Title
Public Hearing to Consider Introduction of Ordinance Amending the Alameda Municipal Code by Amending Chapter 30 (Zoning Ordinance) to Update and Improve the Regulations Governing the Public Art Ordinance. [The proposed amendment is categorically exempt from further environmental review pursuant to State CEQA Guidelines 15305 Minor Alterations to Land Use Limitations]. (Community Development 285)
Body
To: Honorable Mayor and Members of the City Council
From: Jill Keimach, City Manager
Re: Public Hearing to Consider Introduction of Ordinance Amending the Alameda Municipal Code by Amending Chapter 30 (Zoning Ordinance) to Update and Improve the Regulations Governing the Public Art Ordinance. [The proposed amendment is categorically exempt from further environmental review pursuant to State CEQA Guidelines 15305 Minor Alterations to Land Use Limitations]
BACKGROUND
Alameda Municipal Code Section 30-65 Public Art in New Commercial, Industrial, Residential and Municipal Construction (the "Ordinance,”) was adopted in 2003, to require that major development projects include on-site public art. The Ordinance also allows an applicant to pay a fee in lieu of providing the art on-site. Any in-lieu fees collected are deposited in the dedicated Public Art Fund (the "Fund"). The Fund can then only be used by the City to provide or support public art.
Since 2003, twelve public art installations have been completed on-site or are in progress at various private and municipal developments. Because many developers have chosen to install art on-site, annual in-lieu contributions to the Fund have been minimal, and the fund balance remained relatively low. Historically, the small size of the Fund made dispersal of funds a challenge: from Fiscal Years 2003-04 to 2014-15, the average Fund balance was $62,649, with a maximum balance of $83,807. To date, the Fund has been used for a consultant study, described below, and to cover City costs to administer the program. Only in the last year has the Fund increased significantly due to in-lieu payments from two large developments. As of June 2017, the Public Art Fund’s accumulated available balance was $381,940.
In January 2011, the City Council authorized a study to review, assess and update the City public art program. Synergy: Public Art for Alameda (the “Synergy Report”) was completed in November 2014. (The Synergy Report is available on the City website at: <http://alamedaca.gov/sites/default/files/department-files/2014-10-29/synergy_public_art_report_-final.pdf> .)
In November 2014, the City hosted a community meeting to discuss recommendations in the Synergy Report that identified changes to the Ordinance that would facilitate the City’s ability to disperse funds. On February 18, 2015, the Public Art Commission (“the PAC”) recommended that the City Council approve the proposed amendments to the Ordinance, and on November 23, 2015, the Planning Board recommended that the amendments be forwarded to the City Council for adoption.
At the October 4, 2016 City Council meeting, staff introduced the proposed Ordinance amendments and recommended that $200,000 be appropriated for the design and installation of public art, and for cultural arts and arts programming through a public Request for Proposal (RFP) process. Discussion of the item was continued to the October 18, 2016 Council meeting. A supplemental staff report was prepared for the October 18th Council meeting recommending that the level of funding to be appropriated be increased from $200,000 to $350,000 to reflect additional fees received in October of 2016.
At the October 18, 2016 meeting, based on testimony received at the public hearings, the City Council requested that the proposed amendments to the Ordinance be returned to the PAC for further review and recommendation. The Council directed staff to present the following topics to the PAC for review and recommendation:
• Removing staff administrative costs as an allowable use of the Fund;
• Removing maintenance costs as an allowable use of the Fund;
• Preserving or removing the public art focus on Alameda’s historic and maritime traditions;
• Increasing or removing the cap on developer contributions;
• Increasing the required public art contribution from 1% to 1.5% of project valuation;
• Lowering the cap on administrative costs for third-party grantee organizations;
• Ensuring cultural arts and arts programming funded by the Fund be free of charge to the general public; and
• Maintaining or changing the requirement that 25% of funds be allocated to cultural arts and arts programming, and 75% of funds be allocated for the design and installation of physical public art.
The topics listed above are discussed in more detail in the following section. A compilation of the previous staff reports and analysis is provided in Exhibit 1.
A January 18, 2017 special meeting of the PAC was scheduled to discuss the proposed changes to the Ordinance that the Council recommended the PAC consider. The meeting was subsequently canceled due to lack of a quorum. Instead, a community meeting was held in lieu of the PAC meeting. Staff gave a presentation, followed by questions and comments from community members. A full summary of public comments is provided in Exhibit 2, but general comments included:
• Concerns and ideas about how to replenish and sustain the Public Art Fund once the current balance has been distributed;
• Suggestions to improve administration and marketing of the Public Art Program, including improvements to the website, public art tours, and an updated directory of Alameda-based artists for developers providing on-site public art;
• A desire for diversity of public art in Alameda, including support for removing the requirement that public art focus on historic or maritime themes; and
• In general, support for the recommendations assembled in the PAC staff reports.
On February 15, 2017, the PAC reviewed and recommended that the City Council approve a series of amendments to the Ordinance. Those amendments are discussed below. The PAC also reviewed and recommended changes to a draft RFP for public art.
The discussion at the February 15, 2017 PAC meeting was generally supportive of the recommendations made by staff, particularly the recommendation to remove the requirement that public art have a historic or maritime theme. The PAC requested several changes be made to the draft RFP, including changing the evaluation criteria to include a greater weight for local preference, and to add a new criterion evaluating the artwork’s association with Alameda’s community and traditions. The PAC also requested that durability and suitability of materials be included in the evaluation process. Finally, the PAC made a recommendation to adopt staff’s recommendations, with those modifications, and to ask Council to find ways to supplement the public art program with the General Fund.
Because the Public Art Ordinance is part of the Zoning Ordinance, the Planning Board has the responsibility to review any proposed changes. At its March 13, 2017 meeting, the Planning Board was supportive of the recommendations made by staff and the PAC. As part of its review, the Board made two changes to the draft Ordinance: the purpose statements were revised to emphasize the intrinsic value of art to the community, and the language of Section 30-98.10d was revised to clarify that the calculation of 25% of the fund balance (related to the requirement that no more than 25% of the Fund balance be distributed for cultural arts and arts programming) occurs when a request for proposals is released.
In addition, some Board members raised questions about the impact of eliminating the cap on the cost of housing in Alameda, and questioned whether the required contribution for residential projects might be reduced to 0.5%, as in Emeryville and Oakland (see Figure 1 below or Exhibit 5 for a more detailed summary of public art requirements). However, the Board ultimately voted to recommend that Council approve the proposed amendments without a reduction in the required contribution for residential projects. It should be noted that the contribution requirement is applied solely to the building development costs. Site improvement/infrastructure costs are excluded from the calculation.
Since the meeting, staff has also received additional comments about the potential implications of removing the cap on the City’s ability to negotiate additional public benefits such as affordable or workforce housing, transportation funds, and/or open space contributions from large projects in Alameda.
Figure 1: Summary of Public Art Requirements, Select Bay Area Cities
|
City |
Required Contribution for On-site Art (% of dev. costs) |
Required Contribution for In-lieu Fee (% of dev. costs) |
Cap on Contribution |
Allow Cultural Arts and Arts Programming |
|
Dublin |
0.50% |
Same |
No |
No |
|
Albany |
1.75% |
Same |
No |
No |
|
Berkeley |
1% |
0.80% |
No |
No |
|
Emeryville |
1% commercial/ .5% residential |
Same |
No |
No |
|
Oakland |
1% commercial/ .5% residential |
Same |
No |
No |
|
Walnut Creek |
1% |
Same |
No |
No |
|
Palo Alto |
1% for the first $100 million construction valuation, 0.9% thereafter |
Same |
No |
No |
|
Alameda |
1% (current) |
Same |
$150,000 (current) |
Yes |
In September 2017, following PAC’s approval of the RFPs, staff released two RFPs for public art in Alameda:
• An RFP for Physical Public Art featuring awards ranging from $12,500 to $150,000, with a total of up to $262,500 to be distributed.
• An RFP for Cultural Arts and Arts Programming featuring awards ranging from $5,000 to $35,000, with a total of up to $87,500 to be distributed.
Proposals are due in December of 2017, and awards will be made based on evaluation and review by the PAC, with final approval by City Council.
DISCUSSION
Staff is recommending that the City Council introduce the Ordinance amending the City’s Public Art Ordinance. All of the recommended changes outlined below are reflected in the proposed revised Ordinance (Exhibit 3).
I. Clarify and strengthen the purposes of the Ordinance to better connect the vision, values and strategies for public art to the broader ambitions of the City. (Sec. 30-98.1)
The proposed purposes, recommended in the Synergy Report, are intended to strengthen the understanding of the City’s goals in establishing a public art ordinance. The purposes in the draft Ordinance have been revised to reflect the Planning Board’s request that the focus be on the intrinsic value of public art to the community, rather than its impact on economic development.
II. Clarify ordinance exemptions. (Sec. 30-98.3)
The proposed amendments clarify the list of exempt developments to include:
• Affordable housing (if the project is 100% affordable),
• Designated historic landmarks,
• Cultural facilities, and
• Public and non-profit projects, including parks, when the City Council finds it is in the best interest of the Alameda community to exempt such projects.
III. Clarify the requirements and options for physical, on-site public art. (Sec. 90-98.5)
The proposed amendment includes a more specific list of appropriate physical art forms to meet the on-site public art requirement for private and public development. The proposed on-site list specifically excludes temporary cultural events, performances, and construction of stages, outdoor performance spaces, and other physical structures that may support the arts but are not themselves forms of art.
IV. Clarify the application and review process for on-site public art applications. (Sec. 30-98.6)
The proposed amendment clarifies the application and permit approval process and timeline for private applications for on-site public art. The revisions better reflect the City’s review process for public art.
V. Remove maintenance costs as an allowable use of the Public Art Fund. (Sec. 30-98.10)
Maintenance costs for public art include the cost of regular cleaning and service, as well as repairs, restoration and conservation of the artwork. The existing Ordinance allows the Fund to be used to maintain public art, and the Synergy Report recommends that 10% of the public art funding allocation for each city project be set aside for the preservation and maintenance of artwork on public property.
Removing maintenance costs as an allowable use of the Fund will ensure that the maximum share of Fund monies are used for the design and installation of public art. Maintenance costs for art on public property shall be the responsibility of the public entity accepting the public art. In the case of Alameda city parks, these costs will most likely fall to the General Fund. Maintenance of public art on private property shall continue to be funded by the private property owners.
VI. Remove City staff administrative costs as an allowable use of the Public Art Fund. (Sec. 30-98.10)
Staff administrative costs associated with the Ordinance include processing and facilitating approval of on-site public art applications by private developers, reporting to PAC and City Council, and releasing and administering RFPs for public art, among other costs. The existing Ordinance currently states that no more than 25% of the Fund can be used for City administrative costs, and the Synergy Report recommends lowering the cap on City administrative costs from 25% to 20% of the Fund.
Removing City administrative costs as an allowable use of the Fund will ensure that the maximum share of Fund monies are used for the design and installation of public art, or for cultural arts and arts programming. For artwork funded by the Public Art Fund, City administrative costs would need to be budgeted from the General Fund as part of the regular budgeting cycle. For on-site public art, staff recommends, as part of the permit fee, a processing fee for private development based on actual time and material costs.
Removing City staff administrative costs as an allowable use of the Public Art Fund does not preclude the use of grant funding for third-party administrative costs associated with cultural arts and arts programming (see Item XIV).
VII. Expand the list of allowable uses of the Fund to include grants to non-profit arts and cultural organizations. (Sec. 30-98.10)
Local non-profit arts organizations, cultural organizations, and/or educational organizations may be well-positioned to use Public Art Fund grants to provide publicly accessible cultural arts performances, events, and/or arts education.
VIII. Require that all cultural arts and arts programming funded by the Fund be free of charge to the general public. (Sec. 30-98.10)
To be considered public art, it is important that cultural arts and arts programming be as publicly accessible as possible. The requirement that all cultural arts and arts programming be free of charge will ensure that all public art generated by the Ordinance is accessible to the general public.
IX. Change annual planning requirements and fund balance reporting to coincide with the City’s biennial budget cycle. (Sec. 30-98.10)
The proposed amendment changes the requirement to develop a plan for the use of the Public Art Fund from annual to biennial, to better coincide with the City’s biennial budget cycle. This change also minimizes administrative costs associated with the Public Art Fund.
X. Shall the requirement for public art to focus on Alameda’s historic and maritime traditions be removed or preserved? (Sec. 30-98.1)
The current Ordinance contains a requirement that public art relate to historic or maritime traditions. Preserving this requirement would ensure that public art consistently adhere to historic or maritime themes. Removing or modifying this requirement would allow for a diversity of public art in Alameda and provide the PAC maximum flexibility in approving the design and installation of public art.
In the draft Ordinance recommended by staff, and supported by the PAC and the Planning Board, the historic and maritime tradition requirement is removed in order to provide for maximum diversity of public art, and flexibility for the PAC in approving public art. As requested by the PAC, the RFP released in September of 2017 includes a criterion evaluating the relationship of the proposed artwork to the City’s community and traditions. In response to feedback from the Planning Board, the language of this criterion has been expanded to include the City’s diverse cultural history and natural environment.
XI. Shall the cap on the maximum public art contribution be maintained, increased, or removed? (Sec. 30-98.10)
All projects with a development cost over $250,000 are currently required to spend 1% of the development cost on public art or pay an in-lieu fee, up to a maximum of $150,000. Historically, the City has negotiated higher public art requirements for larger projects such as Alameda Landing and Alameda Point Site A, as part of a negotiated public benefit package. Other northern California cities that staff researched do not include any cap on contributions through their Public Art ordinances (Exhibit 4).
The City Council can preserve the maximum contribution, increase it, or remove it altogether. Preserving the $150,000 maximum cap would limit future contributions to the Fund, while maintaining current fees for new development. An increase in the maximum, with annual adjustments tied to the San Francisco Area Consumer Price Index, or removal of the maximum altogether, would bring the City of Alameda ordinance into closer alignment with other California public art ordinances. Although increasing or removing the cap may result in greater contributions to the Fund, it may increase development costs for some projects, and therefore should be given careful consideration. The Synergy Report recommended increasing the cap to $500,000.
At the February 2015 meeting, the PAC recommended inclusion of an amendment that would encourage developers to contribute their 1% directly to the Fund if the development project is valued between $250,000 and $1,000,000; and to split the money 80% for physical on-site art and 20% to the Fund if the development project is valued over $1,000,000. This amendment is not being recommended because legally the Ordinance must allow developers the option of installing the art themselves or providing in-lieu funds. If developers are required to pay in-lieu funds, the Ordinance may be subject to the Mitigation Fee Act (Government Code 66000-66025) and would require a nexus study to justify the fee amount.
In the draft Ordinance recommended by staff, and supported by the PAC and the Planning Board, the cap is removed in order to bring the Ordinance into closer alignment with other California public art ordinances. Since the Planning Board meeting, staff has added a provision to the ordinance (Section 30-98.4) that stipulates that a project-specific “program allocation” for larger projects with a Development Agreement or Disposition and Development Agreement shall be established in the Agreement as part of the comprehensive public amenity package. This change would not impact existing, legally binding agreements.
XII. Shall the required public art contribution be increased from 1% to 1.5% of development costs? (Sec. 30-98.4)
All projects with a development value over $250,000 are currently required to spend 1% of the development cost on public art or pay an in-lieu fee, up to a maximum of $150,000. During the public comment period at the October 18, 2016 City Council meeting, community members asked whether the required contribution of 1% could be increased.
Research conducted by staff found that the 1% requirement is consistent with Public Art ordinances in many other Bay Area cities (Exhibit 4). Similar to increasing or removing the cap on the maximum public art contribution described above, increasing the required contribution from 1% to 1.5% may result in greater contributions to the Fund, but would also increase development costs for most projects.
In order to keep the City’s development fees and requirements comparable to, and competitive, with those of other Bay Area cities, the draft Ordinance recommended by staff, and supported by the PAC and Planning Board, maintains the required contribution at 1%.
XIII. Should the current requirement that 75% of funds be allocated for the design and installation of physical public art and 25% to cultural arts and arts programming be maintained or changed? (Sec. 30-98.10)
Maintaining the current distribution requirement would ensure that Fund monies contribute to cultural arts and arts programming in the City of Alameda. Changing or removing the current distribution requirement would provide the PAC more flexibility to allocate funds in response to changing priorities within the arts and culture community.
In the draft Ordinance recommended by staff, and supported by the PAC and the Planning Board, the requirement is changed to specify that no more than 25% of funds be allocated to cultural arts and arts programming, in order to allow the PAC maximum flexibility to allocate funds, particularly in years with a low Fund balance.
XIV. For grants to third-party organizations, should there be a cap on the maximum share of budget that can be used by grantee organizations for administrative costs, and if so, what should it be? (Sec. 30-98.10)
The proposed revisions to the Ordinance include allowing grants to non-profit and cultural institutions. Restricting the maximum share of the budget that can be used by third-party providers for administrative costs would ensure that the maximum amount of funding goes to the provision of public art. Standard caps on administrative costs for arts grants range from 10% to 20%, depending on how administrative costs are defined.
However, staff research suggests that many public and philanthropic arts grant programs are moving away from set caps on administrative costs (Exhibit 5). Proponents of this approach say that appropriate administrative costs can vary by organization and type of programming, and programs such as gallery exhibits, dance concerts and film festivals can have much higher appropriate administrative costs (up to 50%). In programs without a set cap on administrative costs, the PAC will need to evaluate each application on a case-by-case basis, as part of the RFP process.
In the draft Ordinance recommended by staff, and supported by the PAC and the Planning Board, there is no set cap on third-party administrative costs. Rather, it is recommended that these costs be evaluated on a case-by-case basis as part of the RFP application process.
In conclusion, staff recommends that the City Council hold a public hearing and approve the recommended changes to the Public Art Ordinance listed below by introducing the attached Ordinance. These changes were previously recommended for approval by the PAC and the Planning Board:
1. Clarify and strengthen the purposes of the Ordinance to better connect the vision, values and strategies for public art to the broader ambitions of the City;
2. Clarify ordinance exemptions;
3. Clarify the requirements and options for physical, on-site public art;
4. Clarify the application and review process for on-site public art applications;
5. Remove maintenance costs as an allowable use of the Public Art Fund;
6. Remove City staff administrative costs as an allowable use of the Public Art Fund;
7. Expand the list of allowable uses for the Fund to include grants to non-profit arts and cultural organizations;
8. Require that all cultural arts and arts programming funded by the Fund be free of charge to the general public;
9. Change annual planning requirements and fund balance reporting to coincide with the City’s biennial budget cycle;
10. Remove the requirement for public art to focus on Alameda’s historic and maritime traditions;
11. Remove the cap on the maximum public art contribution;
12. Maintain the current public art contribution at 1%;
13. Specify that no more than 25% of funds can be allocated to cultural arts and arts programming;
14. Do not set a cap on the maximum share of budget that can be used by grantee organizations for administrative costs; and
15. Other proposed changes listed in the staff report and draft revised Ordinance.
Per the PAC’s recommendation, staff requests that Council consider ways to supplement the public art program with funds from the General Fund.
FINANCIAL IMPACT
If administrative fees are removed as an allowable use of the Fund, future administrative costs for off-site public art would be funded through the General Fund. In anticipation of adoption of the proposed Ordinance, an annual allocation of ten thousand dollars ($10,000) was approved as part of the budget process to pay for staff time related to program administration, including managing the RFP process in Fiscal Year 2017-18. For on-site public art, administrative fees will be paid for out of Fund 209, through a processing fee (as part of the permitting fee) for private development based on actual time and material costs.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The Zoning Ordinance is proposed to be amended consistent with the General Plan, Alameda Municipal Code, and State law.
ENVIRONMENTAL REVIEW
The proposed amendments to the Zoning Ordinance regarding public art are categorically exempt under California Environmental Quality Act (CEQA) Section 15305 - Minor Amendments to Land Use Limitations.
RECOMMENDATION
Hold a public hearing and introduce an Ordinance amending the Alameda Municipal Code by amending Chapter 30 (Zoning Ordinance) to update and improve the regulations governing the Public Art Ordinance
Respectfully submitted,
Debbie Potter, Community Development Director
By:
Amanda Gehrke, Management Analyst
Financial Impact section reviewed,
Elena Adair, Finance Director
Exhibits:
1. Background Documents
2. Public Art Meeting, Summarized Public Comments
3. Proposed Changes to Ordinance (Redline)
4. Proposed Changes to Ordinance (Clean Version)
5. Summary of Public Art Requirements
6. Summary of Administrative Caps