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APPROVE DOWNTOWN STOCKTON ALLIANCE PROPOSED 2021 ANNUAL OPERATING BUDGET AND THE 2020 ANNUAL REPORT
recommended action
RECOMMENDATION
It is recommended that the City Council adopt a resolution:
1. Approving the 2021 Operating Budget of the Downtown Stockton Alliance, a non-profit corporation, which operates the Downtown Stockton Management District;
2. Approving the 2020 Annual Report; and
3. Authorizing the City Manager, or designee, to take necessary and appropriate actions to carry out the purpose of this resolution.
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Summary
The Downtown Stockton Alliance (“DSA”) is one of the oldest Property-Based Improvement Districts (PBID) in California and has promoted and maintained the Downtown Stockton Business District since 1996. The City executed a contractual agreement with the Alliance to manage and operate the Downtown Stockton PBID for a ten-year period beginning January 1, 2018; this includes developing the workplan and goals for each year and preparing and managing the DSA’s budget. Each year, the DSA is required by contract to provide the City Council with its operating budget and the annual report of accomplishments for approval. The 2021 Operating Budget and the 2020 Annual Report for the DSA are included as Exhibits 1 and 2 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 DSA 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. The City Council authorized an agreement with the DSA for the administration of the DSA PBID effective January 1, 2018 and it shall remain in effect until December 31, 2027. In accordance with Property and Business District Law of 1994 and pursuant to the agreement, DSA is required to administer funds consistent with the adopted Management District Plan.
Present Situation
In accordance with Property and Business District Law of 1994, the DSA’s agreement with the City requires DSA to administer funds consistent with the adopted Downtown Stockton Management Plan. The Management Plan provides that the DSA submit its budget and annual report to the City by February 1st of each year. The budget is subject to Council approval.
The Downtown Stockton Management District assessments are paid directly to the County by property owners as part of their annual tax bill. The total amount of the assessment paid during 2021 by property owners directly to the County will be $1,127,933. As in the past, the DSA 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 DSA.
The City makes an annual contribution to the DSA’s PBID based on the number, size, and location of City-owned properties within the DSA’s PBID and the annual assessment rates. The City’s contribution is estimated to be $337,077, which includes Parking Authority and Successor Agency properties.
In 2020, the DSA continued to keep the Downtown clean and safe and accomplished the following projects during the pandemic:
• Implementation of the monthly “Talk to Downtown”
• Launch of the Safety Ambassador program
• Implementation of a Place-Making Grant program
• Restoration of Chung Wah/Mun Kwok Lane
• “Spirits of Downtown” series
• Partnering with new downtown neighbors, Parents by Choice and the Hells Angels in their respective Toy Drives, to help less fortunate kids during the Christmas holiday season
The DSA assisted downtown businesses during the pandemic by distributing Personal Protective Equipment to slow the spread of COVID-19 and completed the installation of 13 outdoor patio enclosures, outdoor heaters, and hands-free sanitation stations to downtown restaurants; both projects were funded by the City through the CARES Act. In 2020, the DSA also began planning for the Portable Bathroom and Shower unit available for the homeless at St. John’s Church that began operations in mid-January 2021.
The circumstances from COVID-19 meant having to acclimate to a new standard. The DSA saw a dip in website visitors with the lack of in-person events; however, social media maintained steady growth and engagement over 2020. The DSA Holiday Contest was the most successful social media campaign by sharing participating businesses’ holiday-themed photos and gained 50 Facebook and 151 Instagram followers.
Despite the pandemic, Downtown saw the opening of 25 new businesses, the sale of more than 20 properties, and an increase in monthly stakeholder engagement. Maintenance of the District continued with 176 graffiti removals, 21,072 trash bags removed, 2,357 service calls, and 343 shopping carts collected. The DSA sustained its presence with the continuance of popular downtown events in 2020, such as Talk to Downtown and Full Moon Riders Downtown monthly bike rides.
In 2020 the DSA Board approved a Placemaking Award Program and combined funds with the 2021 funds for a Focus Block Grant to use toward improvements such as murals, beautification projects and landscaping. An additional refurbishing project began in 2020 for Mun Kwok/Chung Wah Lane, located behind the Franco Center on Washington Street, and is nearing completion.
The DSA’s 2021 budget is $1,416,357. The DSA dedicates a significant amount of its budget to economic development and improvement projects, maintenance and cleaning, advertising and marketing, and special events within the District. The DSA spends the balance of its budget on advocacy, administration, and education/networking.
Below are a few of the DSA 2021 goals:
• Expand the outreach of the Safety Ambassador program and work in partnership with Stockton Police Department
• Continue with monthly webinar series “Talk to Downtown”
• Support and promote local businesses in downtown, recruit businesses, and entertainment post pandemic
• Promote the updated Downtown Stockton Enterprise Loan Fund program
• Partner with the City to enhance Parker’s Alley (park area south of the courthouse, near Hunter and Main Street) with Focus Block Improvement funding
For calendar year 2021, the projected annual expenditures for the Downtown Stockton Management District is $1,384,357. In addition to the $1,127,933 assessment, $288,424 in marketing and special events, security contract, outside service contracts, advertising and miscellaneous revenues are projected for total revenues in the amount of $1,416,357.
Staff recommends adoption of the attached resolution, which approves the proposed 2021 Annual Operating Budget (Exhibit 1 to the Resolution) and the 2020 Annual Report (Exhibit 2 to the Resolution) for the Downtown Stockton Management District.
FINANCIAL SUMMARY
The Downtown Stockton Management District assessments are paid directly to the County by property owners as part of their tax bill. The estimated amount of the assessment to be paid in 2021 by property owners directly to the County will be $1,127,933, as displayed in Exhibit 2. This estimate includes assessment charges to City owned properties within the DSA PBID of $337,077.
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 X1 26 (AB 26), the assessments on the Agency-owned property were transferred to the Stockton Successor Agency to the Redevelopment Agency. The annual assessment total for the City-owned property within the district is $337,077, and is broken down as follows:
|
Entity |
Assessment |
Account Number |
Fund |
|
City of Stockton |
$243,994 |
2010-016-670001-100-000-10-20-000-000- |
General Fund |
|
Parking Authority |
$92,376 |
6030-400-670001-630-000-00-60-000-000 |
Parking Authority |
|
Successor Agency |
$707 |
6000-000-670001-700-000-10-60-000-000 |
Successor Agency |
There is no financial impact other than the assessments due on City owned properties within the DSA PBID.