City of Culver City, California
Agenda Item Report
Meeting Date: 11/22/10 Item Number: PH-1
CITY COUNCIL AGENDA ITEM: PUBLIC HEARING - (1) Adoption of a Resolution
Confirming the Business Improvement District Advisory Board’s Annual Report
and the Levy of the Downtown Culver City Business Improvement District
Assessment for 2011; (2) Appointment of Members to the Business Improvement
District Advisory Board; and 2) Approval of the Management Agreement between
the City and the Downtown Business Association for Calendar Years 2011 and
2012.
Contact Person/Dept.: Glenn Heald
Todd Tipton/Community Development
Phone Number: 310-253-5752/5783
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [X] Action Item: [] Attachments: [X]
Commission Action Required: Yes [] No [X] Date: _______________
Public Notification: (E-Mail and Telephone) Downtown Business Association (10/05/10);
(E-Mail) Meetings and Agendas – City Council (11/17/10); Published in Culver City News
(11/04/10 and 11/11/10).
Department Approval:
Sol Blumenfeld: (11/02/10)
City Attorney Approval:
Carol Schwab (by H. Baker) (11/16/10)
Chief Financial Officer Approval:
Jeff Muir (by M. Noller) (11/16/10)
City Manager Approval:
John M. Nachbar (11/17/10)
RECOMMENDATION:
Staff recommends the City Council (1) adopt a Resolution confirming the Business
Improvement District Advisory Board’s Annual Report and the levy of the Downtown
Culver City Business Improvement District Assessment (BID) for 2011 (Attachment
No. 8); (2) appoint members to the BID Advisory Board (Attachment No. 6); and (3)
approve the Management Agreement for calendar years 2011 and 2012 (Attachment
No. 7).
PROCEDURE:
1. Mayor seeks motion from the City Council to receive and file the affidavits of
publication and posting of notices, and correspondence received in response to
the public hearing notices; and,
2. Mayor calls for a staff report and the City Council Members may pose questions
to staff as desired; and,
3. Mayor seeks a motion to open the public hearing; and,
4. Mayor seeks motion to close the public hearing after all public testimony has
been presented; and,
5. The City Council discusses the item and arrives at its decision.
City of Culver City, California
Agenda Item Report
BACKGROUND:
The BID provides a mechanism for businesses to levy assessments on themselves
for the promotion of business activities and public events; decoration of public
places; and the acquisition, construction, installation and maintenance of specific
improvements. The BID assessment reduces the downtown business community’s
dependency on the City and Redevelopment Agency.
On November 1, 2010, the City Council approved the BID’s 2011 Annual Work
Program and Budget, as filed with the City Clerk, and adopted by a Resolution of
Intention to conduct a public hearing on November 22, 2010. Additional information
related to the Annual Work Program and Budget was included in the November 1,
2010, staff report, which is attached for reference (Attachment No. 1).
DISCUSSION:
During 2010, the BID reported approximately $154,518 in total BID assessment
revenues and $22,326 in carryover funds from 2009. These funds were used toward
the 2010 DBA BID Work Program, with an anticipated carryover of $29,640 for 2011.
This is further described in the DBA’s Quarterly Financial Statements and Accounts
Payable Summary, which are attached for review (Attachment No. 5).
BID revenues are managed by the DBA in accordance with the Management
Agreement between the City and the DBA, which details the responsibilities and
obligations of both parties. The DBA uses BID revenues to implement the Work
Program defined in the BID Advisory Board’s Annual Report (Report). The 2011
Annual Work Program and Budget are attached for reference (Attachment No. 2).
The following elements of the BID renewal process are outlined in summary form
below due to their governance by State law: protest of the proposed assessment,
appointment of BID Advisory Board members, and renewal of the Business
Improvement District Management Agreement.
Protest of the Proposed Assessment
State Law [Streets and Highways Code Section 36525.(a)] states: “If written protests
received from the owners of businesses in the proposed area which will pay fifty
percent or more of the assessment proposed to be levied and protests are not
withdrawn so as to reduce the protests to less than that fifty percent, no further
proceedings to create the specified parking and business improvement area or to
levy the proposed assessment, as contained in the Resolution of Intention, shall be
taken for a period of one year from the date of the finding of a majority protest by the
Council.” City of Culver City, California
Agenda Item Report
BID Advisory Board Membership
State law requires the City Council to appoint a BID Advisory Board, which is
responsible for compiling the Report. The Report identifies how BID assessment
revenue will be spent, proposed improvements and activities, the classification of
businesses, the method and basis of levying assessments, and other matters the
Advisory Board deems appropriate.
The BID Advisory Board members for 2010 were:
1) Ken Kaufman – Business Owner
2) John Byers – Business and Property Owner
3) Stu Freeman – Property Owner
4) Eric Sims - Bus Representative
5) Debbie Weiss – Business and Property Owner
6) Gerry Weiner – Business Owner
The DBA recommends the following BID Advisory Board Members for 2011:
1) Ken Kaufman – Business Owner
2) John Byers – Business and Property Owner
3) Stu Freeman - Property Owner
4) Eric Sims – Bus Representative
5) Debbie Weiss – Business and Property Owner
6) Milena Alunni – Business Owner
As part of the Management Agreement between the City and the DBA, all members
of the BID Advisory Board must be in good standing with the City, Redevelopment
Agency, and BID in terms of business tax payments, BID assessments, refuse billing
and Redevelopment Agency debt agreements. The Finance Department has no
record of debt to the City, Redevelopment Agency, or BID by any of the above-
named individuals. The City Council may appoint the members recommended by
the DBA or appoint new members to the BID Advisory Board.
Management Agreement
The current Management Agreement between the City and the DBA expires on
December 31, 2010. The proposed Management Agreement for calendar years
2011 and 2012 is a two year contract from January 1, 2011 through December 31,
2012 (Attachment No. 7). The below 2011-2012 Management Agreement contains
the following changes from the 2009-2010 Management Agreement:
• The two percent (2%) administrative fee retained by the City for normal activities
involving the mailing and processing of BID renewal forms and the distribution of City of Culver City, California
Agenda Item Report
funds collected will be collected on the total amount of assessments levied prior
to disbursement of funds to the DBA.
• The DBA may request the City engage a third party collection agent to pursue
delinquent assessments pursuant to the procedures set forth in the Management
Agreement. The DBA will pay all costs associated with the collection agent and
the collection efforts.
FISCAL ANALYSIS:
There is no significant fiscal impact to the City by approving a one year extension of
the BID program; though there may be incidental expense to the City in staff time
spent preparing and presenting the two required staff reports. The collection and
distribution of BID assessments is offset by the two percent (2%) administrative fee
included in the Management Agreement between the City and the DBA. In 2011 the
BID assessment and 2010 rollover is estimated to total approximately $193,609,
which will be used to fund Maintenance Management ($150,420 – includes
$122,100 funded by maintenance MOU), Advocacy and Administration ($123,900),
and Communication and Image-enhancement expenses ($29,840.
Pursuant to City Council direction, staff has provided the sum of uncollected
delinquent assessments related to the BID. The cumulative total for all uncollected
delinquent assessments past and present years is $41,388, including $8,892 in
current delinquent assessments, $8,892 in current-assessment penalties, and
$23,604 in prior balances due (assessments and penalties). Though prior
Management Agreements have contained methods for collection of delinquent
assessments, the DBA did not choose to pursue the additional collections through
the City and has sought instead to establish new collection procedures with a third
party collection agent, at minimal cost to the DBA.
ATTACHMENTS:
1. Staff Report for the November 1, 2010 meeting of City Council, Approval of the
Downtown Culver City Business Improvement District Advisory Committee’s
Annual Work Program and Budget, and Adoption of a Resolution of Intention
to Conduct a Public Hearing for Continuation of the Downtown Business
Improvement District.
2. 2011 BID Work Program and Budget (Approved by the Council on November
1, 2010).
3. Internal Revenue Service Tax-Exempt Certification.
4. DBA Certificate of General Liability Insurance.
5. DBA Quarterly Financial Statements and Accounts Payable Summary.
6. BID Advisory Board Recommendations for 2011.
7. Management Agreement between the City and the DBA for 2011-2012.
8. Resolution to levy the Proposed Assessment for 2011. City of Culver City, California
Agenda Item Report
MOTION:
That the City Council:
1. (If there is a majority protest) Approve a motion recognizing that protests have
been received from the owners of businesses in the proposed district which
represent fifty percent or more of the assessment proposed to be levied, and no
further proceedings to continue the Downtown Culver City Business
Improvement District shall be taken for a period of one year from the date of this
meeting.
OR
2. (If there is not a majority protest) Adopt a resolution confirming the Business
Improvement District Advisory Board’s Annual Report and the levy of the
Downtown Culver City Business Improvement District Assessment for 2011; and
3. Appoint members to the Business Improvement District Advisory Board; and
4. Approve the Management Agreement for calendar years 2011 and 2012; and
5. Authorize the City Attorney to review/prepare the necessary documents; and
6. Authorize the City Manager to execute such documents on behalf of the City.
MEETING DATE: 11/22110
AGENDA ITEM: Public Hearing to Continue the Downtown Culver City
Business Improvement District for 2011 and Approve
the Management Agreement between the City and
the Downtown Business Association for Calendar.
Years 2011 and 2012.
ATTACHMENTS
Pages
1. Staff Report for the November 1, 2010 meeting of City Council,
1-4
Approval of the Downtown Culver City Business Improvement
District Advisory Committee's Annual Work Program and Budget,
and Adoption of a Resolution of Intention to Conduct a Public
Hearing for Continuation of the Downtown Business Improvement District.
2. 2011 BID Work Program and Budget (Approved by the 5
Council on November 1, 2010).
3. Internal Revenue Service Tax-Exempt Certification. 6-7
4. DBA Certificate of General Liability Insurance. 8
5. DBA Quarterly Financial Statements and Accounts Payable Summary. 9-18
6. BID Advisory Board Recommendations FOR 2011. 19
7. Management Agreement between the City and the DBA for 2011-2012. 20-32
8. Resolution to levy the Proposed Assessment for 2011. 33-35Attachment 1
City of Culver City, California
Agenda Item Report
Meeting Pate:: 11/01/10 itern:NUMber::A-1
FicITy COUNCIL AGENDA ITEM : : i (l) Approval of the Downtown Culver pity iBusiness
Iriiprovement District :AcIvi Ory Committee's voek,:Progrartii:arn4,000get;
and (2): Adoption : of : a: Re40000:: ofii i IntentiOni i :tO i'Cone/tiOtia Public Hearing for
Continuation of the :Downtown Business Improvement District,:::
Contacti iperson/Depti.:: : , Glenn:HO:10: : Phone NUrriber:ii(M):2557:52:and:(310):::
1-i)dil Tipton/CorprnunityDeve!oprnent : ::2545783
: Fiscal Impact Yes: I]
No [X] : : General Fund :Y s 11
:: : : ::::[X]
: public Hearing fl Actibri:Item [X]:: Attachments; [XI:
porprriiSSion:A0tiOn iRequired i : : Y s
II N [X1 :Date:
Public :Notificatian:: :::(F-Maillar4:TelephOne) DOWntOWil Business Association :(09105/10).
E:Mail) liMeetings: and Agendas : :city :ccuncil::(10/27/10),::
Department Approval , : i
: So[ Blumenfeld: :(1 0/2/1.0) :
City Attorney ApprOval::
:Carol Schwab (by II.: Baker.) (10/27/10):
:Chief :FinanCial:OfficerlApplrOal::,:
40ff MOT :(by:W i N:oller) (10/27/10):
i City Manager:Approval::
:John IN/L:iNadnbar:(1::0/27/19)::
RECOMMENDATION:
the Downtown Culver City Business
annual Work Program and
of Intention to conduct a public
the continuation of the Culver City
to levy assessments on themselves
of public spaces and the acquisition,
of specific improvements. The BID
self-reliant, reducing their dependence on
in September 1998, when the City
in accordance with the Parking and
Downtown Business Association (DBA)
between the DBA and the City.
DBA to maintain tax-exempt status with
general liability insurance in an amount
submit quarterly reports and budget
Staff recommends the City Council approve
Improvement District (BID) Advisory Committee's
Budget for 2011 (Report), and adopt a Resolution
hearing on November 22, 2010, to consider
Downtown BID (Attachment No. 1).
BACKGROUND:
A BID provides a mechanism for businesses
for, among other things, the maintenance
construction, installation and maintenance
allows downtown businesses to be more
the City and Redevelopment Agency.
Culver City's Downtown BID was formed
Council adopted Ordinance No. 98-011
Business Improvement Area Law of 1989.
The BID Work Program is managed by the
in accordance with the Management Agreement
The Management Agreement requires the
the Internal Revenue Service, maintain
specified by the City Attorney's Office, andCity of Culver City, California
Agenda Item Report
updates to the Community Development Director describing progress toward
completing their approved work program.
In accordance with the legal process for renewing a BID, the City Council is
required to review and approve the BID Advisory Committee's Report during a
public meeting. The Report describes any proposed changes in the BID
boundaries, a description of activities to be undertaken (a work program), an
estimate of the cost to provide the activities (a budget), the assessment formula,
the amount of surplus/deficit to be carried over from the previous year, and the
amount of other expected BID contributions. The City Council may modify any
particular element contained in the report and approve it as modified or determine
to not approve the Report.
At the conclusion of the public meeting, the City Council is requested to adopt a
Resolution of Intention to conduct a public hearing if the BID is to be continued for
2011. Upon completion of the public hearing, which has been tentatively
scheduled for November 22, 2010, the City Council is requested to consider a final
resolution to formally continue the BID. The public will be notified of the public
hearing in accordance with state law.
DISCUSSION:
Accomplishments 2010
The BID accomplished a great deal in 2010. The accomplishments (attached) are
extensive and relate to maintenance, communication and image, and advocacy and
administration.
BID Assessments 2010
During 2010, there were 136 businesses subject to the BID assessment. Of these,
the assessment was collected from 120 businesses (88%). The total amount
collected was approximately $154,518. The remaining 16 businesses owe part or
all of their assessment(s). If payment is not received after a delinquent notice, the
BID Advisory Committee has the option to enact further collection efforts pursuant
to the Management Agreement.
BID Activities Planned for 2011
In October, the BID Advisory Committee filed the attached 2011 Work Program
and Budget with the City Clerk. The Advisory Board proposes to continue its
activities related to maintenance, communication and image, and advocacy and
administration.City of Culver City, California
Agenda Item Report
BID Assessments 2011
The proposed activities will be funded primarily through the assessment, which
applies to certain downtown businesses (attached). The Advisory Committee does
not propose any changes to the Advisory Committee structure nor to the
boundaries of the parking and business improvement area. A map illustrating the
BID boundaries is included as Exhibit "A" to the proposed resolution. The Advisory
Board recommends no increase in assessment rates for 2011 and that the
assessment schedule remain unchanged. The assessment rates are attached for
reference.
The BID activities and estimated costs for the coming year are set forth in Exhibit
"C" to the proposed resolution (Proposed 2011 Work Program Budget). All funds
collected are used for BID activities to enhance the business community within the
BID area, attract new investment, and improve the quality of life for all downtown
users.
Notes:
1. Business owners with multiple business licenses/operations at the same
address will be assessed only the single highest applicable rate.
2. Business owners with multiple business locations within the BID area will be
assessed separately at each location.
3. Commercial rentals will be assessed for each building location, not each tenant
space.
4. Multiple independent business owners at the same address will be assessed
separately at their respective rates.
FISCAL ANALYSIS:
The BID's quarterly financial statements for 2010 are attached for reference.
These financial statements denote activities undertaken and funds expended
during the DBA's 2010 fiscal year. As previously stated, funds from the 2011 BID
assessment are proposed to be used for business enhancement, marketing and
promotional activity and other items in accordance with Law. During 2011, the BID
anticipates assessment revenues of $164,000 and carry-over funds in the amount
of $29,640. The DBA funds the entire salary of the Executive Director.
There is no fiscal impact to the City for the approval of the BID Annual Work
Program or resolution of intention to conduct a public hearing for the continuation
of the BID for 2011.City of Culver City, California
Agenda Item Report
ATTACHMENTS:
1. Resolution of Intention, including BID Boundary Map (Exhibit "A"), Proposed
Assessment Schedule (Exhibit "B"), and 2011 BID Work Program and Budget
(Exhibit "C").
2. BID accomplishments during 2010.
MOTION:
That the City Council:
1. Approve the 2011 BID Advisory Committee's Annual Work Program and
Budget as filed with the City Clerk; and,
2. Adopt a Resolution of Intention setting November 22, 2010, as the date for a
public hearing to consider the continuation of the Downtown Culver City
Business Improvement District.
LkAttachment 2
Downtown Culver City-Business Improvement District
Proposed Year 2011 Work Program and Budget
Revenue
2011 BID Assessment Fees $164,000
Carry forward from 2010 assessments $ 29,639
Interest income $ 60
Memorandum of Understanding (MOU) $122,100
Downtown Valet Revenue (estimated at $1500 @ 12mos) $ 18,000
Total Revenue $333,799
Expenses
Maintenance Management Contract ($2,060 @ 12mos) $ 24,720
-Labor ($1710 per month)
-Fuel ($350 per month)
MOU Maintenance Management ($10,175 @ 12mos) $122,100
Uniforms $ 100
Beautification Management (twinkles, add ri landscape, etc.) $ 3,500
Total Maintenance Management $150,420
Advocacy/Administration
Executive Director (full-time salary) $ 72,000
City BID Administration Fee (2%) $ 3,280
Professional Fees $ 2,000
D & 0 Insurance $ 1,450
Liability Insurance $ 770
Tax Preparation, Dues, Permits $ 900
Bank Service Charges $ 0
Office Rent $ 0
Telephone $ 1,920
Office Supplies/Postage/Computer Services $ 1,500
Downtown Valet Parking Management
Valet Operations city permit ($300 per each 6mos) $ 600
Valet Stations city permit ($1,290 g 12mos) $15,480
Lot leases ($2,000 @ 12mos) $ 24,000
Total Administration $123,900
Communication/Image/Downtown Marketing $ 29,540
-Holiday Event ($4,300)
-Downtown Block Parties
-Website/e-newsletter
-Public Relations
-Shuttle Service
-Misc.
Total Communication/image $ 29,840
2011 Reserves $ 29,639
Total Expenses $333,799co*
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Hotel 456, 480
Bar/Restaurant: Total Seats, both Indoor & Outdoor: 390, 654-690
0-50 seats
51-100 seats
> 100 seats
Computer Graphics & Computer Services 152, 200
Martial Arts Studio, Health Studios, Hair Salon 744, 276
0-25,000 sq. ft.
> 25,000 sq. ft.
$ 351
$ 585
$ 877.50
$1170
$1755
$1170
$1755
$2340
$ 585
$ 585
$1170
TYPE B
Theaters
858
$2.34/seat
Live Performance
858
$1.17/seat
TYPE C
All others, not listed $351
TYPE D
Banking Institutions 0-7500 sq. ft. 342 $1170
Banking Institutions > 7500 sq. ft $1755
Film Studios 490, 498 $1170
Recording Studios 554 $1170
Utilities $1170
Hospitals > 20,000 sq. ft. 780 $2340
Hospitals and Clinics <20,000 sq. ft. $1170
TYPE E
Commercial Rentals 432
<5,000 $1170
5,001-15,000 $1755
15,001-25,000 $2340
25,001-35,000 $2925
Over 35,000 $3510
Note:
1. Fee for individual business owners with multiple business licenses/operations at the same
address will be based on the single highest category.
2. Business owners with multiple business locations within the BID area will be assessed separately
at each location.
3. Commercial rentals will be assessed for each building location, not each tenant space.
4. Multiple independent business owners at the same address will be assessed separately at their
respective rates.
3S)