Business Agenda Item 5c
STAFF REPORT
Business Agenda Item
DATE: March 16, 2026
TO: Honorable Mayor and Council Members
FROM: Amy Nilsen, City Manager
SUBJECT: Receive and File Fortuna Business Improvement District’s Annual Report and By-Law Amendments
STAFF RECOMMENDATION:
Staff recommends the Council receive and file, with or without modification, the Fortuna Business Improvement District’s (FBID) Annual Report.
EXECUTIVE SUMMARY
The Fortuna Business Improvement District (“FBID”) was established by the City in 1990 under the Parking and Business Improvement Area Law of 1989 (California Streets and Highways Code §§ 36500 et seq.) to benefit and promote the City’s businesses. Under the enabling statute, the Council is required to approve an annual report that contains the following information:
(1) Any proposed changes in the boundaries of FBID 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.
(6) The amount of any contributions to be made from sources other than assessments levied pursuant to this part.
The annual report (Attachment 1) is before your Council. The Council may approve the report as filed or may modify the report and approve it as modified.
As noted above, FBID was established by the City for the purpose of imposing benefit assessments and charges on businesses for certain identified purposes, including:
Business Agenda Item 5c
• Promote public events which are to take place on or in public places in the district; • Decorate public places in the district;
• Furnish music in public places in the district;
• General promotion of business activities in the district; and • Demonstrate to the District through a report the use of funds, attendance, and/or community benefit.
A. PROPOSED CHANGES IN THE FBID BOUNDARIES:
There are no proposed changes to the FBID boundaries.
B. SUMMARY OF ACTIVITIES FOR FISCAL YEAR 2025/2026:
Calendar Year 2025
April
• Approved $4,000 for the Fortuna Vintage Market
• Approved $1,000 for the Fortuna Christmas Music Festival May
• City Council voted to levy a flat assessment for FBID in the amount of $25 for Fiscal Year 2025-26
July
• Approved $1,004 for the Fortuna Fireworks and 3rd of July Festival • Approved $2,425 for the Fortuna Downtown Business Association. • Approved $4,000 to the Chamber of Commerce for Apple Harvest and the Al Gray Lighted Parade
C. BUDGET SUMMARY:
The FBID Advisory Committee reviewed and recommended that the Council accept the annual report and budget for FBID on January 27, 2026. FBID currently has a $25 flat assessment for all businesses for Fiscal Year 2025-26.
The total expenditures for Fiscal Year 2024-2025 year-to-date are $4,216.00. Total revenue for FY 2025-26 is $14,875. If the City Council approves the continuation of the flat assessment to be levied, FBID’s proposed budget for the next fiscal year will be approved with the City’s annual budget.
The FBID fund has an estimated balance of $16,280.
D. LEVY OF ASSESSMENT
For Fiscal Year 2025-26 a flat assessment of $25.00 for all businesses within the City of Fortuna was assessed.
Business Agenda Item 5c
It is the recommendation of the FBID Advisory Committee and staff that the Council make the following changes:
1. That, without changing the overall boundaries of the District and reassess the basis and method of collecting the assessment to a flat rate of $25 per business.
A change in the amount of the assessment and the elimination of the core areas would need to be memorialized in the Council’s annual resolution declaring its intention to levy the assessment and the resolution (following a public hearing) adopting the levy for the next fiscal year. Staff is seeking direction on the proposed levy from the Council to be able to bring forward the intent to levy the assessment and the resolution at an upcoming Council meeting.
FINANCIAL IMPACT:
If the continuation of an annual assessment is approved at a $25 flat fee approximately $16,500 would be generated annually.
The total expenditures for Fiscal Year 2025-26 year-to-date are $4,216. The FBID fund has a estimated year-end balance of $16,280.
RECOMMENDED COUNCIL ACTION:
1. Receive presentation of the FBID annual report and discuss.
2. Open Public Comment.
3. Close Public Comment.
4. Motion to receive and file the FBID Annual Report either (1) as presented or (2) with specified modifications and provide direction on the proposed changes to assessment.
Voice vote.
ATTACHMENTS:
• FBID 2025-26 Annual Report