06-07-2011 - Auto Plaza Business Improvement District - Item 12 (2).docCity of West Covina
Memorandum
A G E N D A
ITEM NO. 12
DATE June 7, 2011
TO: Andrew G. Pasmant, City Manager
and the City Council
FROM: Christopher J. Chung
CDC Director
SUBJECT: AUTO PLAZA BUSINESS IMPROVEMENT DISTRICT
RECOMMENDATION: It is recommended that the City Council adopt the following Resolution:
RESOLUTION NO. - A RESOLUTION OF INTENTION OF THE CITY COUNCIL OF THE CITY OF WEST COVINA TO LEVY ASSESSMENTS WITHIN THE WEST COVINA AUTO PLAZA BUSINESS IMPROVEMENT DISTRICT AREA
FOR FISCAL YEAR 2011-2012, AND PROVIDING NOTICE OF PUBLIC HEARING THEREON TO BE CONDUCTED JUNE 21, 2011.
DISCUSSION:
The purpose of this report is to set the date and time (by approval of the attached Resolution) of the Public Hearing to consider the adoption of a budget and annual assessment for the
West Covina Auto Plaza Business Improvement District area. On June 1, 1993, the City Council adopted Ordinance No. 1923, which established the West Covina Auto Plaza Business Improvement
District. The assessment revenue is collected from businesses located within the Business Improvement Area and is used to pay for the capital costs, operation and maintenance of an
electronic readerboard sign located in the West Covina Auto Plaza adjacent to the I-10 freeway, as well as payment for the operation and maintenance costs for the Auto Plaza entry monument
sign and landscaping located at the southwest corner of Azusa Avenue and Garvey Avenue South.
On April 19, 1994, the City Council appointed an Advisory Board consisting of the owners (and/or their representatives) of the auto dealerships located at the Auto Plaza. The function
of the Advisory Board is to review the Annual Report (Attachment No. 2), which includes the 2010-2011 budget for the proposed assessment and make a recommendation to the City Council
with respect to adopting that report.
On April 18, 2011, the West Covina Auto Plaza Business Improvement District Advisory Board held its annual meeting and approved the Annual Report. The Annual Report has been filed with
the City Clerk as required by the Parking and Business Improvement Area Law of 1989 (Streets and Highways Code Section 36500, et seq.).
At the 2011 annual meeting, the Advisory Board discussed various items, including the possibility of replacing or updating the freeway auto plaza sign. The freeway sign was originally
constructed with a loan from the CDC to the Auto Plaza Business District and will be paid in full in July 2011. It was unanimously agreed by the Advisory Board that the sign should
be replaced or fully refurbished, but wanted some type of financial assistance from the City or the CDC. The Advisory Board will further discuss and indicated that it will present
a plan to the City/CDC in the near future.
Upon setting the date and time of the Public Hearing, the next step in this process would be the City Council’s consideration of a Resolution of Intention (Attachment No. 1), which sets
a public hearing date, at which time the City Council will consider the proposed budget for the Business Improvement District. The attached Resolution sets the required public hearing
for June 21, 2011. At the conclusion of that hearing, the City Council may adopt or revise (but not increase) the proposed assessment.
The Annual Report describes an assessment budget of $48,092.62 divided among six (6) auto dealers resulting in an assessment of $8,015.44 for each dealership for FY 2011-2012. This
assessment reflects the costs of maintenance, electricity, programming, and insurance for the existing electronic readerboard sign, as well as seasonal color (landscape materials) and
landscape maintenance, taxes, and document preparation costs. A reserve of $24,110.00 will also be maintained to cover six-months of operating costs.
It is noted that two dealerships within the BID missed paying the assessment for this operational year and the prior two fiscal years. The shortfall in the assessment revenue was covered
by the annual reserve balance and no impact to the BID operation was observed. The total amount of the delinquency payment is $40,226.18. As the reserve was drawn-down each delinquent
year, the following annual assessment amount charged to each dealership increased to replenish the required six-months of operation costs. A BID representative has discussed the matter
with the delinquent dealerships in the past and the BID is considering disapprobatory actions.
Adoption of a Resolution of Intention is required by the procedure set forth in the Streets and Highways Code, Section 36534.
FISCAL IMPACT:
No impact to City or CDC funds. All costs are covered by assessments to the West Covina Auto Plaza Business Improvement District dealerships.
Prepared by: Benjamin Kim Reviewed by: Mike Lee
Redevelopment Manager Assistant CDC Director
Reviewed/Approved by: Christopher J. Chung Reviewed by: Finance
CDC Director
Approved via e-mail
Reviewed/Approved by: City Attorney
Attachments: No. 1 - Resolution of Intention
No. 2 - Business Improvement District Annual Report & Assessment