SUBJECT: SETTING OF DATES AND TIMES FOR A PUBLIC
MEETING AND A PUBLIC HEARING ON THE LEVY OF INCREASED ASSESSMENTS FOR FISCAL
YEAR 2003-2004 FOR THE DOWNTOWN BUSINESS IMPROVEMENT DISTRICT; AND DIRECTION TO
THE CITY CLERK TO PUBLISH THE REQUIRED NOTICE OF THE PUBLIC MEETING AND PUBLIC
HEARING
COUNCIL DISTRICT:
3
SNI: St.
James Square; University;
Josefa/ Auzerais; Burbank/
Del Monte
It is recommended that the Council: (1) set May 27, 2003 at 1:30 p.m. as the date and time for the public meeting to consider adoption of a resolution of intention to levy increased assessments in the Downtown Business Improvement District for Fiscal Year 2003-2004; (2) set June 17, 2003 at 1:30 p.m. as the date and time for the public hearing on the levy of increased assessments for FY 2003-04; and (3) direct the City Clerk to publish the required notice of the public meeting and public hearing.
BACKGROUND
The Downtown Business Improvement District (“the BID”) was established by the Council in 1988 pursuant to the California Parking and Business Improvement Area Law (“BID Law”) to promote the economic revitalization and physical maintenance of the Downtown business district. In1989, the Council appointed the San Jose Downtown Association as the Advisory Board (“Advisory Board”) for the BID, to advise the Council on the levy of assessments in the BID and the expenditure of revenues derived from the assessments.
Pursuant to BID Law, the Advisory Board must come before the Council on an annual basis to present a report to the Council that proposes a budget for the upcoming fiscal year for the BID. The Council must then: (1) review the report and preliminarily approve it as proposed or as changed by the Council; (2) adopt a resolution of intention to levy the assessments for the upcoming fiscal year; and (3) set the date and time for the public hearing on the levy of assessments in the BID. Absent a majority protest at the public hearing, at the conclusion of the public hearing, the Council may adopt a resolution approving the budget report for FY 2003-04 as filed or as modified by the Council. The adoption of the resolution constitutes the levying of the Downtown BID assessments for FY 2003-04.
This year the Advisory Board will recommend an increase in assessments in the BID. Because of those recommendations, additional public notice is required for the two meetings.
On March 14, the Advisory Board held a retreat and gave preliminary approval to a proposed increase to assessments for FY 2003-04. On April 1, the Executive Committee of the Advisory Board reviewed the FY 2003-04 budget and proposed assessment increases. The Advisory Board will conduct a public meeting on April 11 to inform all BID members of the proposed increased assessments, to receive public testimony and to approve the final budget and assessment schedule. A supplemental report detailing recommended changes to the method and basis to be used for levying increased assessments will be provided to the Mayor and City Council following the Advisory Board’s meeting on April 11, 2003.
The Advisory Board is seeking to adjust the rate schedule to allow the Advisory Board to continue expanding its services to Downtown business and property owners. The Downtown BID fees have not been adjusted since they were last increased in FY 1994-95. BID fees are formulated based on anticipated benefit received from BID programs and services. For instance, retailers pay more than non-retailers because BID-financed promotional activities which draw people downtown benefit retailers to a larger degree than non-retail. Large businesses pay more than small businesses based on employee count because BID-financed amenities, which include parking facilities, street lighting and decorations, accrue to a larger number of people. In addition to the increase in assessments, the Advisory Board also proposes a change to the current BID property owner flat fee by creating a commercial landlord category that is scaled more equitably to anticipated benefit. A commercial landlord with more leasable building space receives more BID benefits and, like the business with more employees, its BID assessment will reflect that in the new proposed fee categories.
The budget for Fiscal Year 2003-2004, including proposed increases to the levy of assessments, is scheduled to be reviewed and approved by the Advisory Board on April 11, 2003.
This report has been coordinated with Redevelopment Agency General Counsel’s Office and the San José Downtown Association.
COST
IMPLICATIONS
Adoption of the proposed BID budget does not impact City revenue. BID assessments are restricted for use exclusively by the BID. This action is consistent with the Economic Recovery Strategy of the Council approved Budget Strategy as it is anticipated that a healthy Business Improvement District will encourage growth of the retail community and consequently result in additional sales tax revenue for the City.
CEQA: Exempt, PP02-05-123
PAUL KRUTKO
Director of Economic Development