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Home My WebLink About05 - CDM BID RenewalCITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item No. 5 June 12, 2007 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Community & Economic Development, Planning Department George A. Berger, AICP; C &ED Program Manager; 949/644 -3207; Aaberger @city.newport- beach.ca.us SUBJECT: Corona del Mar Business Improvement District Renewal: Annual Report for Fiscal Year 2006 -2007, and Adoption of Resolution of Intention to Levy for Fiscal Year 2007 -2008. ISSUE: Annual renewal of the Corona del Mar Business Improvement District. RECOMMENDATION: 1. Approve the Annual Report for the 2006 -2007 Corona del Mar Business Improvement District Fiscal Year; and 2. Adopt a Resolution of Intention to Levy Assessments for FY 2007 -2008, set the public hearing for June 26, 2007. DISCUSSION: The Corona del Mar Business Improvement District (BID) is nearing the end of its eleventh year of operation, and requests renewal of the District for a new fiscal year which will run from July 1, 2007 to June 30, 2008. This report summarizes the District's accomplishments during FY 2006 -2007, and the proposed activities and budget for the coming year. The BID's Board of Directors, which serves as the District Advisory Board, requests City Council approval of the annual report and scheduling of the public hearing for BID renewal for June 26, 2007. California law requires that an annual report for the past fiscal year be prepared by the BID and approved by the Council, and a public hearing be held each year prior to renewal of the District, which includes the area generally located on East Coast Highway from Hazel Drive to Avocado Avenue, as set forth with greater specificity in the map attached as Exhibit 1. CdM BID 2007 -2008 Renewal 1 June 12, 2007 Page 2 Eleventh Year District Accomplishments The Corona del Mar BID sponsored the following promotions and activities during the past year: • The BID again committed $40,000 from its City - provided matching funds (and will for one additional year) to offset the cost of the median landscape improvements constructed along Coast Highway in 2005 -2006. • The BID continued making progress on the various items called for on the CdM Vision Plan, including cooperating with the City to have a flashing pedestrian crosswalk installed at Orchid Street, and working jointly with City staff, the Council, and the CdM Residents Association to find the best solution for pedestrian safety at Iris Street. Designs for decorative sidewalk treatments throughout the village have been presented to the Advisory Board, and additional plans for street lighting and furniture are in process. • The BID continued in its working relationship with the Corona del Mar Chamber of Commerce for marketing support. The BID has contracted with the Chamber to maintain and update the Corona del Mar BID website (www.cdmvillage.com), to educate the public about the CdM Vision Plan, and to distribute information on current events and administration of the BID. The Chamber also includes the BID newsletter in its bi- monthly newsletter, which is sent to all BID and Chamber members. The BID also worked with the Chamber to recognize merchants who renovate their stores or buildings, and continues the successful Holiday Storefront Lighting program. • The BID paid for a presence for all members in the 2007 Corona del Mar Business Directory. • The BID, under contract, provided a quarterly maintenance program for the decorative bedding plantings at the Marguerite /Coast Highway intersection, with additional replanting as needed. The BID also contracts for the maintenance of the 200 Palm and Hong Kong Orchid trees along the Coast Highway sidewalks within the District. • The BID supported the Corona del Mar Chamber of Commerce in their Annual Christmas Walk. • The BID continued its program of installing holiday season decorations in the medians at Marguerite and Coast Highway. Fiscal Year District Revenues During the BID's FY 2006 -2007, approximately $77,637 in member assessments were collected by the BID, with $20,000 in additional funds remaining to be collected. The Z CdM BID 2007 -2008 Renewal 1 June 12, 2007 Page 3 BID's account balance beginning of the year was $45,150, and the BID received $51,240 in matching funds from the City. The BID spent approximately $100,840 for approved activities, and anticipates spending an additional $64,300 by fiscal year end. It is anticipated that a remaining balance of approximately $9,500 will be carried over into the FY 07 -08 budget. The BID anticipates receiving approximately $48,000 in matching funds from the City in FY 2007 -2008, $40,000 of which are committed to be paid back to the City under the agreement to jointly pay for the landscape median improvements along Coast Highway within the District. It anticipates collecting $75,000 from member assessments by fiscal year end. By the end of FY 2007 -2008, the District anticipates spending approximately $132,000 for all approved activities. Proposed Improvements, Activities and Budget The FY 2007 -2008 Priorities and Budget Outline, including specific goals for each category, is submitted by the BID Advisory Board as part of the attached Annual Report. The highest priorities for the upcoming fiscal year are: 1. Marketing, advertising, and promotion of the businesses within Corona del Mar; 2. Physical Improvements within the Corona del Mar business district, including those outlined in the CdM Vision Plan; and 3. Corona del Mar BID Member Outreach, and outreach to the larger regional community. Assessment Collection The current and proposed BID benefit assessment per business is equal to 150% of the annual business license fee paid to the City, pursuant to Chapter 5.08 of the Municipal Code of the City of Newport Beach. For reference, the business license fee is comprised of $134 plus an additional amount for each employee in most cases. Banks and financial institutions exempt from City business license regulations are assessed $500 per year for BID membership. Insurance agencies exempt from City license regulations are assessed $250 per year for BID membership. Persons operating one of the following businesses as an independent contractor in an establishment owned by another person are exempt from this assessment: 1. Hair stylists 2. Nail technicians 3. Real estate agents The penalty for delinquent payments is twenty -five percent per month, provided that the penalty amount added shall in no event exceed one hundred percent of the assessment amount due. Assessments are collected in a single installment at the beginning of the fiscal year, and are prorated for new businesses opening during the year. 3 CdM BID 2007 -2008 Renewal 1 June 12, 2007 Page 4 The Advisory Board of the Corona del Mar Business Improvement District does not expect to raise funds in addition to the assessments levied for the upcoming year. It is anticipated that matching funds will be approved by the City Council for FY 07 -08 in an approximate amount of $48,000. Again, the BID has pre- committed $40,000 of the matching funds to the City in repayment for the median construction. The attached Annual Report further describes the budget and activities for the upcoming year, and has been filed with the City Clerk's office as required by California law. ENVIRONMENTAL REVIEW: Not subject to CEQA, as the activity is not a project, as defined in Section 15378(b)(4) PUBLIC NOTICE: None Required FUNDING AVAILABILITY: Business Improvement District matching funds are included in City Budget Account No. 2720 -8250. - Submitted by: r are y: SHARON Z. WOAD GEORGE A. BERGER, AICP Assistant City Manager C &ED Program Manager With assistance from: CLINTON SCOTT PALMER BID Systems Inc. Attachments: Attachment A: Resolution of Intention 07- Exhibit 1: CdM BID Boundary Map Attachment B: FY 2006 -2007 Annual Report (by BID Advisory Board) Attachment C: FY 2007 -2008 Priorities & Budget (by BID Advisory Board) 4 ATTACHMENT A RESOLUTION NO. 2007- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH STATING ITS INTENTION TO LEVY ASSESSMENTS FOR THE CORONA DEL MAR BUSINESS IMPROVEMENT DISTRICT FOR THE FISCAL YEAR OF JULY 1, 2007 TO JUNE 30, 2008. WHEREAS, the Corona del Mar Business Improvement District was established in 1996 pursuant to the Parking and Business Improvement Area Law of 1989, California Streets and Highways Code, Section 36500 et seq., (hereinafter the "Act'), which requires an annual report to be filed and approved by the City Council for each fiscal year; and WHEREAS, the Advisory Board has prepared an Annual Report for the 2006- 2007 fiscal year which is on file in the Office of the City Clerk, and WHEREAS, the Annual Report for the 2006 -2007 fiscal year was approved by the City Council, NOW, THEREFORE, the City Council of the City of Newport Beach resolves as follows: Section 1: The City Council hereby declares the intention to levy assessments for the Corona del Mar Business Improvement District for a fiscal year July 1, Resolution No. 2007 -` Corona del Mar Business Improvement District Page I S 2007 to June 30, 2008 pursuant to the Act. Such benefit assessment shall be as follows: A. Banks and financial institutions that are exempt from City business license regulations shall be assessed $500 per year; B. Insurance agencies that are exempt from City business license regulations shall be assessed $250 per year; C. Persons operating one of the following types of businesses as an independent contractor in an establishment owned by another person shall be exempt from this assessment: 1. Hair stylists 2. Nail technicians 3. Real estate agents D. The assessment for all other businesses within the District shall be 150 percent (150 %) of the annual business license tax as established pursuant to Chapter 5.08 of the Municipal Code. Section 2: The penalty for delinquent payments shall be twenty -five percent (25 %) per month, providing that the penalty to be added shall in no event exceed one hundred percent (100 %) of the assessment amount due. Section 3: The City shall collect benefit assessments in one annual installment, with collections for new businesses in the District on the day of the issuance of a business license by the City. The assessment for new businesses shall be pro- rated according to the number of full months remaining in the District's fiscal year. Resolution No. 2007 Corona dcl Mar Business Irnprovement District Page 2 E_ Section 4: The improvements and activities to be funded by the benefit assessments shall include only the following: 1. Marketing and advertising 2. Physical Improvements 3. Maintenance Programs 4. Administration Section 5: The location of the District will remain the same: generally located on East Coast Highway from Hazel Drive to Avocado Avenue as set forth with greater specificity in the map attached as Exhibit 1. BE IT FURTHER RESOLVED, that the City Council of the City of Newport Beach shall conduct a public hearing on June 26, 2007 at 7:00 p.m., or as soon thereafter as this matter may be heard, in the Council Chambers located at 3300 Newport Boulevard, Newport Beach, California at which time the Council will hear all interested persons for or against the renewal of the District, the extent of the District and the specific types of improvements or activities to be funded by the benefit assessment. Protests may be made orally or in writing; but if written, protests shall be filed with the City Clerk at or before the time fixed for the Hearing and contain sufficient documentation to verify business ownership and validate the particular protest. If written protests are received by the owners of businesses within the District that pay fifty percent or more of the total assessments to be levied, no further proceedings to renew the District shall be taken for a period of one year from the date of the finding of a majority protest by the City Council. If the majority protest is only against the furnishing of a specific type or types of improvements or activity or benefit within the District, those types Resolution No. 2007 -_ Corona del Mar Business hnprovement District Page 3 17 of improvements or activities or benefit zones shall be eliminated. Further information regarding the proposed Business Improvement District renewal may be obtained at the Newport Beach City Hall, 3300 Newport Boulevard, Newport Beach, California, 92658. Telephone (949) 644 -3225. The City Clerk shall cause this resolution of intention to be published once in a newspaper of general circulation in the City at least seven days before the public hearing. This resolution shall take effect immediately upon adoption. Passed and adopted by the City Council of the City of Newport Beach at a regular meeting held on the day of ATTEST: 2007. MAYOR CITY CLERK ATTACHMENT: Exhibit 1 (Boundary Map) Resolution No. 2007- Corona del Mac Business Improvement District Page 4 N r e EXHIBIT 1 City of Newport Beach Corona del Mar Business Improvement District �, � 1Q, I WO WO Mfli �\ \ y� i qg, " eusiness Improvement District Boundary EE/ 1 Y Z ATTACHMENT B REPORT TO THE MAYOR AND CITY COUNCIL CORONA DEL MAR BUSINESS IMPROVEMENT DISTRICT ANNUAL REPORT FOR 2006 -2007 FISCAL YEAR Overview This is the annual report for the Corona del Mar Business Improvement District, as required by Section 36533 of the California Streets and Highways Code, for the fiscal year July 1, 2006 to June 30, 2007. Boundaries The boundaries of the benefit zone remain unchanged: generally located on East Coast Highway from Hazel Drive to Avocado Avenue as set forth with greater specificity in the map attached as Exhibit A. Proposed Activities The improvements and activities to be provided for the fiscal year include 1. Marketing, advertising, and promotion of Corona del Mar 2. Physical Improvements within Corona del Mar 3. Corona del Mar BID Member and Community Outreach 4. Corona del Mar BID CdM Vision Plan and associated administration. Proposed Budget The estimated cost of providing the proposed improvements and activities in this report is approximately $108,100.00. The implementation of these actions is more fully described in the attached Priorities and Budget Outline for the 2007 -2008 Fiscal Year. Assessments Assessments shall be collected in one annual installment at the beginning of the fiscal year, and shall be prorated for new businesses that open during the fiscal year. The benefit assessment shall be equal to 150% of the City's usual annual business license tax as established pursuant to Chapter 5.08 of the Municipal Code. The penalty for delinquent payments will be twenty -five percent per month, providing that the penalty amount added shall in no event exceed one hundred percent of the assessment amount due. Banks and financial institutions that are exempt from City business license regulations shall be assessed $500 per year. Insurance agencies that are exempt from City business license regulations shall be assessed $250 per year. Persons operating in 10 one of the following types of businesses, as an independent contractor in an establishment owned by another person shall be exempt from this assessment: 1. Hair stylists 2. Nail technicians 3. Real estate agents Account Status During the 2006 -2007 fiscal year the District collected approximately $77,637.00 in assessments from members, with an additional $20,000.00 in accounts receivable to be collected by the end of the fiscal year. Its account balance of the beginning of the year was $47,592.00. The BID received $51,240 in matching funds from the City. The BID has spent approximately $100,840.00 for approved activities, and anticipates spending an additional $64,300.00 by fiscal year end. The District's current account balance is approximately $73,766 at the end of the first eleven months of the fiscal year. It is anticipated the balance will be approximately $9,500 or less at the fiscal year end, June 30, 2007. Revenue from members in the 2007 — 2008 period is projected to be $75,000 and City Matching revenues to be $48,000. Of that $48,000, $40,000 has been previously committed to the City for payment on the medians. $130,000 has been allocated for projected expenses (including the $40,000 payable to the City), with an anticipated $500 left over at the end of the 2007 -2008 Fiscal Year. Prior Year Accomplishments The merchants of Corona del Mar have found their eleventh year as a Business Improvement District to be very successful and have achieved several accomplishments including: * The BID continues to commit $40,000 a year for one more year from matching funds from the City to offset the cost of the medians constructed two years ago. *The BID worked closely with the Public Works Department of the City in installing a flashing crosswalk at Orchid Street. *The BID proceeds to make progress on the various items called for on the CdM Vision Plan. Ongoing efforts to determine the best solution for pedestrian safety at Iris Street are being studied. Designs for sidewalk treatments throughout the village have been presented to the Advisory Board, and additional plans for street lighting and furniture are in process. *The BID continues with the working relationship with the Corona del Mar Chamber of Commerce in marketing efforts. As part of this joint effort, the BID contracted the Chamber to maintain and update the Corona del Mar BID website, www.cdmvillaQe.com, It to educate the public about the CdM Vision plan and distribute information on current events and administration of the BID. The Chamber also includes the BID newsletter in its bi- monthly newsletter sent to all BID members and Chamber members. The BID also worked with the Chamber in recognizing merchants who renovate their stores or buildings, as well as continuing the successful Holiday Lighting program in all participating merchant windows. In addition, the BID paid for a presence for all of its members in the 2007 Corona del Mar Directory. *The BID paid for quarterly maintenance of decorative bedding at the Marguerite / Coast Highway intersection with replanting as needed. *Maintained the health of the 200 Palms and Hong Kong Orchids along the Coast Highway right -of -way. The BID also paid to maintain the planters and irrigation. *Supported the Corona del Mar Chamber of Commerce with the Annual Christmas Walk. *Installed Holiday Season Decorations throughout the District, notably in the medians at Marguerite and Coast Highway. The merchants of Corona del Mar have worked diligently to promote and improve their village and wish to express their appreciation for the City Council's continued support of the Corona del Mar Business Improvement District. 12 ATTACHMENT C REPORT TO THE MAYOR AND CITY COUNCIL CORONA DEL MAR BUSINESS IMPROVEMENT DISTRICT Priorities and Budget Outline July 1, 2007 — June 30, 2008 Funds Available FY End 2007 $ 9,500 Funds to be collected July 2007 $75,000 Anticipated Matching Funds from City $48,000 Total Available Funds $166,000 Priorities Budget Amount 1. Marketing Plan Administration $31,400 2. Physical Improvements/Maintenance $76,600 3. Member and Community Outreach $22,500 4. Vision Plan Implementation $ 1,500 13 Authorized to Publish Advertisements of all kinds including public notices by Decree of the Superior Court of Orange County, California. Number A -6214, September 29, 1961, and A -24331 Lune 11, 1963: RECI:-:I\,//FD PROOF OF PUBLICATI`O'IVI El'l 2.5 1 ?Pl I 01 STATE OF CALIFORNIA) t!''` -}' ) ss. COUNTY OF ORANGE ) I am a Citizen of the United States and a resident of the County aforesaid; I am over the age of eighteen years, and not a parry to or interested in the below entitled matter. I am a principal clerk of the NEWPORT BEACH - COSTA MESA DAILY PILOT, a newspaper of general circulation, printed and published in the City of Costa Mesa, County of Orange, State of California, and that attached Notice is a true and complete copy as was printed and published on the foliowina dates: JUNE 16,2007 I declare, under penalty of perjury, that the foregoing is true and correct. Executed on JUNE 16,2007 at Costa Mesa, California. Signature