Item 16AGENDA ITEM NO. 16
AGENDA STAFF REPORT
City of West Covina I Office of the City Manager
DATE: June 21, 2022
TO: Mayor and City Council
FROM: David Carmany
City Manager
SUBJECT: PUBLIC HEARING TO CONSIDER WEST COVINA AUTO PLAZA
BUSINESS IMPROVEMENT DISTRICT FISCAL YEAR 2022-2023 ANNUAL REPORT
AND ASSESSMENT
RECOMMENDATION:
It is recommended that the City Council conduct the public hearing and then adopt the following
resolution:
RESOLUTION NO. 2022-51 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST
COVINA, CALIFORNIA, CONFIRMING THE ANNUAL REPORT FILED BY THE WEST COVINA
AUTO PLAZA BUSINESS IMPROVEMENT DISTRICT ADVISORY BOARD AND LEVYING AN
ANNUAL ASSESSMENT FOR THE WEST COVINA AUTO PLAZA BUSINESS IMPROVEMENT
DISTRICT FOR FISCAL YEAR 2022-2023
BACKGROUND:
The Parking and Business Improvement Area Law of 1989 (California Streets and Highways Code
Section 36500 et seq) (PBIA Law) establishes the framework for Business Improvement Districts (BID).
The State wanted to make it possible for groups of businesses to band together and invest in their
commercial neighborhoods for the purposes of revitalization, stability, and growth. On June 1, 1993, the
City Council adopted Ordinance No. 1923, which established the West Covina Auto Plaza Business
Improvement District (Auto Plaza BID). The City created this BID at the request of the businesses located
in the area. Each year, the City Council holds a noticed public hearing before deciding whether to renew
the BID for another year.
The assessment revenue is collected from businesses located within the Auto Plaza BID and is used to
pay for the capital costs, operation and maintenance of a LED reader board sign located in the West
Covina Auto Plaza, adjacent to the 1-10 freeway, and for the operation and maintenance of the Auto
Plaza entry monument sign and landscaping located at the southeast corner of Azusa Avenue and
Garvey Avenue South. Assessment revenue is also used for landscaping maintenance along the 1-10
freeway immediately facing and parallel to the Auto Plaza dealerships.
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 make recommendations to the City Council on the expenditure of revenues derived from the levy of
assessments, on the classification of businesses, and on the method and basis of levying the
assessments. Pursuant to the PBIA Law, for each fiscal year that assessments will be levied, the
Advisory Board is required cause a report to be prepared containing the following: (1) any proposed
changes in the boundaries of the BID or in any benefit zones within the area, (2) the improvements and
activities to be provided for that fiscal year, (3) an estimate of the cost of providing the improvements and
the activities for that fiscal year, (4) the method and basis of levying the assessment in sufficient detail to
allow each business owner to estimate the amount of the assessment to be levied against his or her
business for that fiscal year, (5) the amount of any surplus or deficit revenues to be carried over from a
previous fiscal year, and (6) the amount of any contributions to be made from sources other than
assessments levied.
The purpose of this item is to request that the City Council conduct the required public hearing and then
adopt the resolution to confirm the Advisory Board's annual report as originally filed and levy the
assessment for FY 2022-23.
DISCUSSION:
The Annual Report has been prepared and filed with the City Clerk in accordance with the requirements
of the PBIA Law. The Annual Report is included as Attachment No. 2 to this report.
At the June 7, 2022 City Council meeting, the City Council approved the Annual Report and adopted
Resolution 2022-50, declaring the intention to levy the annual assessment for FY 22-23 and setting the
public hearing for June 21, 2022, at 7:00 p.m. in the City Council chambers.
The Annual Report includes a total budget of $124,910.07, with an assessment of $16,524.00 per
dealership site. The gross estimated annual cost for operating expenditures including programming,
maintenance, electricity, and insurance for the readerboard sign, landscaping, landscape maintenance,
taxes and preparation costs, is $70,670.04. The annual loan repayment is $54,240.03, totaling
$124,910.07 in annual expenditures. Staff is recommending that the City levy an assessment of
$16,524.00 per dealership site (the same as last year), which would generate $115,668.00 for FY
2022-23. Since the annual expenditures increased, the assessments will not cover the total annual
expenditures, with a deficit of $9,242.07. A portion of the FY 2021-22 year-end fund balance of
$80,025.41 will be used to cover the deficit and to cover the required six (6) month operating reserve
($35,085.02). An assessment of $16,524.00 for each of the seven (7) dealership sites in the Auto Plaza
BID will be placed on the tax rolls by the County of Los Angeles Department of Auditor -Controller.
The anticipated year-end fund balance for FY 2021-22 is anticipated to be $80,025.41, which includes the
operating reserves.
At the conclusion of the hearing, the City Council may order changes in the proposed assessment, the
proposed improvements to be funded, and/or the proposed boundaries of the BID. If the Council
determines to levy the assessment as proposed, it may adopt the attached resolution (Attachment No.
1), which confirms the Annual Report and levies the assessment for FY 2022-23. Adoption of the
resolution places direct assessments on the auto dealers of the West Covina Auto Plaza BID. The BID
boundaries are included as Exhibit A to the resolution.
LEGAL REVIEW:
The City Attorney's Office has reviewed the resolution and approved it as to form.
OPTIONS:
The City Council has the following options:
1. Approve staff's recommendation; or
2. Provide alternative direction.
Prepared by: Gerardo Rojas, Economic Development Project Coordinator
Fiscal Impact
FISCAL IMPACT:
There is no impact to City funds by adopting the attached resolution that levies the assessment for the
Auto Plaza BID. All costs are covered by assessments collected from the West Covina Auto Plaza
Business Improvement District dealerships. As part of the Annual Report approval by the Auto Plaza
BID is the repayment of the City loan. In addition, the Auto Plaza BID is charged a nominal
administrative fee for City staffs time to administer the West Covina Plaza BID and monitor the annual
budget.
Attachments
Attachment No. 2 - West Covina Auto Plaza Annual Report 2022-2023
Attachment No. 1 - Resolution No. 2022-51
CITY COUNCIL GOALS & OBJECTIVES: Achieve Fiscal Sustainability and Financial Stability
Expand Economic Development Opportunities
ATTACHMENT NO. 1
RESOLUTION NO.2022-51
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF WEST COVINA, CALIFORNIA, CONFIRMING THE
ANNUAL REPORT FILED BY THE WEST COVINA AUTO
PLAZA BUSINESS IMPROVEMENT DISTRICT ADVISORY
BOARD AND LEVYING AN ANNUAL ASSESSMENT FOR
THE WEST COVINA AUTO PLAZA BUSINESS
IMPROVEMENT DISTRICT FOR FISCAL YEAR 2022-2023
WHEREAS, in adopting the Parking and Business Improvement Area Law of 1989
(California Streets & Highways Code sections 36500 et seq.), the California Legislature authorized
cities to levy assessments on businesses in order to promote economic revitalization and tourism,
create jobs, attract new businesses and prevent erosion of business districts; and
WHEREAS, on June 1, 1993, the City Council adopted Ordinance No. 1923, which
established the West Covina Auto Plaza Business Improvement District ("District") for purposes
of levying an assessment within the District to fund the construction, operation and maintenance
of an electronic readerboard to be located adjacent to the I-10 freeway and benefit the West Covina
Auto Plaza dealerships to be assessed. The District was established with one hundred percent
(100%) property owner consent; and
WHEREAS, on April 19, 1994, the City Council appointed the owners and/or their
representatives of the auto dealerships located in the West Covina Auto Plaza as the advisory board
of the District as required by California Streets and Highways Code section 36530 ("Advisory
Board"); and
WHEREAS, on June 16, 2015, the Advisory Board modified the benefits zones within
the District, increasing the number of benefit zones from six (6) dealership sites to seven (7)
dealership sites. The boundaries and benefit zones of the District are set forth in Exhibit A, attached
hereto and incorporated herein; and
WHEREAS, the Advisory Board has caused the annual report for Fiscal Year 2022-23
required by California Streets and Highways Code section 36533 to be prepared and filed with the
City Clerk; and
WHEREAS, the City Council has approved said annual report; and
WHEREAS, the City Council proposes to levy and collect an assessment within the
District for Fiscal Year 2022-23; and
WHEREAS, on June 7, 2022, the City Council adopted Resolution No. 2022-50, a
resolution of intention to levy the assessment within the District for FY 2022-23 and setting the
date for a public hearing for June 21, 2022, in accordance with the requirements of California
Streets and Highways Code section 36534; and
WHEREAS, the City Council has conducted a public hearing as required by California
Streets and Highways Code section 36535; and
WHEREAS, the City Council now desires to confirm the annual report as filed by the
Advisory Board and adopt this Resolution to levy the assessment for the 2022-2023 Fiscal Year.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF WEST COVINA,
CALIFORNIA DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. Annual Report. The City Council hereby confirms the annual report on the
District as originally filed by the Advisory Board in accordance with California Streets and
Highways Code section 36535. The report shall be kept on file in the City Clerk's Office.
SECTION 2. Assessment. An annual assessment for the District for Fiscal Year 2022-23
shall be levied pursuant to California Streets & Highways Code sections 36500 et seq. The
boundaries of the District are set forth in Exhibit A. The amount of the annual assessment is
$16,524.00. Pursuant to California Streets & Highways Code section 36531, new businesses
commenced after the effective date of the resolution levying the assessment will be exempt from
the levy of the assessment for Fiscal Year 2022-23.
SECTION 3. Types of Activities to Be Funded. The assessment revenue collected through
the levy of the annual assessment will be used for financing the operation and maintenance of an
LED readerboard sign located in the West Covina Auto Plaza adjacent to the San Bernardino
Interstate 10 Freeway as well as financing of the operation and maintenance costs for the entry
monument to the Auto Plaza, which includes the sign and landscaping located at the southwest
corner of Azusa Avenue and Garvey Avenue South.
SECTION 4. Method and Basis of Lew. The method and basis of levying the assessment
will be pursuant to Ordinance No. 1923, which was adopted by the City Council on June 1, 1993.
SECTION 5. Certification; Effective Date. The City Clerk shall certify to the adoption of
this Resolution and shall enter the same in the book of original resolutions and it shall become
effective immediately.
APPROVED AND ADOPTED this 21st day of June, 2022.
Dario Castellanos
Mayor
APPROVED AS TO FORM
Thomas P. Duarte
City Attorney
ATTEST
Lisa Sherrick
Assistant City Clerk
I, LISA SHERRICK, ASSISTANT CITY CLERK of the City of West Covina, California,
do hereby certify that the foregoing Resolution No. 2022-51 as duly adopted by the City Council
of the City of West Covina at a regular meeting thereof held on the 21 st day of June, 2022, by the
following vote of the City Council:
AYES:
NOES:
ABSENT:
ABSTAIN:
Lisa Sherrick
Assistant City Clerk
EXHIBIT A
WEST COVINA AUTO PLAZA BUSINESS IMPROVEMENT DISTRICT
BOUNDARIES
Exhibit A
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ATTACHMENT NO.2
WEST COVINA AUTO PLAZA
BUSINESS IMPROVEMENT DISTRICT
ANNUAL REPORT
FOR
FISCAL YEAR 2022-2023
1. Any proposed changes in the boundaries of the business improvement district area.
None.
2. The improvements and activities to be provided for Fiscal Year 2022-2023.
Financing the operation and maintenance of an LED readerboard sign located in the West
Covina Auto Plaza adjacent to the San Bernardino Interstate 10 Freeway as well as
financing of the operation and maintenance costs for the entry monument to the Auto
Plaza, which includes the sign and landscaping located at the southwest corner of Azusa
Avenue and Garvey Avenue South. Financing also includes landscape maintenance
along Interstate 10 Freeway immediately facing and parallel to the Auto Plaza
Dealerships.
3. Estimate of the cost of providing the improvements and the activities for Fiscal Year
2022-2023.
Gross estimated annual cost for operating expenditures including programming,
maintenance, electricity, and insurance for the readerboard sign, landscaping, landscape
maintenance, taxes and preparation costs, is $70,670.04. The principal loan amount is
$54,240.03 (paid in two installments), totaling $124,910.07 in annual expenditures. The
Advisory Board voted to assess themselves $16,524.00 (the same as last year) which
would generate $115,668.00 for FY 2022-23. As the annual expenditures increased, the
assessments will not cover the total annual expenditures with a deficit of $9,242.07. The
Advisory Board elected to utilize a portion of the fund balance of $80,025.41 to cover the
deficit of $9,242.07 and to cover the required six (6) month operating reserve
($35,085.02). An assessment of $16,524.00 for each of the seven (7) dealership sites in
the business improvement district will be placed on the tax rolls by the County of Los
Angeles Department of Auditor -Controller.
4. Method and basis of levying the assessment for Fiscal Year 2022-2023.
The method and basis of levying the assessment will be pursuant to Ordinance No. 1923,
which was adopted by the City Council on June 1, 1993.
5. Amount of any surplus or deficit revenues to be carried over from Fiscal Year 2022-
2023.
FY 2022-2023 is anticipated to have a deficit of $9,242.07. The Advisory Board elected
to use a portion of the fund balance to cover the deficit. The anticipated fund balance
starting for FY 2022-23 is $80,025.41. This includes the six (6) month operating reserve
of $35,085.02.
6. Amount of any contributions to be made from sources other than the assessments
levied.
None.
Exhibit A
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