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  CITY COUNCIL AGENDA ITEM NO. 20   

Meeting Date:  June 13, 2000

 Subject/Title:    Commit Matching Operational Funds from the PEC  Fund Account to the proposed Business Improvement District (BID) if the BID if successfully established.

Submitted by:   Howard Sword, Economic Development Coordinator

Approved by:    Jon Elam, City Manager

RECOMMENDATION

Commit Matching Operational Funds from the PEC  Fund Account to the proposed Business Improvement District (BID) if the BID if successfully established. The Economic Development Sub Committee recommends a 100% match for the first year and a 50% match in years after subject to Council review and approval.

PREVIOUS ACTION

Funding of a BID Feasibility Study by Downtown Revitalization Consultants (DRC).

BACKGROUND

The City Council approved a Feasibility Study for establishing a citywide BID on March 14, 2000. Since that time DRC has been working with a group of local business owners, referred to as the ad hoc formation committee, to prepare a proposal that will be distributed to the entire 424 member business community. Dave Kilborn of DRC will give a brief update and answer questions at the June 13, 2000 City Council meeting. A public meeting will be held in late June to discuss the proposal and determine the level of support in the business community. A Feasibility Study Summary Report will be presented to the City Council at the July 11, 2000 meeting that may include a Notice of Intent to Form a BID if there is demonstrable support in the business community.

One of the issues that the local business owners have been working to resolve is the assessment formula. The original goal was to have a BID commercial marketing budget of between $80,000 and $90,000. This dollar amount, however, does not appear to be attainable when the number of businesses and reasonable individual assessment amounts are calculated. The amount that can reasonably be raised is between $55,000 and $60,000. When this reality was confronted the consultant noted that approximately half of the BIDs that he has worked with receive some percentage of matching funds from their cities and perhaps our city should be approached with this suggestion.

Jerry Thorpe, Peggy Schuitemaker and Ed Stack, co-chairs of the formation committee, made a request to the Economic Development Subcommittee that the City provide the BID 50% matching funds if the District is successfully formed. The Subcommittee responded that it would recommend the City provide a 100% match the first year and a 50% match in subsequent years subject to the annual review and approval of the City Council. The Subcommittee further recommended that that the source of the funding be the PEC Fund Account that was established through negotiated contributions from developers for economic development purposes. The specific uses of the PEC Fund Account are completely at the discretion of the City and most certainly assisting a BID would be a valid and valuable business retention and expansion project.

There are many reasons that the City would want to see a thriving BID,  staff would like to comment on two primary issues of benefit. The first is a direct linkage to increased sales tax revenue. BIDs historically have increased sales as measured by revenues per the gross leasable area (GLA) in the district. Making the cash registers ring louder and more frequently is the primary goal of a BID. The City, of course, will directly benefit by increased sales through its share of sales tax.

The second reason is inherent benefits in having all business districts in the City financially thrive. It should be no surprise that Brentwood is likely to have an additional 500,000 square feet of retail stores located at the Southwest Quadrant of Lone Tree / SR4 Bypass and the Southeast Quadrant of Sand Creek / SR4 Bypass. These developments will be primarily occupied by Triple A Credit national retail tenants and will provide goods and services that our residents are now acquiring in other cities. These developments will provide convenient access to our residents as well as relieve traffic congestion on the regional roadways that are currently being used to acquire these goods and services.

The national retail tenants bring with then very sophisticated commercial marketing programs that analyze consumer trends and invest heavily in institutional advertisement. Brentwood’s historic business district that is primarily served by the Brentwood Boulevard is comprised almost entirely of independent business operators. The great thing about independents is that the store is usually run by the owners and reflects an individual ambiance and atmosphere. The greatest weakness independents suffer is a lack of programmed commercial marketing. This is not a large problem when a community is small and isolated. It can be a huge problem when the national retailers arrive if there is not a commercial marketing program in place. The local independent businesses must establish a market niche and comprehensibly promote it or risk losing sales volume and vitality. This commercial marketing element is one of the primary benefits that a BID brings to a historic business community comprised of independent operators.

There are many communities that have ignored their historic districts and these areas have become blighted parts of the community. On the other hand, many communities, such as Pleasanton, have established BIDs and achieved the best of both retail environments, one which has both convenient access to national retailers as well as a thriving historic business community.  

City Administration
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E-mail allcouncil@brentwoodca.gov