TITLE
Recommendation to receive supporting documentation into the record, concluding the public hearing to consider the modification and renewal of the Downtown Property and Business Improvement District (DLBPBID); direct City Clerk to tabulate the ballots and report the results of the tabulation to the Mayor and City Council during the July 19, 2022 meeting; and, if a majority of ballots received are in favor of the renewal of the DLBPBID, adopt resolution to modify and renew the DLBPBID for a term of 10 years, effective January 1, 2023 through December 31, 2032. (Districts 1,2)
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 of Long Beach (City) to create a property-based assessment district allowing property owners to be assessed for various services beyond those provided by the City, including enhanced maintenance, public safety, marketing, and economic development programs. All properties located within the DLBPBID that receive special benefits, as determined by the Engineer’s Report, must be allocated a proportional share of the assessment.
Property owners of record located in the DLBPBID, who will pay more than 50 percent of the proposed assessment, have submitted petitions to the City for the modification and renewal of the DLBPBID. Modification and renewal of the DLBPBID 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.
The DLBPBID Management District Plan (MDP) (Resolution, Exhibit A) which includes the Engineer’s Report as an exhibit, details the boundaries of the DLBPBID, the method of assessment for each parcel, and the improvements and activities for which the assessment funds will be used. The MDP proposes to expand the DLBPBID boundaries to the north along the Pacific Avenue corridor to 8th Street and to include the Convention Center building and major walkways in the Rainbow Harbor area to help support a seamless Downtown visitor experience with continuity of clean services. If renewed, the expanded DLBPBID will have a ten (10) year life. Special benefit services will begin January 1, 2023, and end December 31, 2032. The City Council will annually review and consider approving the annual assessment of the levy, budgets, and reports as submitted by the Owners’ Association for the DLBPBID. The assessment methodology will generate approximately $3,782,348 in revenue for the DLBPBID during the first year. Property owned by the City will be assessed at $785,156 for the first year.
The MDP proposes that the Downtown Long Beach Alliance (DLBA) will manage the DLBPBID under contract with the City and shall serve as the Owners’ Association per California Streets and Highways Code Section 36651. The DLBA Board of Directors is required to adhere to the Ralph M. Brown Act. Pursuant to the Streets and Highways Code, Section 36650, the DLBA will provide the City with an Annual Report. The City will pay its assessment as a parcel owner for the duration of the DLBPBID.
As approved by the City Council on May 24, 2022, and to comply with the California Constitution, a notice of assessment and an assessment ballot were mailed to property owners who are proposed to be assessed. During the public hearing held at the City Council meeting on July 19, 2022, an independent third party will tabulate the ballots, and will return to the City Council later during the July 19, 2022 meeting to announce the results. If a majority of ballots received are in favor of the renewal of the DLBPBID, the City Council may proceed with the adoption of the Resolution renewing the DLBPBID. If a majority of the ballots received do not support the renewal of the DLBPBID, then the DLBPBID cannot be renewed.
This matter was reviewed by Deputy City Attorney Lauren Misajon on June 28, 2022 and by Budget Operations and Development Officer Rhutu Amin Gharib on June 30, 2022.
TIMING CONSIDERATIONS
City Council action is requested on July 19, 2022, to allow timely completion of the balloting process and submittal of the levy to the Los Angeles County Assessor before August 10, 2022, for the new ten-year term.
FISCAL IMPACT
If a majority of ballots received are in favor of renewal approval of this recommendation, the City Council will adopt a Resolution to renew the DLBPBID for a term of 10 years, effective January 1, 2023. If the DLBPBID is approved and renewed, the estimated total annual City share of the DLBPBID assessment for Fiscal Year 2023 (FY 23) will be $785,156, an increase of $180,983 over the current assessment. This increase is due in part to the proposed expansion of the DLBPBID to include the frontage along the Convention Center building and major walkways in the Rainbow Harbor area.
Of the total amount, $220,484 will pass through the City and be paid by property management contractor Site Centers for the Pike property development. The remaining assessment of $564,672 will be paid by various City departments for properties in the General Fund Group, Civic Center Fund Group, Successor Agency Fund Group, and Tidelands Operating Fund Group in the estimated amounts by fund of $253,869, $108,343, $1,189, and $201,271 respectively. Specific impacts at the department level are under review and will be presented to the City Council should the DLBPBID be approved and renewed. City staff will return to City Council in FY 23 to request any needed appropriation. Upon annual review, per the MDP, the City Council can increase the property assessment up to five (5) percent per year based on demonstrated need. This recommendation has no staffing impact beyond the normal budgeted scope of duties and is consistent with existing City Council priorities. There is no local job impact associated with this recommendation.
SUGGESTED ACTION
Approve recommendation.
BODY
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Respectfully Submitted,
JOHNNY M. VALLEJO
ACTING DIRECTOR
ECONOMIC DEVELOPMENT
APPROVED:
THOMAS B. MODICA
CITY MANAGER