title
APPROVE DOWNTOWN STOCKTON ALLIANCE PROPOSED 2017 ANNUAL OPERATING BUDGET, ASSESSMENT, AND 2016 ANNUAL REPORT
recommended action
RECOMMENDATION
It is recommended that the City Council adopt a resolution approving the proposed 2017 Operating Budget, Assessment, and 2016 Annual Report for the Property and Business Improvement District commonly known as the Downtown Stockton Alliance, a non-profit corporation, which operates the Downtown Stockton Management District.
body
Summary
The Downtown Stockton Alliance (“the Alliance”) is one of the oldest Property-Based Improvement Districts in California and has promoted and maintained the Downtown Stockton Business District since 1996. Each year the Alliance is required by contract to provide the City Council with its operating budget, annual assessment, and annual report of accomplishments for approval. The 2017 Operating Budget, Assessment and 2016 Annual Report for the Alliance are Exhibits 1, 2, and 3 to the Resolution, respectively.
DISCUSSION
Background
The Property and Business Improvement District Law of 1994, Streets and Highways Code section 36600 et seq., authorizes cities and counties to establish property and business improvement districts for the purposes of promoting economic revitalization and physical maintenance. A Property-Based Improvement District is a flexible financing tool for creating private-sector, self-governed management districts. These districts provide the means for enhanced maintenance, safety, marketing, management, and advocacy services.
The Alliance was incorporated in 1996 as a 501(c)(6) corporation for the purpose of promoting and maintaining Downtown Stockton. Operations began in January 1998, with the commencement of an annual assessment to property owners. In 2002, the Alliance was renewed for a second five-year period with 82% approval by assessed property owners. In 2007, the Alliance took advantage of updates in the Property-Based Improvement Districts law, which allowed renewal for a ten-year period. The district boundaries were also expanded at that time. City Council created the Downtown Stockton Management District in July 2007 and entered into an agreement with the Alliance in December 2007 for administration of the Downtown Stockton Management District. The agreement is in effect until December 31, 2017.
The Alliance’s 2017 budget is just under $1.2 million. The Alliance dedicates a significant amount of its budget to Clean & Safe projects, Advertising/Marketing, and Special Events within the Management District. Clean & Safe activities will include contracted services with City Wide Property Services for power washing of public spaces, expanded private security night patrol to observe and report criminal and problematic activities, and expanded maintenance services with a second shift of porters to maintain trash and debris after hours and on weekends.
The Alliance has sustained its marketing presence with the continuance of popular downtown events such as Love You Baby restaurant promotion, Full Moon Riders Downtown monthly bike rides, and concert/street entertainment. The Alliance has developed meeting space, Brick and Mortar, to host a 9-week entrepreneur workshop course that supports economic development and entrepreneurship, as well as host multiple community and private events. Additional supported DSA special events include: Stockton Arts Week, National Night Out, Utility Box Art, and Music To My Ears Piano Projects with plans to install four more pianos in 2017. The Alliance continues to increase social media presence each year; in 2016, website visits increased by 37%.
The Alliance spends the balance of its budget on economic development activities, advocacy, and administration. It also engages in business recruitment, event sponsorship, and advocates for policies to improve access to affordable parking. In 2017, the Alliance will conduct and plan to complete their re-certification of the Property Based Improvement District (PBID).
Present Situation
In accordance with Property and Business District Law of 1994, the Alliance’s agreement with the City requires it to administer funds consistent with the adopted Downtown Stockton Management Plan. The Management Plan provides that the Alliance submit its budget and annual report to the City by March of each year. The budget is subject to Council approval.
The 2017 Alliance budget shows that the City of Stockton is a significant financial contributor to the Downtown Stockton Alliance, accounting for about 30% of its property assessments and one-quarter of its total budget. Assessments on City properties are broken down as follows:
|
|
Assessment |
Account Number |
|
City of Stockton |
$224,317.56 |
010-0131-510 - General Fund |
|
Parking Authority |
$ 83,787.78 |
418-4010-572 - Parking |
|
Agency Property |
$ 641.16 |
633-7310-510 - Successor Agency |
|
TOTAL |
$308,746.50 |
|
In order to leverage its resources, the Alliance and the City are working closely together to achieve common goals. The financial connection between the City and the Alliance supports the idea that the two organizations continue to develop integrated ways of working together in order to capably address existing needs and pursue new opportunities.
To foster a more cohesive relationship, the City maintains a voting seat on the Alliance’s Board of Directors, Economic Development Committee, and Administrative Committee. Participation on the Board and Committees allows the City to be a part of strategic decisions including policy, personnel, and budget. It also gives the City a voice on how the resources of the Alliance are deployed, ensuring that a focus on objectives common to the Alliance and the City is maintained.
The Alliance continuously strives to increase its revenues, which has increased by approximately $80,678 for the 2017 budget through sponsorships, advertising, events, rental income, and grants planned for the 2017 year. Below are a few goals included in the 2017 Work Plan:
• Participate in specific planning, investment, and development for Downtown
• Improve Downtown Parking Management Plan in partnership with the City
• Continue entrepreneurship training at Brick & Mortar Center in partnership with the City, BBVA, and Centro Community Partners.
• Continue Downtown Focus Block Improvement projects to enhance appearance of buildings
• Increase maintenance team members to fill in voids and provide daily maintenance services
• Expand security patrol services
• Continue, implement, and develop new special events in Downtown
• Promote policies encouraging housing development and supportive services for homeless population and participation in SJC Homelessness Task Force
• Complete district recertification
The Downtown Stockton Management District is set to expire at the end of 2017 and, as a result, the Alliance will work on completing the process of renewing the district prior to its expiration. They have hired a consultant for recertification and budgeted this expense. The City Council will be asked to approve a resolution stating its intent to renew the district upon a 51% approval of the downtown property owners later this year.
Staff recommends adoption of the attached resolution which approves the proposed 2017 Annual Operating Budget (Exhibit 1 to the Resolution), Assessment (Exhibit 2 to the Resolution), and 2016 Annual Report (Exhibit 3 to the Resolution) for the Downtown Stockton Management District for calendar year 2017.
FINANCIAL SUMMARY
The Downtown Stockton Management District assessments are paid directly to the County by property owners as part of their tax bill. The total amount of the assessment paid during 2017 by property owners directly to the County will be $1,005,863.86. As in the past, the Alliance will administer these funds on behalf of the Downtown Stockton Management District and the funds collected by the County will be transferred directly to the Alliance.
The City of Stockton, Parking Authority, and Stockton Redevelopment Agency pay an assessment on property owned within the Downtown Stockton Management District. With the dissolution of the Stockton Redevelopment Agency under Assembly Bill 1x 26, the assessments on the Agency-owned property were transferred to the Stockton Successor Agency to the Redevelopment Agency.
The assessment for the Agency-owned property is included in the Successor Agency's Recognized Obligation Payment Schedule for the period beginning July 1, 2016 through June 30, 2017 (ROPS 16-17), adopted by the Successor Agency in January 2016 (Attachment A - OB Resolution 2016-01-27-0601). The Agency-owned property assessment will be paid from the Redevelopment Property Tax Trust Fund (RPTTF).
The 2017 City of Stockton, Parking Authority, and Stockton Successor Agency assessments total $308,746, as identified in the table above, for 110 parcels owned within the Downtown Stockton Management District. This is a minor decrease over last year’s assessment of $310,495, which is due to the disposition of City property.
For calendar year 2017, the projected annual expenditure budget for the Downtown Stockton Management District is $1,189,378. In addition to the $1,005,864 assessment, an additional $183,514 in marketing/special events, advertising and miscellaneous revenues is projected for total revenues in the amount of $1,189,378.
Attachment A - OB Resolution 2016-01-27-0601