TITLE
Recommendation to approve the Downtown Long Beach Property and Business Improvement District Annual Report for the period of
January 1, 2015 through December 31, 2015, automatically extending the Agreement for Funding with the Downtown Long Beach Associates for one year; and authorize payment of $415,548 in City property assessments from the Civic Center Fund (IS 380) in the Public Works Department (PW). (Districts 1,2)
DISCUSSION
Downtown Long Beach Associates (DLBA) has three established sources of revenue that pass through the City to the organization. These include business operator assessments, property owner assessments and downtown parking meter revenue sharing. This recommended action relates to property owner assessment funds for expenses related to security, maintenance, public relations, special projects, advocacy and economic development in Downtown Long Beach. City Council approves the business operator assessment separately. DLBA's Approved FY 2014-15 Budget Narrative, including all sources of revenue, is provided for reference in Exhibit A.
The Downtown Long Beach Property and Business Improvement District (DLB-PBID) was established by the City Council on August 4, 1998. On August 7, 2012, City Council re-established the DLB-PBID. This re-establishment required a majority vote of the property owners in favor of re-establishing the district for a new term of ten years.
On January 12, 2001, City Council and DLBA executed an Agreement for Funding setting forth the duties and delegations of the parties. This Agreement is automatically extended on a year-by-year basis upon approval of the annual Assessment Report and the related levy of assessments by City Council.
The DLBA Board voted on April 16, 2014 to raise assessment rates one and one-half percent (1.5%) per the allowed CPI adjustment. This is reflected in the attached budget and report. Properties are assessed based upon location within two defined zones in the DLB-PBID area. The assessment rate and level of program service provided varies, depending upon the zone in which the property is located. Assessment rates for 2015 are described in Section 6 of Exhibit B. An estimated total property assessment revenue of $2,335,622 is reported in Section 7. Section 4 of the report shows a DLB-PBID budget of $2,335,622 for the period. Adequate reserve funds (three percent of estimated revenue) are available to make up any deficit between budgeted expenditures and actual revenue received for the period (Section 4 of Exhibit B).
The DLB-PBID assessment area contains properties owned by private commercial and residential property owners, the City of Long Beach, and the Long Beach Successor Agency (SA, formerly Redevelopment Agency of Long Beach). In FY 15, the City assessment is $415,548, of which $178,807 is related to Pike property development and will be paid to the City by Developers Diversified Realty (DDR), as required by their lease. Thus, the City's net assessment is $236,741. The Successor Agency's assessment is $109,996, which is approved by the Successor Agency Board separately. City and SA payments together total $346,737 and represent approximately 15 percent of the total levy of $2,335,622 for program year 2015. Exhibit C details City and SA-owned properties located within the DLB-PBID.
The Property and Business Improvement District Law of 1994 (Law) requires that the DLBA Board of Directors file an Annual Report detailing the DLB-PBID assessment methodology and assessment levy filed with Los Angeles County. The subject levy of assessment will cover the DLB-PBID contract period with the DLBA from January 1, 2015 through December 31, 2015. The Annual Report of Levy and Assessment is provided as Exhibit B for City Council approval.
The Law also allows the City to contract with service providers to carry out the DLB- PBID program. For the past 13 years, the City has contracted with the DLBA to carry out the DLB-PBID Management Plan.
This matter was reviewed by Deputy City Attorney Amy Webber on October 20, 2014, and Budget Management Officer Victoria Bell on October 22, 2014.
TIMING CONSIDERATIONS
The current DLB-PBID contract terminates on December 31, 2014. City Council approval of the Annual Report and related levy of assessment is requested on November 11, 2014 to ensure timely transfer of assessment revenue as required by City contract.
FISCAL IMPACT
The City's assessment for FY 15 is $415,548. Of this amount, $178,807 is associated with Pike development property and will be paid to the City by DDR. The City will pay the portion of the assessment attributable to DDR after receipt of those funds from DDR. The balance of the City's assessment, $236,741, will be paid from the Civic Center Fund (IS 380) in the Public Works Department (PW). The FY 15 assessment amount for all Successor Agency-owned parcels is $109,996 and is subject to approval from the State Department of Finance (DOF). Approval of this recommendation will provide continued support to the local economy.
SUGGESTED ACTION
Approve recommendation.
Respectfully Submitted,
MICHAEL P. CONWAY
DIRECTOR OF ECONOMIC AND PROPERTY DEVELOPMENT
APPROVED:
PATRICK H. WEST
CITY MANAGER