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HomeMy WebLinkAboutItem 2c: Contract with New City America for the establishment of PBIDSTAFF REPORT DATE: TO: Mayor and City Council May 15, 2012 Development Services Department FROM: Jason Kruckeberg, Assistant City Manager /Development Services Director: By: Jerry Schwartz, Economic Development Manager j- SUBJECT: AUTHORIZE THE CITY MANAGER TO EXECUTE A CONTRACT WITH NEW CITY AMERICA FOR AN AMOUNT NOT TO EXCEED $70,000 TO WORK WITH THE ARCADIA DOWNTOWN BUSINESS ASSOCIATION ON THE ESTABLISHMENT OF A PROPERTY BASED BUSINESS IMPROVEMENT DISTRICT (PBID) IN DOWNTOWN ARCADIA Recommendation: Approve SUMMARY The Core Group of the Arcadia Downtown Business Association (ADBA) voted unanimously to pursue a Property Based Business Improvement District (PBID) as a means of organizing the downtown business community, financing its activities, and reaching its goals for downtown Arcadia. During a November 15, 2011, Study Session, the City Council directed staff to send out a Request for Proposals (RFP) to downtown consultants for services to establish a PBID. However, in the interim, the State Supreme Court ruling eliminated redevelopment, which had been the funding source for a previous consultant contract to guide the ADBA. At a March 6 Study Session, the City Council approved spending up to $70,000 from the General Fund to hire a downtown consultant. An interview panel made up of three leaders from the ADBA and one City staff member met with the three respondents to the RFP. Based on the proposals, interviews, and background checks, the panel is recommending New City America to pursue the PBID formation in concert with the ADBA and City staff. BACKGROUND The Arcadia Downtown Business Association began their monthly meetings in June 2010. In July 2010, the ADBA established a "Core Group" of business and property owners that were willing to meet separately and provide direction for monthly meetings. The organization developed a mission statement and selected officers. The ADBA invited guest speakers to the monthly meetings to discuss their experiences with business improvement districts and other types of downtown organizations. On January 18, 2011, the City Council held a Study Session about downtown Arcadia, and the ADBA requested the assistance of a downtown consultant to help with PBID May 15, 2012 Page 2 of 3 organization and educate them on various ways to fund programs and activities. On March 15, 2011, the City Council voted to hire Urban Place Consulting to utilize its experience as a downtown consultant to help the ADBA move forward. The result of the work that Urban Place Consulting completed with the ADBA was a report that was presented to the City Council at the November 15, 2011, Study Session. It was during that Study Session the City Council directed staff to issue the RFP for downtown consultants to direct the formation of a PBID. DISCUSSION There were four Requests for Proposal distributed to downtown consultants that had experience developing and managing Property Based Business Improvement Districts (PBID) in California. Three proposals were received. The proposals were initially reviewed by staff, but were put on hold after the State Supreme Court decision was published on December 29, 2011, ending redevelopment. All three firms were informed of the situation. On March 6, 2012, the City Council held a Study Session and heard from several members of the ADBA about the importance of proceeding with the PBID process. When the Council authorized the expenditure of up to $70,000 from the General Fund for a PBID consultant, the process was restarted. The three bids were received as follows: Name of Firm Urban Place Consulting Civitas New City America Proposal Amount $45,581 $54,000 $70,000 Interviews with the three firms were held on March 27. The interview panel was: Matt McSweeny, ADBA President, April Verlato, ADBA Secretary, Scott Hettrick, ADBA Core Group member, and Jerry Schwartz, Economic Development Manager. Each firm was scored on a number of factors, including, responsiveness to the elements of the RFP, understanding the Identified Scope of Services, experience with the establishment of PBIDs, cost of proposal, schedule to complete the project, and references. These factors were identified in the RFP as the basis for the evaluations, giving all respondents a level playing field in the process. The three panelists from the ADBA were unanimous in recommending the selection of New City America as the PBID consultant for downtown Arcadia. The principal of New City America, Marco Li Mandri, has been involved with the development, renewal, and /or operation of 61 PBIDs, mostly in California. He has been responsible for the Little Italy PBID in San Diego, which is an extremely successful business improvement district. The firm also established a PBID in Los Angeles Chinatown, and had strong references from this and other projects. PBID May 15, 2012 Page 3 of 3 The proposed cost for New City America to establish a PBID is not to exceed $70,000. The ADBA members realize that the New City America proposal was the most costly by a wide margin, but nonetheless believe it is the best firm for this project because of the experience of the principal, their understanding of downtown Arcadia, their proven success at working with a variety of business districts and overcoming objections to a PBID, and their background of working in multi-cultural PBIDs. The proposal is structured so that the ADBA would have the option to stop the process after the first $30,000 in costs if there are strong indications that the PBID is not garnering strong enough support to receive the 50% +1 majority necessary for passage. The ADBA leadership believes that New City America and the downtown business owners can work together to generate the necessary support to succeed with the establishment of the PBID. The PBID process is estimated to take approximately 12 months to complete. The initial steps include developing a management plan, establishing an advisory board with property owners and business owners, and determining the assessment methodology and number of assessment zones. Once the PBID is approved, the assessment information is provided to Los Angeles County for inclusion on the tax rolls. This would occur with the tax roll that will be equalized in August 2013. The ADBA would begin to receive PBID revenue after the first property tax payments are made in December 2013. After that, payments would be received as the semi-annual property taxes are paid. The initial PBID approval would last for five years. After that, renewal could be approved for as much as ten years. GENERAL FUND FISCAL IMPACT Approval of the recommendation will cost up to $70,000 from the General Fund as approved by the City Council on March 6, 2012. The $70,000 is shown as an expenditure in the proposed Economic Development Division within the Development Services Department FY 2012-2013 Preliminary Budget. RECOMMENDATION Authorize the City Manager to execute a contract with New City America for an amount not to exceed $70,000 to work with the Arcadia Downtown Business Association on the establishment of a Property Based Business Improvement District in downtown Arcadia. Approved by: Dominic Lazzare4b. ity Manager