Novato City Council Agenda Staff Report Date: ______________ File No. ____________

1 cc11_191.docx; 10/20/2011

STAFF REPORT MEETING DATE: October 25, 2011 TO: City Council FROM: Thomas Adams, Senior Management Analyst

PRESENTER: Thomas Adams, Senior Management Analyst SUBJECT: DOWNTOWN NOVATO BUSINESS IMPROVEMENT DISTRICT –

RENEWAL OF ANNUAL ASSESSMENT REQUEST A. Consider adopting the Resolution Confirming the 2012 Annual BID Report as Modified. (Item is time sensitive in order to meet the annual Finance Department billing process) RECOMMENDATION A. Adopt Resolution Approving and Confirming the 2012 Annual BID Report as Modified. DISCUSSION The Novato Downtown Business Improvement District (BID) was formed by City Ordinance No. 1414 in 1999. There are approximately 400 businesses in the BID which assessed themselves $52,996 in 2011 for the purposes of advertising, marketing, event promotions, and improvements. Since the formation of the BID in 1999, the BID fees have only increased once, in 2005. In 2005, each of the fee categories were increased by 5 percent and the BID boundary was expanded. At that time, the BID expanded westward to include the two retail centers at Seventh and Grant Avenues (Lucky's and DMV centers), northward along Redwood Avenue from Vallejo Avenue to Golden Gate Place (Trader Joe's and North Redwood commercial areas), and eastward the area around Whole Foods was changed from a Zone B to a Zone A. As part of the annual renewal process for the BID, the BID Board is required to prepare an annual report each year on or before November 1. This report will be for the calendar year in which assessments are to be levied and collected to pay the costs of the improvements and activities described in the report.

75 Rowland Way #200 Novato, CA 94945-3232

(415) 899-8900 FAX (415) 899-8213 www.ci.novato.ca.us

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The 2012 Annual BID Report was accepted at the October 11, 2011 City Council meeting and the public hearing to consider levying BID fees for the 2012 calendar year was set for tonight’s meeting. The public hearing tonight is the second step in the two step process to approve the BID assessments and operations for the upcoming 2012 calendar year. The annual report had some technical modifications to it shown in underline or strikeout format and thus, the city council will be approving and confirming the 2012 Annual BID Report with modifications. It should be noted that in 1999 the city council designated the DNBA Board to act as the BID and therefore all references to the DNBA in the Annual Report are considered BID for purposes of this report. As required by state law and enacted locally by City Ordinance No. 1414, the adopted Resolution of Intention to Levy an Annual Assessment was adopted at the previous meeting. It was mailed to all BID members. In addition, the resolution was published in the Marin IJ on October 15, 2011. At the October 11, 2011 meeting, the City Council requested that staff prepare an overview of the requirements for City Council’s role in the annual BID renewal process and provide some background information on the state legislation which allows business improvement districts and the local City of Novato ordinance which implements state law. This information will be provided to City Council under separate cover. Proposed Actions A. Adopt Resolution Confirming the 2012 Annual BID Report as Modified At the conclusion of the public hearing, the City Council may adopt a Resolution Confirming the Annual Report as originally filed, or as modified by the City Council. The adoption of the resolution will constitute a levy of benefit assessments within the BID for calendar year 2012. FISCAL IMPACT The Business Improvement District encourages economic development in Downtown Novato. Since the businesses within the BID assess themselves, there is no direct cost to the City. The City provides, at no cost to the BID, billing and collection of the annual benefit assessments, as well as administration of the annual BID renewal including staff time, mailing costs, and notification costs. ALTERNATIVES 1. Do not adopt the Resolution Confirming the 2012 Annual BID Report as proposed. Give

direction to staff as to any modifications to the resolution. ATTACHMENTS 1. Letter from Downtown Novato Business Improvement District (BID) 2. Resolution Confirming the 2012 Annual BID Report 3. BID Annual Report with BID Budget, BID Map, and BID Assessment Formula

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   October 10, 2011  Dear Novato City Council Members:  Over the past year, the Downtown Novato Business Improvement District (BID) worked very closely with the City of Novato and the Chamber of Commerce to promote the common interests of all BID members throughout the year.  We increased our communication with our members and the general public through our email broadcast system, quarterly newsletter, web site and social media channels. We reached out to our members, volunteers and the public using a comprehensive marketing plan.  We utilized a “Shop Downtown” theme centered on many events throughout the year to provide a consistent marketing message. The BID continues to work in a community marketing collaboration with the City of Novato and the Novato Chamber of Commerce using the City’s 2010‐2013 Strategic Plan Objectives as a guideline.  Many of our events this year set records in public awareness and fun!  Our Spring Celebration was a big success again this year.  The BID received a letter of congratulations and gratitude from the Novato Chamber of Commerce for our participation in the Festival of Art, Wine and Music.  The BID Nostalgia Days’ parade entry won second place in the 4th of July parade competition.  Nostalgia Days yielded the largest financial surplus for our members to date.  “Downtown Days on the Green” continues to grow in recognition and popularity.  Over the past year we have made strides in improving our organizational efficiency. We will transition to a calendar year reporting period which will allow for more clear financial reporting to our members.  The 4th of July Parade will be its own 501C3 nonprofit to allow it to raise more money for this event.  The money saved from the end of our Executive Director’s contract will be used to directly promote downtown businesses through print and online distribution outlets.  Lastly, we are very enthusiastic about the various projects moving forward downtown ‐ the groundbreaking of 999 Grant Avenue, the progress of the Novato Theater renovation, the proposed project at the Mills Restaurant, the Chipotle Restaurant under construction, and the Trek Winery retail project. All of these projects will encourage more people to come and shop downtown.    Sincerely, Randy Stemmer BID President 

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RES/4446 10/20/11 1

CITY COUNCIL OF THE CITY OF NOVATO RESOLUTION NO. ______

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NOVATO CONFIRMING THE 2012 ANNUAL REPORT OF THE BOARD OF DIRECTORS OF THE DOWNTOWN NOVATO BUSINESS IMPROVEMENT DISTRICT AS MODIFIED

WHEREAS, the California Streets and Highways Code Section 36500 et seq, authorizes

cities to establish parking and business improvement areas for the purpose of promoting economic revitalization and physical maintenance of business districts in order to create jobs, attract new business and prevent erosion of the new business district; and

WHEREAS, the Downtown Novato Business Improvement District (BID) was established in 1999 by Ordinance No. 1414; and

WHEREAS, pursuant to Ordinance No. 1414 and the California Streets and Highways Code § 36533, the Board of Directors of the BID shall prepare an annual report for each calendar year in which assessments are to be levied which the City Council shall review; and

WHEREAS, pursuant to Streets and Highways Code §36534, the City Council may approve or modify and approve, as modified, the report. Following such approval, the Council must issue a resolution of intent to levy assessments, and schedule a public hearing on the levy of the proposed assessment.

NOW, THEREFORE, BE IT RESOLVED that based upon the staff report, Board of Director’s annual report, the facts and documents referred to therein, and the evidence adduced at the hearing on this Resolution, and the public meeting on the Resolution of Intention to Levy Assessments the City Council of the City of Novato does hereby resolve, determine and find as follows:

1. The City Council has received the annual report of the Downtown Novato BID for the 2012 calendar year.

2. The City Council adopted a Resolution of Intention to Levy Assessments on

October 11, 2011.

3. The City Council finds that minor modifications to the annual report are necessary and said modifications are incorporated in the Annual Report approved hereby.

4. The City Council held a public hearing on the proposed assessments on October 25,

2011. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Novato does

hereby confirm the annual report of the Board of Directors of the Downtown Novato BID as modified. Adoption of this resolution shall constitute confirmation of the 2012 BID Annual Report

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RES/4446 10/20/11 2

and approval of the levy of assessments described in the 2012 Annual BID Report for the 2012 calendar year.

* * * * * * I HEREBY CERTIFY that the foregoing resolution was duly and regularly adopted by the City Council of the City of Novato, Marin County, California, at a meeting thereof, held on the ____ day of ___________________, by the following vote, to wit: AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers ABSENT: Councilmembers Sheri Hartz, City Clerk Approved as to form: City Attorney of the City of Novato

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2011 2012 Annual BID Report – It should be noted that Cheryl Paddack has tendered her resignation from the BID Board effective at the end of the year (December 31, 2011). All of the following BID Board members were duly elected by the BID membership. Dates for the expiration of the BID Board membership are shown in parentheses. List of Officers Randy Stemmer – President Darren Pomponio – Vice President Regina Bianucci Rus – Treasurer Cheryl Paddack – Secretary Board of Directors Randy Stemmer – MarinMarket.com Strategic Marketing (December 2011) Darren Pomponio- Alterra Home Loans (December 2012) Regina Bianucci Rus- CPA (December 2012) Cheryl Paddack – Novato Youth Center Matt Meblin – Project Invision (December 2011) Catherine Bragg – Flourchylde Bakery (December 2012) Gary Butler – State Farm Insurance (December 2012) Kebby McInroy- Studio 4 Art (December 2012) Paul Podwojski- La Vita Wellness Center (December 2012) Tom Atkin – AE Video Web (December 2012) Vision: Novato enjoys a vibrant, dynamic and fun downtown. Residents and visitors from all over the world enjoy many shops, great restaurants and an exciting nightlife. Mission: The purpose of the Downtown Novato Business Association (DNBA) is to promote and improve the common business interests of business owners and merchants of downtown Novato. Strategic Objectives: The above DNBA Mission and Vision statements align with the City of Novato 2010-2013 Strategic Plan goal number 4 “Promote an active, restored and vibrant downtown” and goal number 5 “Foster a thriving business environment and destination.” To this end, the DNBA focused on three core values for this year as follows: Synthesize: The DNBA pulled together common elements in the DNBA Board of Directors, our volunteers and our members. We emphasized our similarities and strengthened our common

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interests. We deepened the working relationship between the DNBA, the City of Novato and the Novato Chamber of Commerce (NCOC) so we all work for the mutual benefit of DNBA members as much as possible. Integrate: We promoted the common business interests of our members by increasing our communication with our members through our email broadcast system, quarterly newsletter, Web site, Facebook page and monthly General Meetings. Outreach: We worked hard to reach out to our members, volunteers and the public utilizing a new comprehensive marketing plan. The marketing plan called for newspaper and online ads using a “Shop Downtown” theme built around each of our events throughout the year. We made great progress in the area of improvements and activities for the downtown in the following key areas: Improvements: The tree lights along Grant Avenue (starting at Reichert Avenue and ending just past 7th Street) were replaced with new light fixtures. This was done through a project with the Novato Chamber of Commerce Leadership program and the DNBA. The NCOC Leadership team managed the project. The DNBA paid for the lights and the City installed them. Activities: Commercial Media Program: An annual program consisting of Street Banners, television commercials, Internet promotions, editorials and advertising in various newspapers including the Novato Advance and Novato Patch along with the DNBA Web site continues to promote Downtown Novato as a destination for shopping, dining, recreation and services. The Novato 2010 50th Birthday Banners remain all along Grant Avenue promoting Novato destinations and attractions. DNBA was quoted in the Marin IJ for its support of downtown Novato as a community destination for Marin and the Bay Area. It was quoted in the Novato Advance in support of the Redevelopment Agency in Novato. Next year will include a big emphasis on online and social media advertising along with yielding many business promotional opportunities for our members. Downtown Events & Promotions: The following events and promotions are sponsored or produced by the Association to reinforce the Downtown as the Novato community’s center:

Spring Celebration – Easter Egg Hunt and related festivities including food and beverage booths brought another record number of children, participants and families to the City Green. Merchants created a bunny footprint path leading to the stores and offered shopping incentives to the parents. This program was very well received by many merchants.

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Novato Farmers Market – The DNBA invited the Executive Director of Marin Agricultural Institute to a DNBA general meeting to answer concerns of Grant Avenue merchants. The DNBA worked with the Farmer’s Market manager during the duration of the market to address concerns as they arose. The season went very well with no complaints to the DNBA by the merchants.

Art & Wine – DNBA had a Beer and Wine Booth and staffed it with volunteers from the

Business Improvement District. Businesses were encouraged to participate and some purchased booths from the Chamber. The DNBA received a letter of congratulations and gratitude from the NCOC for our participation in the Festival of Art, Wine & Music this year.

4th of July Parade – DNBA co-sponsored this event and it was a great success. The DNBA Nostalgia Days’ parade entry won second place in the 4th of July parade competition this year.

Nostalgia Days – Another impressive turn out included 195 cars and motorcycles, 10 vendors, 6 food booths and 144 dinners served at our pre-registration BBQ with thousands of people walking Grant Avenue for the largest show to date with an estimated $5,000 profit at the time of this report. The Novato Chamber of Commerce participated greatly with a Wine and Beer booth.

Downtown Days on the Green – The DNBA was a major sponsor of this event, produced

by Rock for Good. The community was encouraged to visit the stores and restaurants on Grant Avenue both before and after the event. There were three concerts held on Saturday 8/27, 9/3 and 9/10/11.

Safe Trick or Treat –Activities include face painting, haunted house, stories at the Novato

History Museum, balloons and pictures. Store participants give out candy. Advertising for the event is tied to a “Shop Downtown” advertising campaign.

Tree Lighting – Merchants plan on having organized events downtown each weekend

after the Thanksgiving holiday leading up to the Tree Lighting Ceremony. Chronological Listing of Participatory Events: 1) Paint The Town Red 1/11 2) Newspaper Ad Campaign Began 4/11 3) Spring Celebration 4/11 4) Grant Avenue Tree Lighting Renovation 5/11 5) Farmers’ Market Booth 5/11 through 9/11 6) Art & Wine Festival Booth 6/11 7) Fourth Of July Parade 7/4/11 8) Merchant Sidewalk Sale 7/30/11 9) Nostalgia Days 8/11 & 8/12/11 10) Downtown Novato Days on the Green Concerts 8/27, 9/3 & 9/10/11 11) Merchant Promotion Video 10/11 12) Safe Trick or Treat 10/11

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13) Holiday Celebration 12/11 Ongoing Projects: 1) Novato Theater Revitalization 2) Community Marketing Collaboration with the City of Novato, Novato Chamber of

Commerce & the DNBA using the City’s 2010 – 2013 Strategic Plan Objectives as a guideline

3) New City Building and Parking Plans 4) Circle Bank Building Construction at 999 Grant Avenue 5) Mills Restaurant Redesign and Construction 6) Chipotle Mexican Grill Construction 7) Trek Winery Construction

Committee Reports: Executive Committee: The Executive Committee consists of the President, Vice President, Secretary and Treasurer. The Committee conducts monthly meetings to set policy and guidelines, respond to Merchant concerns and works directly with the Board of Directors to achieve DNBA goals and objectives. Marketing Committee: A monthly meeting with approximately five to seven members who work on strategic marketing, events and promotional ideas. The group created a strategic marketing plan which utilized DNBA funds solely for the purpose of advertising and promotion of businesses in the Business Improvement District (BID). It developed a master calendar of DNBA events to be published on our Web site and Social Media outlets. We are currently developing a promotional video which will include City Council members to highlight Business Improvement District businesses. The main focus of the Marketing Committee is to communicate to Novato residents all the great businesses available to them in the downtown. Finance Committee: Our accounting reporting period was changed to a calendar year to better facilitate reporting of our finances to our members. In a continued effort to be transparent, financial expenditures were published in the DNBA newsletter and discussed at general meetings. The DNBA Treasurer instituted checks and balances and increased financial safeguards throughout the accounting system. Downtown Revitalization Committee: The Committee has been concentrating efforts on a campaign for the Novato Theater renovation. Several successful events were held at City Hall to raise awareness of the project and encourage DNBA members to make a commitment towards bringing the theater back to life. The DNBA has extended financial support through sponsorships of the Novato Theater’s events. Circle Bank held their demolition event at 999 Grant Avenue. DNBA members helped organize, support and took part in the ceremony.

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Membership Committee: Committee worked on a membership packet to be distributed to new and existing members as an informational piece detailing their DNBA membership benefits and ways that members can choose to be involved in the organization. A new Associate Membership was begun this year. The DNBA received 6 new Associate Members during the year. Downtown Novato Business Association Meetings: General Membership Meetings: Meetings are held on the first Wednesday of every month to provide a forum for members, property owners and city representatives to work together in creating a healthy and vibrant downtown. The meeting changed to a town hall meeting format to encourage discussion of member issues and concerns. Speakers with educational or training experience are encouraged to present their information to our members to keep them up to date with business developments and help support their marketing programs. For example, we had speakers present “Business Emergency Planning” and “Employment Trends” so far this year. Board Meetings: The Board of Directors meets on the fourth Tuesday of the month. The Board sets policy in agreement with its By-Laws, approves contracts, creates committees and oversees the disbursement of the assessments provided by the BID for the common interests of its membership. Directors are chosen by the membership to serve a three year term. Joint Community Marketing Meetings: The DNBA worked with City of Novato and the Novato Chamber of Commerce to create a joint community marketing group. It discusses branding for Novato, collaborates on improved downtown Way Finding Signage and creates joint marketing opportunities for DNBA members. The DNBA continues to strengthen its relationship with the Novato Chamber of Commerce and City of Novato representatives. The DNBA hosted a Wine Booth at the Chamber’s Festival of Art Wine & Music in June. The Chamber hosted a Beer and Wine booth at the DNBA’s Nostalgia Days in August. The DNBA and Chamber plan on creating more alliances to work together in the future. BID Map, BID Budget, and BID 2012 Assessment Fee Schedule are attached to this report as Exhibit A (BID Map), Exhibit B (BID Budget), and Exhibit C (BID 2012 Assessment Fee Schedule). Exhibit B, the BID Budget, provides an estimate of the 2012 improvements and activities to be financed with the 2012 assessment.

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EXHIBIT C 2012 BID ASSESSMENT FORMULA Assessment Schedule All assessments are based on the rates approved in 2011 for the 2012 calendar year. There is no increase requested this year. Please refer to the BID Boundary Map for definitions of Zone A and Zone B. Type of Business Benefit Assessment Zone A Zone B Retailers/Restaurants 1-3 Employees $158 $79 4-6 Employees $263 $131 7 + Employees $368 $184 Service Businesses $158 $79 Professional Businesses $131 $65 Financial Institutions $525 $525 Lodging (Bed and Breakfast) $158 $158 Lodging (Hotels and Motels) $263 $263

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{D/l-r/"Sheri Hartz

From: Jan Morris [jan@janmorris.com] Sent: Monday, October 24, 2011 9:42 PM To: Novato Council Subject: BID Assessment

Dear Mayor & Council Members, I know it's the 11 th hour, but as a business owner, I have some concerns regarding the validity/ purpose/expense from the Downtown Novato Business Association (DNBA). My concerns are as follows: 1. The 1st paragraph of the "Resolution" emphasizes "Economic revitalization, maintenance, attract new jobs, & prevent erosion of the business district".------I see the bulk ofthe monies is spent on City Events, a City parade, & City Tree Lighting, which has nothing to do with the marketing & developing a strong economic direction. 2. Questionable expenditures of----­**$6500 bi-annually for a web site that never changes; not user friendly for someone looking for particular businesses. ** $4,025 Spent on a bi-monthly newsletter (sheet ofpaper, mailed to business-6 annually) **$7,158 (with income of$75) covers a City parade, with nothing to do with developing a strong economic direction. **$6500 Spent for "other improvement". Not sure what that is?? The DNBA should *focus on bringing informationlbooklet to the local hotels that focus on our charming downtown/perhaps

with the help of TOT tax (nothing is currently available in any ofthe local hotels)

I feel that my % monies spent to promote the vitality of the downtown is NOT being spent on on true vitality. Maybe a few restaurants benefit from some of the "family events". But not the majority. My recommendation is to place the BID on one year probation to meet other business approvals. It CAN be a benefit. But decisions are short sighted & lack the knowledge of who comes downtown & purpose that actually promote vitality. The 2nd floor "services" need to be re-assessed, as they draw no benefit, but pay the same as 1st floor retail shops. Please re-assess the focus & mission of the Bid District. It is NOT working & needs to be re-worked. Many business owner are unable to make the "meetings" with no ability to voice opinions within the web site (asked to make available years ago).

Thanks for listening, Jan & Austin Morris, 4.5yr Owner of Morris & Company

- MORRIS & COMPANY

_ 701 Grant Avenue

Novato, CA 94945

415.898.8002

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