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HomeMy WebLinkAbout75A - PH RESO DWNTWN SA CMTY MGTREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: DECEMBER 1, 2008 TITLE: PUBLIC HEARING - RESOLUTION ESTABLISHING THE DOWNTOWN SANTA ANA COMMUNITY MANAGEMENT DISTRICT G ~ ~. CITY MANAGER RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ^ As Recommended ^ As Amended ^ Ordinance on 15~ Reading ^ Ordinance on 2"d Reading ^ Implementing Resolution ^ Set Public Hearing For_ CONTINUED TO FILE NUMBER Adopt a Resolution establishing a Downtown Santa Ana Community Management District and the levy of an assessment in accordance with the provisions of Article XX, Chapter 13 of the Santa Ana Municipal Code (the ~~CMD Ordinance"). DISCUSSION Early in 2006, at the request of stakeholders in Downtown Santa Ana, the Community Development Agency (CDA) initiated a study to investigate the feasibility of establishing a Property and Business Improvement District (PBID) to replace the Business Improvement District (BID) which had been in place since 1984. The study indicated that a PBID could generate significantly greater revenue for Downtown programming than the BID. The PBID formation process began in earnest in mid-2007. A formation steering committee worked with staff and an engineering consultant to develop a District Management Plan. The Management Plan anticipates annual assessment revenue of approximately $900,000. The principal work elements in the Plan are supplemental maintenance, Downtown Ambassadors, marketing and promotions, image enhancement, and economic enhancement. The City adopted the CMD Ordinance to authorize the establishment of a Community Management District (CMD), a district analogous to a PBID, but authorized under Santa Ana's charter powers rather than state statute. In August 2008, Downtown stakeholders filed Articles of Incorporation with the California Secretary of State forming a private nonprofit corporation called Downtown Incorporated. As permitted by the CMD Ordinance, it is intended that Downtown Incorporated will serve as the 75A-1 Public Hearing - Resolution for Management District December 1, 2008 Page 2 property owners association under contract to the City to operate and manage the activities of the CMD. On October 6, 2008, having received the required petitions requesting the initiation of the formation process, the City Council adopted Resolution 2008-068, scheduling a public hearing for December 1, 2008, and ordering the preparation and distribution of ballots in accordance with the provisions of Article XIIID of the California Constitution and Sections 54750 through 53756 of the California Government Code. Ballot packets were mailed on Thursday, October 16. Ballots must be received by the close of the public hearing to be counted. Two public information workshops were held in the Downtown on Tuesday, October 28. Since the commencement of these proceedings, a number of owners from the Town Square Condominium project have raised concerns about the specific benefits they would receive should the District be established. The CMD Formation Committee met recently to review these concerns and came to the following conclusion. While it is known that residential enclaves lying at the edges of urban commercial areas do, in fact, benefit from programs and activities provided to them via improvement districts, the Committee found it more prudent to focus its attention and funds on the core of the commercial downtown. The District engineer advises that there is no specific benefit to these outlying properties so long as the focus of the work programs is only on properties that are assessed. The proposed boundary amendment will not affect the benefit/assessment relationship that has been defined in the Management Plan. The Formation Committee is, therefore, requesting that the City Council amend the boundaries of the proposed District prior to the tabulation of the ballots. The Council, pursuant to a previously adopted Ordinance, may exclude territory from the District prior to adoption of the final resolution. These properties will result in a slight decrease in revenues which will not have an impact on the overall activities outlined in the Management Plan. At the close of the public hearing, the ballots will be opened and tabulated, and the results reported to the City Council. If there is a weighted majority of ballots cast in support of establishing the CMD, the City Council may adopt the Resolution establishing the CMD and levying an assessment. If a weighted majority of ballots cast oppose establishing a CMD, no further action can be taken. 75A-2 Public Hearing - Resolution for Management District December 1, 2008 Page 3 FISCAL IMPACT If the CMD is adopted, the City will be assessed $22,304 and the Community Redevelopment Agency will be assessed $95,912. Cynthia J. Nelson Deputy City Manager for Development Services Community Development Agency CJN/TE/mlr 120108 P.H. Reso CMD Establishment (2) 75A-3 JWF (11/24/08) RESOLUTION NO. 2008-XXX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA ESTABLISHING THE DOWNTOWN SANTA ANA COMMUNITY MANAGEMENT DISTRICT AND LEVYING ASSESSMENTS WITHIN SUCH DISTRICT PURSUANT TO ARTICLE XX, CHAPTER 13 OF THE SANTA ANA MUNICIPAL CODE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS: Section 1. The City Council of the City of Santa Ana hereby finds, determines and declares as follows: A. Pursuant to Chapter 13, Article XX of the Santa Ana Municipal Code (the "Law"), on October 6, 2008 the City Council adopted Resolution No. 2008- 068 (the "Resolution of Intent"), stating the intention of the City Council to establish the Downtown Santa Ana Community Management District (the "Downtown CMD") and to levy and collect assessments within such district and setting a time and place for a hearing on protests to such creation; and, B. The Resolution of Intent approved the Management District Plan entitled the "Downtown Santa Ana Community Management District Plan" (the "Management District Plan") containing all of the information to establish the District required by Section 13-204 of the Law, including a description of the boundaries of the district, the improvements and activities proposed for the district, and the cost of such improvements and activities. Included as part of the Management District Plan is an engineers report, prepared by a registered professional engineer, which complies with the requirements of Sections 4(a), (b) and (c) of Article XIIID of the California Constitution. As used herein, Management District Plan shall include the engineer's report. C. The City caused notice of a public hearing concerning the proposed establishment of the Downtown CMD and the proposed levy of assessments within such district to be duly mailed, as required by law, to the record owner of each parcel proposed to be assessed within the District; D. After adoption of the Resolution of Intent and issuance of notice for the public hearing, the Downtown CMD Formation Committee recommended that the boundaries of the Downtown District be amended to delete that portion of the proposed district generally bounded by Flower Street on the Resolution No. 2008-XXX 75A-4 Page 1 of 7 west, 3rd Street on the north, Birch Street on the east and 1st Street on the south (the "Excluded Territory"). The boundaries of the Excluded Territory are set forth in Exhibit A to this Resolution. All of the properties in the Excluded Territory are used exclusively for residential purposes (with the exception of City-owned Birch Park). A number of residential property owners within the Excluded Territory raised concerns about the specific benefits they would receive should the District be established. While the engineer's report contained in the Management District Plan establishes that the Excluded Territory would benefit from the proposed programs and activities within the district, the Committee found it more prudent to focus its attention and funds on the core of the commercial downtown. The District engineer has opined that so long as the Management District Plan is modified to limit any programs under the Plan only to properties that are assessed, there is no specific benefit to the Excluded Territories. E. A public hearing concerning the establishment of the Downtown CMD and the proposed levy of assessments within such district was held on December 1, 2008 at the hour of 6:00 pm in the City Council Chambers at 22 Civic Center Plaza, Santa Ana, California. F. At the public hearing, City Staff presented to the City Council the Management District Plan as described in the Resolution of Intent along with the proposal for the Excluded Territory. G. At the public hearing, the testimony of all interested persons for or against the establishment of the District, the levy of assessments within such District, and the type or types of improvements and activities to be funded with the revenues from the assessments was heard and considered, and a full, fair and complete hearing was held. H. Article XIIID of the California Constitution and Sections 54750 through 53756 of the California Government Code impose certain procedural and substantive requirements relating to the levy of new or increased assessments, including mailing of a notice to each affected property owner regarding the proposed assessment, conducting a ballot procedure, and holding a public hearing. Section 2. The Council, pursuant to the Law, may exclude territory from the District prior to adoption of the final resolution. The City Council hereby approves the recommended exclusion of the Excluded Territories for the Downtown CMD. The Management District Plan shall be amended as necessary to eliminate any programs, services or activities of benefit to the Excluded Territory. Hereafter, all references to the Management District Plan, shall be to the plan as amended. Resolution No. 2008-XXX 75A-5 Page 2 of 7 Section 3. The City Council of the City of Santa Ana hereby finds, determines and declares as follows: (a) That the canvas of votes cast by the property owners is completed and has been certified by the Clerk of the Council, and the votes cast were as set forth in Exhibit B to this Resolution, attached hereto and made a part hereof by this reference. (b) As determined by the ballots cast as weighted according to the amount of assessment owed by each parcel, a majority of the property owners voted in favor of the proposed assessment. No ballots were considered from property owners within the Excluded Territory. Section 4. The City Council heard and considered all objections or protests to the proposed assessments and tabulated the assessment ballots submitted, and not withdrawn, in support of or opposition to the proposed assessments. The City Council hereby finds that a majority protest does not exist as defined in Section 4(e) of Article XIIID of the California Constitution and Section 53753 of the California Government Code. All objections or protests, both written and oral, are hereby duly overruled. Section 5. Pursuant to the Act, the Downtown Santa Ana Community Management District (the "Downtown CMD") is hereby established. The City Council hereby finds that the properties within the Downtown CMD will be benefited by the improvements and activities funded by the assessment to be levied. Section 6. Levy of the Assessment. (a) Except where funds are otherwise available, an assessment will be levied annually to pay for all the improvements and activities to be provided within the Downtown CMD, commencing with fiscal year 2008-09 and ending with fiscal year 2012-13. For purposes of levying and collecting assessments within the Downtown CMD, a fiscal year shall commence on each July 1st and end on the following June 30th. (b) The total amount of the proposed assessment to be levied and collected for fiscal year 2008-09 shall be approximately $920,000, based on the maximum assessment rates described in the Management District Plan. Said assessment and rates shall continue for each of the succeeding four fiscal years and may increase by the maximum rate set forth in the Management District Plan. Increases in building area due to new construction may also cause an increase in the total assessment for a parcel in any given year. (c) The method and basis of levying the assessment shall be as set forth in the Management District Plan. Section 7. There is created a special fund designated as the "Downtown Santa Ana Community Management District Fund" into which all revenue derived from assessments levied pursuant to this Resolution shall be placed, and such funds shall be Resolution No. 2008-XXX 75A*6 Page 3 of 7 used only for the purposes specified in this Resolution. This fund shall be subject to an annual independent audit of financial statements. Section 8. The proposed activities for the Downtown CMD include beautification and physical enhancement, image enhancement, supplemental maintenance, supplemental public security, and economic enhancement, all as more fully set forth in the Management District Plan. The above improvements and activities will be funded by the levy of the assessments. The revenue from the levy of the assessments within the Downtown CMD shall not be used to provide improvements or activities outside the Downtown CMD or for any purpose other than the purposes specified in the Resolution of Intent. Section 9. The City may contract with a nonprofit entity comprised of property and business owners within the Downtown CMD to administer any of the activities described in Section 8, above. Such anon-profit entity shall hold funds in trust for purposes related to the contract and may be required to, at no expense to the City, provide an annual independent report of audited financial statements by a certified public accountant of these funds. The report may be funded from assessment proceeds as part of the general administration of the Downtown CMD. At all times the City shall reserve full rights of accounting of this fund. Furthermore, such a nonprofit entity shall be charged, at minimum, with advising the City on the implementation of CMD funded activities and improvements. Section 10. Properties within the Downtown CMD established by this Resolution shall be subject to any amendments to the Law. Section 11. The City Clerk or a designee is hereby authorized and directed to record a notice and an assessment diagram pursuant to the Law following adoption of this Resolution. The assessment diagram shall reflect all the boundaries of the Downtown CMD as described in the Management District Plan, with the exception of the Excluded Territory. Section 12. The adoption of this Resolution and recordation of the notice and assessment diagram pursuant to the Law constitutes the levy of an assessment in each of the fiscal years referred to in the Management District Plan. Each year, the County Auditor of the County of Orange shall enter on the County Assessment Roll opposite each lot or parcel of land the amount of the assessment and such assessment shall then be collected at the same time and in the same manner as the County taxes are collected. Notwithstanding the foregoing, the City shall directly bill for those assessments levied for fiscal year 2008-2009. Section 13. To ensure that assessment revenues from the Downtown CMD are used to enhance the current level of services provided by the City within the Downtown CMD, the City Council hereby adopts the baseline levels of service as currently provided throughout the Downtown CMD; provided, however, that in the event of a Resolution No. 2008-XXX 75A-7 Page 4 of 7 significant downturn in City revenues, the City Council may reduce the level of City public services, including within the Downtown CMD. Section 14. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution. ADOPTED this 1St day of December, 2008. Miguel A. Pulido Mayor APPROVED AS TO FORM: By: Joseph W. Fletcher, City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers CERTIFICATE OF ATTESTATION AND ORIGINALITY I, PATRICIA E. HEALY, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2008-XXX to be the original resolution adopted by the City Council of the City of Santa Ana on Date: Clerk of the Council City of Santa Ana 75A-8 Resolution No. 2008-XXX Page 5 of 7 Exhibit A to Resolution No. 2008- Excluded Territory Beginning at a point where the westerly right-of-way line of Flower Street intersects with the southerly right-of-way line of Third Street, thence southerly along the westerly right-of- wayline of Flower Street to a point where it intersects with the southerly right-of-way line of First Street, thence easterly along the southerly right-of-way line of First Street to a point where it intersects with an extension of the westerly property line of Parcel Number 398- 592-01, thence northerly along the westerly property line of said Parcel Number 398-592- 01 to the point where it intersects with the southerly property line of Parcel Number 398- 592-09, thence westerly along the southerly property line of said Parcel Number 398-592- 09 to point of termination, thence northerly along the westerly property line of said Parcel Number 398-592-09 to a point where it intersects with the southerly right-of-way line of Third Street, thence westerly along the southerly right-of-way line of Third Street to point of beginning. Resolution No. 2008-XXX 75A_g Page 6 of 7 Exhibit B to Resolution No. 2008- Clerk of the Council Ballot Certification EXHIBIT TO FOLLOW Resolution No. 2008-XXX 75A-1 ~ Page 7 of 7