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 2021-22, and Set a Public Hearing for May 4, 2021 to Levy an Annual Assessment on the Park Street BIA. (Community Development 256)
Body
To: Honorable Mayor and Members of the City Council
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.
This fiscal year is ending during the coronavirus pandemic, which has led to unprecedented challenges for the Park Street district. DABA has requested that there be no annual CPI adjustment to the assessment fees for the second year in a row, due to the pandemic.
Staff is recommending that the City Council adopt a resolution setting a public hearing on May 19, 2020 to levy the annual BIA assessment for Fiscal Year (FY) 2021-22.
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 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 the Downtown Alameda Business Association (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, has prepared the Annual Assessment Report for FY 2021-22 (Exhibit 1). The report describes, in general terms, the activities and expenditures that have occurred in the Park Street BIA during the past fiscal year, FY 2020-21, as well as a work plan outlining the proposed use of BIA funds for the upcoming fiscal year. This year, the Annual Report also contains detailed financial reports, which DABA is required to submit every other year. Staff has reviewed the documents and has found them to be complete and reasonable.
The Coronavirus and the BIA assessment. The pandemic has forced the cancellation of DABA’s signature events (the 2020 Spring Festival, the Art & Wine Fair, and the Classic Car Show) and in-person monthly membership mixers. DABA has maintained a ready-reserve, emergency fund in excess of $100,000 to cover unexpected expenses and lost revenue. It has applied for and received a Small Business Administration Economic Injury Disaster Loan (EIDL) of $150,000. During the past fiscal year, DABA has collaborated with the City to implement the Commercial Streets program, awarded 28 grants under the City’s Parklet Grant Program, developed an “Open With Care” public safety awareness campaign, and increased its membership engagement and advocacy throughout the pandemic.
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. While the businesses in both zones get the same basic services (access to the DABA web site, assistance from DABA, etc.), 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.
1. Per the 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 2.0%, for example, would raise the minimum retail business annual fee by $7.00, to $343.00, in Zone A and by $3.00, to $175, in Zone B. DABA has requested, due to the financial hardship presented to its membership by the pandemic that there not be an annual CPI adjustment to the assessment fees.
Included with this report is the FY 2021-22 BIA assessment fee schedule with no CPI adjustment (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, the 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 and BIA boundaries. The public hearing is scheduled for May 4, 2021. 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 2021-22 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
• Staff recommends approving the Park Street BIA annual report, adopting a Resolution of Intention to Levy an Annual Assessment, and setting a public hearing for May 4, 2021 to levy an annual assessment for the Park Street BIA.
• Postpone the public hearing until a future City Council meeting to allow an opportunity for in-person public comment.
• Decline to adopt the Resolution of Intention to Levy an Annual Assessment.
FINANCIAL IMPACT
The estimated FY 2021-22 BIA budget of $100,000 will subject to City Council approval as part of the FY 2021-23 biennial budget. Revenues from the BIA directly benefit business owners in specified geographic and benefit zones through the promotion of business and similar eligible activities.
BIA billing is done concurrently with Business License billing. 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 001, Program 2450).
The Community Development Department staff works closely with DABA, attending monthly board meetings and subcommittee meetings, estimated to cost $2,300 annually (Fund 256). 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 involves government fiscal activities which do not involve any commitment to any project which may result in a potentially significant physical impact on the environment and is exempt from the California Environmental Quality Act (CEQA), pursuant to CEQA Guidelines section 15378(b)(4).
CLIMATE IMPACT
There are no identifiable climate impacts or climate action opportunities associated with the subject of this report.
RECOMMENDATION
It is recommended that the City Council:
1. Approve the Park Street Business Improvement Area (BIA) annual assessment report;
2. Adopt a Resolution of Intention to Levy an Annual Assessment on the Park Street BIA for Fiscal Year (FY) 2021-22; and
3. Set a Public Hearing for May 4, 2021 to Levy an Annual Assessment on the Park Street BIA.
CITY MANAGER RECOMMENDATION
The City Manager recommends setting a Public Hearing for May 4.
Respectfully submitted,
Lisa Maxwell, Interim Community Development Director
By:
Eric Fonstein, Development Manager
Financial Impact section reviewed,
Annie To, Finance Director
Exhibits:
1. DABA’s Annual Assessment Report
2. BIA Assessment Fee Schedule FY 2021-22
3. BIA Boundaries Map
4. BIA Address List
cc: Eric Levitt, City Manager
Downtown Alameda Business Association