HomeMy WebLinkAbout21 - Levying of Assessments and Appointing the Advisory Board of Directors for the CDMBID's Fiscal Year 2020-21Q �EwPpRT
CITY OF
O �
z NEWPORT BEACH
<,FORN'P City Council Staff Report
June 23, 2020
Agenda Item No. 21
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Grace K. Leung, City Manager - 949-644-3001,
gleung@newportbeachca.gov
PREPARED BY: Melanie Franceschini, Administrative Analyst
mfranceschini@newportbeachca.gov
PHONE: 949-644-3028
TITLE: Resolution No. 2020-64: Confirming the Levying of Assessments and
Appointing the Advisory Board of Directors for the Corona del Mar
Business Improvement District's Fiscal Year 2020-21
ABSTRACT:
Pursuant to the Parking and Business Improvement Area Law of 1989 (1989 Law),
codified in Streets and Highways Code Sections 36500 et seq., the annual renewal of a
1989 Law Business Improvement District requires a public hearing to determine if a
majority of the members protest the assessments or a specific improvement, activity or
benefit proposed by the Corona del Mar Business Improvement District (CdM BID) for
fiscal year 2020-21 (FY 2020-21). If a majority protest is not received, the City Council
may confirm the levying of assessments for FY 2020-21 and appoint the advisory board
of directors for the CdM BID.
RECOMMENDATIONS:
a) Hold a public hearing regarding the renewal of the Corona del Mar Business
Improvement District for Fiscal Year 2020-21;
b-1) If the protests received are less than 50 percent of the total assessment amount,
adopt Resolution No. 2020-64, A Resolution of the City Council of the City of
Newport Beach, California, Confirming the Levying of Assessments for the Fiscal
Year of July 1, 2020 to June 30, 2021 for the Corona del Mar Business
Improvement District;
or
b-2) If the protests received are more than 50 percent of the total assessment amount,
abandon the renewal proceedings for the Corona del Mar Business Improvement
District;
c) 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; and
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Resolution No. 2020-64: Confirming the Levying of Assessments and
Appointing the Advisory Board of Directors for the
Corona del Mar Business Improvement District's Fiscal Year 2020-21
June 23, 2020
Page 2
d) Appoint the following Corona del Mar Business Improvement District members
to serve as the Corona del Mar Business Improvement District's Advisory Board
of Directors for Fiscal Year 2020-21:
BID Member
Representing Business
Ernie Caponera
Harcourts Newport Properties
Keith Dawson
Dawson & Dawson
Edward Hanley
Hanley Investment Group
Hamid Kianipur
76 Gas Station
Scott LaFleur
Representing Cafe Jardin
Scott Laidlaw
Laidlaw Schultz Architects
Jasmin Mortazavi
Mathnasium of Newport Beach
Andrea Sotoma or
Reborn Coffee CdM
Bernie Svalstad
Upland Stor King
FUNDING REQUIREMENTS:
The City of Newport Beach (City) contracts with a vendor (the CdM BID pays for these
services) to collect the stakeholder assessments on behalf of the City and remits the
money directly to the CdM BID's bank account. The monies are used for funding the BID's
activities as described in the annual report, which was filed with the City Council on
June 9, 2020.
DISCUSSION:
The Corona del Mar Business Improvement District (CdM BID) was formed in 1997
(Ordinance 97-24) pursuant to the Parking and Business Improvement Area Law of 1989
(1989 Law), codified in Streets and Highways Code Sections 36500 et seq., for the
purpose of financing activities and programs to benefit the member businesses located
and operating in the area. The CdM BID territory encompasses the commercial area
generally located along East Coast Highway from Hazel Drive to Avocado Avenue in
Corona del Mar.
In accordance with the 1989 Law, a public hearing must be held prior to the City Council
adopting a resolution to confirm the BID's renewal. Owners of member businesses may
submit a written or oral protest against the assessment levy and / or against the furnishing
of a specific type of improvement, activity or benefit proposed for the BID's upcoming
fiscal year.
• If the majority protest is from member business owners, which pay 50 percent or
more of the total assessment to be levied, the City Council should abandon the
renewal. If abandoned, no further proceedings to renew the BID shall be taken for
a period of one year from the date of the finding of a majority protest by the City
Council.
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Resolution No. 2020-64: Confirming the Levying of Assessments and
Appointing the Advisory Board of Directors for the
Corona del Mar Business Improvement District's Fiscal Year 2020-21
June 23, 2020
Page 3
• If the majority protest is only against the furnishing of a specific type of
improvement, activity or benefit within the BID, those types of improvements,
activities or benefits shall be eliminated from the BID's proposed plan.
• If protests represent less than 50 percent of the total assessment, the City Council
may renew the BID.
During the June 9, 2020 regular meeting, the City Council approved the CdM BID'S FY
2019-20 Annual Report and FY 2020-21 Budget, adopted a Resolution of Intention
(Resolution No. 2020-58) to levy and collect assessments in FY 2020-21, and set a public
hearing for June 23, 2020. See Attachment A for the June 9, 2020 staff report (without
attachments).
A public notice of Resolution No. 2020-58, declaring the City Council's intention to levy
and collect assessments for the CdM BID and setting the time and place of the public
hearing, was published in the Daily Pilot newspaper (print edition) on Saturday, June 13,
2020. In addition, it was posted on the City's website (newportbeachca.gov/publicnotices)
and, per the 1989 Law, a full copy of the resolution was mailed to each member of the
CdM BID.
At the time this report was published by the City Clerk, no letters of opposition have been
received to the CdM BID's assessment renewal, the levying of assessments, or to a
specific improvement, activity or benefit proposed. Any subsequent correspondence, with
a tabulation of the protests, will be provided to the City Council at its June 23, 2020
meeting.
Advisory Board Appointments
The City Council has the authority to appoint an advisory board of directors to the CdM
BID. The City may limit membership on the board to persons subject to the BID
assessment or a designated representative of a member business in good standing. The
advisory board that serves the CdM BID is different and distinct from other City advisory
bodies and is not appointed in the same manner. The City relies upon the Streets and
Highways Code for BID advisory board appointments rather than Council Policy A-2. The
CdM BID's bylaws allow for the appointment of up to nine (9) board members.
The City Clerk posted a vacancy announcement for the nine (9) available CdM BID
advisory board seats (board members serve a one-year term). To be eligible to serve on
the CdM BID Board, the applicant must be the member business owner or their
designated representative. In addition, the business represented must be in good
standing (no debt owed to the City or the CdM BID). Nine (9) eligible applications were
received in response to the vacancy announcement published on April 14, 2020.
The CdM BID Board met on May 28, 2020 and recommended the nomination of the nine
(9) applicants for City Council appointment to the FY 2020-21 CdM BID Advisory Board
of Directors as shown in the recommendation.
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Resolution No. 2020-64: Confirming the Levying of Assessments and
Appointing the Advisory Board of Directors for the
Corona del Mar Business Improvement District's Fiscal Year 2020-21
June 23, 2020
Page 4
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).
ATTACHMENTS:
Attachment A — June 9, 2020 Staff Report (without attachments)
Attachment B — Resolution No. 2020-64
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ATTACHMENT A
Q �EwPpRT
CITY OF
O �
z NEWPORT BEACH
<,FORN'P City Council Staff Report
June 9, 2020
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: Melanie Franceschini, Administrative Analyst
mfranceschini@newportbeachca.gov
PHONE: 949-644-3028
TITLE: Resolution No. 2020-58: Resolution of Intention to Renew the Corona
del Mar Business Improvement District, Levy Assessments in
FY 2020-21 and Fix Time and Place of Public Hearing
ABSTRACT:
The Corona del Mar Business Improvement District (CdM BID) Advisory Board of
Directors (Board) has submitted the BID's annual report and budget for the City Council's
review and approval. The Board also submitted a letter requesting the renewal of the CdM
BID for fiscal year 2020-21 and thanking the City Council for considering $40,000 in
funding support to the BID due to the economic impact of the COVID-19 pandemic on
local businesses.
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/or modify the Corona del Mar Business Improvement District's Fiscal
Year 2019-20 Annual Report and its Proposed Fiscal Year 2020-21 Budget;
c) Direct staff to return to the City Council with the CdM BID's detailed plan and budget
for how $40,000 in COVID-19 economic relief funds will be utilized before the City of
Newport Beach releases the funds; and
d) Adopt Resolution No. 2020-58, A Resolution of the City Council of the City of Newport
Beach, California, Declaring its Intention to Renew the Corona del Mar Business
Improvement District and Levy Assessments for the Fiscal Year of July 1, 2020 to
June 30, 2021, and Fix the Time and Place of a Public Hearing for June 23, 2020.
21-5
Resolution No. 2020-58: Resolution of Intention to Renew the Corona del Mar Business
Improvement District, Levy Assessments in FY 2020-21 and Fix Time and
Place of Public Hearing
June 9, 2020
Page 2
FUNDING REQUIREMENTS:
The City of Newport Beach (City) contracts with a vendor (the CdM BID pays for these
services) to collect the stakeholder assessments and remits the money directly to the
CdM BID's bank account. The monies are used for funding the BID's activities as
described in the annual report (Attachment A).
At the May 26, 2020 City Council meeting, the Ad Hoc Committee on Local Business
Advancement recommended providing the CdM BID with $40,000 for COVID-19
economic relief support. Once the City Council determines the CdM BID's COVID-19
relief spending plan is satisfactory, the allocation will be distributed to the CdM BID.
DISCUSSION:
The Corona del Mar Business Improvement District (CdM BID) was formed in
1997 (Ordinance 97-24) pursuant to the Parking and Business Improvement Area Law of
1989 (1989 Law), codified in the Streets and Highways Code Sections 36500 et seq. The
CdM BID was established for the purpose of financing activities and programs that benefit
the member businesses located and operating in the area. The CdM BID territory
encompasses the area generally located along East Coast Highway from Hazel Drive to
Avocado Avenue in Corona del Mar. A boundary map is attached to the Resolution of
Intention (Attachment C).
The CdM BID is nearing the end of its FY 2019-20 operating period and the Board, which
serves in an advisory capacity to the City Council, has requested renewal of the BID for
FY 2020-21. Pursuant to the 1989 Law, an annual report must be prepared and filed with
the City Council and a public hearing must be held prior to the BID's renewal. If the City
Council adopts the Resolution of Intention, the public hearing will be held on June 23.
The CdM BID Board has prepared and submitted the attached annual report for the City
Council's review and approval. The report includes a summary of the CdM BID's FY 2019-
20 accomplishments and revenues, as well as its proposed activities and budget for the
upcoming fiscal year. In addition, the CdM BID Board met on May 28 and recommended
that its chair submit a letter to the City Council requesting the BID's renewal and thanking
the City Council for considering $40,000 in COVID-19 Economic Relief Funding for the
BID (Attachment B).
To meet the requirements for the City Council's offer for COVID-19 economic relief
funding, the BID will be focusing its efforts on the Shop & Dine Local media campaign
and developing new strategic components to promote economic growth during the
"reopening" of the business district. New marketing ideas include forums regarding safe
business re -opening and surveying the needs of the business members to see if the BID
should provide protective equipment, guidance compliance posters or social distancing
floor decals to the stakeholders, and district -wide promotional campaigns to further drive
business to the district.
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Resolution No. 2020-58: Resolution of Intention to Renew the Corona del Mar Business
Improvement District, Levy Assessments in FY 2020-21 and Fix Time and
Place of Public Hearing
June 9, 2020
Page 3
The Board will continue to enhance its digital and media relations to maintain and develop
new marketing collateral to attract customers to the business district. Due to the financial
challenges small businesses currently face, at its May 28 meeting, the BID Board voted
to reduce certain member assessments for FY 2020-21. The current assessment rate for
most members is 150 percent of the business license fee and the proposed assessment
for FY 2020-21 is 70 percent of the business license fee. The assessment rates are
summarized on page 5 of this report.
Staff believes these proposed activities support the Council's desire to have COVID-19
relief funds provided by the City utilized to facilitate the reopening and recovery of BID
member businesses and/or used to offset revenue losses resulting from a temporary
decrease in assessments. However, it is staff's understanding that the Council wants to
see a plan and budget that details the specific activities the CdM BID will accomplish with
$40,000 in COVID-19 relief funds. Therefore, staff is recommending that the City Council
direct staff to return with the CdM BID's detailed plan for Council review and approval
before the monies are distributed to the CdM BID.
Fiscal Year 2019-20 Accomplishments
The CdM BID Board continued making progress on the priorities identified in its Vision
2020 plan. Specific focus areas include its ongoing marketing, outreach and
communication efforts, and regular community support programs and improvement
projects. Board members have been working on several projects, which are consistent
with the BID's efforts to revitalize the business district and support the economic growth
of its member businesses. Highlights of projects from FY 2019-20 are listed below.
1. Parking and Transportation Improvements. A parking study to address potential
solutions to improve parking within the Corona del Mar Business District and adjacent
residential areas was completed. The Board worked with the City for the successful
implementation of increased parking time limits on East Coast Highway. The Board
continues to work toward the implementation of the study's remaining two
recommendations:
a. Incorporate the underutilized private parking supply for public use; and
b. Lower the City's parking requirements in the business district.
2. East Coast Highway Improvements. The CdM BID Board continued to work on the
appearance of the business district through various physical improvement projects
including ordering new light pole banners promoting the district, coordinating the
replacement of the aging dolphin topiaries, maintaining the tree -wells landscaping,
and brainstorming enhancements for the business district entryways.
3. "Shop Local" Marketing Campaign. The BID's "Shop Local" marketing campaign is
an on-going, coordinated effort with the Corona del Mar Chamber of Commerce. The
campaign's branded design theme has been used strategically throughout the year to
promote the business district. It will continue to be used in the immediate future to
encourage more local business during these tough economic times.
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Resolution No. 2020-58: Resolution of Intention to Renew the Corona del Mar Business
Improvement District, Levy Assessments in FY 2020-21 and Fix Time and
Place of Public Hearing
June 9, 2020
Page 4
The remainder of the FY 2019-20 activities listed in the annual report include the ongoing
and regular efforts of the CdM BID for general maintenance of the East Coast Highway,
coordinating and maintaining the annual holiday decor, recognizing businesses through
the Business Beautification Award Program, and the marketing outreach efforts for events
and activities that occurred within the CdM BID boundaries.
FY 2019-20 Operating Results
The estimated year-end operating budget for the CdM BID's FY 2019-20 is summarized
in the table below.
Estimated FY 2019-20 Year -End Operating Budget (Updated Figures)
$40,000
$2,000
Income (City Funding, Assessments and Late Fees
$91,937
Fund Balance Retained Earnings from FY 2018-19
$99,629
Total Income and Fund Balance
$191,566
Total Expenditures
$132,343
Fund Balance Retained Earnings)
$59,223
Proposed Budget for FY 2020-21
The proposed operating budget for FY 2020-21 is attached to the CdM BID's annual
report for the City Council's approval. The Board has identified several project goals for
the year and allocated its funding accordingly, as summarized in the table below.
Income _
Proposed COVID-19 Relief Funding (City's Contribution)*
Late Fees
$40,000
$2,000
Member Assessment
$55,000
Retained Earnings from FY 2019-20
$59,223
Total Income
$156,223
Expenses
Highway Decor and Banner Program
$30,792
Marketing and Administration Services
$102,550
Accounting and Bookkeeping Service
$21,408
Improvements & Parking
$1,473
Total Expenses
$156,223
*This income is proposed as it has not yet been approved for distribution by the City Council.
Should the City Council not approve the relief funding, the budget would be adjusted accordingly.
BID Member Benefits
The CdM BID has a unique and long-standing partnership with the Corona del Mar
Chamber of Commerce (Chamber), a voluntary membership organization located within
the business district. Through a City agreement, the Chamber has provided the CdM BID
with administration and marketing services, coordination of programs and member
communications, and assists with agenda preparation and reporting. BID funds are used
to pay for these services.
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Resolution No. 2020-58: Resolution of Intention to Renew the Corona del Mar Business
Improvement District, Levy Assessments in FY 2020-21 and Fix Time and
Place of Public Hearing
June 9, 2020
Page 5
The marketing campaigns for the business district and the production of the CdM
Business Directory are a joint effort between the BID and the CdM Chamber. The BID
also financially supports various Chamber programs and events, and finances the
decorative banners that promote Chamber events in the business district.
The coordinated marketing efforts support the CdM BID members by attracting local and
regional visitors to the area to shop in the retail establishments, dine from a large selection
of restaurants and cafes, and obtain a variety of professional services.
Resolution of Intention
The Resolution of Intention (Attachment C) for the CdM BID provides for the following:
Renews the CdM BID for fiscal year 2020-21 with assessment levies as follows:
o $500 per year for banks and financial institutions that are exempt from City
business license regulations;
o $250 per year for insurance agencies that are exempt from City business
license regulations;
o $0 per year for independent contractors (hair stylists, nail technicians and
real estate agents) operating in an establishment owned by another person;
and
0 70 percent of the annual business license tax for all other businesses.
Explains the improvements and activities to be funded are:
o Marketing, advertising, and public relations;
o Public area improvements and maintenance programs;
o Promotion of public events in the area;
o Promotion of retail trade activities; and
o Administration.
Sets the public hearing for June 23, 2020 at 7 p.m.
Per the 1989 Law, the City Council may revise, change, reduce or modify the assessment
or the type or types of improvements and activities proposed to be funded.
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.
21-9
Resolution No. 2020-58: Resolution of Intention to Renew the Corona del Mar Business
Improvement District, Levy Assessments in FY 2020-21 and Fix Time and
Place of Public Hearing
June 9, 2020
Page 6
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).
ATTACHMENTS:
Attachment A — CdM BID Annual Report and Budget
Attachment B — Letter from the CdM BID Board Chair
Attachment C — Resolution No. 2020-58
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ATTACHMENT B
RESOLUTION NO. 2020-64
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF NEWPORT BEACH, CALIFORNIA, CONFIRMING
THE LEVYING OF ASSESSMENTS FOR THE FISCAL
YEAR OF JULY 1, 2020 TO JUNE 30, 2021, FOR THE
CORONA DEL MAR BUSINESS IMPROVEMENT
DISTRICT
WHEREAS, on June 9, 2020, the Corona del Mar Business Improvement District
annual report and budget was filed and approved by the City Council;
WHEREAS, on June 9, 2020, the City Council adopted Resolution 2020-58
declaring City Council's intention to levy assessments for the Corona del Mar Business
Improvement District for fiscal year July 1, 2020 to June 30,2021;
WHEREAS, on June 13, 2020, the City Clerk published Resolution No. 2020-58
declaring the City Council's intention to levy assessments for the Corona del Mar
Business Improvement District for fiscal year July 1, 2020 to June 30, 2021; and
WHEREAS, a public hearing regarding the renewal of the Corona del Mar
Business Improvement District was held on June 23, 2020 without a majority protest.
NOW, THEREFORE, the City Council of the City of Newport Beach resolves as
follows:
Section 1: The City Council does hereby confirm the levying of assessments as
described in Resolution 2020-58 dated June 9, 2020, for the Corona del Mar Business
Improvement District for the fiscal year July 1, 2020 to June 30, 2021.
Section 2: The recitals provided in this resolution are true and correct and are
incorporated into the operative part of this resolution.
Section 3: If any section, subsection, sentence, clause or phrase of this
resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not
affect the validity or constitutionality of the remaining portions of this resolution. The City
Council hereby declares that it would have passed this resolution, and each section,
subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or
more sections, subsections, sentences, clauses or phrases be declared invalid or
unconstitutional.
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Resolution No. 2020 -
Page 2 of 2
Section 4: The City Council finds the adoption of this resolution 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, Division 6, Chapter 3,
because it has no potential for resulting in physical change to the environment, directly or
indirectly.
Section 5: This resolution shall take effect immediately upon its adoption by the
City Council, and the City Clerk shall certify the vote adopting the resolution.
ADOPTED this 23rd day of June, 2020.
Will O'Neill
ATTEST:
Leilani I. Brown
City Clerk
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Aaron C. Harp
City Attorney
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