district. Every year, WABA 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.
Per the Alameda Municipal Code (AMC), each year the BIA assessment has an automatic Consumer Price Index (CPI) increase based on the San Francisco Area CPI. This year’s CPI of 2.4 percent would raise the minimum retail business annual fee by $9.00 to $370.00.
Staff requests that City Council adopt a resolution setting a public hearing on May 6, 2025 to levy the annual BIA assessment for Fiscal Year (FY) 2025-26.
BACKGROUND
In 1989, following the Parking and Business Improvement Area Law of 1979 in the California Streets and Highways Code, the City Council established regulations for BIAs in the Park Street and Webster Street commercial areas. This staff report is for the Webster Street BIA, which is managed by WABA.
The BIA is funded from fees collected by the City from all businesses within the 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 benefiting the business area.
State law and the 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 yearly consideration of the assessment.
DISCUSSION
WABA’s Board of Directors, designated as the BIA’s advisory board, prepared the Annual Assessment Report for FY 2025-26 (Exhibit 1). The report describes, in general terms, the activities and expenditures that occurred in the Webster Street BIA during the current fiscal year, FY 2024-25, as well as a work plan outlining proposed use of BIA funds for the next fiscal year, FY 2025-26.
This year, the Annual Report also contains detailed financial reports, which WABA is required to submit every other year. Base Reuse and Economic Development Department staff reviewed the report and found it to be complete and reasonable. The financial documents include WABA’s Profit and Loss statement (P&L) for calendar year 2024, which reflects a loss of $51,438.28.
During 2024, WABA had a change in its executive director position, with the previous retiring executive director overlapping her service with the hiring of the new executive director which created a one-time increase of staffing costs. The executive director position also changed from an hourly to a salary position with added expenses. The P&L also reflects a decrease in the amount of sponsorship contributions WABA received from its dispensaries. WABA addressed the additional expenses, reduced income and ultimate loss through its cash reserves, which were greater than the required ready reserves of $75,000.
In 2024, WABA extended its lease for the Healing Garden/Al Fresco Dining Park, located at the Taylor Avenue/Webster Street lot. The multi-use space has become a hub for community events, business promotions, and non-profit initiatives. Over 40 community events were held at this venue, many of which supported local non-profit organizations. For example, a regular feature has been the Alameda Food Bank Players, a Shakespeare theatrical group that raised over $9,000 for the Alameda Food Bank last year. WABA also continues to host two popular farmers’ markets each week, providing fresh, affordable produce, meats, and baked goods to the local community. In 2024, eight new businesses joined the district.
The City is also working with DABA and WABA to develop a marketing strategy to fill vacant storefronts while supporting existing businesses in the Park Street and Webster Street business districts.
The Webster Street BIA currently has approximately 215 members, and annual fees vary depending on the type of business. The BIA consists of a single zone. The assessment is calculated based on gross receipts. There is a minimum and a maximum assessment. A minimum assessment was established to ensure that there would be sufficient funds to administer the BIA. The maximum assessment acknowledges that there are a few business types (gas stations, fast food restaurants, etc.) whose gross receipts are much higher than other retailers and that a cap would be appropriate for those businesses. The Webster Street BIA also has an assessment surcharge for retailers larger than 30,000 square feet such as Target and Safeway.
Per the AMC, each year the BIA assessment has an automatic CPI increase based on the San Francisco Area CPI. This year’s CPI of 2.4 percent raises the minimum retail business annual fee by $9.00 to $370.00. Included with this report is the FY 2025-26 BIA assessment fee schedule (Exhibit 3), a map of the BIA (Exhibit 4), and a BIA address list (Exhibit 5).
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 6, 2025. At the public hearing, the City Council can modify the Assessment Report or confirm the report as filed. At the public hearing, the 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 2025-26 assessments cannot be levied 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 Webster Street BIA annual report, adopt a Resolution of Intention to Levy an Annual Assessment, and set a public hearing for May 6, 2025 to levy an annual assessment for the Webster 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 done concurrently with 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 (Fund 10024056).
The Base Reuse and Economic Development Department staff works closely with WABA, attending monthly board meetings and subcommittee meetings, estimated to be $2,300 annually (Fund 10061810). 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”.
The annual renewal of the BIA also supports the City’s Strategic Plan, adopted in 2023. The Vision Statement highlights “vibrant commercial centers”. One of the Plan’s strategic priorities focuses on investing in economic opportunities to “support local businesses and workforce development.”
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
1. Approve the Webster Street Business Improvement Area annual assessment report;
2. Adopt a Resolution of Intention to levy an annual assessment on the Webster Street Webster Street Business Improvement Area for fiscal year 2025-26; and
3. Set a public hearing for May 6, 2025 to Levy an annual assessment on the Webster Street Webster Street Business Improvement Area.
Respectfully submitted,
Abigail Thorne-Lyman, Base Reuse and Economic Development Director
By
Eric Fonstein, Development Manager
Financial Impact section reviewed,
Ross McCarthy, Acting Finance Director
Exhibits:
1. WABA’s Annual Assessment Report
2. BIA Assessment Fee Schedule FY 2025-26
3. BIA Boundaries Map
4. BIA Address List
cc: West Alameda Business Association