City of Culver City, California
Agenda Item Report
1
Meeting Date: 11/22/10 Item Number: J-2
JOINT CITY COUNCIL / REDEVELOPMENT AGENCY BOARD AGENDA ITEM:
Discussion Regarding the Creation of a Comprehensive Economic Development
Plan.
Contact Person/Dept.:
Redevelopment/Econ Dev. Division and
Finance Department
Phone Number: (310) 253-5769
(310) 253-5783
(310) 253-6013
Fiscal Impact: Yes [X] No [] General Fund: Yes [] No [X]
Public Hearing: [] Action Item: [X] Attachments: []
Commission Action Required: Yes [] No [X] Date: _______________
Public Notification: (E-Mail) Meetings and Agendas – Redevelopment Agency (11/17/10);
Culver City Chamber of Commerce & Downtown Business Association (11/12/10).
Department Approval:
Sol Blumenfeld: (11/03/10)
Jeff Muir
City Attorney’s Office
Carol Schwab (by H. Baker) (11/16/10)
Agency General Counsel Approval:
Murray Kane: (11/04/10)
Chief Financial Officer Approval:
Jeff Muir (by N. Kimball) (11/16/10)
City Manager/Executive Director Approval:
John M. Nachbar (11/17/10)
RECOMMENDATION:
Staff recommends the City Council and Redevelopment Agency Board (*Agency
Board) provide input and direction regarding the creation of a Comprehensive
Economic Development Plan in order to enhance Culver City’s business climate,
create a broad based economy with a strong employment and tax base, ensure the
City’s ongoing fiscal health and the provision of quality City services.
BACKGROUND:
Flourishing cities require a healthy business climate, a broad based economy with
strong employment and tax bases, and quality city services. A healthy business
climate is synonymous with prosperous businesses, good customer service, well
maintained streets and parks, quality police and fire protection, and high property
values. This correlation between business health and city health must be nurtured
by shaping economic priorities to make the most of a city’s resources. An Economic
Development Plan provides the best way to strategically create a healthy business
climate and to help ensure a city’s long-term fiscal health.
Culver City can develop a Comprehensive Economic Development Plan that
analyzes the City’s current economic base and focuses on business
attraction/retention to create a framework for sustained, goal oriented development, City of Culver City, California
Agenda Item Report
2
i.e. development that meets pre-established goals that have been vetted and
supported by all stakeholders.
The City has a compelling reason to do so because the recent economic downturn
has resulted in the significant loss of sales and other tax revenues, stalled
development projects, and the contraction of major City employers, including Sony
and Symantec. As a result, the City’s vacancy rates for commercial and retail space
have increased from 2.6% in 2007 to approximately 7.7% today. The financial
health of the City has destabilized which threatens the continued provision of core
services. The City needs to think strategically relative to its economy through the
creation of an Economic Development Plan.
The City has put a variety of redevelopment and economic development measures
forward in revitalizing the community. Property has been acquired and redeveloped,
public parking has been created, streetscape improvements have been provided, a
new Business Resource Center has been developed to shepherd projects through
the development process and the West Washington Area Improvement Plan (AIP)
has been implemented along West Washington Boulevard layering streetscape
improvements, commercial rehabilitation grants, street graphics, gap loans, and
other financial incentives to achieve notable results. The AIP has potential for City-
wide application.
Other economic development strategies are available though business outreach “red
teams” that can communicate with existing businesses that need assistance or
solicit potential business relocations to the City. The red teams can be comprised
of redevelopment staff, City administration, the Chamber of Commerce and when
necessary members of the City Council.
Though each of these projects has had a positive impact, there has not been a
coordinated effort to quantify their benefits and maximize economic development
opportunities for the City with an Economic Development Plan.
DISCUSSION:
What are the components of an Economic Development Plan?
Economic Development Plans vary based on particular needs, goals, community
assets and city vision, but generally involve:
§ Analysis of the City’s economic base.
§ Strategic reorganization all economic development tools to maximize their
effect.
§ Market analysis to understand the City’s market role in the region.
§ Business outreach and creation of synergy among businesses. City of Culver City, California
Agenda Item Report
3
§ Integration of municipal policies and programs to promote economic
development goals.
What is the process to prepare an Economic Development Plan?
The process to prepare a plan begins with general goal setting and involves three
basic phases:
1. The first phase requires analysis of the economic base by compiling key
workforce and residential demographic and economic data to understand the
fiscal impacts of business retention, attraction and development choices.
Target industries are analyzed and key industries are identified to understand
their strengths and weaknesses.
2. The second phase requires a market analysis that identifies the business
clusters and components of the economy that are in danger of shrinking. City
sales tax leakage is also analyzed for business attraction purposes.
3. The third phase requires development of a work plan with short and long-term
timelines for implementation. A key part of any plan is the benchmarking
progress in order to clearly understand if the efforts are achieving the desired
results. The desired results must fit the goals and objectives identified at the
outset of the preparation of the plan.
Who is involved?
The creation of a plan should involve all City stakeholders including City Council,
City staff and administration, major employers, the Chamber of Commerce,
Downtown Business Association (DBA) small businesses and residents. The
method for gathering public input must be organized at the outset as part of the plan
and incorporated in the Scope of Work to ensure consensus. The actual plan
production is envisioned as a team effort comprised of the City Manager, Community
Development and Finance Departments in addition to a committee of seven
stakeholders to advise on policy and goal setting. Staff will devise an application
process to select committee members for presentation to the City Council/Agency
Board should the Economic Development Plan and related RFP go forward.
How long does it take?
A plan can take several months to prepare from research and analysis phases
through public involvement and plan approval. A plan is implemented over many
years through specific programs, land use and development project approvals,
redevelopment programs, policy or municipal code changes, budgeting and capital
improvements. A plan is updated as conditions warrant.
City of Culver City, California
Agenda Item Report
4
Next Steps
If the Council and Board support creation of a plan, staff will draft a Scope of Work
and return to the Council/Board for authorization to issue a Request for Proposal.
The Request for Proposal will be used to hire a consultant to perform the necessary
studies and draft the plan. It’s important to note that the method for gathering public
input must be defined at the outset and incorporated in the work effort to ensure
consensus. One method of gathering public input is by creating an Economic
Development Study Team comprised of Council/Board members, City staff, the
Chamber of Commerce, major employers, small businesses and residents.
Conclusion
Overall, a plan will survey the business climate, establish an inventory of the City’s
economic base, analyze the City’s redevelopment incentives and projects, identify
business clusters and sales tax leakage, create a market analysis, prioritize the
City’s economic development and redevelopment goals, and guide related land use
planning recommendations to satisfy identified goals.
A plan will enhance the City’s business climate, create a broad based economy with
a strong employment and tax base, and ensure the City’s ongoing fiscal health and
the provision of good city services.
FISCAL ANALYSIS:
There is no fiscal impact associated with discussion of this item; however, creation
of an economic development plan may serve to bolster and solidify the City’s tax
base by focusing staff’s efforts on businesses that will add value to the community.
If staff is directed to move forward with creation of a Comprehensive Economic
Development Plan, staff will create a RFP to release to firms with expertise in
creating this type of plan. Once proposals are received, staff will be able to provide
more information regarding cost and funding for such a study.
MOTION:
That the City Council and Agency Board:
Provide input and direction on the creation of a Comprehensive Economic
Development Plan and issuance of a Request for Proposal (RFP) for related
consulting services.