HomeMy WebLinkAbout80A - PH - AMEND DOWNTOWN MGMT PLAN REQUEST FOR COUNCIL/
AGENCY ACTION
`
MEETING DATE: CLERK OF COUNCIL USE ONLY:
MAY 18, 2009
TITLE: APPROVED
? As Recommended
PUBLIC HEARING -AMENDMENT OF ? As Arnended
DOWNTOWN MANAGEMENT DISTRICT PLAN, ? Ordinance on 1st Reading
MANAGEMENT AGREEMENT WITH DOWNTOWN INC . , ? Ordinance on 2nd Reading
AND LOAN AGREEMENT ? Implementing Resolution
? Set Public Hearing For
CONTINUED TO
r' ~
~ ~ ~ FILE NUMBER _
CITY MANAGER EXECUTIVE DIRECTOR
RECOMMENDED ACTION
CITY COUNCIL ACTION
1. Adopt a resolution amending the Management District Plan for the
Downtown Santa Ana Community Management District;
2. Authorize the City Manager and Clerk of the Council to execute the
attached management agreement with Downtown Inc. for the management
and implementation of Community Management District funds for a five-
year period ending December 31, 2014, subject to non-substantive
changes approved by the City Manager and City Attorney;
3. Authorize the City Manager and Clerk of the Council to execute the
attached loan agreement with Downtown Inc. and the City of Santa Ana,
subject to non-substantive changes approved by the City Manager and
City Attorney.
COMMUNITY REDEVELOPMENT AGENCY ACTION
Authorize the Executive Director and Agency Secretary to execute the
attached loan agreement with Downtown Inc. and the Community
Redevelopment Agency, subject to non-substantive changes approved by the
Executive Director and Agency General Counsel.
80A-1
Public Hearing - Amendment of Downtown
Management District Plan, Management Agreement
with Downtown Inc., and Loan Agreement
May 18, 2009
Page 2
DISCUSSION
On December 15, 2008, the City Council adopted a resolution establishing
the Downtown Santa Ana Community Management District (CMD) and the levy
of an assessment of the property owners within the District to fund
various activities in the Downtown. The CMD plan provided that the
initial tax assessment was to be levied in FY 2008-09, and the operating
term of the CMD was January 1, 2009 to December 31, 2013.
Downtown Inc. is the newly created non-profit organization that will
oversee the expenditure of the assessments collected during the five
year term of the CMD. The Board of Downtown Inc. recently took an
action to defer the assessment levy until FY 2009-10, with the first
installment being due in October 2009. The Board felt that the new
assessment may place an undue hardship on the property owners in the CMD
due to current challenging economic conditions. This change in
assessment levy necessitates an amendment to the CMD plan approved by
the City Council (Exhibit 1). Further, the operating term of the CMD
must also be modified to now reflect January 1, 2010 to December 31,
2014.
Since the deferral of the first year's assessment to the property owners
in the CMD would not yield funds until January 2010, each director on
the Board has agreed to make a loan to the corporation in order to begin
implementation of the CMD activities in calendar year 2009. The loans
are based on the amount of the first year's assessment and will be
repaid by the fifth year. These loans will generate approximately
$186,000, which will be used for administrative, operating, corporate
start-up, and marketing/promotional activities as outlined on Exhibit 2.
The funds will enable Downtown Inc. to hire a new, full-time Executive
Director along with a support staff person as well as assuming certain
basic services currently provided by the City.
The City is the recipient of the annual property tax assessments;
therefore, it is necessary to enter into a management agreement with
Downtown Inc. to oversee the implementation of the five-year program as
authorized when the CMD was established. The decision to levy the
assessment will be determined by the City Council on an annual basis and
will be based on a program budget developed by Downtown Inc.
80A-2
Public Hearing - Amendment of Downtown
Management District Plan, Management Agreement
with Downtown Inc., and Loan Agreement
May 18, 2009
Page 3
Notice of the public hearing was published in the Orange County Reporter
on May 8 and May 15, 2009, pursuant to Section 13-112 of the Santa Ana
Municipal Code.
FISCAL IMPACT
Funds are available in account no. 407-933-6291 for the City's portion
of the loan; the Agency's loan will be provided from account no. 553-
951-6291.
APPROVED AS TO FUNDS AND ACCOUNTS:
t
Cynthia J. Ne son Francisco Gutierrez ~-i
Deputy City Manager for Executive Director
Development Services Finance and Management Services Agency
Community Development Agency
CJN NTE TE mlr
/ / /
80A-3
80A-4
ERRATA SHEET
Date: June 18, 2010
Documents Affected: Downtown Santa Ana Community Management District
-The Management District Plan
This errata sheet lists the pages corrected from the original Exhibit 1 as prodded to
the City Council for consideration at the reguiarly scheduled City Council Meeting of
May 18, 2009 -Request for Council Action report, Agenda Item 80A.
Corrected pages are as follow:
Page 5
Page 13
Page 14
~ ~
f ~ I
Maria D. Huizar,
Cierl< of the Council
City of Santa Ana
DSA
OWNTOWN ANTA NA
CMD
OMMUNITY ANAGEMENT ISTRICT
TMDP
HE ANAGEMENT ISTRICT LAN
Formed Under Chapter 13 of the Santa Ana Municipal Code
Prepared by
Edward Henning, P.E. and Tom Eidem
In coordination with the
Management District Formation Committee
August 2008
Adopted - October 2008
Amended – May 2009
The Downtown Santa Ana Community Management District
Amended Management District Plan
May 2009
Table of Contents
Introduction
A. Map of the District and Parcels Affected
B. Name of District
C. Description of Boundaries and Benefit Zones
D. List of Improvements and Activities Proposed for Each Year of Operation and
Maximum Costs
E. Total Annual Amount Proposed for Improvements, Maintenance and
Operations for Each Year of Operation
F. Proposed Sources of Financing, Including Method and Basis of Levying of
Assessment
G. Time and Manner of Collecting Assessments
H. Proposed Rules and Regulations to be Applied to the District
I. Continuation of Levy Specifically for Maintenance of Improvements
Constructed by the District
J. Type and Term of District and Showing Specific Number of Years
Assessments Will Be Levied
K. Proposed Timeline for Implementation and Completion of Management
District Plan
L. Community Management District Governance
M. Other Items
Appendix A - List of Parcels Including Publicly Owned Parcels
Appendix B - Engineer’s Report
3
Introduction
Offering a variety of services and amenities for visitors, businesses, and residents,
Downtown Santa Ana is a quaint, historic, yet bustling area located in the heart of the
Santa Ana, the county seat of Orange County. Downtown Santa Ana is home to a
vibrant Latino shopping district, the Artists Village, major office centers, and financial
institutions. Downtown is also home to federal, State, County, and municipal courts and
administrative offices.
A Community Management District (CMD) funds special services that address specific
needs of commercial centers. These services may include special “Clean and Safe”
programs like enhanced maintenance, landscaping, and security; vital Economic
Revitalization programs intended to promote customer and investor confidence, such as
business assistance and attraction, education and information, parking programs, and
the like; and, of course, Marketing and Promotions programs and activities designed to
increase awareness and sales. Marketing and Promotions programs can include
special events, holiday celebrations, music and arts festivals, comprehensive
advertising, branding, public outreach, and more. A CMD also facilitates coordination
among various interests such as City departments, elected officials, community groups
and business leaders to accomplish its goals. This strengthens relationships, increases
cooperation, and integrates the various efforts to thoughtfully improve the district. A
CMD will provide financial and administrative resources to partner with public and
private organizations to bring back the vitality of this lively shopping district.
In 1984, a merchant-based Business Improvement District was established in
Downtown Santa Ana and continues today. Originally managed by the Downtown
Santa Ana Business Association, in recent years program implementation
responsibilities have been divided among different geographical and market sectors.
In 2006, after a number years of economic struggle to revitalize Downtown Santa Ana,
there developed an interest in establishing a Property and Business Improvement
District (PBID). Property owners formed a proponent group and approached the City’s
Community Development Agency for assistance to engage a PBID advisor. The City of
Santa Ana approved hiring a consultant to work with Downtown stakeholders in
establishing a new district. Property owners, in partnership with local merchants and the
City, worked together to launch a new effort to create a district. A Formation Committee
was established to direct and advise on the creation of this Management Plan. In June
2008, the CMD Formation Committee requested that the City of Santa Ana amend the
Municipal Code to enable the establishment of Community Management Districts. The
City Council began the amendment process in July 2008.
The formation of the Downtown Santa Ana Community Management District will serve
to enhance the commercial district thereby increasing commerce and prosperity.
B. Name of District
The name of the new District shall be The Downtown Santa Ana Community
Management District.
4
1
C. Description of Boundaries and Benefit Zones
The Downtown Santa Ana Community Management District includes a total of
282 parcels represented by 102 individual property owners. With some minor
exclusions resulting from essential boundary adjustments, the District generally
includes all parcels between Walnut Street on the south, Civic Center Drive on
the north, Mortimer Street on the east and Flower Street on the west. This area
represents the core of the greater Downtown and is unique in its combination of
retail, entertainment, government, and professional/office uses as well as its
diversity of market sectors.
The entire District comprises a single benefit zone. All parcels within the above-
mentioned boundaries shall be assessed to fund special benefit services as
outlined in this plan, excluding only those properties owned, occupied by and
operated as a federal, State, County and municipal government. Services will be
provided only to those properties paying into the assessment fund; no services
shall be provided outside the District boundaries.
The Downtown Santa Ana Community Management District encompasses most
properties within the following general description boundaries:
- Flower Street on the west
- First Street from Flower Street to Birch Street and Walnut Street from
Broadway to Orange Street on the south
- Maple Street from Walnut Street to First Street, the easterly property line of
the commercial center known as Downtown Plaza, and Mortimer Street from
Third Street to Santa Ana Boulevard on the east
- Santa Ana Boulevard from Mortimer Street to Bush Street, and Civic Center
Drive from Bush Street to Flower Street on the north
The above description is general and does not account for minor exclusions and
inclusions.
More precisely, the boundaries are described as follows:
Beginning at a point where the westerly right-of-way line of Flower Street
intersects with the northerly right-of-way line of Civic Center Drive, thence
southerly along the westerly right-of-way line of Flower Street to a point where it
intersects with the southerly right-of-way line of First Street, thence easterly
along southerly right-of-way line of First Street to point where it intersects with
center line on the alley bisecting Block 276, thence southerly along the centerline
of said alley to a point where it intersects with the southerly right-of-way line of
Walnut Street, thence easterly along the southerly right-of-way line of Walnut
1
Resolution 2008-078, adopted December 15, 2008, excluded certain territory from the plan. Please refer to
Resolution 2008-078 for legal description.
5
Street to a point where it intersects with the westerly right-of-way line of Orange
Street, thence northerly along the westerly right-of-way line of Orange Street to a
point in alignment with an extension of the southerly property line of Parcel
Number 398-517-01, thence easterly along said line, continuing along the
southerly property line of Parcel Number 398-517-01 to a point where it
intersects with the easterly right-of-way line of the alley in Block 517, thence
northerly along the easterly right-of-way line of said alley 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 in alignment with an
extension of the easterly property line of Parcel Number 398-508-19, thence
northerly along said line across First Street and continuing northerly along the
easterly property line of Block 516 to a point intersecting with the southerly right-
of-way line of Third Street, thence westerly along the southerly right-of-way line
of Third Street to a point where it intersects with the easterly right-of-way line of
French Street, thence northerly along said easterly right-of-way line of French
Street to a point where it intersects with the southerly property line of Parcel
Number 398-507-08, thence easterly along said southerly property line of Parcel
Number 398-507-08 to a point where it meets the easterly property line of said
parcel, thence northerly along said easterly property line of Parcel Number 398-
507-08 to a point where it intersects with the southerly right-of-way line of Fourth
Street, thence easterly along the southerly right-of-way line of Fourth Street to a
point where it intersects with a point in alignment with an extension of the
easterly right-of-way line of Mortimer Street, thence northerly along said line
across Fourth Street along and continuing northerly along the easterly right-of-
way line of Mortimer Street to a point where it intersects with the northerly right-
of-line of Santa Ana Boulevard, thence westerly along the northerly right-of-line
of Santa Ana Boulevard to a point where it intersects with the easterly right-of-
line of Bush Street, thence northerly along the easterly right-of-way line of Bush
Street to a point where it intersects with the northerly right-of-line of Eighth
Street, thence westerly along the northerly right-of-way line of Eighth Street to a
point where it intersects with the westerly right-of-line of Main Street, thence
southerly along the westerly right-of-way line of Main Street to a point where it
intersects with the northerly property line of Parcel Number 398-244-02, thence
westerly along said northerly property line of Parcel Number 398-244-02 and
Parcel Number 398-244-01 and extending across Sycamore Street and
continuing westerly to a point where it intersects with the northerly right-of-way
line of Civic Center Drive, thence along the northerly right-of-way line of Civic
Center Drive westerly to the point of beginning.
D. List of Improvements and Activities Proposed for Each Year of
Operation and Maximum Costs
A description of Improvements is as follows:
1. Maintenance and Landscaping Services
Maintenance may include sidewalk sweeping and pressure washing, gum
removal, graffiti abatement, trash and/or bulky item removal; the watering,
6
weeding and pruning of all trees and plantings; alley/median/parkway
maintenance; litter and debris pick-up; trash receptacle collection/disposal
and maintenance/replacement; and other maintenance and landscaping
issues that may arise.
Each maintenance service will assist in beautifying the Downtown District
and enhancing the image of the commercial core. This activity is
designed to increase customer comfort within the greater Downtown which
will, in turn, increase commerce and help to attract and retain new
businesses and patrons within the District. These maintenance services
will be provided only within the District; therefore, these services constitute
"special benefits" to the assessed parcels.
2. Marketing and Promotions
This activity is intended to enhance the image of Downtown Santa Ana
through sophisticated marketing, advertising and branding of the
Downtown. It will heighten the excitement and pleasure of the customer
and visitor experience by way of holiday celebrations, special events,
festivals, promotions and sales, art shows, live music, and similar
customer attractions. This activity also includes those types of
supplemental activities such as newsletters, visitor guides, graphics arts
materials, business improvement workshops, and the like.
3. Downtown Ambassador Program
Uniformed customer assistance Ambassadors will provide a variety of
business and customer support services by assisting patrons and
employees, supporting SAPD crime prevention efforts to reduce the
incidence of crime and nuisance activities, and productively addressing the
challenges associated with street populations. Deployment of Downtown
Ambassadors can include highly visible foot, bicycle or Segway patrols that
will provide service during critical, high-impact periods. The initial
deployment will be when their services are most needed. Actual days and
times are still to be determined, but Ambassador assignments can change
as necessary.
The Downtown Ambassador Program will assist in creating a safe and
secure environment throughout the Downtown area and, hence, will
enhance the economic revitalization. This activity is designed to increase
vehicular and pedestrian traffic within the District which will increase
commerce and help to attract new and retain existing businesses and
patrons. This Ambassador Program will be provided only within the CMD
boundaries; therefore these services constitute "special benefits" to the
assessed parcels.
4.Physical Enhancement & Amenities
7
The Physical Enhancement category consists of capital improvements that
may include tree/landscape planting, additional street furniture, fixtures
and equipment, and other streetscape amenities the Board deems
appropriate. These amenities include light pole and skyline banners,
advertising and information kiosks, decorations, directories, and special
lighting.
These improvements will beautify and enhance the image of Downtown
Santa Ana and thereby increase pedestrian and vehicular traffic to the
District. This activity is designed to enhance the shopping experience
within the District boundaries. Because the Physical Enhancement
program will be provided only within the District, these improvements will
constitute “special benefits” to the assessed parcels.
5. Administration and Operations
Included in the Administration component are the costs for an Executive
Director, Marketing & Promotions Coordinator, office support staff, office
expenses, legal fees, accounting/bookkeeping fees, and Directors &
Officers and General Liability insurance.
This component is vital to the proper expenditure of assessment funds
and the administration of programs and activities which are intended to
promote business within the CMD boundaries through increased
commerce and the attraction and retention of new business. Because this
operating cost/administration program exists only for the purposes of the
District and will be provided only for matters occurring within the CMD
boundaries, this program constitutes a "special benefit" to the assessed
parcels.
NOTE: Existing City services will be supplemented, not
supplanted or duplicated, by Management District services.
Each of these programs and activities work together to create a more
pleasing environment within the District that is conducive to strengthening
the economic vitality of this commercial center through the attraction and
retention of new business and increased commerce. The programs,
improvements, and services are designed to specifically benefit properties
within the CMD boundaries. The proposed CMD assessments will be
levied only on properties within the CMD boundaries. Assessment
revenues will be spent to deliver services that provide a direct and special
benefit to assessed parcels and to improve the economic vitality of these
properties.
8
PROJECTED FIVE-YEAR BUDGETS/PROGRAM COSTS
REVENUE
Source Year 1 Year 2 Year 3 Year 4 Year 5
CMD Assessments $920,000.00 $966,000.00 $1,014,300.00 $1,065,015.00 $1,118,265.75
All Other $30,000.00 $31,500.00 $33,075.00 $34,728.75 $36,465.19
$950,000.00 $997,500.00 $1,047,375.00 $1,099,743.75 $1,154,730.94
EXPENDITURES
Programs & Activities Year 1 Year 2 Year 3 Year 4 Year 5
Maint & Landscaping $220,135.00 $231,141.75 $242,698.83 $254,833.77 $267,575.45
Marketing &
$372,990.00 $391,639.50 $411,221.47 $431,782.54 $453,371.66
Promotions
Ambassador Program $183,390.00 $192,559.50 $202,187.47 $212,296.84 $222,911.68
Physical
$48,825.00 $51,266.25 $53,829.56 $56,521.04 $59,347.09
Enhancement
Admin & Operations $124,660.00 $130,893.00 $137,437.65 $144,309.53 $151,525.00
TOTAL $950,000.00 $997,500.00 $1,047,375.00 $1,099,743.75 $1,154,730.94
All projects and activities are designed to enhance the assets and image of Downtown
Santa Ana, and thereby increase commerce and promote business within the boundaries
of the CMD. The annual budget for the first year is estimated to be $950,000. Of that
amount, $920,000 is to be generated through special assessments. The nonprofit
Management District Corporation shall have the right to reallocate up to 35 percent of the
total budget within the budget categories. Accrued interest or delinquent payments may
be expended in any budget category.
Any funds remaining after the fifth year of operation will be rolled over into the renewal
budget or returned to stakeholders. Also, if the funds are available in the fourth or fifth
year of operations, costs for renewal may be expended. If the District is not renewed or
terminated for any reason, unexpended funds will be returned to the property owners.
9
E. Total Annual Amount Proposed for Improvements, Maintenance and
Operations for Each Year of Operation
BUDGET SUMMARY – Revenue & Expense
REVENUE – FIRST YEAR
CMD Assessments $920,000
All Other 30,000
TOTAL REVENUE $950,000
EXPENDITURES – FIRST YEAR
Maintenance & Landscaping Services $220,135 23.2%
Marketing & Promotions 372,990 39.2%
Ambassador Program 183,390 19.3%
Physical Enhancement & Amenities 48,825 5.1%
Administration & Operations 124,660 13.1%
TOTAL EXPENDITURES $950,000 100.0%
FIRST YEAR OPERATIONS – PROGRAM SUMMARY
Maintenance & Landscape Services
Done by contract service providers (daily litter & debris pick-up, daily trash
collection, daily receptacle cleaning & maintenance, gum removal, graffiti
abatement, sidewalk washing FF&E maintenance & repair)
Marketing & Promotions
Special events, holiday celebrations, social events (art walks, concerts),
merchant promotions, co-op and piggyback opportunities, print material and
graphics, advertising (district-wide and targeted), newsletter, business
enhancement (business attraction and retention)
Ambassador Program
Contract Service (Allocation allows for added security of approximately 110 hours
per week deployed at PBID’s discretion.)
Physical Enhancement & Amenities
FF&E, banners, kiosks, signage, decorations, directories, lighting
Administration & Operations
Personnel, direct administrative costs
10
During the term of the Community Management District, the annual budget and
corresponding assessments may be adjusted to reflect an annual cost of
operations increase of five percent. This is the maximum allowable increase
based upon this Management District Plan utilizing the approved assessment
methodology. This increase may be imposed at the discretion of the Owners
Association. The Owners Association shall make a notification to the City
annually as to whether any adjustments to the current year’s assessment rates
will be made.
Additionally, any annual budget surplus or deficit will be incorporated into the
subsequent year’s CMD budget, and subsequent annual assessments will be set
to account for surpluses or deficits carried forward.
PROJECTED FIVE-YEAR BUDGETS/PROGRAM COSTS
REVENUE
% % % %
Source Year 1 Year 2 Year 3 Year 4 Year 5
Increase Increase Increase Increase
CMD Assessments $920,000.00 5.00% $966,000.00 5.00% $1,014,300.00 5.00% $1,065,015.00 5.00% $1,118,265.75
All Other $30,000.00 5.00% $31,500.00 5.00% $33,075.00 5.00% $34,728.75 5.00% $36,465.19
$950,000.00 $997,500.00 $1,047,375.00 $1,099,743.75 $1,154,730.94
EXPENDITURES
% % % %
Programs & Activities Year 1 Year 2 Year 3 Year 4 Year 5
Increase Increase Increase Increase
Maint & Landscaping $220,135.00 5.00% $231,141.75 5.00% $242,698.83 5.00% $254,833.77 5.00% $267,575.45
Marketing &
$372,990.00 5.00% $391,639.50 5.00% $411,221.47 5.00% $431,782.54 5.00% $453,371.66
Promotions
Ambassador Program $183,390.00 5.00% $192,559.50 5.00% $202,187.47 5.00% $212,296.84 5.00% $222,911.68
Physical
$48,825.00 5.00% $51,266.25 5.00% $53,829.56 5.00% $56,521.04 5.00% $59,347.09
Enhancement
Admin & Operations $124,660.00 5.00% $130,893.00 5.00% $137,437.65 5.00% $144,309.53 5.00% $151,525.00
TOTAL $950,000.00 $997,500.00 $1,047,375.00 $1,099,743.75 $1,154,730.94
11
F. Proposed Sources of Financing, Including Method and Basis of
Levying of Assessment
The Downtown Santa Ana Community Management District anticipates two
general sources of revenue – special assessment revenue which is the principal
source of funding (97 percent), and program income which includes funding from
sources such as sponsorships, sales of goods and services, dues, interest
income, and the like. The Downtown Santa Ana Community Management
District is a benefit assessment-type district whereby special service and district
program costs are apportioned among benefitting properties based on the
special benefit each property is expected to derive from those services and
programs. This method of financing such special services and programs is based
upon the levy of assessments on real property that benefit from proposed
improvements and activities.
The method and basis of spreading program costs vary from one district to
another based on local geographic conditions, types of programs and activities to
be undertaken, and size and development complexity. Further, general benefits
may not be incorporated into the assessment formula and levied on the CMD
properties; only special benefits and cost may be considered. Assessment
formulae typically relate to the physical factors of a parcel such as street
frontage, lot size, building size, location. The formula may base assessments on
a single factor or a combination of factors.
Based on the program activities to be funded, which relate substantially to the
pedestrian-oriented sidewalk areas/public walkways, parcel size and physical
improvements, it is determined that the assessments be based in part on four
property-related elements:
?
The amount of adjacent street/sidewalk frontage (linear feet)
?
The parcel size (total land area)
?
The building area
?
A flat parcel fee
These variables were developed by the consulting engineer and presented to a
focus group that was conducted for purposes of gathering a consensus of
affected property owners. The focus group included key stakeholders in the
Downtown. The variables and formulae were verified as equitable by an
Engineer's Report.
The assessment formula utilized in the Downtown Santa Ana Community
Management District is comprised of these four variables, each with a relative
weighting derived from program benefit. The variables are:
12
Street/Sidewalk Frontage 30% or $276,000
Parcel Size (Land Area) 30% or $276,000
Building Area 30% or $276,000
Flat Parcel Fee 10% or $ 92,000
100% $920,000
2
Within the CMD there are 282 221 parcels with roughly 60,000 40,000 linear
feet of street frontage, 3.0 million square feet of land and 2.5 3.1 million square
feet of building area. A list of all parcels in the CMD is shown in Appendix A.
Using the cumulative property-related data totals from above, the base Year 1
assessment rates are set at $6 per linear foot of street frontage, 10 cents per
square foot of land area, and 15 cents per square foot of building area (based on
gross exterior building dimensions). The parcel fee shall be $425 per parcel.
Due to identified diminished benefits and a number of formula adjustment factors
for certain land uses, parcel configurations and other circumstances are also
incorporated into the proposed CMD formula as follows:
1. Single-family residential uses are set at a rate of 10 cents per square foot of
building pad, from one to four units are set at a flat rate of $100 per unit
(includes residential condos).
2. Multi-family residential uses of five or more units are set at 50 25 percent of
respective base assessment rates (apartments).
3. Nonprofit- (501c3) owned/occupied properties are set at 50 25 percent of
respective base assessment rates.
4. Building areas are capped at a floor area ratio (FAR) of 4.0.
5. Government-owned/occupied properties will not be assessed and will receive
no direct services.
6. Residential uses, regardless of the number of units, that are 100 percent
project-based rental assistance programs; for example, senior housing and
the like, will not be assessed and will receive no direct services.
7. Mixed-use properties/complexes will generally be assessed based on
prorated land-use ratios, using the following guidelines:
Commercial/Office Condos – No Residential Uses (multiple owners)
a. Building area fee at full building area fee rate (structured parking area
excluded).
2
Correcting plan figures/wording on the plan to match that as adopted by City Council on October 6, 2008, agenda
item 55B.
13
b. Land area fee at full land area fee rate but prorated for each unit based on
ratio of unit building area to total building area.
c. Frontage fee at full frontage rate but prorated for each unit based on ratio
of unit building area to total building area.
Mixed-Use Rental: Ground-Floor Commercial and Upper-Floor Residential
(single owner)
a. Building area fee at full rate for commercial area and 50 25 percent
commercial rate for residential area (structured parking area excluded).
b. Land area fee at full land area fee rate.
c. Frontage fee at full frontage rate.
Mixed-Use Condos: Ground-Floor Commercial and Upper-Floor Residential
(multiple owners)
a. Building area fee at full rate for commercial pad areas and $100 per year
10 cents per square foot of building pad area, per residential condo unit
(structured parking area excluded).
b. Land area fee at full land area fee rate for commercial pad footprint.
c. Frontage fee at full frontage rate for commercial units (ground floor direct
frontage).
d. Live-work condo units where there is a clear and legally defined distinction
between work space and living space will be assessed using a
combination of a, b, and c above.
YEAR ONE ASSESSMENT CALCULATION
A parcel’s first annual assessment is calculated as follows. Any applicable
adjustment factors are applied after the calculation of the parcel’s assessment at
the full rate.
ANNUAL ASSESSMENT = Street Frontage Fee + Land Area Fee +
Building Area Fee + Parcel Fee
Street Frontage Fee is calculated by multiplying the linear feet of street frontage
of a parcel by the Street Frontage Rate ($6 per linear foot).
2
Correcting plan figures/wording on the plan to match that as adopted by City Council on October 6, 2008, agenda
item 55B.
14
Land Area Fee is calculated by multiplying the square footage of the parcel by
the Land Area Rate (10 cents per square foot)
Building Area Fee is calculated by multiplying the square footage of a structure,
as derived from its gross exterior dimensions, by the Building Area Rate (15
cents per square foot).
Flat Parcel Fee – each individual Assessor’s Parcel is assessed the Flat Parcel
Rate ($425).
Street Frontage Rate Land Area Rate Building Area Rate Flat Parcel Rate
$6.00 per linear foot 10¢ per square foot 15¢ per square foot $425 per parcel
During the term of the CMD, the annual budget and corresponding assessments
may be adjusted to reflect an annual cost of operations increase of five percent.
Since the CMD is planned for a five-year term, maximum assessments for future
years (years 2-5) must be set at the inception of the CMD. While future
inflationary and other program cost increases are unknown at this point, a built-in
maximum increase of five percent per year is incorporated into the projected
program cost and, in turn, the resulting assessment rates for the five-year life of
the CMD. These figures are shown in the table below. Assessment rates may
not exceed those indicated below.
Five-Year Maximum Assessment Rates
(Includes a 5 percent cap on annual
increases)
Rate Year One Year Two Year Three Year Four Year Five
Street Frontage Fee $6 $6.30 $6.62 $6.95 $7.30
Land Area Fee 10¢ 10.5¢ 11¢ 11.6¢ 12.2¢
Building Area Fee 15¢ 15.8¢ 16.6¢ 17.4¢ 18.3¢
Flat Parcel Fee $425 $446 $469 $491 $516
Any annual budget surplus or deficit will be incorporated into the subsequent
year’s CMD budget, and subsequent annual assessments will be set to account
for surpluses or deficits carried forward.
15
G. Time and Manner of Collecting Assessments
Pursuant to analogous law pertaining to Property and Business Improvement
Districts, the Santa Ana Downtown Community Management District assessment
will be collected by the County of Orange in the same manner as annual property
taxes are collected, and will appear as a separate line item on the annual
property tax bills prepared and issued by the County. Property tax bills are
generally distributed to property owners in the fall, and payment is expected by
lump sum or in two installments. The County of Orange shall distribute the
assessments to the City which will, in turn, forward the assessments to the
managing association pursuant to the authorization of this plan. Existing laws for
enforcement of property taxes apply to the District’s assessments.
The assessments shall be collected at the same time and in the same manner as
for any ad valorem property tax paid to the County of Orange. These
assessments shall provide for the same lien priority and penalties for delinquent
payment as is provided for the ad valorem property tax. If necessary, the
Santa Ana City Clerk’s Office will directly bill property owners or entities that do
not appear on the direct billing of the property tax roll provided by the County.
The “property owner” of the ad valorem interest shall be any person listed as the
owner/taxpayer on the last equalized ad valorem interest assessment roll or
otherwise known to be the owner/taxpayer by the City.
H. Proposed Rules and Regulations to be Applied to the District
There are no specific rules or regulations applied to this District.
I. Continuation of Levy Specifically for Maintenance of Improvements
Constructed by the District
In accordance with Section 13-103 (i) of Article XX, Chapter 13, Santa Ana
Municipal Code, it shall be a requirement of the Downtown Santa Ana
Community Management District that assessments specifically designated for the
maintenance and upkeep of improvements constructed by the District using
assessment revenue, if any, shall continue to be levied on each parcel of land
within the CMD for a period of time equal to the useful life of the improvement, as
determined by the City Engineer, regardless of whether the District is
disestablished or the term of the original levy has expired.
J. Type and Term of District and Showing Specific Number of Years
Assessments Will Be Levied
The proposed Downtown Santa Ana Community Management District is a new
district. The CMD will have an initial operating term of five years. Due to the
16
time and manner of levying and collecting assessments as described in Section
G, assessment revenue is generally not available for direct operations until the
following January. The CMD will commence with the first year of levying of
assessments in August of 2009, and the first year of programs and activities
beginning in January of 2010, as assessment funds become available. The final
assessment shall be levied by August of 2013 with the fifth year of programs and
activities commencing in January of 2014, as assessment funds become
available. Program operations are expected to be complete by December 31,
2014. Any continuation of the CMD after the initial five-year period will require
compliance with the regulations in place at that time relative to establishment of a
Community Management District.
An assessment for the maintenance of improvements constructed by the CMD, if
any, may extend beyond the original five-year term as described in Section I of
the Management District Plan.
K. Proposed Time for Implementation and Completion of Management
District Plan
Estimated Date of
Task to be Completed
Completion
Completion and approval of Management District Plan. August 2008
Send complete Management District Plan to Assessment Engineer. August 2008
Complete petition drive reflecting support of property owners in the
August - September
proposed district who will pay more than 30 percent of the assessment
2008
proposed to be levied.
Submit completed petitions to City Clerk. September 2008
Resolution of Intention setting a public hearing and ordering the
October 2008
distribution of ballots adopted by City Council.
Ballots returned to City Clerk. December 1, 2008
Public Hearing/counting of returned ballots, consideration of ordinance
December 1, 2008
by Santa Ana City Council establishing the District.
L. Community Management District Governance
Downtown, Incorporated will be the agency responsible for the ongoing day-to-
day management and administration of the Downtown Santa Ana Community
Management District (CMD). Downtown, Incorporated is an existing nonprofit
corporation formed by business and property owners located in Downtown
Santa Ana. Downtown, Incorporated may choose to contract with third-party
entities to carry out the District programs and activities.
17
The annual programs, budgets, and assessments for the Downtown Santa Ana
Community Management District shall be determined by Downtown,
Incorporated, which shall also serve as the Community Management District
“owners association” described in Article XX Chapter 13 of the Santa Ana
Municipal Code. Such programs, budgets, and assessments must be consistent
with this Management Plan. Downtown, Incorporated shall be responsible for the
general oversight of the District including approval of the annual work programs
and budgets, monitoring performance, and ensuring compliance with appropriate
rules and regulations, including a Community Management District management
agreement with the City of Santa Ana. Upon Community Management District
adoption/renewal, the City of Santa Ana and Downtown, Incorporated will
execute a contract for the performance and delivery of the stipulated program
services over the life of the District.
The Board of Directors of Downtown, Incorporated shall meet generally on a
monthly basis. When related to Community Management District matters, such
meetings shall be subject to the State of California “Brown Act” open meeting
requirements. Records of this corporation pertaining to Community Management
District-related matters shall be available for public review as stipulated by State
law. Pursuant to the Municipal Code, the Downtown, Incorporated Board of
Directors shall file, for approval by the City Council, an annual report for the
upcoming year for which assessments shall be levied.
Downtown, Incorporated will employ a management professional as Executive
Director/CEO whose duties shall include the implementation of the programs and
activities of the CMD as well as the management of the day-to-day affairs of the
CMD and Downtown, Incorporated. Additional staff may be employed as needed
and as provided for in the budget.
M. Other Items
No bonds will be issued for any CMD projects.
H:\Mgmt Dist & BID Formation\BID Information\Management District Formation Committee\MANAGEMENT DISTRICT
PLAN Amended REVISED5.09.docx
18
DOWNTOWN SANTA ANA
COMMUNITY MANAGEMENT DISTRICT
THE MANAGEMENT DISTRICT PLAN
Formed Under Chapter 13 of the Santa Ana Municipal Code
Prepared by
Edward Henning, P.E. and Tom Eidem
In coordination with the
Management District Formation Committee
Originally Adopted -August 2008
Amended -May 2009
Exhibit 1
80A-5
The Downtown Santa Ana Community Management District
Amended Management District Plan
May 2009
Table of Contents
Introduction
A. Map of the District and Parcels Affected
B. Name of District
C. Description of Boundaries and Benefit Zones
D. List of Improvements and Activities Proposed for Each Year of Operation and
Maximum Costs
E. Total Annual Amount Proposed for Improvements, Maintenance and
Operations for Each Year of Operation
F. Proposed Sources of Financing, Including Method and Basis of Levying of
Assessment
G. Time and Manner of Collecting Assessments
H. Proposed Rules and Regulations to be Applied to the District
I. Continuation of Levy Specifically for Maintenance of Improvements
Constructed by the District
J. Type and Term of District and Showing Specific Number of Years
Assessments Will Be Levied
K. Proposed Timeline for Implementation and Completion of Management
District Plan
L. Community Management District Governance
M. Other Items
Appendix A -List of Parcels Including Publicly Owned Parcels
Appendix B -Engineer's Report
2
80A-6
Introduction
Offering a variety of services and amenities for visitors, businesses, and residents,
Downtown Santa Ana is a quaint, historic, yet bustling area located in the heart of the
Santa Ana, the county seat of Orange County. Downtown Santa Ana is home to a
vibrant Latino shopping district, the Artists Village, major office centers, and financial
institutions. Downtown is also home to federal, State, County, and municipal courts and
administrative offices.
A Community Management District (CMD) funds special services that address specific
needs of commercial centers. These services may include special "Clean and Safe"
programs like enhanced maintenance, landscaping, and security; vital Economic
Revitalization programs intended to promote customer and investor confidence, such as
business assistance and attraction, education and information, parking programs, and
the like; and, of course, Marketing and Promotions programs and activities designed to
increase awareness and sales. Marketing and Promotions programs can include
special events, holiday celebrations, music and arts festivals, comprehensive
advertising, branding, public outreach, and more. A CMD also facilitates coordination
among various interests such as City departments, elected officials, community groups
and business leaders to accomplish its goals. This strengthens relationships, increases
cooperation, and integrates the various efforts to thoughtfully improve the district. A
CMD will provide financial and administrative resources to partner with public and
private organizations to bring back the vitality of this lively shopping district.
In 1984, amerchant-based Business Improvement District was established in
Downtown Santa Ana and continues today. Originally managed by the Downtown
Santa Ana Business Association, in recent years program implementation
responsibilities have been divided among different geographical and market sectors.
In 2006, after a number years of economic struggle to revitalize Downtown Santa Ana,
there developed an interest in establishing a Property and Business Improvement
District (PBID). Property owners formed a proponent group and approached the City's
Community Development Agency for assistance to engage a PBID advisor. The City of
Santa Ana approved hiring a consultant to work with Downtown stakeholders in
establishing a new district. Property owners, in partnership with local merchants and the
City, worked together to launch a new effort to create a district. A Formation Committee
was established to direct and advise on the creation of this Management Plan. In June
2008, the CMD Formation Committee requested that the City of Santa Ana amend the
Municipal Code to enable the establishment of Community Management Districts. The
City Council began the amendment process in July 2008.
The formation of the Downtown Santa Ana Community Management District will serve
to enhance the commercial district thereby increasing commerce and prosperity.
I
3
80A-7
B. Name of District
The name of the new District shall be The Downtown Santa Ana Community
Management District.
C. Description of Boundaries and Benefit Zones
The Downtown Santa Ana Community Management District includes a total of
282 parcels represented by 102 individual property owners. With some minor
exclusions resulting from essential boundary adjustments, the District generally
includes all parcels between Walnut Street on the south, Civic Center Drive on
the north, Mortimer Street on the east and Flower Street on the west. This area
represents the core of the greater Downtown and is unique in its combination of
retail, entertainment, government, and professional/office uses as well as its
diversity of market sectors.
The entire District comprises a single benefit zone. All parcels within the above-
mentioned boundaries shall be assessed to fund special benefit services as
outlined in this plan, excluding only those properties owned, occupied by and
operated as a federal, State, County and municipal government. Services will be
provided only to those properties paying into the assessment fund; no services
shall be provided outside the District boundaries.
The Downtown Santa Ana Community Management District encompasses most
properties within the following general description boundaries:
- Flower Street on the west
- First Street from Flower Street to Birch Street and Walnut Street from
Broadway to Orange Street on the south
- Maple Street from Walnut Street to First Street, the easterly property line of
the commercial center known as Downtown Plaza, and Mortimer Street from
Third Street to Santa Ana Boulevard on the east
- Santa Ana Boulevard from Mortimer Street to Bush Street, and Civic Center
Drive from Bush Street to Flower Street on the north
The above description is general and does not account for minor exclusions and
inclusions.
4
80A-8
More precisely, the boundaries are described as follows:
Beginning at a point where the westerly right-of-way line of Flower Street
intersects with the northerly right-of-way line of Civic Center Drive, thence
southerly along the westerly right-of-way line of Flower Street to a point where it
intersects with the southerly right-of-way line of First Street, thence easterly
along southerly right-of-way line of First Street to point where it intersects with
center line on the alley bisecting Block 276, thence southerly along the centerline
of said alley to a point where it intersects with the southerly right-of-way line of
Walnut Street, thence easterly along the southerly right-of-way line of Walnut
Street to a point where it intersects with the westerly right-of-way line of Orange
Street, thence northerly along the westerly right-of-way line of Orange Street to a
point in alignment with an extension of the southerly property line of Parcel
Number 398-517-01, thence easterly along said line, continuing along the
southerly property line of Parcel Number 398-517-01 to a point where it
intersects with the easterly right-of-way line of the alley in Block 517, thence
northerly along the easterly right-of-way line of said alley 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 in alignment with an
extension of the easterly property line of Parcel Number 398-508-19, thence
northerly along said line across First Street and continuing northerly along the
easterly property line of Block 516 to a point intersecting with the southerly right-
of-way line of Third Street, thence westerly along the southerly right-of-way line
of Third Street to a point where it intersects with the easterly right-of-way line of
French Street, thence northerly along said easterly right-of-way line of French
Street to a point where it intersects with the southerly property line of Parcel
Number 398-507-08, thence easterly along said southerly property line of Parcel
Number 398-507-08 to a point where it meets the easterly property line of said
parcel, thence northerly along said easterly property line of Parcel Number 398-
507-08 to a point where it intersects with the southerly right-of-way line of Fourth
Street, thence easterly along the southerly right-of-way line of Fourth Street to a
point where it intersects with a point in alignment with an extension of the
easterly right-of-way line of Mortimer Street, thence northerly along said line
across Fourth Street along and continuing northerly along the easterly right-of-
way line of Mortimer Street to a point where it intersects with the northerly right-
of-line of Santa Ana Boulevard, thence westerly along the northerly right-of-line
of Santa Ana Boulevard to a point where it intersects with the easterly right-of-
line of Bush Street, thence northerly along the easterly right-of-way line of Bush
Street to a point where it intersects with the northerly right-of-line of Eighth
Street, thence westerly along the northerly right-of-way line of Eighth Street to a
point where it intersects with the westerly right-of-line of Main Street, thence
southerly along the westerly right-of-way line of Main Street to a point where it
intersects with the northerly property line of Parcel Number 398-244-02, thence
westerly along said northerly property line of Parcel Number 398-244-02 and
Parcel Number 398-244-01 and extending across Sycamore Street and
continuing westerly to a point where it intersects with the northerly right-of-way
5
80A-9
line of Civic Center Drive, thence along the northerly right-of-way line of Civic
Center Drive westerly to the point of beginning.
D. List of Improvements and Activities Proposed for Each Year of
Operation and Maximum Costs
A description of Improvements is as follows:
1. Maintenance and Landscaping Services
Maintenance may include sidewalk sweeping and pressure washing, gum
removal, graffiti abatement, trash and/or bulky item removal; the watering,
weeding and pruning of all trees and plantings; alley/median/parkway
maintenance; litter and debris pick-up; trash receptacle collection/disposal
and maintenance/replacement; and other maintenance and landscaping
issues that may arise.
Each maintenance service will assist in beautifying the Downtown District
and enhancing the image of the commercial core. This activity is
designed to increase customer comfort within the greater Downtown which
will, in turn, increase commerce and help to attract and retain new
businesses and patrons within the District. These maintenance services
will be provided only within the District; therefore, these services constitute
"special benefits" to the assessed parcels.
2. Marketing and Promotions
This activity is intended to enhance the image of Downtown Santa Ana
through sophisticated marketing, advertising and branding of the
Downtown. It will heighten the excitement and pleasure of the customer
and visitor experience by way of holiday celebrations, special events,
festivals, promotions and sales, art shows, live music, and similar
customer attractions. This activity also includes those types of
supplemental activities such as newsletters, visitor guides, graphics arts
materials, business improvement workshops, and the like.
3. Downtown Ambassador Program
Uniformed customer assistance Ambassadors will provide a variety of
business and customer support services by assisting patrons and
employees, supporting SAPD crime prevention efforts to reduce the
incidence of crime and nuisance activities, and productively addressing the
challenges associated with street populations. Deployment of Downtown
Ambassadors can include highly visible foot, bicycle or Segway patrols that
will provide service during critical, high-impact periods. The initial
deployment will be when their services are most needed. Actual days and
6
80A-10
times are still to be determined, but Ambassador assignments can change
as necessary.
The Downtown Ambassador Program will assist in creating a safe and
secure environment throughout the Downtown area and, hence, will
enhance the economic revitalization. This activity is designed to increase
vehicular and pedestrian traffic within the District which will increase
commerce and help to attract new and retain existing businesses and
patrons. This Ambassador Program will be provided only within the CMD
boundaries; therefore these services constitute "special benefits" to the
assessed parcels.
4. Physical Enhancement & Amenities
The Physical Enhancement category consists of capital improvements that
may include tree/landscape planting, additional street furniture, fixtures
and equipment, and other streetscape amenities the Board deems
appropriate. These amenities include light pole and skyline banners,
advertising and information kiosks, decorations, directories, and special
lighting.
These improvements will beautify and enhance the image of Downtown
Santa Ana and thereby increase pedestrian and vehicular traffic to the
District. This activity is designed to enhance the shopping experience
within the District boundaries. Because the Physical Enhancement
program will be provided only within the District, these improvements will
constitute "special benefits" to the assessed parcels.
5. Administration and Operations
Included in the Administration component are the costs for an Executive
Director, Marketing & Promotions Coordinator, office support staff, office
expenses, legal fees, accounting/bookkeeping fees, and Directors &
Officers and General Liability insurance.
This component is vital to the proper expenditure of assessment funds
and the administration of programs and activities which are intended to
promote business within the CMD boundaries through increased
commerce and the attraction and retention of new business. Because this
operating cost/administration program exists only for the purposes of the
District and will be provided only for matters occurring within the CMD
boundaries, this program constitutes a "special benefit" to the assessed
parcels.
NOTE: Existing City services will be supplemented, not
supplanted or duplicated, by Management District services.
7
80A-11
Each of these programs and activities work together to create a more
pleasing environment within the District that is conducive to strengthening
the economic vitality of this commercial center through the attraction and
retention of new business and increased commerce. The programs,
improvements, and services are designed to specifically benefit properties
within the CMD boundaries. The proposed CMD assessments will be
levied only on properties within the CMD boundaries. Assessment
revenues will be spent to deliver services that provide a direct and special
benefit to assessed parcels and to improve the economic vitality of these
properties.
PROJECTED FIVE-YEAR BUDGETS/PROGRAM COSTS
REVENUE
Source Year 1 Year 2 Year 3 Year 4 Year 5
CMD Assessments $920,000.00 $966,000.00 $1,014,300.00 $1,065,015.00 $1,118,265.75
All Other $30,000.00 $31,500.00 $33,075.00 $34,728.75 $36,465.19
$950,000.00 $997,500.00 $1,047,375.00 $1,099,743.75 $1,154,730.94
EXPENDITURES
Programs & Activities Year 1 Year 2 Year 3 Year 4 Year 5
Maint & Landscaping $220,135.00 $231,141.75 $242,698.83 $254,833.77 $267,575.45
Marketing & $372,990.00 $391,639.50 $411,221.47 $431,782.54 $453,371.66
Promotions
Ambassador Program $183,390.00 $192,559.50 $202,187.47 $212,296.84 $222,911.68
Physical $48,825.00 $51,266.25 $53,829.56 $56,521.04 $59,347.09
Enhancement
Admin & Operations $124,660.00 $130,893.00 $137,437.65 $144,309.53 $151,525.00
TOTAL $950,000.00 $997,500.00 $1,047,375.00 $1,099,743.75 $1,154,730.94
8
80A-12
All projects and activities are designed to enhance the assets and image
of Downtown Santa Ana, and thereby increase commerce and promote
business within the boundaries of the CMD. The annual budget for the
first year is estimated to be $950,000. Of that amount, $920,000 is to be
generated through special assessments. The nonprofit Management
District Corporation shall have the right to reallocate up to 35 percent of
the total budget within the budget categories. Accrued interest or
delinquent payments may be expended in any budget category.
Any funds remaining after the fifth year of operation will be rolled over into
the renewal budget or returned to stakeholders. Also, if the funds are
available in the fourth or fifth year of operations, costs for renewal may be
expended. If the District is not renewed or terminated for any reason,
unexpended funds will be returned to the property owners.
9
80A-13
E. Total Annual Amount Proposed for Improvements, Maintenance and
Operations for Each Year of Operation
BUDGET SUMMARY -Revenue & Expense
REVENUE -FIRST YEAR
CMD Assessments $920,000
All Other 30,000
TOTAL REVENUE $950,000
EXPENDITURES -FIRST YEAR
Maintenance & Landscaping Services $220,135 23.2%
Marketing & Promotions 372,990 39.2%
Ambassador Program 183,390 19.3%
Physical Enhancement & Amenities 48,825 5.1
Administration & Operations 124,660 13.1
TOTAL EXPENDITURES $950,000 100.0%
FIRST YEAR OPERATIONS -PROGRAM SUMMARY
Maintenance & Landscape Services
Done by contract service providers (daily litter & debris pick-up, daily trash
collection, daily receptacle cleaning & maintenance, gum removal, graffiti
abatement, sidewalk washing FF&E maintenance & repair)
Marketing & Promotions
Special events, holiday celebrations, social events (art walks, concerts),
merchant promotions, co-op and piggyback opportunities, print material and
graphics, advertising (district-wide and targeted), newsletter, business
enhancement (business attraction and retention)
Ambassador Program
Contract Service (Allocation allows for added security of approximately 110 hours
per week deployed at PBID's discretion.)
Physical Enhancement & Amenities
FF&E, banners, kiosks, signage, decorations, directories, lighting
Administration & Operations
10
80A-14
Personnel, direct administrative costs
During the term of the Community Management District, the annual budget and
corresponding assessments may be adjusted to reflect an annual cost of
operations increase of five percent. This is the maximum allowable increase
based upon this Management District Plan utilizing the approved assessment
methodology. This increase may be imposed at the discretion of the Owners
Association. The Owners Association shall make a notification to the City
annually as to whether any adjustments to the current year's assessment rates
will be made.
Additionally, any annual budget surplus or deficit will be incorporated into
the subsequent year's CMD budget, and subsequent annual assessments
will be set to account for surpluses or deficits carried forward.
PROJECTED FIVE-YEAR BUDGETSIPROGRAM COSTS
REVENUE
Source Year 1 Increase Year 2 Incre°ase Year 3 Incre°ase Year 4 Incre°ase Year 5
CMD Assessments $920,000.00 5.00% $966,000.00 5.00% $1,014,300.00 5.00% $1,065,015.00 5.00% $1,118,265.75
All Other $30,000.00 5.00% $31,500.00 5,00% $33,075.00 5.00% $34,728.75 5.00% $36,465.19
$950,000.00 $997,500.00 $1,047,375.00 $1,099,743.75 $1,154,730.94
EXPENDITURES
Programs & Activities Year 1 Increase Year 2 Incre°ase Year 3 Incre°ase Year 4 Incre°ase Year 5
Maint & Landscaping $220,135.00 5.00% $231,141.75 5.00% $242,698.83 5.00% $254,833.77 5.00% $267,575.45
Marketing & $372,990.00 5.00% $391,639.50 5.00% $411,221.47 5.00% $431,782.54 5.00% $453,371.66
Promotions
Ambassador Program $183,390.00 5.00% $192,559.50 5.00% $202,187.47 5.00% $212,296.84 5.00% $222,911.68
Physical $48,825.00 5.00% $51,266.25 5.00% $53,829.56 5,00% $56,521.04 5.00% $59,347.09
Enhancement
Admin & Operations $124,660.00 5.00% $130,893.00 5.00% $137,437.65 5.00% $144,309.53 5.00% $151,525.00
TOTAL $950,000.00 $997,500.00 $1,047,375.00 $1,099,743.75 $1,154,730.94
80A-15
F. Proposed Sources of Financing, Including Method and Basis of
Levying of Assessment
The Downtown Santa Ana Community Management District anticipates two
general sources of revenue -special assessment revenue which is the principal
source of funding (97 percent), and program income which includes funding from
sources such as sponsorships, sales of goods and services, dues, interest
income, and the like. The Downtown Santa Ana Community Management
District is a benefit assessment-type district whereby special service and district
program costs are apportioned among benefitting properties based on the
special benefit each property is expected to derive from those services and
programs. This method of financing such special services and programs is based
upon the levy of assessments on real property that benefit from proposed
improvements and activities.
The method and basis of spreading program costs vary from one district to
another based on local geographic conditions, types of programs and activities to
be undertaken, and size and development complexity. Further, general benefits
may not be incorporated into the assessment formula and levied on the CMD
properties; only special benefits and cost may be considered. Assessment
formulae typically relate to the physical factors of a parcel such as street
frontage, lot size, building size, location. The formula may base assessments on
a single factor or a combination of factors.
Based on the program activities to be funded, which relate substantially to the
pedestrian-oriented sidewalk areas/public walkways, parcel size and physical
improvements, it is determined that the assessments be based in part on four
property-related elements:
• The amount of adjacent street/sidewalk frontage (linear feet)
• The parcel size (total land area)
• The building area
• A flat parcel fee
These variables were developed by the consulting engineer and presented to a
focus group that was conducted for purposes of gathering a consensus of
affected property owners. The focus group included key stakeholders in the
Downtown. The variables and formulae were verified as equitable by an
Engineer's Report.
The assessment formula utilized in the Downtown Santa Ana Community
Management District is comprised of these four variables, each with a relative
weighting derived from program benefit. The variables are:
12
80A-16
Street/Sidewalk Frontage 30% or $276,000
Parcel Size (Land Area) 30% or $276,000
Building Area 30% or $276,000
Flat Parcel Fee 10% or $ 92,000
100% $920,000
Within the CMD there are 282 parcels with roughly 60,000 linear feet of street
frontage, 4 million square feet of land and 2.5 million square feet of building area.
A list of all parcels in the CMD is shown in Appendix A. Using the cumulative
property-related data totals from above, the base Year 1 assessment rates are
set at $6 per linear foot of street frontage, 10 cents per square foot of land area,
and 15 cents per square foot of building area (based on gross exterior building
dimensions). The parcel fee shall be $425 per parcel.
Due to identified diminished benefits and a number of formula adjustment factors
for certain land uses, parcel configurations and other circumstances are also
incorporated into the proposed CMD formula as follows:
1. Residential uses from one to four units are set at a flat rate of $100 per unit
(includes residential condos).
2. Residential uses of five or more units are set at 50 percent of respective base
assessment rates (apartments).
3. Nonprofit- (501 c3) owned/occupied properties are set at 50 percent of
respective base assessment rates.
4. Building areas are capped at a floor area ratio (FAR) of 4.0.
5. Government-owned/occupied properties will not be assessed and will receive
no direct services.
6. Residential uses, regardless of the number of units, that are 100 percent
project-based rental assistance programs; for example, senior housing and
the like, will not be assessed and will receive no direct services.
7. Mixed-use properties/complexes will generally be assessed based on
prorated land-use ratios, using the following guidelines:
Commercial/Office Condos - No Residential Uses (multiple owners)
a. Building area fee at full building area fee rate (structured parking area
excluded).
b. Land area fee at full land area fee rate but prorated for each unit based on
ratio of unit building area to total building area. i
13
80A-17
c. Frontage fee at full frontage rate but prorated for each unit based on ratio
of unit building area to total building area.
Mixed-Use Rental: Ground-Floor Commercial and Upper-Floor Residential
(single owner)
a. Building area fee at full rate for commercial area and 50 percent
commercial rate for residential area (structured parking area excluded).
b. Land area fee at full land area fee rate.
c. Frontage fee at full frontage rate.
Mixed-Use Condos: Ground-Floor Commercial and Upper-Floor Residential
(multiple owners)
a. Building area fee at full rate for commercial pad areas and $100 per year
per residential condo unit (structured parking area excluded).
b. Land area fee at full land area fee rate for commercial pad footprint.
c. Frontage fee at full frontage rate for commercial units (ground floor direct
frontage).
d. Live-work condo units will be assessed using a combination of a, b, and c
above.
YEAR ONE ASSESSMENT CALCULATION
A parcel's first annual assessment is calculated as follows. Any applicable
adjustment factors are applied after the calculation of the parcel's assessment at
the full rate.
ANNUAL ASSESSMENT =Street Frontage Fee + Land Area Fee +
Building Area Fee + Parcel Fee
Street Frontage Fee is calculated by multiplying the linear feet of street frontage
of a parcel by the Street Frontage Rate ($6 per linear foot).
Land Area Fee is calculated by multiplying the square footage of the parcel by
the Land Area Rate (10 cents per square foot)
Building Area Fee is calculated by multiplying the square footage of a structure,
as derived from its gross exterior dimensions, by the Building Area Rate (15
cents per square foot).
14
80A-18
Flat Parcel Fee -each individual Assessor's Parcel is assessed the Flat Parcel
Rate ($425).
Street Fronta a Rate Land Area Rate Buildin Area Rate Flat Parcel Rate
$6.00 er linear foot 10¢ er s uare foot 15¢ er s uare foot $425 er arcel
During the term of the CMD, the annual budget and corresponding assessments
may be adjusted to reflect an annual cost of operations increase of five percent.
Since the CMD is planned for afive-year term, maximum assessments for future
years (years 2-5) must be set at the inception of the CMD. While future
inflationary and other program cost increases are unknown at this point, abuilt-in
maximum increase of five percent per year is incorporated into the projected
program cost and, in turn, the resulting assessment rates for the five-year life of
the CMD. These figures are shown in the table below. Assessment rates may
not exceed those indicated below.
Five-Year Maximum Assessment Rates (Includes a 5 percent cap on annual
increases)
Rate Year One Year Two Year Three Year Four Year Five
Street Frontage Fee $6 $6.30 $6.62 $6.95 $7.30
Land Area Fee 10¢ 10.5¢ 11 ¢ 11.6¢ 12.2¢
Building Area Fee 15¢ 15.8¢ 16.6¢ 17.4¢ 18.3¢
Flat Parcel Fee $425 $446 $469 $491 $516
Any annual budget surplus or deficit will be incorporated into the subsequent
year's CMD budget, and subsequent annual assessments will be set to account
for surpluses or deficits carried forward.
G. Time and Manner of Collecting Assessments
Pursuant to analogous law pertaining to Property and Business Improvement
Districts, the Santa Ana Downtown Community Management District assessment
will be collected by the County of Orange in the same manner as annual property
taxes are collected, and will appear as a separate line item on the annual
property tax bills prepared and issued by the County. Property tax bills are
generally distributed to property owners in the fall, and payment is expected by
lump sum or in two installments. The County of Orange shall distribute the
assessments to the City which will, in turn, forward the assessments to the
15
80A-19
managing association pursuant to the authorization of this plan. Existing laws for
enforcement of property taxes apply to the District's assessments.
The assessments shall be collected at the same time and in the same manner as
for any ad valorem property tax paid to the County of Orange. These
assessments shall provide for the same lien priority and penalties for delinquent
payment as is provided for the ad valorem property tax. If necessary, the
Santa Ana City Clerk's Office will directly bill property owners or entities that do
not appear on the direct billing of the property tax roll provided by the County.
The "property owner" of the ad valorem interest shall be any person listed as the
owner/taxpayer on the last equalized ad valorem interest assessment roll or
otherwise known to be the owner/taxpayer by the City.
H. Proposed Rules and Regulations to be Applied to the District
There are no specific rules or regulations applied to this District.
I. Continuation of Levy Specifically for Maintenance of Improvements
Constructed by the District
In accordance with Section 13-103 (i) of Article XX, Chapter 13, Santa Ana
Municipal Code, it shall be a requirement of the Downtown Santa Ana
Community Management District that assessments specifically designated for the
maintenance and upkeep of improvements constructed by the District using
assessment revenue, if any, shall continue to be levied on each parcel of land
within the CMD for a period of time equal to the useful life of the improvement, as
determined by the City Engineer, regardless of whether the District is
disestablished or the term of the original levy has expired.
J. Type and Term of District and Showing Specific Number of Years
Assessments Will Be Levied
The proposed Downtown Santa Ana Community Management District is a new
district. The CMD will have an initial operating term of five years. Due to the
time and manner of levying and collecting assessments as described in Section
G, assessment revenue is generally not available for direct operations until the
following January. The CMD will commence with the first year of levying of
assessments in August of 2009, and the first year of programs and activities
beginning in January of 2010, as assessment funds become available. The final
assessment shall be levied by August of 2013 with the fifth year of programs and
activities commencing in January of 2014, as assessment funds become
available. Program operations are expected to be complete by December 31,
2014. Any continuation of the CMD after the initial five-year period will require
16
80A-20
compliance with the regulations in place at that time relative to establishment of a
Community Management District.
An assessment for the maintenance of improvements constructed by the CMD, if
any, may extend beyond the original five-year term as described in Section I of
the Management District Plan.
K. Proposed Time for Implementation and Completion of Management
District Plan
Task to be Completed Estimated Date of
Completion
Completion and approval of Management District Plan. August 2008
Send complete Management District Plan to Assessment Engineer. August 2008
Complete petition drive reflecting support of property owners in the August -September
proposed district who will pay more than 30 percent of the assessment 2008
ro osed to be levied.
Submit completed petitions to City Clerk. September 2008
Resolution of Intention setting a public hearing and ordering the October 2008
distribution of ballots ado ted b Cit Council.
P Y Y
Ballots returned to City Clerk. December 1, 2008
Public Hearing/counting of returned ballots, consideration of ordinance December 1, 2008
by Santa Ana City Council establishing the District.
L. Community Management District Governance
Downtown, Incorporated will be the agency responsible for the ongoing day-to-
day management and administration of the Downtown Santa Ana Community
Management District (CMD). Downtown, Incorporated is an existing nonprofit
corporation formed by business and property owners located in Downtown
Santa Ana. Downtown, Incorporated may choose to contract with third-party
entities to carry out the District programs and activities.
The annual programs, budgets, and assessments for the Downtown Santa Ana
Community Management District shall be determined by Downtown,
Incorporated, which shall also serve as the Community Management District
"owners association" described in Article XX Chapter 13 of the Santa Ana
Municipal Code. Such programs, budgets, and assessments must be consistent
with this Management Plan. Downtown, Incorporated shall be responsible for the
general oversight of the District including approval of the annual work programs
and budgets, monitoring performance, and ensuring compliance with appropriate
rules and regulations, including a Community Management District management
17
80A-21
agreement with the City of Santa Ana. Upon Community Management District
adoption/renewal, the City of Santa Ana and Downtown, Incorporated will
execute a contract for the performance and delivery of the stipulated program
services over the life of the District.
The Board of Directors of Downtown, Incorporated shall meet generally on a
monthly basis. When related to Community Management District matters, such
meetings shall be subject to the State of California "Brown Act" open meeting
requirements. Records of this corporation pertaining to Community Management
District-related matters shall be available for public review as stipulated by State
law. Pursuant to the Municipal Code, the Downtown, Incorporated Board of
Directors shall file, for approval by the City Council, an annual report for the
upcoming year for which assessments shall be levied.
Downtown, Incorporated will employ a management professional as Executive
Director/CEO whose duties shall include the implementation of the programs and
activities of the CMD as well as the management of the day-to-day affairs of the
CMD and Downtown, Incorporated. Additional staff may be employed as needed
and as provided for in the budget.
M. Other Items
No bonds will be issued for any CMD projects.
H:\New BID Formation\BID Consultant\Management District Formation Committee\MANAGEMENT DISTRICT PLAN
Amended 5.09.docx
Ig
80A-22
r~ownTown
INCORPORATED
Proposed 2009 Budget
DOWNTOWN SANTA ANA COMMUNITY MANAGEMENT DISTRICT
REVENUE
Board of Directors' Direct Loans $186,320
TOTAL REVENUE $186,320
GENERAL/ ADMINISTRATIVE OPERATING EXPENDITURES
Personnel Services $82,000
Supplies 5,000
Other Services and Charges 30,000
Furniture, Fixtures & Equipment (Office Start-up) 30,000
TOTAL GENERAL/ADMIN OPERATING EXPENSE $147,000
PROGRAM EXPENDITURES
Marketing & Promotions 39 320
TOTAL PROGRAM EXPENSE 39 320
TOTAL EXPENDITURES 186 320
Exhibit 2
80A-23
80A-24
JWF (05/08/09)
RESOLUTION NO. 2009-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA AMENDING THE MANAGEMENT DISTRICT
PLAN FOR THE DOWNTOWN SANTA ANA COMMUNITY
MANAGEMENT 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 Cit of Santa Ana hereb finds determines
v Y ,
and declares as follows:
A. On December 15, 2008, b Resolution No. 2008-078 ursuant to Article
Y ,p
XX of Chapter 13 of the Santa Ana Municipal Code (the "Law"), the City
Council established the Downtown Santa Ana Community Management
District (CMD).
B. Resolution 2008-078 and the Management District Plan for the CMD
called for the assessment to be levied commencing with Fiscal Year 2008-
2009 and for the CMD to be operative from January 1, 2009 to December
31, 2013.
C. Economic considerations have dictated that both the initial assessment
and operative term be delayed one year.
D. The City Council has adopted Resolution No. 2009-020 stating its intent to
consider, at a public hearing on May 18, 2009, amending the Management
District Plan to levy the initial assessment for Fiscal Year 2009-2010 and
fort the CMD to be operative from January 1, 2010 through December 31,
2014.
E. Pursuant to Section 13-112 of the Law, notice of the draft resolution of
intention was sent to all assessees and published. Following adoption,
the resolution was again published.
Section 2. A duly noticed public hearing was held on May 18, 2009 as
required by the Law.
Section 3. The Management District Plan for the Downtown Community
Management District are hereby amended as follows:
Section G. The last sentence is hereby deleted.
Resolution No. 2009-XXX
8~A-25 Page 1 of 3
Section J is hereby amended to revise the commencement and termination dates
of the Plan from commencing on January 1, 2009, and terminating on December 31,
2013 to commencing January 1, 2010 and terminating on December 31, 2014.
Section 4. The Management District Plan for the Downtown Community
Management District, as amended to reflect the changes set forth in Section 3 of this
Resolution and on file in the Office of the Deputy City Manager for Development
Services, is hereby approved and shall supersede the Plan previously approved by the
City Council.
Section 5. Section 6 of Resolution 2008-078 is hereby amended to provide
that the initial assessment shall be levied for Fiscal Year 2009-2010 and ending with
Fiscal Year 2013-2014.
Section 6. 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 day of May, 2009.
Miguel A. Pulido
Mayor
APPROVED AS TO FORM:
By:
Joseph W. Fletcher, City Attorney
AYES: Councilmembers
NOES: Councilmembers
ABSTAIN: Councilmembers
NOT PRESENT: Councilmembers
Resolution No. 2009-
8~A~26 Page 2 of 3
CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, PATRICIA E. HEALY, Clerk of the Council, do hereby attest to and certify the
attached Resolution No. 2009-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
Resolution No. 2009-XXX
8~A~27 Page 3 of 3
i
80A-28
AGREEMENT FOR COMMUNITY MANAGEMENT
DISTRICT SERVICES
This agreement is made on day of 2009, between the City of Santa
Ana, a charter city and municipal corporation duly organized and existing under the Constitution
and laws of the State of California, (the "CITY") and Downtown Incorporated, a California non-
profit corporation, (the "ASSOCIATION").
RECITALS:
A. Pursuant to its Resolution No. 2008-078 (the "RESOLUTION") the City (:ouncil of the
CITY has established a community management district designated as the "Downtown
Community Management District " (the "DISTRICT"), under Article XX of Chapter 13 of
the Santa Ana Municipal Code (the "ORDINANCE"); and
B. Pursuant to the Resolution and the Ordinance, assessments will be levied annually against the
assessable parcels in the DISTRICT commencing with Fiscal Year 2009-2010 and
continuing through Fiscal Year 2013-2014; and
C. Such assessments may be used only for the purposes set forth in the Resolution; and
D. The CITY desires to use the assessments to contract for the administration of a program of
improvements and activities in connection with the DISTRICT for Fiscal Years 2009-2010
through 2013-14; and
E. Section 13-209 of the Ordinance authorizes the CITY to contract with anon-profit owners
association to manage the district on a day-to-day basis.
F. The ASSOCIATION represents that it is a private nonprofit corporation registered and in
good standing with the California Secretary of State qualified to serve pursuant to the
Ordinance.
G. The CITY seeks to contract with the ASSOCIATION to administer such program of
improvements and activities.
NOW, THEREFORE, the CITY and ASSOCIATION mutually agree as follows:
1. TERM OF AGREEMENT
1.1. The term of this Agreement shall be from July 1, 2009 to and including December
31, 2015.
1.2. In the case of a default by the ASSOCIATION, the CITY may terminate this
Agreement by giving written notice to the ASSOCIATION.
80A-29
1.3. Upon termination or expiration of this Agreement, all unexpended moneys for the
DISTRICT and all assets purchased with DISTRICT funds shall be returned to the
CITY.
2. USE OF FUNDS
2.1. Funds received by the ASSOCIATION pursuant to this Agreement shall only be
expended for the purposes stated in the Resolution and authorized by the
Ordinance. Such funds shall be expended in accordance with the Management
District Plan.
3. ASSOCIATION RESPONSIBILITIES
3.1. The ASSOCIATION shall administer the DISTRICT work program and perform
all of the services specified in the Management District Plan and shall cooperate
with the City Manager of the CITY or such personnel as the City Manager
designates.
3.2. Throughout the term of this Agreement, the ASSOCIATION shall submit to the
CITY's Finance Director the following:
3.2.1. Annual Report -The ASSOCIATION shall submit a report for the current
Fiscal Year complying with the Section 13-211 of the Ordinance. The
timing of submittal of the Annual Report shall be as directed by the City's
Deputy City Manager for Development Services.
3.2.2. Financial Statements -The ASSOCIATION shall submit a statement of
income and expenses of the ASSOCIATION in relation to the DISTRICT,
reviewed by a Certified Public Accountant covering the previous Fiscal
Year.
3.2.3. Within 10 days of a request of the CITY's Finance Director, the
ASSOCIATION shall provide such other financial information of the
ASSOCIATION in relation to the DISTRICT as the CITY's Finance
Director shall reasonably request.
3.3. The ASSOCIATION hereby agrees to comply with all State and local laws and
regulations as they relate to the administration of the DISTRIC"C, including all
open meeting and public records laws.
4. CITY RESPONSIBILITIES
4.1. The CITY shall submit to the County of Orange each year an annual assessment
roll for the DISTRICT and shall disburse the DISTRICT assessment revenues
80A-30
received by the CITY from the County of Orange to the ASSOCIATION in
accordance with Section 5.1 hereof.
4.3. With respect to any public agencies for which the County of Orange does not bill
the annual DISTRICT assessments, the CITY shall hand bill such agencies for the
DISTRICT assessments, provided that the CITY shall have no responsibility to
enforce the collection of such assessments.
4.4. The CITY shall make available to the ASSOCIATION such information in its
possession, except for information which is determined to be confidential
information by the City Attorney, which is necessary for implementation of the
DISTRICT work program.
4.5. The CITY shall report to the ASSOCIATION on a regular basis as to the status of
DISTRICT assessment revenues thus far collected so that the ASSOCIATION
can adjust its budget and work program accordingly.
5. DISBURSEMENTS
5.1. Commencing with Fiscal Year 2009-2010 and continuing through Fiscal Year
2013-2014, the CITY shall annually remit to the ASSOCIATION the DISTRICT
assessment revenues collected by the County of Orange and paid to the CITY
within 30 days of receipt of such revenues by the CITY from the County of
Orange.
6. AUDITS, ACCOUNTING AND AUDIT EXCEPTIONS
6.1. The ASSOCIATION's program, as it relates to the DISTRICT, will be audited in
accordance with policy and funding guidelines established by the CITY from time
to time. The CITY or its authorized representatives shall, with 10 days' prior
notice, have access for the purpose of audit or inspection to any and all books,
documents, papers, records, property and premises of the ASSOCIATION.
6.2. The ASSOCIATION'S staff will cooperate fully with authorized auditors when
they conduct audits and examinations of the ASSOCIATION'S program, as it
relates to the DISTRICT. If indications of misappropriation or misapplication of
the funds governed by this Agreement cause the CITY to require a special audit,
the cost of the audit shall be paid by the ASSOCIATION. Should it be
subsequently determined that the special audit was not reasonably warranted, the
amount will be restored to the ASSOCIATION. The right to audit, as provided by
this Section, shall be for a period of three (3) years from the date of submission of
the financial report in question or any indication or notice to the CITY of any
misappropriation or misapplication of funds by the ASSOCIATION, whichever is
later.
80A-31
6.3. The ASSOCIATION will establish and maintain on a current basis an adequate
accrual accounting system in accordance with generally accepted accounting
principles and standards. The system shall detail all costs chargeable to the
DISTRICT under this Agreement and shall substantiate all such costs, meeting
acceptable standards for major public entities in Southern California and
complying with any applicable Federal standards. The system shall meet the
minimum fiscal and internal control requirements as reasonably determined by the
CITY.
7. INSURANCE
ASSOCIATION shall, at its own expense, procure and maintain policies of insurance of
the types and in the amounts set forth below, for the duration of this agreement, including
any extensions thereto. The policies shall state that they afford primary coverage.
7.1.1 General Liability with minimum limits of at least $1,000,000 combined
Premises/Operations and Personal Injury coverage is required. The City
of Santa Ana, its directors, commissioners, officers, employees, agents and
volunteers must be endorsed on the policy as additional insured as respects
liability arising out of the ASSOCIATION's performance of this
Agreement.
A. If ASSOCIATION employs other contractors as part of its
performance under this agreement, Contractor's Protective
Coverage is required. ASSOCIATION may insure all
subcontractors under its own policy or shall procure and furnish
separate insurance for each subcontractor, meeting the
requirements set forth herein.
B. Blanket Contractual Coverage.
C. Personal Injury and Advertising Coverage.
7.1.2 ASSOCIATION shall comply with the applicable sections of the
California Labor Code concerning workers' compensation for injuries on
the job. Compliance is accomplished in one of the following manners:
A. Provide copy of permissive self-insurance certificate approved by
the State of California; or
B. Provide a copy of permissive self-insurance certificate approved by
the State of California; or
C. To the extent that the ASSOCIATION has employees, the
ASSOCIATION shall secure and maintain in force a policy of
workers' compensation insurance with statutory limits and
Employer's Liability Insurance with a minimal limit of $1,000,000
per accident. The policy shall be endorsed to waive all rights of
80A-32
subrogation against City, its directors, commissioners, officers,
employees, and volunteers for losses arising from performance of
this Agreement; or
D. Provide a signed statement certifying that no employees subject to
the Labor Code's Workers' Compensation provision will be used in
performance of this Contract.
7.1.3 ASSOCIATION shall procure and maintain at its own expense a policy
covering its Directors & Officer Liability with minimal limits of
$1,000,000.
7.1.4 Each insurance policy included in this clause shall be endorsed to state
that coverage shall not be cancelled except after thirty (30) days' prior
written notice to CITY, and that coverage is primary to any other coverage
available to CITY.
7.1.5 Prior to commencement of performance, ASSOCIATION shall furnish
CITY with a certificate of insurance for each policy. Each certificate is to
be signed by a person authorized by that insurer to bind coverage on its
behalf. The certificate(s) must be in a form approved by CITY. CITY
may require complete, certified copies of any or all policies at any time.
7.2 Failure on the part of the ASSOCIATION to procure or maintain required
insurance shall constitute a material breach of contract under which CITY
may immediately terminate this agreement.
7.3 The City Manager of the CITY is hereby authorized to modify the
insurance requirement of this Section as he or she may deem appropriate
from time to time.
8. NOTICES
8.1. All notices, plans, or reports permitted or required under this Agreement shall be
in writing, and shall be deemed made when personally delivered to the following
persons as provided in this Agreement. Additionally, such notices shall be
deemed made 48 hours after deposited in the U.S. Mail, first class postage prepaid
and addressed to the respective parties at the following address, or at such other
address as the respective parties may provide in writing for this purpose:
CITY OF SANTA ANA
20 Civic Center Plaza M-25
Santa Ana, California 92701
Attention: Deputy City Manager of Development Services
80A-33
DOWNTOWN INCOPORATED
Santa Ana, CA 92701
President
9. RESERVED.
10. NONDISCRIMINATION.
10.1. The ASSOCIATION represents and agrees that it does not and will not
discriminate against any employee or ap licant for em to ment because of
p P y
political affiliation or opinion, age, ancestry, marital status, physical condition,
pregnancy or pregnancy-related condition, race, religion, color, sex, sexual
orientation, national origin or medical condition.
11. GENERAL PROVISIONS.
11.1. Assi nment. Neither this Agreement, nor any interest herein, shall be assigned by
any party without the prior written consent of the other party.
11.2. Independent Contractor. It is agreed and understood that the ASSOCIATION is a
wholly independent contractor. This Agreement is not intended and shall not be
construed to create the relationship of agent, employee, servant, partnership, joint
venture or association as between the CITY and the ASSOCIATION. Neither the
CITY nor its agents shall have control over the conduct of the ASSOCIATION
except as set forth herein. The CITY shall have no liability or responsibility for
payment of any wage or benefits to the ASSOCIATION'S employees, for whom
the DISTRICT shall bear sole responsibility and liability.
11.3. Default of Contractor. In the case of default by the ASSOCIATION in providing
any service, or in performing this Agreement, the CITY may, in addition to all
other remedies it may have, including but not limited to termination of the
Agreement and/or filing of a suit at law or equity, obtain such services from other
sources and deduct the cost thereof from any costs due or thereafter owing to the
ASSOCIATION relating to such items or to otherwise claim and collect such
costs.
11.4. Indemnity. The ASSOCIATION shall indemnify and hold the CITY harmless
and defend, with counsel acceptable to the CITY, the CITY and every officer,
employee and agent of the CITY, from any and all claims, causes of action,
damages to persons or property, penalties, obligations, liabilities or financial
losses, including, without limitation, attorney's fees and court costs arising
directly or indirectly from any or all negligent or other wrongful acts, errors or
omissions of the ASSOCIATION, its agents, employees and subcontractors in the
performance of this Agreement.
80A-34
11.5. Entire Agreement. This Agreement contains the entire agreement of the parties
with respect to the subject matter hereof. This Agreement may only be modified
in writing signed by both parties.
11.6. Governing_Law. This Agreement shall be governed by the laws of the State of
California.
11.7. Time of Essence. Time is of the essence of each and every provision of this
Agreement.
ATTEST: CITY OF SANTA ANA
By:
Patricia E. Healy David N. Ream
Clerk of the Council City Manager
APPROVED AS TO FORM:
Joseph W. Fletcher
City Attorney
DOWNTOWN INCORPORATED
By:
Its:
80A-35
LOAN AGREEMENT
This AGREEMENT is entered into this day of , 2009 among the City of
Santa Ana, a charter city, duly organized and existing under the Constitution and laws of the
State of California, (hereinafter "City"), the Community Redevelopment Agency of the City of
Santa Ana, a public body, corporate and politic, and Downtown Incorporated, a California non-
profit corporation, (hereinafter "Downtown, Inc.").
RECITALS
A. On December 15, 2008 the City Council of the City of Santa Ana established the
Downtown Community Management District (the "CMD") to promote economic
revitalization and physical maintenance of Downtown Santa Ana through the levy,
collection and expenditure of funds.
B. Pursuant to state law, governmental agencies such as the City and Agency which own
property within an assessment district must be assessed for special benefits conferred
upon such governmental properties.
C. The first assessments for the CMD will not be received and be available for use in
the district until January 2010 and is in the interest of the property owners in the
district that some of the programs called for under the Management District Plan
begin in the first half of Fiscal Year 2009-2010.
D. The board of directors of the CMD, including the City and Agency have been
requested to loan an amount equal to the estimated first year assessment to
Downtown, Inc., who shall be the management entity for the district under agreement
with the City (the "Management Agreement").
E. The loans shall be repaid by Downtown, Inc in accordance with this Agreement and a
promissory note.
NOW THEREFORE, for good and valuable consideration the parties agree as follows:
1. City and A enc~bli ation. City and Agency shall loan to Downtown, Inc. the
sums of $ (the "City Loan") and $ (the
"Agency Loan") (collectively, the "Loan Proceeds") secured by Downtown,
Inc.'s execution of the Promissory Notes attached hereto as Exhibit 1 & 2 and
incorporated herein by this reference.
2. Use of Funds Repayment Acceleration. The Loan Proceeds shall be used by
Downtown, Inc. for purposes consistent with the Management Agreement.
Downtown, Inc. shall repay City Loan and Agency Loan on or before June 30,
2014. Notwithstanding the foregoing, in the event the annual assessments for the
Page 1
80A-36
CMD are not renewed in any year, the loans shall immediately become due and
payable at the point on September 1 of that year.
3. Non-Waiver. Failure to exercise any right any party hereto may have or be
entitled to, in the event of a default hereunder, shall not constitute a waiver of
such right or of any other right in the event of a subsequent default.
5. Defaults. Failure or delay by Downtown, Inc. to perform any term or provision
of this Agreement which is not cured within thirty (30) days after receipt of notice
from the City and Agency constitutes a default under this Agreement; provided,
however, if such default is of a nature requiring more than (30) days to cure, the
defaulting party shall avoid default by commencing to cure within such thirty (30)
day period and thereafter diligently pursuing such cure to completion.
6. Governing Law. This Agreement shall be governed by the laws of the State of
California. Any legal action brought under this Agreement must be instituted in
the Superior Court of the County of Orange, State of California.
7. Amendment of Agreement. No modification, rescission, waiver, release or
amendment of any provisions of this Agreement shall be made except by written
agreement executed by the parties hereto.
9. Assignment by Downtown Inc Prohibited. In no event shall Downtown, Inc.
assign or transfer any portion of this Agreement without the prior express written
consent of City's and Agency's City Manger and Executive Director,
respectively, which consent may be given or withheld in City's and Agency's sole
and absolute discretion. No assumption of the City's and Agency Obligations
shall be permitted at any time. This section shall not prohibit City's and Agency's
right to assign all or any portion of its rights to the proceeds of the Notes
hereunder.
10. Entire Agreement. This Agreement constitutes the entire understanding and
agreement of the parties. This Agreement integrates all of the terms and
conditions mentioned herein or incidental thereto, and supersedes all prior
negotiations, discussions and previous agreements between concerning all or any
part of the subject matter of this Agreement.
[Signatures provided on next page]
Page 2
80A-37
ATTEST: CITY OF SANTA ANA
Patricia E. Healy David N. Ream
Clerk of the Council City Manager
APPROVED AS TO FORM:
Joseph W. Fletcher
City Attorney
ATTEST: COMMUNITY REDEVELOPMENT AGNECY
OF THE CITY OF SANTA ANA
Patricia E. Healy Cynthia J. Nelson
Secretary Executive Director
APPROVED AS TO FORM:
Joseph W. Fletcher
Agency Counsel
DOWNTOWN, INC.
By:
Its:
Page 3
80A-38
CITY PROMISSORY NOTE
Santa Ana, California
$ .00 , 2009
FOR VALUE RECEIVED, the undersigned Downtown Incorporated, a California non-profit
corporation, ("Borrower"), promises to pay to the City of Santa Ana, a charter city and municipal
corporation, ("City"), or order, at 20 Civic Center Plaza, Santa Ana, California, 92701, or such
other location as the holder hereof may designate, the sum of $ ,without interest
pursuant to the terms of that certain Loan Agreement entered into by and between the Borrower
and City dated , 2009, which are incorporated herein as if set forth in full by this
reference (the "Agreement").
"Borrower"
By:
Its:
Page 4
80A-39
AGENCY PROMISSORY NOTE
Santa Ana, California
$ .00 , 2009
FOR VALUE RECEIVED, the undersigned Downtown Incorporated, a California non-profit
corporation, ("Borrower"), promises to pay to the Community Redevelopment Agency of the
City of Santa Ana, a public body corporate and politic, ("Agency"), or order, at 20 Civic Center
Plaza, Santa Ana, California, 92701, or such other location as the holder hereof may designate,
the sum of $ ,without interest pursuant to the terms of that certain Loan Agreement
entered into by and between the Borrower and the Agency dated , 2009, which are
incorporated herein as if set forth in full by this reference (the "Agreement").
"Borrower"
By:
Its:
Page 5
80A-40