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3 DATE: December 18, 2023
TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager
FROM: Marlene Subhashini, Assistant City Manager
Edmund Suen, Finance Director
Sofia Mangalam, Community Development Director
Priscilla Schaus, Communications Director/City Clerk
DEPARTMENT: City Manager
Finance
Community Development
Communications/City Clerk
SUBJECT: UPDATE ON PROGRESS ON THE BUSINESS LICENSE TAX (BLT) ORDINANCE AND A POTENTIAL 2024 BLT BALLOT
MEASURE
RECOMMENDATION
It is recommended that the City Council, by minute order, receive an update on the progress on amending the Business License Tax (BLT) Ordinance and potential 2024 BLT ballot measure.
EXECUTIVE SUMMARY
On October 16, 2023, staff provided a preliminary report on the approach to amending the BLT Ordinance, and steps leading up to the ballot measure in the November 2024 General Election. At the meeting, the City Council received the report and provided the direction to staff to continue the work on placing the BLT ballot measure on the November 2024 General Election (see link to the meeting). Additionally, staff noted the issuance of a Request for Proposal (RFP) for BLT consulting services and another RFP for a focused stakeholder outreach and polling leading up to the November 2024 ballot.
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3 BACKGROUND/ANALYSIS
On September 19, 2023, staff issued an RFP for BLT consulting services, and received one (1) response from HDL Companies (HDL), with a proposed contract amount not exceeding $30,000.
Upon interviewing HDL, staff determined that the consultant possessed the requisite expertise and knowledge related to BLT. The City has a purchasing policy under which if the contract amount is between $10,000-$50,000, the City Manager can authorize the issuance of an RFP and is authorized to approve contracts under $50,000. Thus, City contracted with HDL for amending BLT ordinance. A kickoff meeting was conducted to discuss the scope of the work. HDL is currently engaged in preparing an informational report for the upcoming City Council meeting in January/February 2024, where staff and the consultant will seek guidance on the preferred methodology to amend the BLT Ordinance.
Concurrently, another RFP was issued for 2024 Ballot Measure Polling and Public Outreach Consultant Services on October 26, 2023, with a response deadline set for November 15, 2023. Staff received three (3) responses, including:
• Probolsky Research/GrassrootsLab
• Team Civx/EMC Research/NBS
• Tripepi Smith/FM3 Research
In order to better understand the scope of work provided in the responses, City staff, including Assistant City Manager Subhashini, Finance Director Suen, Communications Director/City Clerk Schaus and Community Development Director Director Mangalam, conducted interviews with all the three (3) firms. Due to the complexity of two (2) different aspects of outreach involving focused outreach and polling, it was noted that the lead consultant teamed up with subconsultants to provide a comprehensive response. Upon further deliberation and based on discussions with staff from neighboring cities engaged in a similar effort, staff decided that two (2) separate RFPs, one (1) for outreach and one (1) for polling/surveys would be a better approach and also cost effective.
On December 01, 2023, a separate RFP for outreach consultant services was issued, again yielding three (3) responses, including, GrassrootsLab, Team Civx/ NBS and Tripepi Smith. Among the three (3) proposals, GrassrootsLab stood out for its excellent understanding of complexity of public engagement and education pertaining to a ballot measure. The agreement amount of $49,000 is within the City Manager’s approval authority. The selected outreach consultant will undertake a comprehensive approach, including but not limited to:
• A dedicated webpage with information regarding the current business license tax program, background on modernizing the tax, discussions to date, the options being considered, and the timeline for a ballot measure. • A direct, targeted outreach to the approximately 24 businesses that would potentially be impacted by such changes to the BLT Ordinance. 5 2
3 • Community workshop(s) for local businesses and residential community to inform them of the proposed amendments to the BLT Ordinance.
Recognizing the importance of understanding residents and business community’s opinion, ensuring that voters are accurately informed and understanding the outcome of their vote(s) associated with the ballot measure, staff will also be engaging a separate consultant for polling services. These services will include:
• Create survey(s)for residential and business community, instrument and undertake a statistically valid online survey and/or telephone poll related to the BLT measure.
• Provide statistical data from which conclusions can be drawn and recommendations made relative to the number of respondents and the effect on the margin of error. The sample size should yield a 90% confidence level and a +/-5% accuracy level.
Next Steps
Staff is working with HDL on an informational report that would compare Foster City’s BLT with other local jurisdictions, including an analysis of comparable cities’ business license tax structures and alternative fee structures, formula, its impact on existing businesses and the City’s revenues. Upon completion of the report, staff will present the report to the City Council in January/February 2024 to seek direction on the preferred methodology to amend the BLT Ordinance. Staff will then work with the consultant on the proposed amendments to the BLT Ordinance and introduce the ordinance to the City Council in May/June 2024. Parallel to this, staff will conduct a focused stakeholder outreach and polling leading up to the November 2024 ballot.
California Environmental Quality Act
The action proposed herein is exempt from the California Environmental Quality Act (CEQA), pursuant to state CEQA Guidelines Section 15061 (b)(3).
FISCAL IMPACT
The agreement amounts for the consulting services, including BLT amendments and stakeholder outreach will be paid from the Economic Development Division budget due to savings from the vacant Economic Development Manager position. Those savings will be used to fund the consulting services; therefore, no additional appropriation is required.
CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Smart Planning, Development, and the Local Economy
ATTACHMENTS:
None