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Home My WebLink About14 - Approval of Funding Support for the BVMA Inc.P0 @ CITY OF i NEWPORT BEACH City Council Staff Report June 25, 2019 Agenda Item No. 14 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Grace K. Leung, City Manager - 949-644-3001, gleung@newportbeachca.gov PREPARED BY: Mary Locey, Management Analyst mlocey(@.newportbeachca.gov PHONE: 949-644-3031 TITLE: Approval of Funding Support for the BVMA Inc. ABSTRACT: The BVMA Inc. (BVMA), a local non-profit organization, requests financial support from the City to continue to offer special events and marketing of the Balboa Village business district. RECOMMENDATIONS: a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; b) Approve and file the BVMA Inc. Fiscal Year 2018-19 Annual Report and Fiscal Year 2019-20 Proposed Projects and Budget; c) Approve $40,000 in funding support for the BVMA Inc. for Fiscal Year 2019-20; and d) Authorize the City Manager to execute a grant agreement with the BVMA Inc. for Fiscal Year 2019-20. FUNDING REQUIREMENTS: Should the City Council approve the BVMA's request for funding support, the City's approved FY 2019-20 budget includes sufficient funding to contribute $40,000. It will be expensed to the City Manager's Office, Economic Development Division, Community Support Expense Account 01020202-821015. 14-1 Approval of Funding Support for the BVMA Inc. June 25, 2019 Page 2 DISCUSSION: On February 27, 1995, the City Council adopted Ordinance No. 95-4 establishing the Central Balboa Business Improvement District (BID), formed pursuant to the Parking and Business Improvement Area Law of 1989, codified in California Streets and Highways Code Sections 36500 et seq. (1989 Law). The BID subsequently changed its name to the Balboa Village Business Improvement District. The BID was comprised of small businesses in the area between A Street and Coronado Street on the Balboa Peninsula. Operating as a 1989 Law BID, the board members, accustomed to making quick and independent decisions in the private -sector environment, found the many laws, policies and procedures to be complicated and burdensome for what they wanted to accomplish. After nearly a year of investigating various options to allow more freedom to operate, in 2013, the BID board supported disestablishing the BID to form a merchant association, which would operate independently of the City of Newport Beach (City). Once the non- profit organization was established, the City agreed it would provide $40,000 annually for five years to assist the new organization. The City Council approved the disestablishment of the BID on May 28, 2013 by Ordinance No. 2013-13, which went into effect on June 30, 2013. The BVMA became an active entity (officially filed as BVMA Inc.) with the State of California on August 6, 2013. On September 28, 2013, the City Manager executed a grant agreement with the BVMA for $40,000 in City funding support for the purpose of marketing, public relations, and event planning in support of the merchants located in the Balboa Village. The BVMA represents approximately 80 businesses and is committed to supporting tourism and economic growth, providing business promotion, and advocating for area enhancements. The merchant association works closely with Newport Beach and Company (NB&Co.) for its marketing, public relations, and outreach efforts. NB&Co. hosts and maintains the BVMA's website; develops and posts social media content; and facilitates a variety of special events, promotional opportunities and strategic advertisements. For the past six years, the City has provided $40,000 annually to the BVMA through City issued grant agreements. Each year, the City Manager included funding for the BVMA in the City Council approved budget and executed the grant agreements. This is the first time staff is presenting the matter to the City Council for funding consideration since 2013. On June 5, 2019, the BVMA submitted a letter requesting the City's continued financial support; its annual report of accomplishments for FY 2018-19; and its proposed projects and budget for FY 2019-20 (Attachment A). 14-2 Approval of Funding Support for the BVMA Inc. June 25, 2019 Page 3 ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENT: Attachment A — BVMA Annual Report, Proposed Projects and Budget 14-3 ATTACHMENT A !� L 1G BVMA Inc. Balboa Village Merchants Association Inc. 2865 East Coast Highway, Suite 360 Corona del Mar, CA 92625 949 675-2337 Fax 949 760-8415 June 5, 2019 Mary Locey City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 Dear Ms. Locey, The Balboa Village Merchant's Association hereby requests a grant to be made to the Association in the amount of $40,000. These monies will assure the Merchants of Balboa Village will continue the successful programs implemented during the past six5 years of the City's generous funding. The Village has held several successful special events, including summer concert series and a Ski Week promotion. Other events such as the Balboa Car Show and programs including street d6cor help the merchants during slow after -summer seasonal periods. Our cooperation with Newport Beach and Company has led to a much higher social media presence and a modern, well designed website. We are very excited about the Programmatic Platform to provide enhanced shopping, dining and fun experiences to our customers. Attached to this letter are financial statements for the 2017-2018 Fiscal Year as well as a description of the past accomplishments and future activities planned. On behalf of the BVMA, Inc., we thank you for this grant, and look forward to a beneficial continuing relationship. Kelly Carlson, Owner, Balboa Water Sports Chair Coleen DiAluisio, Oceanquest Vice Chair 14-4 BVMA Inc. BALBOA VILLAGE MERCHANTS ASSOCIATION 2018 — 2019 ANNUAL REPORT The sixth year of the Balboa Village Merchant's Association was very successful in establishing new and continuing special events that helped promote the merchants of the village. Balboa Village Merchant Association accomplishments during fiscal year 2018 - 2019 follow: * Worked with Newport Beach and Company to bring social media "influencers" into the village to promote recreation and dining opportunities in the Village. * Contracted with Desert Publications to start a program of "Programmatic" internet-based promotions and media tracking using a geofencing technology. * Instituted a cost sharing program to help advertise in the Newport Beach Inspiration Guide and in the Newport Beach Guide Map program. These programs are in development with the help of Newport Beach and Company. * Held a "Christmas at the Beach" throughout the month of December featuring new holiday programs and decor. * Worn and damaged seasonal decorations were retired, and a new cost- effective strategy of decorating the village was implemented. * Created and implemented various programs to promote the Village locally, such as Ski Week promotions. *Held the "Balboa Beach Boogie" summer concert series featuring a live weekly performance by a DJ on the patio at Oceanquest. * Represented the Association at the Mayor's Dinner. * Continued refinement of the www.balboavillage.com website with Newport Beach and Company Visitor's website, providing seasonal information and announcements as well as an electronic merchant directory. * Continued a Constant Contact program to inform merchants of meetings and news * The Association sponsored the Balboa Village Car Shows every Sunday: *Carried various administrative and operating costs including storage for the seasonal decorations, E&O Insurance, bookkeeping, and tax preparation. The Association will finish the Fiscal Year with approximately $38,000 to pass over into the next fiscal year, as well as $34,000 in seasonal decorations held as assets. 14-5 BVMA Inc. BALBOA VILLAGE MERCHANTS ASSOCIATION 2019 - 2020 PROJECTED PROJECTS Looking forward to the next fiscal year, BVMA Inc. has the following objectives: *Begin an aggressive social media campaign through Facebook and Instagram using community wide mural paintings. At Newport Beach and Company's recommendation, artists were screened for innovative ideas and styles to create "Instagram" worthy backdrops to help promote the tenor and entertainment value of the Village. *Institute new membership, advertising, and sponsorship structures to create revenue in addition to the continued City funding. *Revise and Implement new seasonal and patriotic decoration programs within the village. *The website www.balboavillage.com will be improved and additional social media outreach programs will be developed through the partnership with Newport Beach & Company. Additional advertising campaigns will be produced as well as collateral. *Encourage the continuing "Car Show" Sundays put on in the Market Parking lot every Sunday. *Administer the Association using a third party consultant, as well as miscellaneous costs (including the annual meeting). *Continue the alliance between Newport Beach and Company and the Association for implementation of the strategic marketing for the Village, as well as creating additional "influencer" social media programs. * Explore a resident targeted family oriented special event to take place in the park adjacent to the Village. *Continue a program in conjunction with OceanQuest for weekly DJ events on the patio at the Discovery Center * Continue to improve the shuttle program in conjunction with other merchant associations, the City of Newport Beach and Newport Beach and Company. * Institute a Christmas Walk Program for the holiday and Boat Parade Season. The merchants of Balboa Village appreciate the efforts of the City Council and your continued support of their Association. 2 14-6 Balboa Village Merchants Association BVMA Inc. Budget Outline July 1, 2019 — June 30, 2020 Funds Available FY End 2019 $34,000 Funds from City 2019 — 2020 $40,000 Additional Funding from the City* $ 7,500 Sponsorships and Participation Fees $10,000 Total Available Funds $91,500 Expenditures Marketing & Advertising $69,500 Maintain memberships with NB CofC/NB CVB Website Maintenance and Content Management Special Event Promotion Social Media Development Programmatic Program Print/Electronic Media Purchases Special Events $8,000 Holiday Events Sunday Car Shows Village Beautification $ 7,000 Street Decorating Administration $7,000 Administration Total Planed Expenditures $91,500 *May special event grants 3 14-7 10:01 AM BVMA, Inc. 06/04/19 Balance Sheet Accrual Basis As of June 4, 2019 Page 1 14-8 Jun 4, 19 ASSETS Current Assets Checking/Savings 10000 • Union oper 35,236.69 Total Checking/Savings 35,236.69 Accounts Receivable 11000 • Accounts Receivable 3,550.00 Total Accounts Receivable 3,550.00 Other Current Assets 13000 • Decorations 13100 Holiday Decorations( December) 32,217.19 13200 Seasonal Decorations 1,824.23 Total 13000 • Decorations 34,041.42 Total Other Current Assets 34,041.42 Total Current Assets 72,828.11 TOTAL ASSETS 72,828.11 LIABILITIES & EQUITY Equity 32000 • Unrestricted Net Assets 51,166.75 Net Income 21,661.36 Total Equity 72,828.11 TOTAL LIABILITIES & EQUITY 72,828.11 Page 1 14-8 10:01 AM BVMA, Inc. 06/04/19 Profit & Loss Accrual Basis July 1, 2018 through June 4, 2019 Total 65100 • Program Expenses 13,356.02 Total Expense 18,338.64 Net Ordinary Income 21,661.36 Net Income 21,661.36 Page 1 14-9 Jul 1, '18 - Jun 4, 19 Ordinary Income/Expense Income 43400 • Direct Public Support 43410 • Municipal Contributions 40,000.00 Total 43400 • Direct Public Support 40,000.00 Total Income 40,000.00 Gross Profit 40,000.00 Expense 62100 • Contract Services 62110 • Accounting Fees 1,108.33 Total 62100 • Contract Services 1,108.33 65000 • Operations 65008 • E&O Insurance 1,135.00 65060 • Bookkeeping 2,251.67 65070 Taxes/ Fees 250.00 65090 Meeting Expense 237.62 Total 65000 • Operations 3,874.29 65100 • Program Expenses 62000 • Advertising 62010 Online Advertising 2,000.00 62200 Print 4,100.00 Total 62000 • Advertising 6,100.00 63100 • Professional Memberships 1,300.00 65200 • Special Events 65400 • Christmas at the Beach 65430 Decorations 5,523.02 65470 Permits 433.00 Total 65400 • Christmas at the Beach 5,956.02 Total 65200 • Special Events 5,956.02 Total 65100 • Program Expenses 13,356.02 Total Expense 18,338.64 Net Ordinary Income 21,661.36 Net Income 21,661.36 Page 1 14-9