TITLE
Recommendation to adopt Resolution of Intention to form the Uptown Property and Business Improvement District, setting the date of hearing for Tuesday, August 7, 2018 at 5:00 p.m. for public hearing, receive petitions, authorize City Manager to sign in favor and return the City’s Ballot, and designate the Owners’ Association. (Districts 8,9)
DISCUSSION
The State of California Property and Business Improvement District Law of 1994 (Section 33600 et seq. of the California Streets and Highways Code) and Article XIIID of the California Constitution (Proposition 218) enables the City to create a property-based assessment district allowing property owners to voluntarily assess themselves for various services beyond those provided by the City, including enhanced maintenance, public safety, beautification, marketing, and economic development programs. All properties located within the boundaries of the Uptown Property and Business Improvement District (UPBID) that receive special benefits, as determined by the engineer’s report, must be allocated a proportional share of the assessment.
The UPBID was initially established by the City Council on January 1, 2014. On February 18, 2014, the City Council executed an Agreement for Funding (Contract) with the Uptown Property and Community Association (UPCA). The Contract set forth the duties of the parties under an annual Budget and Management Plan with respect to the use of property owner assessment funds within the UPBID area. The current UPBID Contract terminates on December 31, 2018, and the UPBID area property owners are seeking to re-establish the UPBID for a term of ten years. On May 22, 2018, the City Council authorized the City Manager to sign the petition in favor of the UPBID re-establishment. If re-established, the properties within the UPBID area would be levied an assessment beginning in January 2019, in accordance with the methodology detailed in the Management Plan and Engineer’s Report.
Re-establishment of the UPBID is accomplished through a majority vote of the property owners in favor of the proposed assessment for the new term. Pursuant to the California Constitution, the vote on a proposed special assessment must be weighted according to the proportional financial obligation of the affected properties. The assessment is based upon the special benefits each individual parcel receives as determined by an independent Engineer’s Report prepared pursuant to State law. For the UPBID to be re-established and the Contract renewed, a petition signed by the property owners in the proposed district who will pay more than 50 percent of the assessments proposed to be levied must be submitted to the City. Following the submission of this petition, the City Council may initiate proceedings to re-establish the UPBID by the adoption of a Resolution of Intention (ROI), and set public hearings and issue ballots to each individual parcel owner. On June 5, 2018, petitions representing more than 50 percent of the proposed assessments were submitted.
The UPBID Management District Plan (MDP) (attached to the Resolution as Exhibit A) details the boundaries of the UPBID, the method of assessment for each parcel, and the improvements and activities for which the assessment funds will be used. The assessment methodology will generate approximately $177,356 in revenue for the UPBID during the first year. The anticipated assessment for the parcels owned by the City during the first year is $40,880; a detail of each parcel assessment is found in the MDP.
If the City Council adopts the ROI, a formal vote of the property owners (including the City) will be conducted in accordance with State law. This will include written notice of the proposed assessment to the record owners of all assessed parcels, a voting ballot, and a statement that a majority protest vote will prevent the assessment’s passage. The City will conduct a public hearing on August 7, 2018, to consider the re-establishment of the UPBID, hear all protests or arguments against the proposed assessment, and tabulate the assessment ballots. In tabulating the ballots, each ballot shall be weighted according to the proportional financial obligation of the affected property. The results of the tabulated ballots will be announced prior to the conclusion of the hearing. The ROI also appoints the UPCA Board as the Owners’ Association for the UPBID.
This matter was reviewed by Deputy City Attorney Amy R. Webber on May 21, 2018 and by Budget Analysis Officer Julissa José-Murray on May 10, 2018.
TIMING CONSIDERATIONS
The current UPBID contract terminates on December 31, 2018. City Council action is required on June 12, 2018, to allow timely completion of the balloting process and submittal of the levy to the Los Angeles County Assessor before August 9, 2018, for the new ten-year term and proposed assessment to become effective in January 2018.
FISCAL IMPACT
The proposed recommendation adopts the UPBID ROI, sets the schedule for public hearing, and gives the City Manager the permission to vote affirmatively on the City’s ballot and to designate the UPBID Owners’ Association. Should the ROI be adopted and a formal vote of property owners result in the re-establishment of the UPBID, the City’s assessment for FY19 is projected to be $40,880 (as shown on Attachment A). This amount is associated with Houghton Park, Michelle Obama Library, Fire Station 12, and other City-owned properties in the UPBID. City departments have a budget for the current assessment that can continue to be used to support future assessments. Approval of this recommendation will provide continued support to the local economy.
SUGGESTED ACTION
Approve recommendation.
BODY
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Respectfully Submitted,
JOHN KEISLER
DIRECTOR OF ECONOMIC DEVELOPMENT
APPROVED:
PATRICK H. WEST
CITY MANAGER