Modesto and Visit Modesto. Beginning July 1, 2025, the Agreement includes a base share allocation of 13.33% of the City’s annual TOT receipts, serving as the foundational funding for Visit Modesto's operations.
To incentivize increased TOT revenue generation, the Agreement introduces a bonus share mechanism. The bonus share is calculated based on a recalculated baseline, defined as the annual average TOT receipts over the preceding three fiscal years. For every $50,000 increase in TOT revenue beyond this baseline, Visit Modesto will receive an additional 0.25% of the total TOT revenue, up to a combined maximum of 20% (base and bonus shares). Importantly, the bonus share is restricted to the current TOT rate of 9%, ensuring that any future TOT rate increases will not alter Visit Modesto’s share.
The Agreement also includes quarterly payment schedules based on projected TOT receipts, with annual financial reconciliations ensuring equitable adjustments for over or underpayments. To streamline operational planning, the City will provide projected TOT revenue figures for the subsequent two fiscal years by February 15 annually, allowing Visit Modesto to align its operating budget and marketing plan submissions with City forecasts. Visit Modesto must submit a draft operating budget and marketing plan by June 1, detailing revenue projections, cost-of-living adjustments (COLA), salary and benefit changes, and vendor estimates. A final version will be due by June 30 for review and approval by the City Manager or designee.
Accountability measures include Visit Modesto’s annual report submission, covering financial status, activities, and Key Performance Indicators (KPIs) by December 31, alongside sponsorship reports for the prior fiscal year. These measures ensure transparency and alignment with the City's expectations and the Modesto Tourism District Management Plan. TOT funds allocated to Visit Modesto will remain in a separate account, restricted to approved uses outlined in the budget.
The Agreement also encourages the prioritization of local vendors to enhance community engagement and economic development.
MTMD Owner’s Association Agreement
On June 25, 2019, The Modesto Tourism Marketing District (the District), was established through Resolution Number 2019-310. This resolution established the District by the hotels issuing a 1% assessment rate to increase tourism in Modesto. In 2024, through Resolution 2024-170, the MTMD was renewed for ten years through 2034. Governed by lodging business owners, the MTMD generates approximately $448,984 annually in assessments, providing a stable funding source for marketing and promotional efforts to boost hotel room night sales.
Visit Modesto has served as the Owners' Association since the District’s inception, managing district funds in alignment with the goals of the Property and Business Improvement District Law of 1994. The initial agreement was set to expire in June 2024 however, via Resolution 2024-256, the Owner’s Association Agreement was extended to June 2025. Under the proposed agreement extension, Visit Modesto will continue managing the District’s funds through June 30, 2030, ensuring consistent promotion of Modesto as a tourist, meeting, and event destination. Should the District be disestablished prior to this date, the agreement will terminate accordingly.
Together, the TOT Funding Agreement and District Owners’ Association Agreement enable Visit Modesto to continue its mission of driving economic growth and enhancing Modesto’s appeal to #11..
- 403 -
Economic Development Committee, May 5, 2025
Agreement with Visit Modesto for Transient Occupancy Tax Funding and Tourism Marketing Owner's Association Agreement
visitors while safeguarding resources through structured accountability and stakeholder collaboration.
FISCAL IMPACT:
The proposed agreements, if approved, establish a structured financial relationship between the City and Visit Modesto, with funding primarily derived from Transient Occupancy Tax (TOT) revenues and Tourism Marketing District (MTMD) assessments. The agreements aim to sustain tourism marketing efforts while ensuring accountability and alignment with city priorities. Key financial components include:
Base TOT Funding Allocation: Starting July 1, 2025, the City will continue to allocate
13.33% of annual TOT receipts as the base share of funding for Visit Modesto’s operations. Estimated at $464,769.39 a year.
Bonus Funding Mechanism: To incentivize increased TOT revenues, Visit Modesto is eligible for a bonus share of 0.25% of TOT receipts for every $50,000 increase in revenue above the recalculated baseline (average TOT revenue of the preceding three fiscal years). Total funding (base and bonus) will not exceed 20% of TOT receipts. For example, see Figure 2 below.
The fiscal impact of this agreement is dependent on the City’s future TOT receipts, the performance of Visit Modesto in driving revenue. The City’s TOT receipts are General Fund revenue that can be used for any purpose.
The Modesto Tourism Marketing District assessment is projected to contribute 45% (or $385,000) of Visit Modesto’s ongoing revenue in Fiscal Year 2025, and the City’s TOT contributions are expected to contribute 55% (or $485,871.9 from the General Fund).
The chart below shows the historical data of the amount Visit Modesto has received based on the current agreement. Second, the chart outlines the TOT revenue increases by $150,000 above the baseline, applying a 0.25% bonus for every $50,000 over that amount.
Figure 1: Chart of Historical TOT Revenues and Distributions by Fiscal Year3 Agreement Fiscal Year TOT Revenue VM Share To VM
FY204 $3,063,194.82 $408,323.87
FY21 $3,041,281.84 $405,402.87
FY22 $3,596,687.88 $479,438.49
FY23 $3,511,475.75 $468,079.72
5-Year TOT
FY24 $3,351,762.69 $446,789.97
1-Year TOT FY255 $3,644,950.52
13.33%
$485,871.90
3 Source: City of Modesto Finance Department
4 Rate charged at a rate of 15% from July 1,2019 to February 1,2020 per annum; effective February 1,2020 the applicable rate was adjusted to 13.33% per annum
5 Fiscal year ‘25 is partially forecasted
#11..
- 404 -
Economic Development Committee, May 5, 2025
Agreement with Visit Modesto for Transient Occupancy Tax Funding and Tourism Marketing Owner's Association Agreement
Figure 2: Chart of Forecasted TOT Revenues and Distribution to Visit Modesto—Scenario 2: TOT Revenues Increase by $150,000, Bonus Share 0.75%6 Fiscal Year TOT Revenue VM Share To VM
FY26 $3,636,642.11 14.08% $512,039.21
Total 5-Year $18,183,210.55 14.08% $2,560,196.05
RECOMMENDED COMMITTEE ACTION:
Motion recommending a five-year Transient Occupancy Tax Funding Agreement with Visit Modesto for continued Tourism Marketing Services, through June 30, 2030, and forwarding to Council for approval.
Motion recommending a Modesto Tourism Marketing District Owners’ Association Agreement with Visit Modesto, Inc. through June 30, 2030, for continued Tourism Marketing Services, and forwarding to Council for approval.
Approved by:
Jessica Hill, Director of Community and Economic
Development
Joseph P. Lopez, City Manager
Attachments:
1. Transient Occupancy Tax Funding Agreement
2. MTMD District Owner's Association Agreement
3. Resolution 2024-170
4. Modesto TMD MDP 1-10-24 FINAL Management Plan
6 This forecast is based upon distributing an additional bonus share of 0.25% per $50,000 increase of generated TOT Revenue
#11..
- 405 -
1 TRANSIENT OCCUPANCY TAX FUNDING AGREEMENT
THIS TRANISENT OCCUPANCY TAX FUNDING AGREEMENT (the “Agreement”) is made and entered into in as of , 2025, (“Effective Date”) by and between the CITY OF MODESTO, a municipal corporation of the State of California, hereinafter referred to as "City", and VISIT MODESTO, INC., a California non-profit corporation, hereinafter referred to as "Visit Modesto".
This Agreement is made with regard to the following recitals:
A. The purpose of Visit Modesto is to attract visitors to the area by promoting and marketing Modesto and to provide coordination and leadership for the tourism industry.
B. The City has previously provided funding to Visit Modesto, and is willing to continue to provide certain funding to Visit Modesto.
C. The City imposed a Transient Occupancy Tax (“TOT”) on the privilege of occupying a hotel on a transient basis, pursuant to Article 6 of Title 8 of the Modesto Municipal Code.
D. As of the Effective Date, the TOT rate is nine percent (9%).
E. The public purpose of providing such funding is the economic benefit that businesses and citizens of Modesto gain from Visit Modesto’s efforts to promote and market the city as a destination for visitors.
NOW, THEREFORE, in consideration of this agreement, and the mutual promises, covenants, and stipulations hereinafter contained, the parties agree as follows:
1. PAYMENT OF TOT.
A. Base Share: Beginning July 1, 2025, for the sole purpose of funding the activities of Visit Modesto during the term of this Agreement, City will provide funding to Visit Modesto in the amount equal to thirteen and one-third percent (13.33%) of the City’s actual annual TOT receipts, this will be defined as the base share.
B. Bonus Share: For the sole purpose of providing an incentive to increase total TOT receipts, the city will offer a bonus on top of the 13.33% base share. The bonus will be based on a calculation of a baseline of annual average TOT from the past three fiscal years. The baseline will be recalculated with each annual #11..
- 406 -
2 review of the agreement. For every $50,000 increase in absolute TOT revenue per year, above the baseline, the shared percentage will increase by 0.25% as a bonus.
C. The combined total percent of both the base share and the bonus share will not go above 20%. The base share and bonus share shall be based upon the City’s TOT receipts from the TOT rate of 9% in existence as of the Effective Date. In the event that the City increases the TOT rate, Visit Modesto shall receive no funds from the TOT receipts attributable to the increased rate.
D. Visit Modesto shall submit a detailed budget to the City no later than August 20th outlining the intended use of the Bonus Share funds.
E. The Bonus Share funds shall not be used for personnel-related expenses, including but not limited to salaries, wages, bonuses, benefits, or any other form of compensation for employees. Visit Modesto agrees to maintain the current level of effort and funding for non-bonus share projects or programs such that the Bonus Share funds shall be used to supplement, not supplant, existing funding and efforts.
F. The City shall make quarterly payments of the funds required by subsections A, above, to Visit Modesto annually on July 5, November 5, February 5, and May 5 (except that the first payment shall be made within thirty days of the Effective Date). The quarterly payments shall be made based on the City’s budgeted TOT receipts. A financial reconciliation of Visit Modesto 's share of TOT for the fiscal year shall be completed by City no later than August 20th of the following fiscal year. Any over or underpayment to the Visit Modesto, as determined by the financial reconciliation will be treated as an adjustment to the November 5th payment. In the event that the Agreement terminates or expires, the City shall make a payment to Visit Modesto to cover any underpayment, and Visit Modesto shall make a payment to the City to cover any overpayment, within ninety (90) days of the termination or expiration of the Agreement. All future TOT payable to Visit Modesto shall be calculated by applying the established formula based on estimated TOT revenue budgeted, and all future financial reconciliation will be completed annually for the preceding Fiscal Year, by the City by August 20th of each year. Any adjustments for over or underpayment will be adjusted on estimated TOT payments each November 5th.
G. For the purposes of this agreement, the annual term shall refer to the fiscal year lasting from July 1 to June 30.
2. ANNUAL REPORTS & BUDGET
#11..
- 407 -
3 A. Annually, by February 15, the City will provide Visit Modesto with the projected revenues for the upcoming two fiscal years. While the City’s projections will be shared for informational purposes, Visit Modesto will retain the discretion to use its own revenue forecasts for budgeting, unless otherwise required by law to align with the City’s figures.
B. Annually by June 1 (or earlier), Visit Modesto shall provide a draft operating budget and annual marketing plan for the upcoming fiscal year to the City Manager, or designee. The draft operating budget shall include all revenue projections, percentage expenditure increases due to cost-of-living adjustments (COLA), salary and benefit increases for employees, and vendor estimates, as well as projected gross labor by category and such other information as the City shall reasonably request. The draft annual marketing plan shall include measurable performance standards.
C. Annually by June 30, Visit Modesto shall submit a final operating budget and annual marketing plan for the upcoming fiscal year which is satisfactory to the City Manager or designee. The final operating budget shall include income, expenses, and fund balances, and such other information as the City shall reasonably request. The operating budget shall be in a form approved by the City Manager and contain sufficient information and detail to permit meaningful review by the public. The final annual marketing plan shall include measurable performance standards.
D. Visit Modesto shall provide the City with a copy of its Annual Report, during its distribution to the board of directors, which includes an overview of its activities, financial accountings, and Key Performance Indicators (KPIs), no less than fifteen (15) days in advance of publishing the report to the public. This report shall be submitted annually by December 31.
E. Annually by December 31, Visit Modesto shall provide a report of all sponsorships made by Visit Modesto for the previous fiscal year, in a format agreed upon by both parties.
3. USE OF FUNDS.
A. TOT Funds paid to Visit Modesto by the City pursuant to this Agreement shall be segregated from all other Visit Modesto funds in a separate account and shall be expended solely for Visit Modesto operations and activities in conformance with the approved operating budget. In no event shall such funds be commingled in any way with other Visit Modesto funds. Further, no such funds shall be transferred, spent, loaned, or encumbered for Visit Modesto activities or #11..
- 408 -
4 purposes other than the operation of Visit Modesto as designated by Visit Modesto Board of Directors.
B. This Agreement will be reviewed with Visit Modesto Board and the City Manager or designee annually.
C. Visit Modesto and City agree to continue to explore and develop ways by which the businesses of the hospitality industry can assist Visit Modesto in the on-going funding of Visit Modesto.
D. When purchasing goods and services, Visit Modesto shall use its best efforts to use local vendors.
E. Visit Modesto may initiate non-binding discussions with City on an annual basis with regard to the economic terms and/or amendment of the collection and distribution of City’s TOT.
4. AUDIT & RECORDS. Visit Modesto will pay for a biannual independent Certified Public Accountant (CPA) firm to conduct a comparative financial audit of its finances for each fiscal year in accordance with generally accepted accounting principles (U.S. GAAP), for submission to and approval by the City. The audit shall be performed by a qualified CPA firm, reasonably acceptable to the City’s Finance Director. The first annual audit shall be due by December 31, 2025, for the fiscal year ending June 30, 2025, with subsequent audits continuing on an biannual basis and due six months after the fiscal year-end.
Visit Modesto Board shall make available to the City, its authorized agents, officers, or employees, for examination any and all ledgers, payroll records, books of accounts, invoices, vouchers, cancelled checks, and other records or documents evidencing or relating to the expenditures and disbursement of Visit Modesto assessment funds, and shall furnish to the City, within thirty (30) days after examination, its authorized agents, officers or employees such other evidence or information as the City may require with regard to any such expenditure or disbursement charged by Visit Modesto. The City further reserves the right to examine and re-examine said books, records and data during the five (5) year period following termination of this Agreement or completion of all work hereunder, as evidenced in writing by the City, and Visit Modesto shall in no event dispose of, destroy, alter, or mutilate said books, records, accounts, and data in any manner whatsoever for five (5) years after the City makes the final or last payment or within five (5) years after any pending issues between the City and Visit Modesto with respect to this Agreement are closed, whichever is later. All requests for audits and records will be made by the City to the Visit Modesto Board. #11..
- 409 -
5 5. INSURANCE REQUIREMENTS. Visit Modesto shall provide at its own expense and maintain at all times the following insurance with insurance companies licensed in the State of California and shall provide evidence of such insurance to the City as may be required by the Risk Manager of the City. The policies or certificates thereof shall provide that, thirty (30) days prior to cancellation or material change in the policy, notices of same shall be given to the Risk Manager of the City by certified mail, return receipt requested, for all the following stated insurance policies.
In the event the certificates of insurance required hereunder do not provide for notice of cancellation to the certificate holder and/or additional insureds, Visit Modesto shall provide, and shall require its subcontractors to provide, as an express condition precedent to payment hereunder, an endorsement from their insurers providing that the additional insureds identified herein shall be provided 30 days’ notice of the cancellation on the policies of insurance required hereunder (10 days’ notice if the policies are cancelled for non-payment of premium). In addition, the named insured on all such policies shall provide to the additional insureds identified herein any notices of cancellation of said insurance policies within 5 business days of receipt of such notice. Visit Modesto shall, as a further express condition precedent to payment for work performed, affirm under penalty of perjury that the required insurance on the project remains in place and said insurance has not been cancelled.
(a) Worker's Compensation - in compliance with the statutes of the State of California, plus employer's liability with a minimum limit of liability of $1,000,000. (b) General Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. This insurance shall indicate on the certificate of insurance the following coverages and indicate the policy aggregate limit applying to premises and operations; broad form contractual; independent consultants and subcontractors; products and completed operations as applicable.
(c) Automobile Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover any automobile for bodily injury and property damage. #11..
- 410 -
6 (d) Professional Liability insurance with a minimum limit of $2,000,000 per claim and policy aggregate. If coverage is on a claim made basis it shall be maintained for at least three (3) years following completion of the work.
If at any time any of said policies shall be unsatisfactory to the City, as to form or substance, or if a company issuing such policy shall be unsatisfactory to the City, Visit Modesto shall promptly obtain a new policy, submit the same to the Risk Manager for approval and submit a certificate thereof as hereinabove provided.
Upon failure of Visit Modesto to furnish, deliver or maintain such insurance and certificates as above provided, this Agreement, at the election of the City, may be forthwith declared suspended or terminated. Failure of Visit Modesto to obtain and/or maintain any required insurance shall not relieve Visit Modesto from any liability under this Agreement, nor shall the insurance requirements be construed to conflict with or otherwise limit the obligations of Visit Modesto concerning indemnification. The City, its agents, officers, employees, and volunteers shall be named as an additional insured on all insurance policies required herein, except Workers' Compensation and Professional Liability. The Workers' Compensation insurer shall agree to waive all rights of subrogation against the City, its agents, officers, employees, and volunteers for losses arising from work performed by Visit Modesto for the City. Visit Modesto 's insurance policy(ies) shall include a provision that the coverage is primary as respects the City; shall include no special limitations to coverage provided to additional insured; and shall be placed with insurer(s) with acceptable Best's rating of A: VII or with approval of the Risk Manager. Visit Modesto must deliver certificates evidencing existence of the insurance listed above to the City prior to the time the contract is signed.
Visit Modesto shall provide City with separate endorsements evidencing proof of the City’s additional insured status as to both the general liability and automobile liability insurance policies. In addition, Visit Modesto shall provide City with a Workers Compensation subrogation waiver by way of a separate endorsement. All endorsements referenced above must include the applicable policy number.
For any claims related to this project, Visit Modesto’s insurance coverage shall be primary insurance as respects the Entity, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the Entity, its officers, officials, employees, or volunteers shall be excess of Visit Modesto insurance and shall not contribute with it.
6. TERM OF AGREEMENT. The term of this Agreement (the “Term”) shall begin on the Effective Date and terminate June 30, 2030, unless extended or sooner termianted by the Parties as set forth herein.
#11..
- 411 -
7 7. ADDITIONAL OBLIGATIONS OF VISIT MODESTO. Throughout the term of this Agreement, Visit Modesto shall possess, or secure all licenses, permits, qualifications and approvals legally required to conduct business. Visit Modesto warrants that it has all of the necessary professional capabilities and experience, as well as all tools, instrumentalities, facilities and other resources necessary to provide the City with the services contemplated by this Agreement. Visit Modesto further warrants that it will follow the best current, generally accepted and professional practices to make findings, render opinions, prepare factual presentations, and provide professional advice and recommendations regarding this project. Visit Modesto shall carry out all services contemplated by this Agreement in accordance with all applicable federal, state, and local laws, ordinances, and regulations.
8. OWNERSHIP OF DOCUMENTS/TITLE TO DATA. All reports, drawings, designs, graphics, working papers, and other incidental work or materials (collectively, the “Materials”) prepared by Visit Modesto shall be the property of Visit Modesto. Copies of all Materials shall be delivered to City by Visit Modesto upon the completion or termination of services under the contract, or at any time upon written request. Visit Modesto hereby grants the City an irrevocable license to reproduce and use such Materials in whatever manner City deems appropriate, without any additional cost to the City. Such license shall survive termination or expiration of the agreement. All materials, documents, data, or information obtained from the City data files or any City medium furnished to Visit Modesto in the performance of this Agreement will at all times remain the property of the City. Such data or information may not be used or copied for direct or indirect use by Visit Modesto after termination of this Agreement without written consent of the City.
9. NEWS AND INFORMATION RELEASE. Visit Modesto agrees that it will not issue any news releases in connection with either the award of this Agreement, or any subsequent amendment of or efforts under this Agreement, without first obtaining review and approval of said news releases from the City Manager.
10.CONFLICT OF INTEREST. Visit Modesto warrants that it presently has no interest and shall not acquire any interest, direct or indirect, which would create a “conflict of interest”, as that term is defined in the Political Reform Act (Gov. Code § 81000 et seq), for Visit Modesto in the performance of this Agreement. Visit Modesto warrants that, in performance of this Agreement, Visit Modesto shall not employ any person having any such interest. Visit Modesto understands that, if this Agreement is made in violation of Government Code § 1090 et seq., the entire Agreement is void and Visit Modesto will not be entitled to any compensation for services performed. Visit Modesto agrees to file a Statement of Economic Interests with the City Clerk at the start and end of this contract if so, required at the option of City. #11..
- 412 -
8 11.AMENDMENTS. This Agreement, including the Exhibits attached hereto, may be amended only by a writing signed by both Parties. City will not be responsible to pay any charges Visit Modesto may incur in performing services not identified in Exhibit ‘A’ unless first authorized by the City in writing
12.INDEPENDENT CONTRACTOR. All acts of Visit Modesto, its agents, officers, and employees and all others acting on behalf of Visit Modesto relating to the performance of this Agreement, shall be performed as independent contractors and not as agents, officers, or employees of City. Except as City may specify in writing, Visit Modesto has no authority to bind or incur any obligation on behalf of City. Visit Modesto has no authority or responsibility to exercise any rights or power vested in the City. It is understood by both Visit Modesto and City that this Agreement shall not under any circumstances be construed or considered to create an employeremployee relationship or a joint venture. Visit Modesto, its agents, officers and employees are and, at all times during the terms of this Agreement, shall represent and conduct themselves as independent contractors and not as employees of City.
Visit Modesto shall determine and control the method, details and means of performing the work and services to be provided by Visit Modesto under this Agreement. Visit Modesto shall be responsible to City only for the requirements and results specified in this Agreement, and, except as expressly provided in this Agreement, shall not be subjected to City's control with respect to the physical action or activities of Visit Modesto in fulfillment of this Agreement. Visit Modesto is permitted to provide services to others during the same period service is provided to City under this Agreement. If necessary, Visit Modesto has the responsibility for employing other persons or firms to assist Visit Modesto in fulfilling the terms and obligations under this Agreement.
If in the performance of this Agreement any third persons are employed by Visit Modesto, such persons shall be entirely and exclusively under the direction, supervision, and control of Visit Modesto. All terms of employment including hours, wages, working conditions, discipline, hiring, and discharging or any other term of employment or requirement of law shall be determined by Visit Modesto.
It is understood and agreed that as an independent contractor and not an employee of City neither Visit Modesto or Visit Modesto 's assigned personnel shall have any entitlement as a City employee, right to act on behalf of the City in any capacity whatsoever as an agent, or to bind the City to any obligation whatsoever. It is further understood and agreed that Visit Modesto must issue W-2 forms or other forms as required by law for income and employment tax purposes for all of Visit Modesto 's personnel.
#11..
- 413 -
9 13.ASSIGNMENT. Neither this Agreement nor any portion thereof shall be subcontracted or assigned without the express prior written consent of the City in each and every instance.
14.PATENT/COPYRIGHT MATERIALS. Unless otherwise expressly provided in the contract, Visit Modesto shall be solely responsible for obtaining the right to use any patented or copyrighted materials in the performance of this Agreement. Visit Modesto shall furnish a warranty of such right to use to City at the request of City
15.NOTICES. Notice required by this Agreement shall be given in writing and shall be deemed given and effective upon delivery provided that such are delivered in accordance with the provisions of this Section. Notices shall be delivered either by:
(a) personal delivery; (b) overnight courier service which obtains confirmation of delivery; or (c) certified pail, return receipt requested, if delivery is confirmed by a return receipt; or (d) by electronic transmission subject to reasonable proof that the notice was both transmitted and received. Each such notice shall be sent to the parties at the address respectively set forth below or to such other address as a party may designate by written notice given in accordance with the provisions of this Section:
For Visit Modesto: Visit Modesto, Inc.
1008 12th Street
Modesto, CA 95354
Attention:Todd Aaronson, CEO
For City City of Modesto
P.O. Box 642
Modesto, CA 95353
Attention: Community and Economic Development
Director
16.TERMINATION OF AGREEMENT. Either party, upon one (1) year’s written notice, may terminate this Agreement, without cause. Any unencumbered or unexpended #11..
- 414 -
10 funds paid to Visit Modesto by CITY pursuant to this Agreement shall be repaid to CITY within thirty (30) days after the end of the one (1) year effective termination date. CITY may terminate this Agreement for cause in the event of Visit Modesto’s insolvency, material uncorrected breach of this Agreement after notice and a reasonable opportunity to cure, changes in Visit Modesto’s by-laws, goals, or mission away from promotion of local tourism or business that are unapproved by CITY’s Council.
17.INDEMNITY. Visit Modesto shall hold the City, its agents, officers, employees, and volunteers, harmless from and save, defend and indemnify them against any and all claims, losses, liabilities, judgments or damages from every cause, including but not limited to injury to person or property or wrongful death, including reasonable costs and expenses of defense of any judicial or administrative action, arising directly or indirectly out of any negligent or intentional act or omission of Visit Modesto , or its agents, officers, employees, or volunteers relating to or during the performance of its obligations under this Agreement.
Visit Modesto 's obligation to defend, indemnify, and hold the City, its agents, officers, and employees harmless under the provisions of this paragraph is not limited to or restricted by any requirement in this Agreement for Visit Modesto to procure and maintain a policy of insurance.
In the event that Visit Modesto or any employee, agent, or subcontractor of Visit Modesto providing services under this Agreement is determined by a court of competent jurisdiction or the California Public Employees Retirement System (PERS) to be eligible for enrollment in PERS as an employee of City, Visit Modesto shall indemnify, defend, and hold harmless City for the payment of any employee and/or employer contributions for PERS benefits on behalf of Visit Modesto or its employees, agents, or subcontractors, as well as for the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of City.
18.DISPUTE RESOLUTION. Venue for all claims, controversies, or disputes arising out of, or relating to the formation of this Agreement, or the breach, termination execution, enforcement, interpretation, or validity of this Agreement, including the determination of the scope or applicability of this contract provision shall be in the Superior Court of Stanislaus County or the United States District Court for the Eastern District of California.
19.ATTORNEYS’ FEES. If a party to this AGREEMENT brings any action, including an action for declaratory relief, to enforce or interpret the provision of this AGREEMENT, the prevailing party shall be entitled to reasonable attorneys’ fees in #11..
- 415 -
11 addition to any other relief to which that party may be entitled. The court may set such fees in the same action or in a separate action brought for that purpose.
20.ENTIRE AGREEMENT. This Agreement and its exhibits contain the entire understanding between Visit Modesto and City. All previous proposals, offers and communications relative to this Agreement, whether oral or written, are hereby superseded except to the extent that they have been incorporated into this Agreement.
21.THIRD PARTY BENEFICIARIES. This Agreement is solely between and for the benefit of the City and Visit Modesto, and there are no third party beneficiaries of this Agreement.
22.PARTIAL INVALIDITY.If any provision in this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way.
23.WAIVER. The waiver by any party to this Agreement of a breach of any provision hereof shall be in writing and shall not operate or be construed as a waiver of any other or subsequent breach hereof unless specifically stated in writing.
24.GOVERNING LAW. This Agreement shall be governed according to the laws of the State of California.
25.HEADINGS NOT CONTROLLING. Headings used in the Agreement are for reference purposes only and shall not be considered in construing this Agreement.
26.COMPLIANCE WITH LAWS. Visit Modesto shall insure compliance with all safety and hourly requirements for employees, in accordance with federal, state, and county safety and health regulations and laws. Visit Modesto shall fully comply with all applicable federal, state, and local laws, ordinances, regulations and permits
27.CITY BUSINESS LICENSE. Visit Modesto will have a City of Modesto business license.
#11..
- 416 -
1 MODESTO TOURISM MARKETING DISTRICT OWNERS’ ASSOCIATION
AGREEMENT
This Modesto Tourism Marketing District Owners’ Association Agreement (the “Agreement”), dated this th day of , 2025, is by and between the City of Modesto, a California municipal corporation (“City”) and “Visit Modesto, Inc”, a California nonprofit corporation (“Visit Modesto”), collectively referred to as the “Parties.”
WITNESSETH
WHEREAS, on June 25, 2019, the City Council adopted Resolution Number 2019-310 , , creating the Modesto Tourism Marketing District (“MTMD”) in accordance with the provisions of the Property and Business Improvement District Law of 1994, Streets and Highways Code Section 36600 et seq., (the “1994 Law”).
WHEREAS, on May 14, 2024, the City Council adopted Resolution Number 2024-170, (the “Resolution”), attached as Exhibit A, hereto, renewing the MTMD for a ten-year term in accordance with the provisions of the “1994 Law”.
WHEREAS, Visit Modesto was designated in the Resolution and MTMD Management District Plan as the Owners’ Association in accordance with Streets and Highways Code Section 36612, and as the entity responsible for managing the operations of the MTMD.
WHEREAS, the Streets and Highways Code section 36651 requires a contract between the City and the Owners’ Association.
WHEREAS, On January 28, 2020, by Resolution Number 2020-039, the Modesto City Council approved the MTMD agreement which authorized Visit Modesto to provide marketing and promotional programs intended to increase hotel room night sales at all hotels that remit an MTMD assessment.
#11..
- 417 -
2 WHEREAS, on July 9, 2024 by Resolution 2024-256 the MTMD agreement was extended through June 30, 2025.
WHEREAS, the City desires, and Visit Modesto agrees, to continue to have Visit Modesto provide services to the City on the terms and conditions set forth in this Agreement.
Now, therefore, the parties agree as follows:
1. Term. The term of this Agreement shall begin on the last date signed by all Parties, and end on June 30, 2030, unless extended or sooner terminated by the Parties or, if the MTMD is disestablished prior to June 30, 2030, the effective date of MTMD disestablishment.
2. Engagement. Each Party hereby retains the other Party to provide the services described in Exhibit B, and each Party accepts such engagement.
3. Services Rendered. Visit Modesto shall provide sales and marketing programs and other improvements and activities as set forth in the MTMD Management District Plan (“Management Plan”), attached hereto as Exhibit B. Visit Modesto hereby agrees to abide by all rules and regulations as established by the Resolution, this Agreement and the Management Plan, including, but not limited to, the plan budget, annual report, Brown Act and Public Records Act compliance. Visit Modesto shall submit an annual report to the City for review and approval for each fiscal year for which assessments were levied and collected for the MTMD (the "Annual Report "). The Annual Report shall be prepared in accordance with Section 36650 of the Streets and Highways Code.
4. Payment/Pass-through of Assessments Collected. The City shall distribute to Visit Modesto on or before the 30th day of October, January, April and July the MTMD assessment funds collected during the preceding calendar quarter, less the amount necessary to reimburse the City for its costs to collect and administer the MTMD assessment. In no event shall the amount withheld by the City to cover its costs exceed three percent (3%) of funds collected during the fiscal year. Neither the City's General Fund, nor any other City fund, revenue source, #11..
- 418 -
3 or any other City monies, shall be transferred to Visit Modesto by the City. All Parties acknowledge and agree that any unpaid MTMD assessments are not a debt of the City, nor a legal or equitable pledge, charge, lien or encumbrance upon any City property or upon City income, receipts or revenues.
5. Independent Contractor. No relationship of employer and employee is created by this Agreement; it being understood and agreed that Visit Modesto is an independent contractor. Visit Modesto is not the agent or employee of City in any capacity whatsoever and City shall not be responsible for any acts or omissions of Visit Modesto nor for any obligations or liabilities incurred by Visit Modesto.
A. Visit Modesto personnel shall not be entitled to any benefits payable to employees of the City.
B. Any third parties employed by Visit Modesto shall be entirely and exclusively under the direction, control and supervision of Visit Modesto, and Visit Modesto shall be solely responsible for and obligated to pay directly all applicable payroll taxes (including federal and state income taxes) or contributions for unemployment insurance or old age pensions or annuities which are imposed by any governmental entity in connection with the labor used or which are measured by wages, salaries or other remuneration paid to Visit Modesto’s employees or agents and agrees to indemnify and hold City harmless from any and all liability which City may incur because of Visit Modesto’s failure to pay such amounts.
C. In carrying out the work contemplated herein, Visit Modesto shall comply with all applicable federal and state workers’ compensation and liability laws and regulations with respect to the officers, agents and/or employees conducting and participating in the work; and agrees that such officers, agent, and/or employees will be considered independent contractors and shall not be treated in any way as officers, agents and/or employees of the City.
D. Visit Modesto hereby agrees to hold City harmless from any and all claims that may be made against City based upon any contention by any third party that an employer-employee relationship exists by reason of this Agreement. In the event that Visit Modesto or any employee, agent or #11..
- 419 -
4 subcontractor of Visit Modesto providing services under this Agreement is determined by a court of competent jurisdiction or the California Public Employees Retirement System (PERS) to be eligible for enrollment in PERS as an employee of City, Visit Modesto shall indemnify, defend and hold harmless City for payment of any employee and/or employer contributions for PERS benefits on behalf of Visit Modesto or its employees, agents or subcontractors, as well as for the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of City.
E. Visit Modesto agrees to perform its work and functions at all times in strict conformance with all applicable federal, state, county and city laws, regulations, resolutions, and currently approved methods and practices in the field; and that the sole interest of City is to ensure that the services shall be performed and rendered in a competent, efficient, timely and satisfactory manner and in accordance with the standards required by the City.
6. Indemnification: Visit Modesto shall indemnify, defend with counsel acceptable to City, and hold harmless CITY, its officers, officials, employees, agents, and volunteers from and against any and all liability, losses, claims, suits, actions, damages, expense, and costs (including without limitations attorneys’ fees) and causes of action arising out of any personal injury, bodily injury, loss of life, or damage to property, or any violation of any federal, state or municipal law or ordinance, arising out of Visit Modesto’s performance of the work described herein or its failure to comply with any applicable law or regulation, except such loss or damage which was caused by the sole negligence or willful misconduct of City.
7. Insurance Provisions. The Visit Modesto shall provide at its own expense and maintain at all times the following insurance with insurance companies licensed in the State of California and shall provide evidence of such insurance to the City as may be required by the Risk Manager of the City. The policies or certificates thereof shall provide that, thirty (30) days prior to cancellation or material change in the policy, notices of same shall be given to the Risk Manager of the City by #11..
- 420 -
5 certified mail, return receipt requested, for all of the following stated insurance policies.
In the event the certificates of insurance required hereunder do not provide for notice of cancellation to the certificate holder and/or additional insureds, the Visit Modesto shall provide, and shall require its subcontractors to provide, as an express condition precedent to payment hereunder, an endorsement from their insurers providing that the additional insureds identified herein shall be provided 30 days notice of the cancellation on the policies of insurance required hereunder (10 days notice if the policies are cancelled for non-payment of premium). In addition, the named insured on all such policies shall provide to the additional insureds identified herein any notices of cancellation of said insurance policies within five (5) business days of receipt of such notice. The Visit Modesto shall, as a further express condition precedent to payment for work performed, affirm under penalty of perjury that the required insurance on the project remains in place and said insurance has not been cancelled.
A. Worker's Compensation - in compliance with the statutes of the State of California, plus employer's liability with a minimum limit of liability of $1,000,000.
B. General Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. This insurance shall indicate on the certificate of insurance the following coverages and indicate the policy aggregate limit applying to: premises and operations; broad form contractual; independent contractorsand subcontractors; products and completed operations as applicable.
C. Automobile Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover any automobile for bodily injury and property damage.
#11..
- 421 -
6 D. Professional Liability insurance with a minimum limit of $1,000,000 per claim and policy aggregate. If coverage is on a claims made basis it shall be maintained for at least three (3) years following completion of the work.
If at any time any of said policies shall be unsatisfactory to the City, as to form or substance, or if a company issuing such policy shall be unsatisfactory to the City, the Visit Modesto shall promptly obtain a new policy, submit the same to the Risk Manager for approval and submit a certificate thereof as hereinabove provided.
Upon failure of the Visit Modesto to furnish, deliver or maintain such insurance and certificates as above provided, this Agreement, at the election of the City, may be forthwith declared suspended or terminated. Failure of the Visit Modesto to obtain and/or maintain any required insurance shall not relieve the Visit Modesto from any liability under this Agreement, nor shall the insurance requirements be construed to conflict with or otherwise limit the obligations of the Visit Modesto concerning indemnification. The City, its agents, officers, officials, employees, and volunteers shall be named as an additional insured on all insurance policies required herein, except Workers' Compensation and Professional Liability. The Workers' Compensation insurer shall agree to waive all rights of subrogation against the City, its agents, officers, officials, employees, and volunteers for losses arising from work performed by Visit Modesto for the City. The Visit Modesto's insurance policy(ies) shall include a provision that the coverage is primary as respects the City; shall include no special limitations to coverage provided to additional insured; and, shall be placed with insurer(s) with acceptable Best's rating of A:VII or with approval of the Risk Manager. The Visit Modesto must deliver certificates evidencing existence of the insurance listed above to the City prior to the time the contract is signed.
Visit Modesto shall provide CITY with separate endorsements evidencing proof of the CITY’s additional insured status as to both the general liability and automobile liability insurance policies. In addition, Visit Modesto shall provide CITY with a Workers Compensation subrogation waiver by way of a separate
endorsement. All endorsements referenced above must include the applicable policy number.
#11..
- 422 -
7 For any claims related to this project, the Visit Modesto’s insurance coverage shall be primary insurance as respects the Entity, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the Entity, its officers, officials, employees, or volunteers shall be excess of the Visit Modesto’s insurance and shall not contribute with it.
8. Conformity with Law. Visit Modesto shall comply with all applicable laws, ordinances and codes of federal, state and local governments in performance of this Agreement.
9. Taxes. Payment of all applicable federal, state and local taxes shall be Visit Modesto’s sole responsibility.
10. Ownership of Documents.
A. Visit Modesto is the owner of all documents and materials produced and created in support of the MTMD. Visit Modesto hereby agrees to provide to a private, not-for-profit, successor and if there is none then assigns the City and its assignees all copyright and other use rights in any and all proposals, plans, specifications, designs, drawings, sketches, renderings, models, reports and related documents (including computerized or electronic copies) respecting in any way the subject matter of this Agreement, whether prepared by the City, Visit Modesto, Visit Modesto’s subcontractors or third parties at the request of the Visit Modesto (collectively, “Documents and Materials”). This explicitly includes electronic copies of all above stated documentation.
B. Visit Modesto shall be permitted to retain copies, including reproducible copies and computerized copies, of Documents and Materials. Visit Modesto agrees to take such further steps as may be reasonably requested by City to implement the aforesaid assignment. If for any reason said assignment is not effective, Visit Modesto hereby grants the City and any assignee of the City an express royalty – free license to retain and use said Documents and Materials. The City’s rights under this paragraph shall apply regardless of the degree of completion of the Documents and Materials and whether or not Visit Modesto’s services set #11..
- 423 -
8 forth in Exhibit “A” of this Agreement have been fully performed or paid for.
C. Visit Modesto shall pay all royalties and license fees which may be due for any patented or copyrighted materials, methods or systems selected by Visit Modesto shall defend, indemnify and hold the City harmless from any claims for infringement of patent or copyright arising out of such selection.
D. The City’s rights under this Section shall not extend to any computer software used to create such Documents and Materials.
E. Nothing in this Section is intended to, or shall, limit Visit Modesto’s obligations to comply with the California Public Records Act, and make the Documents and Materials available upon request unless an exemption to the California Public Records Act applies.
11. Notices. Notices shall be in writing and shall be deemed to be properly given if delivered, mailed, or sent as follows:
A. A nationally recognized overnight courier, in which case notice shall be deemed delivered one (1) business day after deposit with that courier; B. Hand delivery, in which case notice shall be deemed delivered upon receipt;
C. By United States Mail, by postage prepaid, in which case notice shall be deemed delivered five (5) days after delivery in the United States Mail; or D. Facsimile or similar means if copy of the notice is also sent by United States Mail, in which case notice shall be deemed delivered on transmittal by the facsimile or other similar means, provided that a transmission report is generated by reflecting the accurate transmission of the notice.
All notices under this section shall be given as set forth below. Any party may change its address or facsimile number by giving the other Party notice of the change in any manner permitted by this Agreement.
City: City of Modesto
PO Box 642
Modesto, CA 95353
#11..
- 424 -
9 Attention: Jessica Hill, Director CED
Visit Modesto: Visit Modesto
1008 12th Street
Modesto, CA 95354
Attention: Todd Aaronson, CEO
Any correctly addressed notice that is refused, unclaimed, or undeliverable because of an act or omission of the party to be notified shall be deemed effective as of the first date that said notice was refused, unclaimed, or deemed undeliverable by the postal authorities, messenger, or overnight delivery service.
12. Use of City Property. Visit Modesto shall not use City property, including equipment, instruments and supplies, or personnel for any purpose other than the performance of its obligations under this Agreement.
13. Audits and Records Access.
A. Visit Modesto shall make available to the City, its authorized agents, officers or employees, for examination any and all ledgers, books of accounts, invoices, payroll records, vouchers, cancelled checks, and other records or documents evidencing or relating to the expenditures and disbursement of MTMD assessment funds, and shall furnish to City, its authorized agents, officers or employees, such other evidence or information as the City may require with regard to any such expenditure or disbursement charged by Visit Modesto.
B. Visit Modesto shall maintain full and adequate records in accordance with City requirements to show the actual costs incurred by Visit Modesto in the performance of this Agreement. If such books and records are not kept and maintained by Visit Modesto within the City, Visit Modesto shall, upon request of City make such books and records available to City for inspection at a location within the City or Visit Modesto shall pay to City the reasonable and necessary costs incurred by City in inspecting Visit Modesto’s books and records, including, but not limited to, travel, lodging and subsistence costs. Visit Modesto shall provide such assistance as #11..
- 425 -
10 may be reasonably required in the course of such inspection. The City further reserves the right to examine and re-examine said books, records and data during the four (4) year period following the termination of this Agreement, or completion of all work hereunder, as evidenced in writing by City, and Visit Modesto shall in no event dispose of, destroy, alter or mutilate said books, records, accounts and data in any manner whatsoever for four (4) years after any pending issues between the City and Visit Modesto with respect to this Agreement are closed, whichever is later.
C. The records required by subsection A and B above shall be provided promptly to the City upon request. Failure to provide such records within a reasonable period of time shall be a breach of this Agreement.
D. Visit Modesto will pay for a biannual independent Certified Public Accountant (CPA) firm to conduct a comparative financial audit of its finances for each fiscal year in accordance with generally accepted accounting principles (U.S. GAAP), for submission to and approval by the City. The audit shall be performed by a qualified CPA firm, reasonably acceptable to the City’s Finance Director. The first annual audit shall be due by December 31, 2025, for the fiscal year ending June 30, 2025, with subsequent audits continuing on an annual basis and due six months after the fiscal year-end.
14. Documents and Materials. Visit Modesto shall maintain and make available to City for its inspection and use during the term of this Agreement, all Documents and Materials, as defined in this Agreement. Visit Modesto’s obligations shall continue for four (4) years following the termination or expiration of this Agreement and Visit Modesto shall in no event dispose of, destroy, alter or mutilate said Documents and Materials, for four (4) years following City’s last payment to Visit Modesto under this Agreement.
15. Termination/Disestablishment. The City has and reserves the right to suspend, terminate or abandon the execution of any work by Visit Modesto without cause at any time after the adoption of a resolution of intention to disestablish the MTMD pursuant to the 1994 Law by City and upon providing Visit Modesto a copy of the adopted resolution of intention. In the event the City disestablishes #11..
- 426 -
11 the MTMD, Visit Modesto shall be entitled to retain Visit Modesto revenues only for paying the Visit Modesto’s current liabilities of the MTMD. Pursuant to the 1994 Law, Visit Modesto shall refund to City any remaining MTMD revenues to enable distribution of the revenues to the businesses that paid the assessment.
16. Licensing Requirements. To the extent the business license requirements of the Modesto Municipal Code apply, Visit Modesto and any subcontractors subject to the requirements must acquire at their sole expense a business license from City in accordance with the Code. Such licenses must be kept valid throughout the Agreement term. Visit Modesto represents and warrants to City that Visit Modesto and its employees, agents, and any subcontractors have all licenses, permits, qualifications, and approvals of whatsoever nature that are legally required to practice in their respective professions. Visit Modesto expressly represents and warrants to City that Visit Modesto and its employees, agents, and any subcontractors shall, at their sole cost and expense, keep in effect at all times during the term of this Agreement any licenses, permits, and approvals that are legally required to practice their respective professions.
17. Advertising or Publicity. Visit Modesto shall not use, reproduce or copy the seal of the City and shall not represent the City in an official capacity as spokesperson or officer or agent or use the name City of Modesto, or the names of the City’s officers, employees or agents, in advertising or publicity releases or otherwise without securing the prior written consent of City in each instance. Nothing in this Section prohibits Visit Modesto from using the name “Modesto Tourism Marketing District” or “City of Modesto” for regional identification for promotion and marketing of the MTMD.
18. Choice of Law and Venue. This Agreement and any dispute arising from it shall be governed by the Laws of the State of California. Any legal action arising out of this Agreement shall be filed in and adjudicated by a court of competent jurisdiction in the County of Stanislaus, California.
19. Non-Discrimination. In performing this Agreement, Visit Modesto shall not discriminate against any employee, recipient of Visit Modesto’s services, or any other person, on the basis of a person’s race, religion, color, national origin, age, physical or mental handicap or disability, medical condition, marital status, #11..
- 427 -
12 gender, or sexual orientation, and shall comply with all applicable local, state and federal laws relating to nondiscrimination.
20. Entire Agreement. This Agreement, including all attachments, exhibits, and any other documents specifically incorporated into this Agreement, shall constitute the entire agreement between City and Visit Modesto relating to the subject matter of this Agreement. As used herein, Agreement refers to and includes any documents incorporated herein by reference and any exhibits or attachments.
This Agreement supersedes and merges all previous understandings, and all other agreements, written or oral, between the parties and sets forth the entire understanding of the parties regarding the subject matter thereof. This Agreement may not be modified except by a written document signed by both parties.
21. Modification of Agreement. This Agreement may be supplemented, amended or modified only by mutual agreement of the parties; however, this Agreement shall be subject to any amendments to the MTMD Management District Plan adopted by the City Council pursuant to the 1994 Law. No supplement, amendment or modification of this Agreement, except for a duly adopted amendment to the MTMD Management District Plan, shall be binding unless it is in writing and signed by authorized representatives of both parties.
22. Assurance of Performance. If at any time the City has good objective cause to believe Visit Modesto may not be adequately performing its obligations under this Agreement or that Visit Modesto may fail to complete services as required by this Agreement, City may request from Visit Modesto prompt written assurances of performance and a written plan acceptable to City, to correct the observed deficiencies in Visit Modesto’s performance. Visit Modesto shall provide such written assurances and written plan within thirty (30) calendar days of its receipt of City’s request and shall thereafter diligently commence and fully perform such written plan. Visit Modesto acknowledges and agrees that any failure to provide such written assurances and written plan within the required time is a material breach under this Agreement.
23. Subcontracting and Assignments. Visit Modesto shall not subcontract, assign or delegate any portion of this Agreement or any duties or obligations hereunder #11..
- 428 -
13 without the City’s prior written approval. Visit Modesto may use subcontractors to provide services without prior written consent of the City.
24. Severability. If a court of competent jurisdiction holds any provision of this Agreement to be illegal, unenforceable, or invalid in whole or in part for any reason, the validity and enforceability of the remaining provisions, or portions of them, will not be affected, unless an essential purpose of this Agreement would be defeated by the loss of the illegal, unenforceable, or invalid provision.
25. Conflict of Interest. Visit Modesto warrants that it presently has no interest and shall not acquire any interest, direct or indirect, which would create a “conflict of interest”, as that term is defined in the Political Reform Act (Gov. Code § 81000 et seq), for Visit Modesto in the performance of this Agreement. Visit Modesto warrants that, in performance of this Agreement, Visit Modesto shall not employ any person having any such interest. Visit Modesto understands that, if this Agreement is made in violation of Government Code § 1090 et seq., the entire Agreement is void and Visit Modesto will not be entitled to any compensation for services performed. Visit Modesto agrees to file a Statement of Economic Interests with the City Clerk at the start and end of this contract if so required at the option of City.
26. Interpretation. Each party hereto has had an equivalent opportunity to participate in the drafting of the agreement and/or to consult with legal counsel. Therefore, the usual construction of an agreement against the drafting party shall not apply hereto. This Agreement is made solely for the benefit of the parties hereto, with no intent to benefit any third parties.
#11..
- 429 -
14 IN WITNESS WHEREOF, the CITY, a Municipal Corporation, has authorized the execution of this MODESTO TOURISM MARKETING DISTRICT OWNERS’ ASSOCIATION AGREEMENT in duplicate by its City Manager and attestation by its City Clerk (under authority of Resolution No. adopted by the Council of the City of Modesto) on the day of , and VISIT MODESTO has caused this Agreement to be duly executed.
#11..
- 430 -
15 EXHIBIT A
[Attach resolution for this Exhibit]
#11..
- 431 -
16 EXHIBIT B
[Attach Management Plan for this Exhibit]
#11..
- 432 -
#11..
- 433 -
#11..
- 434 -
#11..
- 435 -
#11..
- 436 -
#11..
- 437 -
#11..
- 438 -
#11..
- 439 -
#11..
- 440 -
#11..
- 441 -
April 11, 2019
R
MODESTO TOURISM MARKETING DISTRICT
MANAGEMENT DISTRICT PLAN
Prepared pursuant to the Property and Business Improvement District Law of 1994, Streets and Highways Code section 36600 et seq.
2024-2034
January 10, 2024
#11..
- 442 -
CONTENTS
I. OVERVIEW.......................................................................................................................................... 3 II. BACKGROUND................................................................................................................................. 5 III. ACCOMPLISHMENTS ..................................................................................................................... 6 IV. BOUNDARY........................................................................................................................................ 8 V. ASSESSMENT BUDGET AND SERVICES..............................................................................10 A. Annual Service Plan.......................................................................................................... 10 B. Annual Budget .................................................................................................................. 11 C. California Constitutional Compliance .............................................................................. 13 D. Assessment........................................................................................................................ 15 E. Interest and Penalties ........................................................................................................ 16 F. Time and Manner for Collecting Assessments................................................................. 16 VI. GOVERNANCE ...............................................................................................................................17 A. Owners’ Association......................................................................................................... 17 B. Brown Act and California Public Records Act Compliance ............................................ 17 C. Annual Report................................................................................................................... 17 APPENDIX 1 – LAW ....................................................................................................................................18 APPENDIX 2 – ASSESSED BUSINESSES..............................................................................................31 Prepared by
Civitas
(800)999-7781
www.civitasadvisors.com
#11..
- 443 -
MTMD Management District Plan 3
January 10, 2024
I. OVERVIEW
Developed by Visit Modesto, Inc. (VM) and Modesto lodging businesses, the Modesto Tourism Marketing District (MTMD) is an assessment district proposed to continue to provide specific benefits to payors, by funding marketing and sales promotion efforts for assessed businesses. This approach has been used successfully in other destination areas throughout the country to provide the benefit of additional room night sales directly to payors. The MTMD was created in 2019 for a four (4) year and eleven (11) month term. VM, Modesto lodging businesses, now wish to renew the MTMD for an additional ten (10) year term.
Location: The renewed MTMD includes all lodging businesses with twenty (20) rooms or more, existing and in the future, available for public occupancy located within the boundaries of the City of Modesto (referred to herein as “assessed businesses”), as shown on the map in Section IV.
Services: The MTMD is designed to provide specific benefits directly to payors by increasing awareness and demand for room night sales. Marketing and sales promotions will increase demand for overnight tourism and market payors as tourist, meeting, and event destinations, thereby increasing demand for room night sales.
Budget: The total MTMD annual assessment budget for the initial year of its ten (10) year operation is anticipated to be approximately $430,540. A similar budget is expected to apply to subsequent years, but this budget is expected to fluctuate as room sales do, as businesses open and close, and if assessment rates are increased as detailed in Section V.
Cost: The annual assessment rate is one percent (1%) of gross short-term sleeping room rental revenue. Based on the benefit received, assessments will not be collected on:
stays of more than twenty-seven (27) consecutive days; stays by any officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty; stays by any officer or employee of the United States Government, or of a federal credit union, or of a state, county, city or other domestic public entity who pays rent in the discharge of official government business; and stays by any officer or employee of a bank or insurance company who pays rent in the discharge of official bank or insurance company business.
During the MTMD’s ten (10) year term, upon the recommendation of the TMD Committee and approval by the Modesto City Council, the assessment rate may be increased by the Owners’ Association to a maximum rate of three percent (3%) of gross short-term sleeping room rental revenue for assessed businesses as described in Section V. The increase in any year shall not exceed one-half of one percent (0.50%) of gross short-term sleeping room rental revenue as detailed in Section V. #11..
- 444 -
MTMD Management District Plan 4
January 10, 2024
……………………………………………………..
Collection: The City of Modesto (City) will be responsible for collecting the assessment (including any delinquencies, interest, and penalties) from each assessed business located in the boundaries of the MTMD. As the tax administrator, the City shall have the flexibility to determine and set the assessment collection schedule (monthly/quarterly). The City shall take all reasonable efforts to collect the assessments from each assessed business.
Duration: The renewed MTMD will have a ten (10) year life, beginning July 1, 2024, or as soon as possible thereafter, and ending ten (10) years from its start date. After ten (10) years, the MTMD may be renewed pursuant to the Property and Business Improvement District Law of 1994, Streets and Highways Code section 36600 et seq. (94 Law) if business owners support continuing the MTMD programs. Once per year, beginning on the anniversary of MTMD formation, there is a thirty (30) day period in which owners paying fifty percent (50%) or more of the assessment may protest and initiate a City Council hearing on MTMD termination.
Management: With the approval of the Modesto City Council, Visit Modesto, Inc. (VM) shall continue to serve as the MTMD’s Owners’ Association. The Owners’ Association is charged with managing funds and implementing programs in accordance with this Plan and must provide annual reports to the City Council. VM shall create a TMD Management Committee comprised of lodging business owners paying the assessment. The TMD Management Committee shall be tasked with determining how MTMD funds are spent within the designated programs in this Plan, subject to final approval by VM’s Board.
#11..
- 445 -
MTMD Management District Plan 5
January 10, 2024
II. BACKGROUND
TMDs are an evolution of the traditional Business Improvement District. The first TMD was formed in West Hollywood, California in 1989. Since then, over 100 California destinations have followed suit. In recent years, other states have begun adopting the California model –Illinois, Minnesota, Massachusetts, Montana, South Dakota, Washington, Colorado, Texas, and Louisiana have adopted TMD laws. Several other states are in the process of adopting their own legislation. The cities of Wichita, Kansas and Newark, New Jersey used an existing business improvement district law to form a TMD. Additionally, some cities, like Portland, Oregon and Memphis, Tennessee have utilized their home rule powers to create TMDs without a state law.
California’s TMDs collectively
raise over $500 million
annually for local destination
marketing. With competitors
raising their budgets, and
increasing rivalry for visitor
dollars, it is important
that Modesto lodging
businesses continue to invest
in stable, commerce-specific
marketing programs.
TMDs utilize the efficiencies
of private sector operation in the market-based promotion of tourism districts. TMDs allow lodging business owners to organize their efforts to increase commerce. Lodging business owners within the TMD pay an assessment and those funds are used to provide services that increase commerce.
In California, most TMDs are formed pursuant to the Property and Business Improvement District Law of 1994. This law allows for the creation of a benefit assessment district to raise funds within a specific geographic area. The key difference between TMDs and other benefit assessment districts is that funds raised are returned to the private non-profit corporation governing the district.
There are many benefits to TMDs:
• Funds must be spent on services and improvements that provide a specific benefit only to those who pay;
• Funds cannot be diverted to general government programs; • They are customized to fit the needs of payors in each destination; • They allow for a wide range of services;
• They are designed, created, and governed by those who will pay the assessment; and • They provide a stable, long-term funding source for tourism promotion. #11..
- 446 -
MTMD Management District Plan 6
January 10, 2024
III. ACCOMPLISHMENTS
1. TOT Revenue
• Since the 2018/19 Fiscal Year, total TOT (Transient Occupancy Tax) revenue has increased by over 21%
• In marketing spending on tour and travel related business has increased by over 24% (DRA reports)
2. Pandemic Revenue
Throughout the pandemic, the Modesto Hospitality market achieved the best results in the Central Valley. In the fiscal year 2021-22, the market performance for Modesto far exceeded all cities of the Central Valley in Occupancy and RevPAR resulting in a record year for TOT at $3.6M. More importantly, in the fiscal year ending June 30, 2020, after 90 days of a global standstill, the TOT performance in Modesto exceeded the best year in collection history (2018-19). All these achievements occurred while the global travel industry was in constant flux.
More importantly, compared to the Central Valley’s largest cities while experiencing the reduced room count, Modesto outperformed every city in pre-pandemic v post-pandemic performance for 2022-23 in both Occupancy and RevPAR. Note that while all cities experienced a loss in occupancy, Modesto had the lowest variance and was the only city to GROW in RevPAR.
3. February/March Growth
Upon inception, the Visit Modesto team committed to the MTMD that ‘shoulder periods’ would be the primary focus of efforts to grow occupancy & RevPAR. The first initiative was launched in February 2020, the Almond Blossom Cruise, for the February/March season with a unique Agricultural Tourism and a long-drive market-stay-overnight angle. The results have been incredible, though a global pandemic almost brought tourism to a grinding halt starting in February of 2020.
The results for RevPAR performance are below compared to pre-pandemic levels; REVPAR 2019 2020 2021. 2022. 2023.
February $64.27 $66.44 $66.80 $77.53 $83.17
March $71.28 $49.91* $77.84 $82.80 $79.60
*Global quarantines began in March 2020
The end result is incredible with a 29.5% increase for February and a 11.7% increase for March.
These types of results exemplify the reason the MTMD was formed and the potential that the team at Visit Modesto has to impact tourism when the market conditions and travel trends are aligned for new initiatives.
4. Destination Programs
During the pandemic, Visit Modesto had several successful initiatives that brought significant visitor impact during traditionally low occupancy, low visitation periods; • Almond Blossom Cruise; increased occupancy and revenues for February/March. In 2022, in the heart of the Pandemic when the weather was good (2023 had 40 out of 45 days with rain) the Almond Blossom Cruise generated over 100K Visitor Trips alone! • MoCheer impacts December visitor traffic.
• MoFresh is creating more opportunities for visitors to stay for more than gas fill-ups May through August
#11..
- 447 -
MTMD Management District Plan 7
January 10, 2024
• MoPink has created both local and regional reasons to spend more in Modesto and have an impact on charities that keep money local in support of local programs
5. Global Perception of Modesto
With a change in focus from a one-dimensional value proposition of Modesto, Graffiti Summer, there has been an incredible public relations impact for the community. Modesto’s restaurants, agricultural attractions and murals have all received national press attention.
Awards & Accolades – Modesto is no longer on all the ‘naughty’ lists! - 2021; ESTO Award Finalist (1 of 3 in the US) US Travel Excellence Award - 2021; Poppy Award Finalist (1 of 3 in California) Visit CA Excellence Award - 2022; Top Cities for Cyclists
- 2022; Best Places to Live US News & World Report
- 2023; #8 Best Places to Live in CA Forbes2023
- 2023; #87 Best Cities in America (made the top 100 list!!!) - 2023; #1 Hidden Gem Live Music City in the US
Public Relations/Influencers & Major Media
- Key Highlights
o 2021; Good Day Sacramento (7 times), ABC 10 & Fox 40 Sacramento o 2022; HiTravel Tales, Forbes, Travel Pulse, SF Gate September o 2023; NBC Los Angeles, Thrillist, Secret San Francisco, Washington Post, Tasting Table, KNBC Los Angeles, KSND San Diego, KOVR Sacramento, SF Gate, HelloRubyDoodle, Momtastic, Travel Tweeks, Tennessee Tribune, Yahoo Canada #11..
- 448 -
MTMD Management District Plan 8
January 10, 2024
IV. BOUNDARY
The MTMD will include all lodging businesses with twenty (20) rooms or more, existing and in the future, available for public occupancy within the boundaries of the City of Modesto (referred to herein as “assessed businesses”), as shown in the map on the following page.
Lodging business means: any structure, or any portion of any structure within the City, which is intended or designed for lodging or sleeping purposes wherein the owner or operator thereof offers occupancy, defined as the use or possession, or the right to use or possession granted by the owner or operator thereof for compensation of any room or rooms or portion thereof for lodging or sleeping purposes. Lodging business does not include any vacational rental, vacation rental unit, short-term vacation rental, nor any hospital, medical clinic, convalescent home or other temporary or permanent domicile equipped primarily for the care of aged or infirm people.
A complete listing of assessed businesses within the renewed MTMD, can be found in Appendix 2. #11..
- 449 -
MTMD Management District Plan 9
January 10, 2024
#11..
- 450 -
MTMD Management District Plan 10
January 10, 2024
V. ASSESSMENT BUDGET AND SERVICES
A. Annual Service Plan
Assessment funds will be spent to provide specific benefits conferred or privileges granted directly to the payors that are not provided to those not charged, and which do not exceed the reasonable cost to the City of conferring the benefits or granting the privileges. The privileges and services provided with the MTMD funds are sales and marketing programs available only to assessed businesses.
A service plan assessment budget has been developed to deliver services that benefit the assessed businesses. A detailed annual assessment budget will be developed and approved by VM. The chart below illustrates the initial annual assessment budget allocations. These activities and allocations will also apply in subsequent years. The total initial assessment budget is estimated to be $430,540.
Although actual revenues will fluctuate due to market conditions, the proportional allocations of the budget shall remain the same. However, the City and VM’s Board shall have the authority to adjust budget allocations between the categories by no more than fifteen percent (15%) of the total budget per year. A description of the proposed improvements and activities for the initial year of operation is below. The same activities are proposed for subsequent years. In the event of a legal challenge against the MTMD, any and all assessment funds may be used for the costs of defending the MTMD.
Each budget category includes all costs related to providing that service in accordance with Generally Accepted Accounting Procedures (GAAP). For example, the sales and marketing budget includes the cost of staff time dedicated to overseeing and implementing the sales and marketing program. Staff time dedicated purely to administrative tasks is allocated to the administrative portion of the budget.
The costs of an individual staff member may be allocated to multiple budget categories, as appropriate Administration &
Collection, $64,581
, 15%
Contingency /
Reserve / Renewal,
$21,527 , 5%
Sales &
Marketing,
$344,432 , 80%
Initial Annual Assessment Budget - $430,540
#11..
- 451 -
MTMD Management District Plan 11
January 10, 2024
in accordance with GAAP. The staffing levels necessary to provide the services below will be determined by VM on an as- needed basis.
Sales and Marketing
A sales and marketing program promotes assessed businesses as tourist, meeting, and event destinations. The sales and marketing program will have a central theme of promoting Modesto as a desirable place to visit. The program has the goal of increasing overnight visitation and room night sales at assessed businesses, and may include, but not limited to, the following activities:
• Multi-media marketing efforts including digital, print, and other diversified media strategies curated to target prospective visitors and maximize online presence and visibility; • Television ads targeted at potential visitors;
• Radio ads targeted at potential visitors;
• Attendance of trade shows;
• Special events highlighting unique aspects of Modesto; • Preparation and production of collateral promotional materials such as brochures, flyers, and maps;
• Data and industry analytics used for marketing;
• Participation fees and attendance of professional industry conferences and affiliation events; • Lead generation activities designed to attract tourists and group events to Modesto; and • Any agency fees and commissions related to the execution of programs and activities authorized by this Plan.
Administration and Collection
The administration portion of the budget shall be utilized for administrative staffing costs, office costs, and other general administrative costs such as insurance, legal, and accounting fees. The collection portion of the budget shall be utilized for paying the City of Modesto for the costs of collecting the assessment. The City of Modesto shall be paid based upon the actual costs it incurs in administering the assessment, subject to audit, but such amount shall not exceed three percent (3%) of the amount collected to cover the costs of collecting the assessment.
Contingency/Reserve/Renewal
A portion of the budget will be allocated to a contingency fund to account for lower than anticipated collections. If collected contingency funds remain in the budget near the expiration of the MTMD’s term, and business owners wish to renew the District, the contingency funds may be used for renewal costs.
B. Annual Budget
The total ten (10) year assessment budget is projected at approximately $430,540 annually, or $4,305,400 through FY 2033 – 34 if assessment rates are not increased. If the maximum assessment rate increases are adopted, the estimated total assessment budget through FY 2033 – 34 is $10,736,500 This amount may fluctuate as sales and revenue increase at assessed businesses, and as businesses open and close, but is not expected to change significantly over the term. #11..
- 452 -
MTMD Management District Plan 12
January 10, 2024
The initial annual assessment rate is one percent (1%) of gross short-term sleeping room rental revenue. Upon the recommendation of the TMD Committee, the assessment rate may be increased by VM’s Board and subject to Modesto City Council approval, up to a maximum of one-half of one percent (0.50%) per year to a maximum rate of three percent (3%). However, the assessment rate increase in any given year may be an amount less than one-half of one percent (0.50%). For example, the assessment rate in FY 2025-26 could be increased by one-quarter of one percent (0.25%) and in FY 2026-27 the assessment rate could be increased by another one-quarter of one percent (0.25%), etc. up to a maximum assessment rate of three percent (3%).
The table below demonstrates the estimated maximum budget with the assumption that the assessment rate will be increased at the earliest opportunity as it is a required disclosure, it is not the anticipated course of action. Alternate courses of action may be taken in regard to implementing the assessment rate increase other than what is demonstrated in the chart below, within the parameters of this Management District Plan.
Estimated Annual Budget If Maximum Assessment Rates Are Adopted Fiscal
Year Sales & Marketing Administration & Collection
Contingency /
Reserve / Renewal Total
2024-25 $344,432 $64,581 $21,527 $430,540
2025-26 $516,648 $96,872 $32,291 $645,810
2026-27 $688,864 $129,162 $43,054 $861,080
2027-28 $861,080 $161,453 $53,818 $1,076,350
2028-29 $1,033,296 $193,743 $64,581 $1,291,620
2029-30 $1,033,296 $193,743 $64,581 $1,291,620
2030-31 $1,033,296 $193,743 $64,581 $1,291,620
2031-32 $1,033,296 $193,743 $64,581 $1,291,620
2032-33 $1,033,296 $193,743 $64,581 $1,291,620
2033-34 $1,033,296 $193,743 $64,581 $1,291,620
Total $8,610,800 $1,614,525 $538,175 $10,763,500
The table below demonstrates the annual improvement and service plan budget with the assumption that the rates will not be increased during the MTMD’s term. #11..
- 453 -
MTMD Management District Plan 13
January 10, 2024
Estimated Annual Budget if Assessment Rates Are Not Increased Fiscal
Year Sales & Marketing Administration & Collection
Contingency /
Reserve / Renewal Total
2024-25 $322,905 $64,581 $21,527 $430,540
2025-26 $344,432 $64,581 $21,527 $430,540
2026-27 $344,432 $64,581 $21,527 $430,540
2027-28 $344,432 $64,581 $21,527 $430,540
2028-29 $344,432 $64,581 $21,527 $430,540
2029-30 $344,432 $64,581 $21,527 $430,540
2030-31 $344,432 $64,581 $21,527 $430,540
2031-32 $344,432 $64,581 $21,527 $430,540
2032-33 $344,432 $64,581 $21,527 $430,540
2033-34 $344,432 $64,581 $21,527 $430,540
Total $3,422,793 $645,810 $215,270 $4,305,400
C. California Constitutional Compliance
The MTMD assessment is not a property-based assessment subject to the requirements of Proposition 218. Courts have found Proposition 218 limited the term ‘assessments’ to levies on real property.1 Rather, the MTMD assessment is a business-based assessment, and is subject to Proposition 26.
Pursuant to Proposition 26 all levies are a tax unless they fit one of seven exceptions. Two of these exceptions apply to the MTMD, a “specific benefit” and a “specific government service.” Both require that the costs of benefits or services do not exceed the reasonable costs to the City of conferring the benefits or providing the services.
1. Specific Benefit
Proposition 26 requires that assessment funds be expended on, “a specific benefit conferred or privilege granted directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of conferring the benefit or granting the privilege.”2 The services in this Plan are designed to provide targeted benefits directly to assessed businesses, and are intended only to provide benefits and services directly to those businesses paying the assessment. These services are tailored not to serve the general public, businesses in general, or parcels of land, but rather to serve the specific businesses within the MTMD. The activities described in this Plan are specifically targeted to increase demand for room night sales for assessed businesses within the boundaries of the MTMD, and are narrowly tailored. MTMD funds will be used exclusively to provide the specific benefit of increased demand for room night sales directly to the assessees.
Assessment funds shall not be used to feature non-assessed businesses in MTMD programs, or to directly generate sales for non-assessed businesses. The activities paid for from assessment revenues 1 Jarvis v. the City of San Diego 72 Cal App. 4th 230 2 Cal. Const. art XIII C § 1(e)(1) #11..
- 454 -
MTMD Management District Plan 14
January 10, 2024
are business services constituting and providing specific benefits to the assessed businesses. Nothing in this Plan limits the ability of the Owners’ Association to enter into private contracts with nonassessed businesses for the provision of services to those businesses.
The assessment imposed by this MTMD is for a specific benefit conferred directly to the payors that is not provided to those not charged. The specific benefit conferred directly to the payors is an increase in demand for room night sales. The specific benefit of an increase in demand for room night sales for assessed businesses will be provided only to businesses paying the district assessment, with marketing and sales programs promoting businesses paying the MTMD assessment. The marketing and sales programs will be designed to increase demand for room night sales at each assessed business. Because they are necessary to provide the marketing and sales programs that specifically benefit the assessed businesses, the administration and contingency services also provide the specific benefit of increased demand for room night sales to the assessed businesses.
Although the MTMD, in providing specific benefits to payors, may produce incidental benefits to non-paying businesses, the incidental benefit does not preclude the services from being considered a specific benefit. The legislature has found that, “A specific benefit is not excluded from classification as a ‘specific benefit’ merely because an indirect benefit to a nonpayer occurs incidentally and without cost to the payor as a consequence of providing the specific benefit to the payor.”3
2. Specific Government Service
The assessment may also be utilized to provide, “a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service or product.”4 The legislature has recognized that marketing and promotions services like those to be provided by the MTMD are government services within the meaning of Proposition 265 . Further, the legislature has determined
that “a specific government service is not excluded from classification as a ‘specific government service’ merely because an indirect benefit to a nonpayer occurs incidentally and without cost to the payor as a consequence of providing the specific government service to the payor.”6
3. Reasonable Cost
MTMD services will be implemented carefully to ensure they do not exceed the reasonable cost of such services. The full amount assessed will be used to provide the services described herein. Funds will be managed by VM, and reports submitted on an annual basis to the City. Only assessed businesses will be featured in marketing materials, receive sales leads generated from MTMD-funded activities, be featured in advertising campaigns, and benefit from other MTMD-funded services. Nonassessed businesses will not receive these, nor any other, MTMD-funded services and benefits. 3 Government Code § 53758(a)
4 Cal. Const. art XIII C § 1(e)(2)
5 Government Code § 53758(b)
6 Government Code § 53758(b)
#11..
- 455 -
MTMD Management District Plan 15
January 10, 2024
The MTMD-funded programs are all targeted directly at and feature only assessed businesses. It is, however, possible that there will be a spill over benefit to non-assessed businesses. If non-assessed businesses receive incremental room nights, that portion of the promotion or program generating those room nights shall be paid with non-MTMD funds. MTMD funds shall only be spent to benefit the assessed businesses, and shall not be spent on that portion of any program which directly generates incidental room nights for non-assessed businesses.
D. Assessment
The annual assessment rate is one percent (1%) of gross short-term sleeping room rental revenue on all lodging businesses with twenty (20) rooms or more, existing and in future, available for public occupancy, located within the boundaries of the City of Modesto. Based on the benefit received, assessments will not be collected on: stays of more than twenty-seven (27) consecutive days; stays by any officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty; stays by any officer or employee of the United States Government, or of a federal credit union, or of a state, county, city or other domestic public entity who pays rent in the discharge of official government business; and stays by any officer or employee of a bank or insurance company who pays rent in the discharge of official bank or insurance company business.
During the ten (10) year term, the assessment rate may be increased by VM’s Board and Modesto City Council approval up to a total of three percent (3%) of gross short-term sleeping room rental revenue.
The initial annual assessment rate is one percent (1%) of gross short-term sleeping room rental revenue. The maximum increase in any year shall not exceed one-half of one percent (0.50%). Any assessment rate increase approved by VM’s Board shall be included in the annual report.
The assessment was calculated based on the total cost of the activities to be provided for the benefit of the assessed businesses within the MTMD, with costs allocated based on the proportional benefit conferred to each assessed business. Activities funded by the MTMD, are specifically targeted to increase demand for room nights at assessed businesses. All room night sales do not represent the same benefit to the payors. For example, a higher priced room night is of greater benefit than a lower priced room night because the assessee derives greater revenue. To account for this benefit differential and to make sure the benefits are proportional, an assessment formula based on a percentage of revenue has been selected. The proposed formula accurately reflects greater benefit to assessed businesses with higher priced room nights.
The term “gross short-term sleeping room rental revenue” as used herein means the consideration charged, whether or not received, for the occupancy of space in an assessed business valued in money, whether to be received in money, goods, labor or otherwise, including all receipts, cash, credits and property and services of any kind or nature, without any deduction therefrom whatsoever. Gross short-term sleeping room rental revenue does not include compensation for services or products.
Gross short-term sleeping room rental revenue shall not include, and therefore the assessment shall not be charged upon, any federal, state, or local taxes collected, including but not limited to transient occupancy taxes.
#11..
- 456 -
MTMD Management District Plan 16
January 10, 2024
The assessment is levied upon and a direct obligation of the assessed business. However, the assessed business may, at its discretion, pass the assessment on to transients. The amount of assessment, if passed on to each transient, shall be disclosed in advance and separately stated from the amount of rent charged and any other applicable taxes, and each transient shall receive a receipt for payment from the business. If the MTMD assessment is identified separately it shall be disclosed as the “MTMD Assessment.” As an alternative, the disclosure may include the amount of the MTMD assessment and the amount of the assessment imposed pursuant to the California Tourism Marketing Act, Government Code §13995 et seq. and shall be disclosed as the “Tourism Assessment.” The assessment is imposed solely upon and is the sole obligation of the assessed business even if it is passed on to transients. The assessment shall not be considered revenue for calculation of transient occupancy taxes.
Bonds shall not be issued.
E. Interest and Penalty Charges
The MTMD shall reimburse the City of Modesto for any costs associated with collecting unpaid assessments. If sums in excess of the delinquent MTMD assessment are sought to be recovered in the same collection action by the City, the MTMD shall bear its pro rata share of such collection costs.
Assessed businesses which are delinquent in paying the assessment shall be responsible for paying:
1. Delinquency
Any assessed business that fails to remit any assessment imposed by this Plan within the time required shall, in addition to the amount of the assessment, pay a penalty of five percent (5%) of the amount of the assessment per month or fraction thereof until paid; the maximum penalty imposed on any one delinquency shall not exceed twenty-five percent (25%) of the amount of the assessment.
2. Fraud
If the City determines that the non-payment of any assessment due from any transient or assessed business under this Plan is due to intentional non-payment or fraud, a penalty of twenty-five percent (25%) of the amount of the assessment shall be added thereto in addition to the penalties stated above.
3. Penalties
Every penalty imposed and collected under the provisions of this section by the City, shall be required to be paid and shall be retained by the City to cover the cost of collection of the delinquency.
F. Time and Manner for Collecting Assessments
The MTMD assessment will be implemented beginning July 1, 2024, or as soon as possible thereafter, and ending ten (10) years from its start date. The City will be responsible for collecting the assessment on a quarterly basis and is subject to change as determined by the City (including any delinquencies, interest and penalties) from each assessed business located in the City of Modesto. The City shall take all reasonable efforts to collect the assessments from each assessed business. The City shall forward the assessments collected to the Owners’ Association.
#11..
- 457 -
MTMD Management District Plan 17
January 10, 2024
VI. GOVERNANCE
A. Owners’ Association
The City Council, through adoption of this Management District Plan, has the right, pursuant to Streets and Highways Code §36651, to identify the body that shall implement the proposed program, which shall be the Owners’ Association of the MTMD as defined in Streets and Highways Code §36612. The City Council has determined that Visit Modesto, Inc. (VM) will continue to serve as the Owners’ Association for the MTMD.
TMD Management Committee
VM will create a TMD Management Committee charged with managing funds and implementing programs in accordance with this Plan. The TMD Management Committee will be required to provide an annual report on activities and expenditures to the City of Modesto, which will also be available to assessed business owners. The TMD Management Committee must also hold open meetings and make records available pursuant to the Brown Act and Public Records Act.
B. Brown Act and California Public Records Act Compliance An Owners’ Association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. The Owners’ Association is, however, subject to government regulations relating to transparency, namely the Ralph M. Brown Act and the California Public Records Act. These regulations are designed to promote public accountability. The Owners’ Association acts as a legislative body under the Ralph M. Brown Act (Government Code §54950 et seq.). Thus, meetings of VM board and certain committees must be held in compliance with the public notice and other requirements of the Brown Act. Accordingly, the Owners’ Association shall publicly report any action taken and the vote or abstention on that action of each member present for the action. The Owners’ Association is also subject to the record keeping and disclosure requirements of the California Public Records Act.
C. Annual Report
VM shall present an annual report at the end of each year of operation to the City Council pursuant to Streets and Highways Code §36650 (see Appendix 1). The annual report shall include:
• Any proposed changes in the boundaries of the improvement district or in any benefit zones or classification of businesses within the district.
• The improvements and activities to be provided for that fiscal year. • An estimate of the cost of providing the improvements and the activities for that fiscal year. • 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.
• The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal year.
• The estimated amount of any contributions to be made from sources other than assessments levied pursuant to this part.
#11..
- 458 -
MTMD Management District Plan 18
January 10, 2024
APPENDIX 1 – LAW
*** THIS DOCUMENT IS CURRENT THROUGH THE 2023 SUPPLEMENT *** (ALL 2022 LEGISLATION)
STREETS AND HIGHWAYS CODE
DIVISION 18. PARKING
PART 7. PROPERTY AND BUSINESS IMPROVEMENT DISTRICT LAW OF 1994 CHAPTER 1. General Provisions
ARTICLE 1. Declarations
36600. Citation of part
This part shall be known and may be cited as the “Property and Business Improvement District Law of 1994.” 36601. Legislative findings and declarations; Legislative guidance The Legislature finds and declares all of the following:
(a) Businesses located and operating within business districts in some of this state’s communities are economically disadvantaged, are underutilized, and are unable to attract customers due to inadequate facilities, services, and activities in the business districts. (b) It is in the public interest to promote the economic revitalization and physical maintenance of business districts in order to create jobs, attract new businesses, and prevent the erosion of the business districts. (c) It is of particular local benefit to allow business districts to fund business related improvements, maintenance, and activities through the levy of assessments upon the businesses or real property that receive benefits from those improvements.
(d) Assessments levied for the purpose of conferring special benefit upon the real property or a specific benefit upon the businessesin a business district are not taxesfor the general benefit of a city, even if property, businesses, or persons not assessed receive incidental or collateral effects that benefit them. (e) Property and business improvement districts formed throughout this state have conferred special benefits upon properties and businesses within their districts and have made those properties and businesses more useful by providing the following benefits:
(1) Crime reduction. A study by the Rand Corporation has confirmed a 12-percent reduction in the incidence of robbery and an 8-percent reduction in the total incidence of violent crimes within the 30 districts studied.
(2) Job creation.
(3) Business attraction.
(4) Business retention.
(5) Economic growth.
(6) New investments.
(f) With the dissolution of redevelopment agencies throughout the state, property and business improvement districts have become even more important tools with which communities can combat blight, promote economic opportunities, and create a clean and safe environment. (g) Since the enactment of this act, the people of California have adopted Proposition 218, which added Article XIII D to the Constitution in order to place certain requirements and restrictions on the formation of, #11..
- 459 -
MTMD Management District Plan 19
January 10, 2024
and activities, expenditures, and assessments by property-based districts. Article XIII D of the Constitution provides that property-based districts may only levy assessments for special benefits. (h) The act amending this section is intended to provide the Legislature’s guidance with regard to this act, its interaction with the provisions of Article XIII D of the Constitution, and the determination of special benefits in property-based districts.
(1) The lack of legislative guidance has resulted in uncertainty and inconsistent application of this act, which discourages the use of assessments to fund needed improvements, maintenance, and activities in property-based districts, contributing to blight and other underutilization of property. (2) Activities undertaken for the purpose of conferring special benefits upon property to be assessed inherently produce incidental or collateral effects that benefit property or persons not assessed.
Therefore, for special benefits to exist as a separate and distinct category from general benefits, the incidental or collateral effects of those special benefits are inherently part of those special benefits.
The mere fact that special benefits produce incidental or collateral effects that benefit property or persons not assessed does not convert any portion of those special benefits or their incidental or collateral effects into general benefits.
(3) It is of the utmost importance that property-based districts created under this act have clarity regarding restrictions on assessmentsthey may levy and the proper determination ofspecial benefits.
Legislative clarity with regard to this act will provide districts with clear instructions and courts with legislative intent regarding restrictions on property-based assessments, and the manner in which special benefits should be determined.
36602. Purpose of part
The purpose of this part is to supplement previously enacted provisions of law that authorize cities to levy assessments within property and business improvement districts, to ensure that those assessments conform to all constitutional requirements and are determined and assessed in accordance with the guidance set forth in this act. This part does not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes.
36603. Preemption of authority or charter city to adopt ordinances levying assessments Nothing in this part is intended to preempt the authority of a charter city to adopt ordinances providing for a different method of levying assessments for similar or additional purposes from those set forth in this part. A property and business improvement district created pursuant to this part is expressly exempt from the provisions of the Special Assessment Investigation, Limitation and Majority Protest Act of 1931 (Division 4 (commencing with Section 2800)). 36603.5. Part prevails over conflicting provisions
Any provision of this part that conflicts with any other provision of law shall prevail over the other provision of law, as to districts created under this part.
36604. Severability
This part is intended to be construed liberally and, if any provision is held invalid, the remaining provisions shall remain in full force and effect. Assessments levied under this part are not special taxes.
ARTICLE 2. Definitions
36606. “Activities”
“Activities” means, but is not limited to, all of the following that benefit businesses or real property in the district:
#11..
- 460 -
MTMD Management District Plan 20
January 10, 2024
(a) Promotion of public events.
(b) Furnishing of music in any public place.
(c) Promotion of tourism within the district.
(d) Marketing and economic development, including retail retention and recruitment. (e) Providing security, sanitation, graffiti removal, street and sidewalk cleaning, and other municipal services supplemental to those normally provided by the municipality. (f) Other services provided for the purpose of conferring special benefit upon assessed real property or specific benefits upon assessed businesses located in the district. 36606.5. “Assessment”
“Assessment” means a levy for the purpose of acquiring, constructing, installing, or maintaining improvements and providing activities that will provide certain benefits to properties or businesses located within a property and business improvement district.
36607. “Business”
“Business” means all types of businesses and includes financial institutions and professions. 36608. “City”
“City” means a city, county, city and county, or an agency or entity created pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code, the public member agencies of which includes only cities, counties, or a city and county, or the State of California. 36609. “City council”
“City council” means the city council of a city or the board of supervisors of a county, or the agency, commission, or board created pursuant to a joint powers agreement and which is a city within the meaning of this part. 36609.4. “Clerk”
“Clerk” means the clerk of the legislative body.
36609.5. “General benefit”
“General benefit” means, for purposes of a property-based district, any benefit that is not a “special benefit” as defined in Section 36615.5.
36610. “Improvement”
“Improvement” means the acquisition, construction, installation, or maintenance of any tangible property with an estimated useful life of five years or more including, but not limited to, the following:
(a) Parking facilities.
(b) Benches, booths, kiosks, display cases, pedestrian shelters, and signs. (c) Trash receptacles and public restrooms.
(d) Lighting and heating facilities.
(e) Decorations.
(f) Parks.
(g) Fountains.
(h) Planting areas.
#11..
- 461 -
MTMD Management District Plan 21
January 10, 2024
(i) Closing, opening, widening, or narrowing of existing streets. (j) Facilities or equipment, or both, to enhance security of persons and property within the district. (k) Ramps, sidewalks, plazas, and pedestrian malls.
(l) Rehabilitation or removal of existing structures.
36611. “Management district plan”; “Plan”
“Management district plan” or “plan” means a proposal as defined in Section 36622. 36612. “Owners’ association”
“Owners’ association” means a private nonprofit entity that is under contract with a city to administer or implement improvements, maintenance, and activities specified in the management district plan. An owners’ association may be an existing nonprofit entity or a newly formed nonprofit entity. An owners’ association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. Notwithstanding this section, an owners’ association shall comply with the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), at all times when matters within the subject matter of the district are heard, discussed, or deliberated, and with the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code), for all records relating to activities of the district.
36614. “Property”
“Property” means real property situated within a district. 36614.5. “Property and business improvement district”; “District” “Property and business improvement district,” or “district,” means a property and business improvement district established pursuant to this part.
36614.6. “Property-based assessment”
“Property-based assessment” means any assessment made pursuant to this part upon real property. 36614.7. “Property-based district”
“Property-based district” means any district in which a city levies a property-based assessment. 36615. “Property owner”; “Business owner”; “Owner”
“Property owner” means any person shown as the owner of land on the last equalized assessment roll or otherwise known to be the owner of land by the city council. “Business owner” means any person recognized by the city as the owner of the business. “Owner” means either a business owner or a property owner. The city council has no obligation to obtain other information as to the ownership of land or businesses, and its determination of ownership shall be final and conclusive for the purposes of this part. Wherever this part requires the signature of the property owner, the signature of the authorized agent of the property owner shall be sufficient. Wherever this part requires the signature of the business owner, the signature of the authorized agent of the business owner shall be sufficient. 36615.5. “Special benefit”
#11..
- 462 -
MTMD Management District Plan 22
January 10, 2024
(a) “Special benefit” means, for purposes of a property-based district, a particular and distinct benefit over and above general benefits conferred on real property located in a district or to the public at large. Special benefit includes incidental or collateral effects that arise from the improvements, maintenance, or activities of property-based districts even if those incidental or collateral effects benefit property or persons not assessed. Special benefit excludes general enhancement of property value.
(b) “Special benefit” also includes, for purposes of a property-based district, a particular and distinct benefit provided directly to each assessed parcel within the district. Merely because parcels throughout an assessment district share the same special benefits does not make the benefits general. 36616. “Tenant”
“Tenant” means an occupant pursuant to a lease of commercial space or a dwelling unit, other than an owner.
ARTICLE 3. Prior Law
36617. Alternate method of financing certain improvements and activities; Effect on other provisions This part provides an alternative method of financing certain improvements and activities. The provisions of this part shall not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes. Every improvement area established pursuant to the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500) of this division) is valid and effective and is unaffected by this part.
CHAPTER 2. Establishment
36620. Establishment of property and business improvement district A property and business improvement district may be established as provided in this chapter. 36620.5. Requirement of consent of city council
A county may not form a district within the territorial jurisdiction of a city without the consent of the city council of that city. A city may not form a district within the unincorporated territory of a county without the consent of the board of supervisors of that county. A city may not form a district within the territorial jurisdiction of another city without the consent of the city council of the other city.
36621. Initiation of proceedings; Petition of property or business owners in proposed district (a) Upon the submission of a written petition, signed by the property or business owners in the proposed district who will pay more than 50 percent of the assessments proposed to be levied, the city council may initiate proceedings to form a district by the adoption of a resolution expressing its intention to form a district.
The amount of assessment attributable to property or a business owned by the same property or business owner that is in excess of 40 percent of the amount of all assessments proposed to be levied, shall not be included in determining whether the petition is signed by property or business owners who will pay more than 50 percent of the total amount of assessments proposed to be levied. (b) The petition of property or business owners required under subdivision (a) shall include a summary of the management district plan. That summary shall include all of the following:
(1) A map showing the boundaries of the district.
(2) Information specifying where the complete management district plan can be obtained. #11..
- 463 -
MTMD Management District Plan 23
January 10, 2024
(3) Information specifying that the complete management district plan shall be furnished upon request.
(c) The resolution of intention described in subdivision (a) shall contain all of the following:
(1) A brief description of the proposed improvements, maintenance, and activities, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property or businesses within the district, a statement as to whether bonds will be issued, and a description of the exterior boundaries of the proposed district, which may be made by reference to any plan or map that is on file with the clerk. The descriptions and statements do not need to be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements, maintenance, and activities, and the location and extent of the proposed district. (2) A time and place for a public hearing on the establishment of the property and business improvement district and the levy of assessments, which shall be consistent with the requirements of Section 36623.
36622. Contents of management district plan
The management district plan shall include, but is not limited to, all of the following:
(a) If the assessment will be levied on property, a map of the district in sufficient detail to locate each parcel of property and, if businesses are to be assessed, each business within the district. If the assessment will be levied on businesses, a map that identifies the district boundaries in sufficient detail to allow a business owner to reasonably determine whether a business is located within the district boundaries. If the assessment will be levied on property and businesses, a map of the district in sufficient detail to locate each parcel of property and to allow a business owner to reasonably determine whether a business is located within the district boundaries.
(b) The name of the proposed district.
(c) A description of the boundaries of the district, including the boundaries of benefit zones, proposed for establishment or extension in a manner sufficient to identify the affected property and businesses included, which may be made by reference to any plan or map that is on file with the clerk. The boundaries of a proposed property assessment district shall not overlap with the boundaries of another existing property assessment district created pursuant to this part. This part does not prohibit the boundaries of a district created pursuant to this part to overlap with other assessment districts established pursuant to other provisions of law, including, but not limited to, the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500)). This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with another business assessment district created pursuant to this part. This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with a property assessment district created pursuant to this part. (d) The improvements, maintenance, and activities proposed for each year of operation of the district and the estimated cost thereof. If the improvements, maintenance, and activities proposed for each year of operation are the same, a description of the first year’s proposed improvements, maintenance, and activities and a statement that the same improvements, maintenance, and activities are proposed for subsequent years shall satisfy the requirements of this subdivision.
(e) The total annual amount proposed to be expended for improvements, maintenance, or activities, and debt service in each year of operation of the district. If the assessment is levied on businesses, this amount may be estimated based upon the assessment rate. If the total annual amount proposed to be expended in each year of operation of the district is not significantly different, the amount proposed to be expended in the initial year and a statement that a similar amount applies to subsequent years shall satisfy the requirements of this subdivision.
(f) The proposed source or sources of financing, including the proposed method and basis of levying the assessment in sufficient detail to allow each property or business owner to calculate the amount of the assessment to be levied against their property or business. The plan also shall state whether bonds will be issued to finance improvements.
#11..
- 464 -
MTMD Management District Plan 24
January 10, 2024
(g) The time and manner of collecting the assessments.
(h) The specific number of years in which assessments will be levied. In a new district, the maximum number of years shall be five. Upon renewal, a district shall have a term not to exceed 10 years. Notwithstanding these limitations, a district created pursuant to this part to finance capital improvements with bonds may levy assessments until the maximum maturity of the bonds. The management district plan may set forth specific increases in assessments for each year of operation of the district. (i) The proposed time for implementation and completion of the management district plan. (j) Any proposed rules and regulations to be applicable to the district. (k)
(1) A list of the properties or businesses to be assessed, including the assessor’s parcel numbers for properties to be assessed, and a statement of the method or methods by which the expenses of a district will be imposed upon benefited real property or businesses, in proportion to the benefit received by the property or business, to defray the cost thereof. (2) In a property-based district, the proportionate special benefit derived by each identified parcel shall be determined exclusively in relationship to the entirety of the capital cost of a public improvement, the maintenance and operation expenses of a public improvement, or the cost of the activities. An assessment shall not be imposed on any parcel that exceeds the reasonable cost of the proportional special benefit conferred on that parcel. Only special benefits are assessable, and a property-based district shall separate the general benefits, if any, from the special benefits conferred on a parcel. Parcels within a property-based district that are owned or used by any city, public agency, the State of California, or the United States shall not be exempt from assessment unless the governmental entity can demonstrate by clear and convincing evidence that those publicly owned parcels in fact receive no special benefit. The value of any incidental, secondary, or collateral effects that arise from the improvements, maintenance, or activities of a property-based district and that benefit property or persons not assessed shall not be deducted from the entirety of the cost of any special benefit or affect the proportionate special benefit derived by each identified parcel. (3) In a property-based district, properties throughout the district may share the same special benefits. In a district with boundaries that define which parcels are to receive improvements, maintenance, or activities over and above those services provided by the city, the improvements, maintenance, or activities themselves may constitute a special benefit. The city may impose assessments that are less than the proportional special benefit conferred, but shall not impose assessments that exceed the reasonable costs of the proportional special benefit conferred. Because one or more parcels pay less than the special benefit conferred does not necessarily mean that other parcels are assessed more than the reasonable cost of their special benefit. (l) In a property-based district, a detailed engineer’s report prepared by a registered professional engineer certified by the State of California supporting all assessments contemplated by the management district plan. (m) Any other item or matter required to be incorporated therein by the city council. 36623. Procedure to levy assessment
(a) If a city council proposes to levy a new or increased property assessment, the notice and protest and hearing procedure shall comply with Section 53753 of the Government Code. (b) If a city council proposes to levy a new or increased business assessment, the notice and protest and hearing procedure shall comply with Section 54954.6 of the Government Code, except that notice shall be mailed to the owners of the businesses proposed to be assessed. A protest may be made orally or in writing by any interested person. Every written protest shall be filed with the clerk at or before the time fixed for the public hearing. The city council may waive any irregularity in the form or content of any written protest. A written protest may be withdrawn in writing at any time before the conclusion of the public hearing. Each written protest shall contain a description of the business in which the person subscribing the protest is interested sufficient to identify the business and, if a person subscribing is not shown on the official records of the city as the owner of the business, the protest shall contain or be accompanied by written evidence that #11..
- 465 -
MTMD Management District Plan 25
January 10, 2024
the person subscribing is the owner of the business or the authorized representative. A written protest that does not comply with this section shall not be counted in determining a majority protest. If written protests are received from the owners or authorized representatives of businesses in the proposed district that will pay 50 percent or more of the assessments proposed to be levied and protests are not withdrawn so as to reduce the protests to less than 50 percent, no further proceedings to levy the proposed assessment against such businesses, as contained in the resolution of intention, shall be taken for a period of one year from the date of the finding of a majority protest by the city council. (c) If a city council proposes to conduct a single proceeding to levy both a new or increased property assessment and a new or increased business assessment, the notice and protest and hearing procedure for the property assessment shall comply with subdivision (a), and the notice and protest and hearing procedure for the business assessment shall comply with subdivision (b). If a majority protest is received from either the property or business owners, that respective portion of the assessment shall not be levied. The remaining portion of the assessment may be levied unless the improvement or other special benefit was proposed to be funded by assessing both property and business owners.
36624. Changes to proposed assessments
At the conclusion of the public hearing to establish the district, the city council may adopt, revise, change, reduce, or modify the proposed assessment or the type or types of improvements, maintenance, and activities to be funded with the revenues from the assessments. Proposed assessments may only be revised by reducing any or all of them. At the public hearing, the city council may only make changes in, to, or from the boundaries of the proposed property and business improvement district that will exclude territory that will not benefit from the proposed improvements, maintenance, and activities. Any modifications, revisions, reductions, or changes to the proposed assessment district shall be reflected in the notice and map recorded pursuant to Section 36627. 36625. Resolution of formation
(a) If the city council, following the public hearing, decides to establish a proposed property and business improvement district, the city council shall adopt a resolution of formation that shall include, but is not limited to, all of the following:
(1) A brief description of the proposed improvements, maintenance, and activities, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property, businesses, or both within the district, a statement on whether bonds will be issued, and a description of the exterior boundaries of the proposed district, which may be made by reference to any plan or map that is on file with the clerk. The descriptions and statements need not be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements, maintenance, and activities and the location and extent of the proposed district. (2) The number, date of adoption, and title of the resolution of intention. (3) The time and place where the public hearing was held concerning the establishment of the district.
(4) A determination regarding any protests received. The city shall not establish the district or levy assessments if a majority protest was received.
(5) A statement that the properties, businesses, or properties and businesses in the district established by the resolution shall be subject to any amendments to this part. (6) A statement that the improvements, maintenance, and activities to be conferred on businesses and properties in the district will be funded by the levy of the assessments. The revenue from the levy of assessments within a district shall not be used to provide improvements, maintenance, or activities outside the district or for any purpose other than the purposes specified in the resolution of intention, as modified by the city council at the hearing concerning establishment of the district.
Notwithstanding the foregoing, improvements and activities that must be provided outside the #11..
- 466 -
MTMD Management District Plan 26
January 10, 2024
district boundaries to create a special or specific benefit to the assessed parcels or businesses may be provided, but shall be limited to marketing or signage pointing to the district. (7) A finding that the property or businesses within the area of the property and business improvement district will be benefited by the improvements, maintenance, and activities funded by the proposed assessments, and, for a property-based district, that property within the district will receive a special benefit.
(8) In a property-based district, the total amount of all special benefits to be conferred on the properties within the property-based district.
(b) The adoption of the resolution of formation and, if required, recordation of the notice and map pursuant to Section 36627 shall constitute the levy of an assessment in each of the fiscal years referred to in the management district plan.
36627. Notice and assessment diagram
Following adoption of the resolution establishing district assessments on properties pursuant to Section 36625, the clerk shall record a notice and an assessment diagram pursuant to Section 3114. No other provision of Division 4.5 (commencing with Section 3100) applies to an assessment district created pursuant to this part. 36628. Establishment of separate benefit zones within district; Categories of businesses The city council may establish one or more separate benefit zones within the district based upon the degree of benefit derived from the improvements or activities to be provided within the benefit zone and may impose a different assessment within each benefit zone. If the assessment is to be levied on businesses, the city council may also define categories of businesses based upon the degree of benefit that each will derive from the improvements or activities to be provided within the district and may impose a different assessment or rate of assessment on each category of business, or on each category of business within each zone. 36628.5. Assessments on businesses or property owners
The city council may levy assessments on businesses or on property owners, or a combination of the two, pursuant to this part. The city council shall structure the assessments in whatever manner it determines corresponds with the distribution of benefits from the proposed improvements, maintenance, and activities, provided that any propertybased assessment conforms with the requirements set forth in paragraph (2) of subdivision (k) of Section 36622. 36629. Provisions and procedures applicable to benefit zones and business categories All provisions of this part applicable to the establishment, modification, or disestablishment of a property and business improvement district apply to the establishment, modification, or disestablishment of benefit zones or categories of business. The city council shall, to establish, modify, or disestablish a benefit zone or category of business, follow the procedure to establish, modify, or disestablish a property and business improvement district. 36630. Expiration of district; Creation of new district If a property and business improvement district expires due to the time limit set pursuant to subdivision (h) of Section 36622, a new management district plan may be created and the district may be renewed pursuant to this part.
CHAPTER 3. Assessments
36631. Time and manner of collection of assessments; Delinquent payments #11..
- 467 -
MTMD Management District Plan 27
January 10, 2024
The collection of the assessments levied pursuant to this part shall be made at the time and in the manner set forth by the city council in the resolution levying the assessment. Assessments levied on real property may be collected at the same time and in the same manner as for the ad valorem property tax, and may provide for the same lien priority and penalties for delinquent payment. All delinquent payments for assessments levied pursuant to this part may be charged interest and penalties.
36632. Assessments to be based on estimated benefit; Classification of real property and businesses; Exclusion of residential and agricultural property
(a) The assessments levied on real property pursuant to this part shall be levied on the basis of the estimated benefit to the real property within the property and business improvement district. The city council may classify properties for purposes of determining the benefit to property of the improvements and activities provided pursuant to this part.
(b) Assessments levied on businesses pursuant to this part shall be levied on the basis of the estimated benefit to the businesses within the property and business improvement district. The city council may classify businesses for purposes of determining the benefit to the businesses of the improvements and activities provided pursuant to this part.
(c) Properties zoned solely for residential use, or that are zoned for agricultural use, are conclusively presumed not to benefit from the improvements and service funded through these assessments, and shall not be subject to any assessment pursuant to this part.
36633. Time for contesting validity of assessment
The validity of an assessment levied under this part shall not be contested in an action or proceeding unless the action or proceeding is commenced within 30 days after the resolution levying the assessment is adopted pursuant to Section 36625. An appeal from a final judgment in an action or proceeding shall be perfected within 30 days after the entry of judgment.
36634. Service contracts authorized to establish levels of city services The city council may execute baseline service contracts that would establish levels of city services that would continue after a property and business improvement district has been formed. 36635. Request to modify management district plan
The owners’ association may, at any time, request that the city council modify the management district plan. Any modification of the management district plan shall be made pursuant to this chapter. 36636. Modification of plan by resolution after public hearing; Adoption of resolution of intention (a) Upon the written request of the owners’ association, the city council may modify the management district plan after conducting one public hearing on the proposed modifications. The city council may modify the improvements and activities to be funded with the revenue derived from the levy of the assessments by adopting a resolution determining to make the modifications after holding a public hearing on the proposed modifications. If the modification includes the levy of a new or increased assessment, the city council shall comply with Section 36623. Notice of all other public hearings pursuant to this section shall comply with both of the following:
(1) The resolution of intention shall be published in a newspaper of general circulation in the city once at least seven days before the public hearing.
#11..
- 468 -
MTMD Management District Plan 28
January 10, 2024
(2) A complete copy of the resolution of intention shall be mailed by first class mail, at least 10 days before the public hearing, to each business owner or property owner affected by the proposed modification.
(b) The city council shall adopt a resolution of intention which states the proposed modification prior to the public hearing required by this section. The public hearing shall be held not more than 90 days after the adoption of the resolution of intention.
36637. Reflection of modification in notices recorded and maps Any subsequent modification of the resolution shall be reflected in subsequent notices and maps recorded pursuant to Division 4.5 (commencing with Section 3100), in a manner consistent with the provisions of Section 36627.
CHAPTER 3.5. Financing
36640. Bonds authorized; Procedure; Restriction on reduction or termination of assessments (a)The city council may, by resolution, determine and declare that bonds shall be issued to finance the estimated cost of some or all of the proposed improvements described in the resolution of formation adopted pursuant to Section 36625, if the resolution of formation adopted pursuant to that section provides for the issuance of bonds, under the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500)) or in conjunction with Marks-Roos Local Bond Pooling Act of 1985 (Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code). Either act, as the case may be, shall govern the proceedings relating to the issuance of bonds, although proceedings under the Bond Act of 1915 may be modified by the city council as necessary to accommodate assessments levied upon business pursuant to this part.
(b) The resolution adopted pursuant to subdivision (a) shall generally describe the proposed improvements specified in the resolution of formation adopted pursuant to Section 36625, set forth the estimated cost of those improvements, specify the number of annual installments and the fiscal years during which they are to be collected. The amount of debt service to retire the bonds shall not exceed the amount of revenue estimated to be raised from assessments over 30 years.
(c) Notwithstanding any other provision of this part, assessments levied to pay the principal and interest on any bond issued pursuant to this section shall not be reduced or terminated if doing so would interfere with the timely retirement of the debt.
CHAPTER 4. Governance
36650. Report by owners’ association; Approval or modification by city council (a) The owners’ association shall cause to be prepared a report for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvements, maintenance, and activities described in the report. The owners’ association’s first report shall be due after the first year of operation of the district. The report may propose changes, including, but not limited to, the boundaries of the property and business improvement district or any benefit zones within the district, the basis and method of levying the assessments, and any changes in the classification of property, including any categories of business, if a classification is used.
(b) The report shall be filed with the clerk and shall refer to the property and business improvement district by name, specify the fiscal year to which the report applies, and, with respect to that fiscal year, shall contain all of the following information:
(1) Any proposed changes in the boundaries of the property and business improvement district or in any benefit zones or classification of property or businesses within the district. #11..
- 469 -
MTMD Management District Plan 29
January 10, 2024
(2) The improvements, maintenance, and activities to be provided for that fiscal year. (3) An estimate of the cost of providing the improvements, maintenance, and activities for that fiscal year.
(4) The method and basis of levying the assessment in sufficient detail to allow each real property or business owner, as appropriate, to estimate the amount of the assessment to be levied against his or her property or business for that fiscal year.
(5) The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal year.
(6) The estimated amount of any contributions to be made from sources other than assessments levied pursuant to this part.
(c) The city council may approve the report as filed by the owners’ association or may modify any particular contained in the report and approve it as modified. Any modification shall be made pursuant to Sections 36635 and 36636.
The city council shall not approve a change in the basis and method of levying assessments that would impair an authorized or executed contract to be paid from the revenues derived from the levy of assessments, including any commitment to pay principal and interest on any bonds issued on behalf of the district. 36651. Designation of owners’ association to provide improvements, maintenance, and activities The management district plan may, but is not required to, state that an owners’ association will provide the improvements, maintenance, and activities described in the management district plan. If the management district plan designates an owners’ association, the city shall contract with the designated nonprofit corporation to provide services.
CHAPTER 5. Renewal
36660. Renewal of district; Transfer or refund of remaining revenues; District term limit (a) Any district previously established whose term has expired, or will expire, may be renewed by following the procedures for establishment as provided in this chapter. (b) Upon renewal, any remaining revenues derived from the levy of assessments, or any revenues derived from the sale of assets acquired with the revenues, shall be transferred to the renewed district. If the renewed district includes additional parcels or businesses not included in the prior district, the remaining revenues shall be spent to benefit only the parcels or businesses in the prior district. If the renewed district does not include parcels or businesses included in the prior district, the remaining revenues attributable to these parcels shall be refunded to the owners of these parcels or businesses. (c) Upon renewal, a district shall have a term not to exceed 10 years, or, if the district is authorized to issue bonds, until the maximum maturity of those bonds. There is no requirement that the boundaries, assessments, improvements, or activities of a renewed district be the same as the original or prior district.
CHAPTER 6. Disestablishment
36670. Circumstances permitting disestablishment of district; Procedure (a) Any district established or extended pursuant to the provisions of this part, where there is no indebtedness, outstanding and unpaid, incurred to accomplish any of the purposes of the district, may be disestablished by resolution by the city council in either of the following circumstances:
(1) If the city council finds there has been misappropriation of funds, malfeasance, or a violation of law in connection with the management of the district, it shall notice a hearing on disestablishment. (2) During the operation of the district, there shall be a 30-day period each year in which assessees may request disestablishment of the district. The first such period shall begin one year after the date of establishment of the district and shall continue for 30 days. The next such 30-day period shall #11..
- 470 -
MTMD Management District Plan 30
January 10, 2024
begin two years after the date of the establishment of the district. Each successive year of operation of the district shall have such a 30-day period. Upon the written petition of the owners or authorized representatives of real property or the owners or authorized representatives of businesses in the district who pay 50 percent or more of the assessments levied, the city council shall pass a resolution of intention to disestablish the district. The city council shall notice a hearing on disestablishment. (b) The city council shall adopt a resolution of intention to disestablish the district prior to the public hearing required by this section. The resolution shall state the reason for the disestablishment, shall state the time and place of the public hearing, and shall contain a proposal to dispose of any assets acquired with the revenues of the assessments levied within the property and business improvement district. The notice of the hearing on disestablishment required by this section shall be given by mail to the property owner of each parcel or to the owner of each business subject to assessment in the district, as appropriate. The city shall conduct the public hearing not less than 30 days after mailing the notice to the property or business owners. The public hearing shall be held not more than 60 days after the adoption of the resolution of intention. 36671. Refund of remaining revenues upon disestablishment or expiration without renewal of district; Calculation of refund; Use of outstanding revenue collected after disestablishment of district (a) Upon the disestablishment or expiration without renewal of a district, any remaining revenues, after all outstanding debts are paid, derived from the levy of assessments, or derived from the sale of assets acquired with the revenues, or from bond reserve or construction funds, shall be refunded to the owners of the property or businesses then located and operating within the district in which assessments were levied by applying the same method and basis that was used to calculate the assessments levied in the fiscal year in which the district is disestablished or expires. All outstanding assessment revenue collected after disestablishment shall be spent on improvements and activities specified in the management district plan. (b) If the disestablishment occurs before an assessment is levied for the fiscal year, the method and basis that was used to calculate the assessments levied in the immediate prior fiscal year shall be used to calculate the amount of any refund.
#11..
- 471 -
MTMD Management District Plan 31
January 10, 2024
APPENDIX 2 – ASSESSED BUSINESSES
Hotel Address City, State, Zip
Apex Inn 2225 Yosemite Blvd Modesto, CA 95354-3003
Baymont Inn & Suites 4100 Salida Blvd Modesto, CA 95358-8840 Best Western Palm Court Inn 2001 W Orangeburg Ave Modesto, CA 95350-3741 Comfort Inn Modesto 2025 W Orangeburg Ave Modesto, CA 95350-3741 Discovery Inn 115 Downey Ave Modesto, CA 95354-1201
Doubletree Hotel Modesto 1150 9th St Modesto, CA 95354-0823 Economy Inn 602 Mchenry Ave Modesto, CA 95350-5412
El Capitan Motel 1121 Needham St Modesto, CA 95354-0731 Modesto Days Inn 1312 Mchenry Ave Modesto, CA 95350-5377 Modesto Hotel 1720 Sisk Rd Modesto, CA 95350-2500
Modesto Marriott Residence Inn 2901 HealthCare Way Modesto, CA 95356 Motel 6 807 Needham St Modesto, CA 95354-0736
Motel 6 Modesto 1920 W Orangeburg Ave Modesto, CA 95350-3740 Quality Inn 500 Kansas Ave Modesto, CA 95351-1605
Ramada By Wyndham 1525 Mchenry Ave Modesto, CA 95350-4576 Rodeway Inn 912 Mchenry Ave Modesto, CA 95350-5417
Springhill Suites Modesto 1901 W Orangeburg Ave Modesto, CA 95350-3838 Tiki Lodge 936 Mchenry Ave Modesto, CA 95350-5417
Townhouse Lodge 909 16th St Modesto, CA 95354-1117
Travelers Motel 710 N 9th St Modesto, CA 95350-5795
Yosemite Inn 500 Kansas Ave Modesto, CA 95351-1605
#11..
- 472 -
CITY OF MODESTO
COMMITTEE AGENDA REPORT
DATE OF MEETING:
May 5, 2025
Date: April 15, 2025
TO: Economic Development Committee
Eric Alvarez, Chair
Sue Zwahlen, Vice-Chair
Nick Bavaro, Member
THROUGH: Joseph P. Lopez, City Manager
FROM: Jessica Hill, Director of Community and Economic Development SUBJECT: Final Draft of the Economic Development Strategic Plan (2025) CONTACT: Trevin W. Barber, Economic Development Manager [email protected], 209-860-1251
DESCRIPTION:
Consider the acceptance of the Economic Development Strategic Plan (2025) and forwarding to Council for approval. (Funding Source: Not Applicable)
STRATEGIC PLAN ELEMENT:
The recommended action supports the City’s 2020-2025 Strategic Plan Goal E. Drive Economic Vitality: Drive the success of a vibrant and economically sustainable business climate.
BACKGROUND:
The City’s last Economic Development Strategic Plan, approved in 2003, reflected data from 1991-2000—a time long before the profound shifts that have transformed our local and global economy. Over the past two decades, the city has faced challenges and opportunities in workforce development, housing availability, and resilience, including the impact of COVID-19.
Economic development practices themselves have evolved, shifting from traditional business attraction and retention to a broader, inclusive approach. Regional collaboration initiatives such as Stanislaus2030 and North Valley Thrive exemplify this new direction, emphasizing inclusive economies and shared prosperity.
Modesto stands at a critical juncture, with the opportunity to shape its future through the General Plan Update 2050. Incorporating a robust Economic Development Element into this plan will enable the city to attract investment effectively, collaborate with regional partners, and ensure sustained economic growth. An up-to-date Plan is essential to achieving these goals, aligning Modesto's efforts with broader community and regional initiatives.
On August 21, 2023, Modesto issued Request for Proposal INF23-04 for Economic Development Strategic Planning Services, and eleven qualified firms submitted proposals by the #12..
- 473 -
Economic Development Committee, May 5, 2025
Final Draft of the Economic Development Strategic Plan (2025)
September 21 deadline. The City assembled a Review and Scoring Committee, including staff and experts from Modesto and Opportunity Stanislaus, to assess proposals based on technical merit and cost. After careful evaluation, the Natelson Dale Group (Consultant) was selected as the most responsive and cost-effective provider.
Natelson Dale Group (Consultant) is a nationally recognized economic consulting firm established in California in 1974, bringing extensive experience in planning and implementing economic and workforce development programs. The firm’s deep understanding of local real estate markets and regional economic trends positioned them as an ideal partner for developing the new Plan. On January 9, 2024, the City Council approved Resolution 2024-02, authorizing an agreement with the Consultant for an amount not exceeding $144,875.
The new Plan draws on Modesto’s 2020-2025 Strategic Plan, which prioritized economic vitality alongside quality of life and governance. Economic vitality goals focus on fostering a sustainable business climate, creating a recognizable city identity, and transforming downtown Modesto into a regional destination. The Consultant’s approach supported these goals through the completion of four broad tasks:
1. Conducted a market assessment and built a baseline profile of current conditions.
2. Conducted stakeholder engagement and visioning using a SWOT analysis, which illuminated barriers to achieving economic development goals, including competitiveness, opportunity, strategy, and equity.
3. Developed draft administrative plans, including economic development action plans, standard operating procedures, and qualified and quantified measures of success; and
4. Reported and summarized findings and recommendations.
The plan ensured alignment and continuity of the following community plans. Stan2030: This is a public-private partnership that advances a shared vision for economic prosperity for all. It focuses on creating more quality jobs, reducing the number of struggling families, and emphasizing growth, prosperity, and inclusion. The new economic development strategic plan utilized the data and initiatives identified in Stan2030's Investment Blueprint to align efforts across governmental agencies, privatepublic partnerships, educational institutions, businesses, service providers, and community groups.
North Valley THRIVE: This is a coalition of community organizations, government entities, educational institutions, and economic development agencies across San Joaquin, Stanislaus, and Merced Counties as formed by the California Jobs First initiative. It primarily works toward the growth of inclusive economies. The new economic development strategic plan synced with their place-based economic development strategies to leverage the partnerships and initiatives of North Valley Thrive to foster economic resilience and inclusivity.
General Plan 2050: The General Plan is in development, and such plans typically provide a long-term framework for development, land use, transportation, and public services. The new economic development strategic plan leveraged this to ensure that economic development initiatives aligned with the broader goals and guidelines of the community. The planning efforts have produced a draft Economic Development Element for the General Plan 2050 Update.
#12..
- 474 -
Economic Development Committee, May 5, 2025
Final Draft of the Economic Development Strategic Plan (2025)
Downtown Master Plan: This plan focused on zoning policies for local, inclusive placemaking. It envisioned the next evolution of downtown, which could have included new businesses, residential areas, and public spaces. The new economic development strategic plan built on the existing defensible community mandates to define new programs that would attract investment and stimulate economic activity in the downtown area.
By integrating these plans, the new economic development strategic plan ensured a coordinated and comprehensive approach to economic development, maximizing the impact of each initiative and fostering a resilient and prosperous community.
The development of the new Plan was guided by a thorough, collaborative process that combined both technical analysis and community engagement. The process took place over the course of 2024 and into early 2025, ensuring that the plan reflects Modesto's unique economic landscape and the priorities of its community. This comprehensive approach helped shape the final strategic framework, which includes actionable steps for economic growth, workforce development, business support, and regional collaboration.
The detailed scope of the new Plan development process included a variety of tasks, all aimed at gathering insights, analyzing trends, and crafting a plan that could be effectively implemented. These tasks included:
Demographic and Economic Analysis: Understanding current and future trends in population, labor force, and key industries, providing a foundation for the strategic direction.
Stakeholder Engagement: Direct input was gathered through novel combination of workshop-style meetings and panelist forums. This ensured that the strategies developed were rooted in real-world insights from business owners, educators, community organizations, and government officials.
o On May 23, 2024, the city hosted a stakeholder’s summit. Participants of the stakeholders' summit helped to identify potential opportunities/options for future economic growth, partner organizations (public and private) that can support implementation of the Plan, and specific strategies to address the identified opportunities and constraints.
o Central Valley Real Estate Summit: On August 7, 2024, the Central Valley Real Estate Summit brought together real estate brokers and developers from the Central Valley, Bay Area, and Capitol Region to discuss 2024’s market performance, a market forecast, and to contribute to our economic Development Strategic Plan efforts.
o Workforce Development Forum: On August 8, 2024, the city hosted a Workforce Development Forum addressing skill gaps, job training, and aligning education with industry needs.
o Entrepreneurial Development Forum: On August 14, 2024, the city hosted an Entrepreneurial Development Forum aiming to provide a platform to discuss #12..
- 475 -
Economic Development Committee, May 5, 2025
Final Draft of the Economic Development Strategic Plan (2025)
strategies for supporting startups, encouraging innovation, and creating an entrepreneurial ecosystem.
o State Policies and Legislative Agenda Forum: On August 28, 2024, the city hosted a State Policies and Legislative Agenda Forum in which participants engaged in dialogue about state-level policies and legislation that impacts jobs and small business. An opportunity to advocate for favorable policies and address challenges.
o Urban Design and Zoning Forum: On August 29, 2024, the city hosted an Urban Design and Zoning Forum focusing on shaping the physical environment to promote economic growth. Discussions centered around land use, zoning regulations, and urban planning.
Industry Cluster Analysis: An in-depth study was conducted to identify the most promising industry clusters for Modesto, focusing on those with the potential for growth and job creation, such as agribusiness, food processing, advanced manufacturing, and healthcare.
Real Estate Market Analysis: A comprehensive assessment of demand for commercial and industrial space in Modesto was conducted, identifying opportunities for development and investment.
SWOT Analysis: Strengths, weaknesses, opportunities, and threats (SWOT) to Modesto’s economic development were identified through stakeholder input, helping shape the direction of the EDSP.
Actionable Strategies: The findings from the workshops and analysis were translated into 22 strategic recommendations organized across 12 key focus areas aimed at enhancing Modesto's economic competitiveness and quality of life.
DISCUSSION:
The Economic Development Strategic Plan (2025) (the Plan) provides a five-year strategic framework to advance the city’s economic future through intentional, inclusive, and datainformed action. Developed with extensive stakeholder input and technical analysis, the plan focuses on strengthening Modesto’s business climate, workforce, and regional influence.
The Plan begins with foundational steps like branding, engagement, and internal coordination, followed by expanded regional partnerships and targeted economic development programs. It includes several initiatives such as establishing Modesto as the hub of the Bioeconomy Valley, accelerating remote tech job growth, and launching a Downtown Catalyst Project for highimpact, visitor-oriented development. Collectively, this plan positions Modesto to become a more inclusive, innovative, and economically resilient city.
It outlines 12 key focus areas, each with specific strategies designed to improve quality of life, grow jobs, and attract investment. These key focuses areas are summarized below. The Final Draft Economic Development Strategic Plan is attached as attachment 1 for a comprehensive review.
Key Focus Areas and Initiatives
#12..
- 476 -
Economic Development Committee, May 5, 2025
Final Draft of the Economic Development Strategic Plan (2025)
1. Brand and Image: Upgrade the City’s economic development website and launch an image enhancement campaign.
2. Community Engagement and Inclusion: Implement inclusive outreach and raise public awareness of economic development.
3. Placemaking: Support development and placemaking efforts in Downtown and other target areas
4. Development Capacity and Business Friendliness: Expand development-ready land and streamline business processes.
5. Talent Development: Establish a Workforce Development Consortium and support training programs.
6. Regional Collaboration: Leverage initiatives like BEAM Circular and Stanislaus 2030 for mutual benefit
7. Entrepreneurship and Innovation: Be the lead in the region to invest, support, and facilitate new business ventures in the City of Modesto.
8. Business Attraction and Recruitment: Focus recruitment on traded industry clusters and targeted retail growth
9. Business Retention and Expansion (BRE): Deploy a proactive business engagement program with customized support.
10. Small Business Development: Create distinct programs for small business startups and support.
11. Tourism and Visitation: Lead and coordinate tourism and destination development efforts
12. EDSP Administration: Allocate resources and staff for planning implementation and performance tracking.
FISCAL IMPACT:
The total cost of the Economic Development Strategic Plan $144,875 utilized CED salary savings from fiscal year 2022-2023. At this time, the adoption of the plan does not have any impact to the General Fund. As we work towards implementation of the EDSP there will be additional funding requests to support implementation of the initiatives.
RECOMMENDED COMMITTEE ACTION:
Staff Recommendations:
Motion recommending the acceptance of the Economic Development Strategic Plan (2025) and forwarding to Council for approval.
#12..
- 477 -
Economic Development Committee, May 5, 2025
Final Draft of the Economic Development Strategic Plan (2025)
Approved by:
Jessica Hill, Director Community and Economic
Development
Joseph P. Lopez, City Manager
Attachments:
1. Economic Development Strategic Plan (2025) _Public
#12..
- 478 -
APRIL 2025
Prepared for the City of Modesto by:
The Natelson Dale Group, Inc. (TNDG)
In association with:
Economic Growth Strategies, LLC
#12..
- 479 -
TABLE OF CONTENTS
1. Introduction........................................................................................................................................ 1 Overview of the Strategic Planning Process....................................................................................................1 Essential Strengths of Modesto’s Organizational Culture...............................................................................4
2. Stakeholder Acknowledgements.......................................................................................................... 5
3. Executive Summary............................................................................................................................. 8 Action Plan Goals and Scope...........................................................................................................................8 Overview of EDSP Initiatives ...........................................................................................................................9 Sequencing of Action Plan Implementation................................................................................................. 11 “Game-changer” Initiatives.......................................................................................................................... 13 Implementation Partners............................................................................................................................. 14 Business Retention/Expansion/Attraction Targets...................................................................................... 19
4. SWOT SUMMARY.............................................................................................................................. 20
5. Highlights of Background / Technical Studies..................................................................................... 23 Demographic and Economic Overview ........................................................................................................ 23 Census-Based Demographic Profile ............................................................................................................. 23 Population and Employment Forecasts (StanCOG)...................................................................................... 25 Labor Force Data .......................................................................................................................................... 26 Taxable Sales Data........................................................................................................................................ 28 Target Industry/Cluster Analysis.................................................................................................................. 31 Overview of Employment in Modesto ......................................................................................................... 31 Existing Important Clusters in Modesto, Stanislaus County and the North San Joaquin Valley.................. 31 “Candidate” Clusters for Modesto Target Industry Program....................................................................... 40 Market Demand for Commercial/Industrial Land Uses............................................................................... 46 Summary of Retail Demand Analysis ........................................................................................................... 47 Summary of Office Demand Analysis........................................................................................................... 48 Summary of Industrial Demand Analysis ..................................................................................................... 49
6. EDSP Action Plan............................................................................................................................... 50 Overview of Action Plan............................................................................................................................... 50 Prioritization of City Resources.................................................................................................................... 51 EDSP Strategies ............................................................................................................................................ 52 Action Steps and Implementation Timeframes ........................................................................................... 54
7. Business Attraction Strategy.............................................................................................................. 72 Recommended Business Retention/Expansion/Attraction Targets............................................................. 72 Assessing Modesto from a Site Selector’s Perspective................................................................................ 76 Business Recruitment Strategy .................................................................................................................... 78
8. Tracking EDSP Progress ..................................................................................................................... 81 Appendix A: EDSP Action Plan Details by Year
Appendix B: Key Performance Indicators
Appendix C: Two-Year Goals / Performance Indicators
Cover Photo Source: "The Gallo Center for the Arts in Modesto, California." by OsotedeMonte – Licensed under CC BY 4.0 via Wikipedia.com – https://commons.wikimedia.org/wiki/File:Gallo_Center_for_the_Arts_Modesto.jpg. #12..
- 480 -
CITY OF MODESTO, CA | EDSP
PAGE | 1
1.INTRODUCTION
This document provides a strategic framework to guide the City of Modesto’s economic development policies and programs over the next 5 years. The Modesto Economic Development Strategic Plan (EDSP) is based on a comprehensive research and stakeholder input process, and reflects consensus views on the most promising opportunities and the most pressing challenges facing Modesto’s economy. While the EDSP places primary emphasis on actions and initiatives to be pursued by the City, it recognizes that a wide array of public- and private-sector entities have roles in influencing the economic vitality of Modesto. In this regard, some of the recommended actions will be carried out through partnerships with other entities. Even for those action items in which the City’s role is essentially coordination, this function can take many forms and is often critical to solving problems that may not otherwise have a clear constituency or single responsible entity assigned to resolving them.
OVERVIEW OF THE STRATEGIC PLANNING
PROCESS
The recommended policies and program activities are based on an extensive planning process that included the following components:
• An analysis of Modesto’s existing and projected demographic profile, providing an understanding of underlying trends that may affect economic growth potentials. • Direct input from a cross section of the City’s economic development stakeholders via a series of workshop-style meetings and panelist forums.
• A review of the various public- and private-sector entities involved in different aspects of economic development (or related activities).
• An industry “cluster” analysis to identify the industry groups (clusters) that are the most important “engines” of the existing local economy, as well as the industry groups that are likely to offer the most attractive growth potentials in the future.
• A real estate market analysis to identify potential future demand for commercial and industrial development in the City.
Where relevant, key findings of the background and technical studies are referenced in the EDSP.
The graphic on the next page summarizes the timeline for developing the EDSP. #12..
- 481 -
CITY OF MODESTO, CA | EDSP
PAGE | 2
As a companion document to the EDSP, the City is concurrently preparing an Economic Development Element as part of the current General Plan Update. Whereas the EDSP and the Economic Development are internally consistent and closely related, they are distinct from each other in the following respects:
#12..
- 482 -
CITY OF MODESTO, CA | EDSP
PAGE | 3
Document: Economic Development
Strategic Plan (EDSP)
General Plan Economic
Development Element
Purpose: Strategic/tactical plan focused
on implementation of an
expanded economic
development program for the
City
Overarching polices (within the
context of the City’s General
Plan) that define the City’s longterm vision and priorities for economic development and
provide a policy framework that
supports implementation of
more specific documents such
as the EDSP
Planning Horizon (Timeframe): 5 years, with annual progress reporting and year-to-year
refinement of priorities
Longer-term horizon,
corresponding to the life of the
General Plan Update (typically
10-20 years)
Level of Detail: Highly detailed – intended to
provide step-by-step guidance
on implementation, with action
items focused on specific
targets
Broad policy statements that
support (and are consistent
with) more detailed documents
such as the EDSP, but which are
general enough to remain
relevant as shorter-term
strategies evolve over the life of
the General Plan
Thematic Focus: Largely focused on expanding
the economic opportunities
(i.e., job and income creation)
of Modesto residents by
attracting new business
investment and supporting the
growth of existing businesses
Largely focused on themes that
have a direct or indirect nexus
to land use and development
policies; whereas the General
Plan is focused on land and
buildings comprising the built
environment, the EDSP is more
concerned with the specific
types of industries and firms
that will occupy developed
buildings
#12..
- 483 -
CITY OF MODESTO, CA | EDSP
PAGE | 4
ESSENTIAL STRENGTHS OF MODESTO’S
ORGANIZATIONAL CULTURE
Throughout the SWOT process conducted for the EDSP, participating stakeholders noted that the City of Modesto has made significant strides in recent years in improving the organizational culture for successful economic development. Key strengths in this regard include:
• The current City Council is highly engaged with and supportive of the City’s economic development program and recognizes economic development as an essential role of municipal government. • The City has a long track record of successful collaboration with a diverse range of public and private partners focused on a broad spectrum of issues influencing Modesto’s economic environment. • The City’s Community Development Department was restructured to ensure that economic development has a more prominent and visible place in the City’s organizational structure. In particular, the Department’s Engineering Services division was moved to a new Engineering Services Department to allow for more focus on economic development.
• The City has taken steps to ensure that business prospects and high-priority development projects receive “red carpet” treatment during approval and permitting processes. For example, to emphasize a culture of interdepartmental collaboration focused on expediting important development projects, the City has a instituted a practice of having “everyone [i.e., every affected department] in the room” during initial meetings with developer applicant teams.
The last point above – creating a “red carpet experience” for business and development prospects – is especially germane to the overall intent of the EDSP. Many of the EDSP recommendations relate to the topic of business and development “friendliness” and represent real opportunities for the City to continue to build on the strong organizational foundations noted above. A sharp focus on enhancing the ways the City supports the business community should ultimately be undergirded by mindset among all City staff that “economic development is everyone’s job.”
#12..
- 484 -
PAGE | 5
CITY OF MODESTO, CA | EDSP
2.STAKEHOLDER
ACKNOWLEDGEMENTS
The City of Modesto gratefully acknowledges the participation of the following individuals in the preparation of the EDSP:
MEMBERS OF THE MODESTO CITY COUNCIL
Mayor Sue Zwahlen
Councilmember Rosa Escutia-Braaton, District 1
Councilmember Eric E. Alvarez, District 2
Councilmember Chris Ricci, District 3
Vice Mayor Nick Bavaro, District 4
Councilmember Jeremiah Williams, District 5
Councilmember David Wright, District 6
EDSP SUMMIT ATTENDEES
Julian Aguirre, City of Ceres
Trevin Barber, City of Modesto
Kirstie Boyett Zacharias, Modesto Chamber of Commerce
Steve Brown, Rolling F Credit Union
Ralph Carrasco
Trish Christensen, Modesto Chamber of Commerce
Elyse Christiansen, Visit Modesto
Cameron Cramer, City of Modesto
Kathryn Davis, Valley First Credit Union
Jorge De Nava, CVOC
Joe Duran, Stanislaus Equity Partners
Monica Escamilla, Digital NEST
Jessica Filbrun, Stanislaus Equity Partners, Inc.
Kyle Fliflet, Stanislaus County Health Services Agency
Monica Flinn, Opportunity Stanislaus
Doris Foster, Stanislaus County Workforce Development
Doris Foster, Stanislaus County Workforce Development
Jessica Fregoso, Central Valley Opportunity Center
Kristin Galloway, Visit Modesto
Marc Garcia, City of Modesto
Edgar Garibay, Valley Improvement Projects
Joe Gonzales, Digital NEST
Chris Hancock, Stanislaus County Workforce Development
Jody Hayes, County of Stanislaus
Maria Hernandez, Stanislaus Equity Partners
Jessica Hill, City of Modesto
Amanda Hughes, Stanislaus 2030
#12..
- 485 -
PAGE | 6
CITY OF MODESTO, CA | EDSP
Margie Johnson
Terry Johnson
Rick W Jones, Central Valley Association of Realtors Government Affairs Director Marian Kaanon, Stanislaus Community Foundation
Patrick Koepele, Tuolumne River Trust
Vivian Lopez, West Modesto Community Collaborative
Tiffany Louk, GO-Biz
Anaiz Madrigal, Stanislaus Equity Partners
Tony Madrigal
Daisy Mayorga, yüda
Andrew Mendoza, Kaiser
Yolanda Meraz, Stanislaus Equity Partners
Perfecto Munoz, Stanislaus Multi Cultural Community Health Coalition West Modesto King K Chris Murphy, Sierra Pacific Warehouse Group
Aaron Nousaine, BAE Urban Economics (General Plan Consultant) Miguel Preciado, Central Valley Women's Entrepreneur Center Joanne Ramos, The Salvation Army
Tina Rocha, Stanislaus County Chief Executive Office
Jose Sabala, Oak Valley Community Bank
Shane Saunders, Mocse Credit Union
Heidi Savage, Downtown Modesto Partnership
Christine Schweininger, Valley Builders Exchange
Kevin Smith, Stanislaus Equity Partners
Raj Solanki, City of Modesto
Karen Warner, BEAM Circular
Toby Wells, City of Modesto
David White, Opportunity Stanislaus
Jeremiah Williams, City Council
David Wright, Modesto City Council
Angie Young, Stanislaus County Workforce Development
German Zavalza, Valley Sierra SBDC
REAL ESTATE SUMMIT PRESENTERS
Will Austin, Director of Market Analytics, CoStar Group Daniel Davis, SIOR, CCIM, Senior Vice President, CBRE
Victor Adjei, Asset Management, Graceada Partners
Ken K. Hira, President, Kosmont Companies
WORKFORCE DEVELOPMENT FORUM PANELISTS
Doris Foster, Director, Stanislaus County Workforce Development Rachelle Barkus, Senior Director of Educational Options, Modesto City Schools Brian Sanders, Ed.D., President, Modesto Junior College Dr. Aubrey Priest, Executive Director, Innovation and Workforce Development, California State University, Stanislaus
Damon Fugett, School Director, DeHart Technical School
Phillip Lan, President, Bay Valley Tech
#12..
- 486 -
PAGE | 7
CITY OF MODESTO, CA | EDSP
ENTREPRENEURIAL DEVELOPMENT FORUM PANELISTS
Dr. Gokce Soydemir, Business Economics Professor, California State University, Stanislaus Amanda Hughes, Executive Director, Stanislaus 2030
Yolanda Meraz, Chief Strategy Officer, Stanislaus Equity Partners German Zavalza, Director, Sierra Valley SBDC
Kris Helton, Business Partner, BBSI/Central Valley Business Expo Fred Resuli, Business Partner, BBSI/Central Valley Business Expo Bob Adams, Central Valley Regional Specialist, CalOSBA
Ted Hillman, Resiliency Training Coordinator, CalOSBA
STATE POLICIES AND LEGISLATIVE AGENDAS FORUM PANELISTS
Gurbax Sahota, President & CEO, California Association for Local Economic Development Dana Ferreira, Regulatory Analyst, Modesto Irrigation District Antonio Aguilar, Central/Northern CA Outreach Manager, Small Business Majority Tiffany Louk, Central Valley Business Development Specialist, CA Business Investment Services Danna Stroud, Central California Regional Manager, GO-Biz Justin Farkas, Field Representative, Office of State Assemblymember Juan Alanis
PLACEMAKING (URBAN DESIGN AND ZONING) FORUM PANELISTS
Dan Amsden, Principal, MIG
Kimberly Garza, Founder & Principal, Atlas Lab Inc.
Heidi Savage, President & CEO, Downtown Modesto Partnership #12..
- 487 -
PAGE | 8
CITY OF MODESTO, CA | EDSP
3.EXECUTIVE SUMMARY
ACTION PLAN GOALS AND SCOPE
The EDSP Action Plan is designed to achieve the following major goals:
• Expand economic opportunities for Modesto’s resident workforce • Attract firms and entrepreneurial startups in high-growth/high-wage industry clusters • Leverage the economic development potentials of Modesto’s historic downtown and waterfront areas • Revitalize Modesto’s other commercial and industrial areas • Position Modesto as a “central place” within the North San Joaquin Valley for residents, business investors, and visitors
• Strengthen the City’s fiscal position
Whereas these goals largely revolve around attracting and retaining targeted business investment, the Action Plan recognizes that the strength of the local business/development environment will ultimately depend on Modesto’s strategic attention to a range of “foundational” conditions such as:
• Modesto’s “brand”
• The City’s reputation for business/development friendliness • Land, zoning and infrastructure capacity
• Entrepreneurial development resources
• Education/workforce development systems
• Placemaking initiatives that leverage Modesto’s unique locational advantages and sense of community • The City’s organizational capacity for economic development and business support • Overall image and quality of life
#12..
- 488 -
PAGE | 9
CITY OF MODESTO, CA | EDSP
OVERVIEW OF EDSP INITIATIVES
The EDSP Action Plan (detailed in Chapter 6) is organized around eleven major focus areas and a total of 22 strategy recommendations:
Foundational / Capacity Building
Focus Area 1:
Brand and Image
Recommendation 1: Upgrade City's economic development website Recommendation 2: Implement image enhancement campaign (replace negative/inaccurate perceptions with positive messaging) Focus Area 2:
Community
Engagement and
Inclusion
Recommendation 3: Include community engagement as an ongoing/core function of ED program; implement a broad community engagement plan to enhance stakeholder dialogue/trust and raise public awareness of the value of the City's ED function Recommendation 4: Integrate the practice of inclusive economic development into all aspects and phases of EDSP implementation
Focus Area 3:
Placemaking
Recommendation 5: Promote development opportunities in Downtown Recommendation 6: Implement a range of programs and policies aimed at enhancing the placemaking potentials of the Downtown and other distinct subareas (these programmatic investments would complement the development-focused investments in Recommendation 5)
Focus Area 4:
Development
Capacity and
Business
Friendliness
Recommendation 7: Expand industrial space/development capacity Recommendation 8: Promote revitalization and expansion of Modesto's commercial development footprint
Recommendation 9: Integrate City's housing-related policies/programs with economic development opportunities
Recommendation 10: Implement across-the-board improvements in Modesto business/development permitting and approval processes; promote Modesto as the "most business friendly" City in California
Focus Area 5:
Talent
Development
Recommendation 11: Establish Modesto Workforce Development Consortium (City led and coordinated) to facilitate regular information exchange of among partners Recommendation 12: Develop City-specific support services to supplement partner-led workforce development programs
Focus Area 6:
Regional
Collaboration
Recommendation 13: Position Modesto as a leader in BEAM Circular initiative; maximize Modesto's capture of opportunities generated by BEAM Circular Recommendation 14: Leverage small business support system being launched by Stanislaus 2030 (Small Business Strategy and Implementation Roadmap) Recommendation 15: Leverage research and strategic framework of North Valley Thrive (NVT)
Recommendation 16: Actively collaborate with regional partners to improve region-wide conditions related to state/federal regulations and funding, essential infrastructure, and program delivery
#12..
- 489 -
PAGE | 10
CITY OF MODESTO, CA | EDSP
Business Development / Job Creation
Focus Area 7:
Entrepreneurship
and Innovation
Recommendation 17: Establish City Office of Entrepreneurism and Innovation with an overall mission of maximizing local access to business startup resources and positioning Modesto as the premiere North Valley location for technology-oriented entrepreneurial ventures
Focus Area 8:
Business Attraction
and Recruitment
Recommendation 18: Implement business attraction program focused on targeted industries in "traded" clusters
Recommendation 19: Implement retail/restaurant tenant attraction program Focus Area 9:
Business Retention
and Expansion
(BRE)
Recommendation 20: Implement "boots on the ground" business retention/expansion (BRE) program to identify "red flags" for businesses needing retention/expansion services; customize assistance package based on challenges/opportunities facing identified firms Focus Area 10:
Small Business
Development
Recommendation 21: Implement small business startup and assistance program (separate and distinct from entrepreneurial development programming) Focus Area 11:
Tourism and
Visitation
Recommendation 22: Lead coordination of various organizations and initiatives focused on expanding tourism (and visitor-related real estate development) in Modesto Focus Area 12:
EDSP
Administration
Recommendation 23: Allocate staff time for initial and ongoing EDSP administration #12..
- 490 -
PAGE | 11
CITY OF MODESTO, CA | EDSP
Sequencing of Action Plan Implementation
The figure on the next page introduces considerations for how the EDSP might proceed from a business-plan point of view. Beginning with the Brand and Image process, relationships with regional programs begin to be positioned, and community engagement initiated, while promotional materials are put in place for various purposes. City administrative actions and other functional details would come later, parallel with regional collaboration efforts and associated multiple programmatic considerations. #12..
- 491 -
PAGE | 12
CITY OF MODESTO, CA | EDSP
#12..
- 492 -
PAGE | 13
CITY OF MODESTO, CA | EDSP
“Game-changer” Initiatives
Gamechanger #1: Planting the Modesto flag in the Bioeconomy Valley Bioeconomy Valley: The regional BEAM Circular initiative has the potential to fundamentally transform and elevate the North San Joaquin Valley’s economy. Modesto should stake its claim as the capital city of the Bioeconomy Valley. Initiatives should include creating a Memorandum of Understanding with BEAM Circular, memorializing a long term commitment to support initiatives (innovation center, R&D facilities, etc.) to increase the presence of BEAM Circular programs, activities, and investments. The City should convene an International Bioeconomy Development Opportunity (BDO) Zone Conference. Most of the meetings are currently done by Zoom. Modesto could secure sponsors and investors to bring BDO communities (and private sector BDO leaders) to a conference discuss common challenges, opportunities, etc. This would provide the opportunity for Modesto to be viewed as the center of this industry and showcase ground-level opportunities. To further establish Modesto as a credible “player” in the bioeconomy and related opportunities such as climate adaptive technology development, it is recommended that Modesto (in partnership with Stanislaus County) develop an Integrated Multi-Jurisdictional Climate Action, Adaptation, and Resiliency Plan (ICAARP).
Gamechanger #2: Job and Wealth Creation through Talent Development Remote Tech Jobs as a Catalyst for Business Attraction and Startups: Modesto is uniquely positioned to capture medical and technology jobs in the City. Partnering with existing Modesto organizations, such as Bay Valley Tech and Valley Consortium for Medical Education, the City can grow and retain a local workforce that can provide remote work to technology companies and meet the demand of the growing needs in the local health care industry. The increase of trained workforce in these areas would position the City as a leader and can be leveraged to attract companies to the City. The City should create a strategy with these types of existing partners for a goal to train and retain a certain number of residents in these industries.
Gamechanger #3: Leveraging City Resources to Maximize Downtown’s Destination Potentials Downtown Catalyst Project: The City should explore opportunities for positioning underutilized land in the Downtown for development of hotels and other visitor-oriented facilities. As an initial pilot or catalyst project, the City should consider seeking EDA funding for a joint venture project to pursue high-impact development opportunities aligned with the City’s overall strategic objectives for the Downtown. #12..
- 493 -
PAGE | 14
CITY OF MODESTO, CA | EDSP
IMPLEMENTATION PARTNERS
The table below lists the various non-City entities that will potentially support implementation of the EDSP.
Organizations / Focus Areas
Brand and ImageCommunity Engagement and InclusionPlacemakingDevelopment Capacity and Business FriendlinessTalent DevelopmentRegional CollaborationEntrepreneurship and InnovationBusiness Attractionand RecruitmentBusiness Retention and Expansion (BRE)Small Business SupportTourism and VisitationEDA Administration 1 2 3 4 5 6 7 8 9 10 11 12
City of Modesto
Economic Development L L S L C C L L L L L L
Community Development S L S S S S S S S
City Manager's Office S S S S S S S
Media & Communications S S S
Planning C S S
Engineering Services C S
Police Department S S S
Parks, Recreation, & Neighborhoods S S S
Contractors/Consultants
Branding/Marketing Consultant S S S
Retail Consultant S S S
Real Estate S S S
Partners
Bay Valley Tech S S
BEAM Circular S S S
CALED S S
California Chamber of Commerce S S
California State University, Stanislaus S S
Central Valley Business Expo S
DeHart Technical School S
Downtown Modesto Partnership S S S
East Stanislaus RCD S S
Role Legend
Role Coordination Lead Support
Role Code C L S
#12..
- 494 -
PAGE | 15
CITY OF MODESTO, CA | EDSP
Organizations / Focus Areas
Brand and ImageCommunity Engagement and InclusionPlacemakingDevelopment Capacity and Business FriendlinessWorkforce DevelopmentRegional CollaborationEntrepreneurship and InnovationBusiness Attractionand RecruitmentBusiness Retention and Expansion (BRE)Small Business SupportTourism and VisitationEDA Administration 1 2 3 4 5 6 7 8 9 10 11 12
Partners
HealthForce Partners S
Latino Chamber of Commerce S
Latino Community Roundtable S
Manufacturers Council of the Central
Valley S S S S
Modesto Chamber of Commerce S S S S S
Modesto City Schools S
Modesto Development Roundtable S
Modesto Irrigation District S S
Modesto Junior College S
Modesto Neighborhoods, Inc. S
NAACP S
North Valley Thrive Steering Committee S
Opportunity Stanislaus S S S S S S S
River Partners S S S
Small Business Majority S S
South Modesto Neighborhoods S
South West Modesto MAC S
Stanislaus 2030 S S S
Stanislaus County S S S
Stanislaus County Workforce
Development S
Stanislaus Equity Partners S
State (CalBIS, GO-Biz) S S
State (CalOSBA) S S
State Senate and Assembly Offices S S S S
Role Legend
Role Coordination Lead Support
Role Code C L S
#12..
- 495 -
PAGE | 16
CITY OF MODESTO, CA | EDSP
Organizations / Focus Areas
Brand and ImageCommunity Engagement and InclusionPlacemakingDevelopment Capacity and Business FriendlinessWorkforce DevelopmentRegional CollaborationEntrepreneurship and InnovationBusiness Attractionand RecruitmentBusiness Retention and Expansion (BRE)Small Business SupportTourism and VisitationEDA Administration 1 2 3 4 5 6 7 8 9 10 11 12
Partners
Tuolumne River Trust S S S
University of California, Merced S S
University of the Pacific S
Valley Consortium for Medical
Education S
Valley Sierra SBDC S S
Visit Modesto S S S
Role Legend
Role Coordination Lead Support
Role Code C L S
#12..
- 496 -
PAGE | 17
CITY OF MODESTO, CA | EDSP
Partnerships in economic development always need tending, but this is especially true in Modesto given the wealth of regional programs with which the City will be interfacing in the EDSP. Specifically:
• Partners have recognized enough common purpose, in challenges as well as opportunities, that a robust regional ecosystem for economic development has emerged. • While the advantages of such regionalism are generally self-evident, to both the partnering entities and prospective/active funders, most entities in these arrangements also have histories of competitive rivalries.
• Nevertheless, potential benefits to Modesto include:
o Having the groundwork already in place for numerous Modesto strategic objectives. o Regional programs provide additional validation for parallel Modesto objectives.
To maximize these benefits the City will need to:
o Establish its preferred positions within the range of goals, strategies, and action steps of the various programs. This includes consideration of how to maximize the interactions among strategies, which would be readily integrated within an independently derived and implemented strategic plan for Modesto. The Gamechanger programs in the EDSP are relevant in this regard. o Assume active roles where possible, including financial support if necessary to maintain decisionmaking involvement. o Monitor closely the proceedings, leadership choices, policy directions and actions, etc. of regional programs and provide continuous input.
#12..
- 497 -
PAGE | 18
CITY OF MODESTO, CA | EDSP
#12..
- 498 -
PAGE | 19
CITY OF MODESTO, CA | EDSP
BUSINESS RETENTION/EXPANSION/ATTRACTION
TARGETS
The EDSP recommends that Modesto focus its business retention/expansion/attraction efforts on the following industry clusters:
Potential Business Retention/Expansion/Attraction Targets for Modesto Industry Cluster Potential Areas of Focus for Modesto
Agribusiness and Food
Processing
Agribusiness
• Sustainable Practices
• Technological Advancements
• Changing Consumer Preferences
• AgTech Development
Food Processing
• Technological Innovation
• Sustainability
• Health and Wellness
• Convenience Foods
Advanced Manufacturing • Digital Transformation
• Sustainability / Climate Adaptive Technology
• Reshoring and Localization
• Advanced Materials
• Workforce Development (invest in training to create competitive advance and as an incentive to businesses considering a Modesto location)
Healthcare and Biotechnology • Personalized Medicine
• Telehealth and Remote Monitoring
• Biotechnology Innovations
• Technological Advancements
• Increased Funding and Investments
• Agricultural Biotechnology
Tourism, Hospitality and Retail With a growing population and increasing tourism, retail stores, restaurants, and hotels can do well. Enhancing the local tourism infrastructure can further boost this sector. Enhancing tourism infrastructure and promoting local attractions can boost the hospitality industry and bring in additional revenue.
Technology and Professional
Services
As the city continues to develop, there is a growing need for IT services, consulting firms, and other professional services. In Modesto, this sector can benefit from the proximity to major tech hubs like the Bay Area. #12..
- 499 -
PAGE | 20
CITY OF MODESTO, CA | EDSP
4. SWOT SUMMARY
The technical studies and stakeholder input provided the basis for identification of important SWOT (strengthweakness-opportunity-threat) factors affecting Modesto’s economic development potentials. Highlights of the SWOT analysis are provided below.
Strengths
• Strong base of core industries (agriculture, food processing, logistics, manufacturing, healthcare) • Affordable housing (compared to other parts of California) • Competitive costs of doing business in a business-friendly environment • Low unemployment rates of resident workforce
• Strong commercial/industrial real estate markets (retail, office and industrial vacancy rates under 5%) • Innovative workforce development programs and resources • Established arts/entertainment community (one of the few cities in the U.S. that has all of the following:
opera, symphony orchestra, and ballet)
• Highest participation rate nationally in “National Night Out” • Concentration of NPO's based in Modesto (prospective partners for ED and community engagement) • Established (and expanding) collaboration with regional partners for ED programs • Proximity to "superstar tech hub" (Bay Area / Silicon Valley) • Water availability and competitive pricing (independent district) • Current City Council is recognized as engaged with and supportive of ED • Close knit community combining small town feel with larger-city opportunities • Distinctive residential neighborhoods
Weaknesses
• Image problem: Modesto is not perceived by outsiders as an attractive place to live or visit • Lack of amenities makes Modesto an unattractive residential option for young professionals • Lack of housing diversity
• Lack of shovel-ready industrial land
• Lack of awareness (in business community) of available assistance resources • Disconnect between workforce development programs and private industry/employers • Disconnect between City's business assistance resources and the communities that most need them • Perception that City does not do enough to engage underserved communities #12..
- 500 -
PAGE | 21
CITY OF MODESTO, CA | EDSP
• Mobility (transit) options are limited
• Low educational attainment of Modesto's resident population (20.5% of residents have Bachelor’s degrees, compared to statewide average of 37.0%)
• Stanislaus County lags in “business dynamism” (i.e., Stanislaus underperforms peer regions in terms of creation and sustainability of new ventures)
• Modesto’s taxable retail sales growth has not kept pace with county and state growth rates, suggesting that “leakage” of resident spending has grown over time • Persistent homelessness problem
Opportunities
• Build on major ED-related initiatives currently underway in region (BEAM Circular, Stanislaus 2030, North Valley Thrive)
• Position Modesto to maximize capture of opportunities generated by regional initiatives (BEAM Circular, etc.)
• Position Modesto as visitor destination / entertainment district • Leverage Modesto's unique placemaking opportunities (Downtown, waterfront) • Focus program resources to take Downtown Modesto to the "next level" as a visitor destination and housing option – positioning Downtown as the City’s “living room” • Leverage the potential economic development benefits of pending "catalyst development projects" (e.g., ACE train, new courthouse, potential sports stadium, etc.) • Continue to improve Modesto's reputation for business/development friendliness • Launch major initiative on entrepreneurism/innovation (through partnerships and local resources) • Grow industry "clusters" around historic core industries • Position climate resilience initiatives as business development opportunities • Bioeconomy Development Opportunity (BDO) Zone designation (regional) • Growing acceptance of remote work (allowing Bay Area workers to live in Modesto) • Expand business assistance outreach (and Spanish language support) to BIPOC communities • Leverage emerging regional models/frameworks for inclusive ED • Pursue "food culture" development as a business/tourism opportunity • Support the evolution of retail shopping centers consistent with current market trends • Leverage City-owned real estate for development (potentially requiring City to consider strategic acquisitions of new property and/or partnerships with private landowners) • Train Modesto residents as remote tech workers (for jobs based in Bay Area) #12..
- 501 -
PAGE | 22
CITY OF MODESTO, CA | EDSP
• Promote ED potentials of major pending investments (e.g., ACE Train, transit center, courthouse) • Expand use of virtual ED services (and services provided through partnerships) Threats
• Outdated perception that Modesto's development approval process is cumbersome and political • State-level regulations that are unfavorable to business attraction • County-level regulations/restrictions on business
• Global evolution of the retail industry (impacts of e-commerce) • Conversion of employment land to housing
• Potential proliferation of homelessness (especially in high-visibility areas such as the Downtown) • Climate change (and the cost of adapting to new regulations) #12..
- 502 -
CITY OF MODESTO, CA | EDSP
PAGE | 23
5.HIGHLIGHTS OF BACKGROUND /
TECHNICAL STUDIES
DEMOGRAPHIC AND ECONOMIC OVERVIEW
Census-Based Demographic Profile
The following data were obtained from the U.S. Census Bureau, American Community Survey (ACS) 5-year estimates (2018-22). Data are provided for primarily the City of Modesto, Stanislaus County the State of California, as well as selected benchmark cities: Bakersfield, Clovis, Elk Grove, Fresno, Merced, Roseville, Sacramento, Stockton, Tracy, Tulare, and Visalia.
Median Household Income Levels. Figure 1 provides a summary of median household income levels for the referenced geographies. The City’s median household income level ($73,375) is slightly lower than the average level in the benchmark cities and in Stanislaus County.
FIGURE 1. CENSUS DATA ON MEDIAN HOUSEHOLD INCOME –
MODESTO, STANISLAUS COUNTY, CALIFORNIA, AND BENCHMARK CITIES Source: U.S. Census Bureau, 2018-2022 American Community Survey 5-Year Estimates; TNDG.
Housing Ownership. Figure 2 provides a summary of the share of owner-occupied versus renter-occupied housing units for the referenced geographies. Modesto has a higher share of owner-occupied housing units (57.7%) than renter-occupied housing units (42.3%). Modesto’s proportion of owner-occupied units (57.7%) is somewhat lower than the countywide average (60.5%) and somewhat higher than the statewide average (55.6%). $73,375 $74,872
$91,905
$84,238
0 10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
Modesto Stanislaus CA Benchmark Cities
#12..
- 503 -
CITY OF MODESTO, CA | EDSP
PAGE | 24
FIGURE 2. CENSUS DATA ON HOUSING TYPES –
MODESTO, STANISLAUS COUNTY, CALIFORNIA, AND BENCHMARK CITIES Source: U.S. Census Bureau, 2018-2022 American Community Survey 5-Year Estimates; TNDG.
Educational Attainment. Figure 3 provides a summary of educational attainment (Bachelors degree or higher, population 25 years and over) for the referenced geographies. About 20.5% of the City is in the Bachelor’s degree or higher category, below the shares in all but two of the benchmark cities. Similarly, Modesto outperforms the rest of Stanislaus County, where only 18.8% of those above 25 hold a Bachelor’s degree or higher.
FIGURE 3. CENSUS DATA ON EDUCATIONAL ATTAINMENT –
MODESTO, STANISLAUS COUNTY, CALIFORNIA, AND BENCHMARK CITIES Source: U.S. Census Bureau, 2018-2022 American Community Survey 5-Year Estimates; TNDG.
57.7% 60.5%
55.6% 55.8%
42.3% 39.5%
44.4% 44.2%
0%
10%
20%
30%
40%
50%
60%
70%
Modesto Stanislaus CA Benchmark Cities
Owner-Occupied Renter-Occupied
20.5% 18.8%
37.0%
28.6%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Modesto Stanislaus CA Benchmark Cities
Bachelor's degree or higher
#12..
- 504 -
CITY OF MODESTO, CA | EDSP
PAGE | 25
Population and Employment Forecasts (StanCOG)
Table 1 and Table 2 below show demographic and employment forecasts for the City of Modesto, Stanislaus County, as well as Fresno, Kern, Merced, and San Joaquin Counties. The table shows absolute and percentage growth rate projections (households and employment) for the 2019-2035 and 2035-2050 periods. The projections in Table 1 come from Stanislaus County of Governments’ Demographic and Employment Forecast, while those in Table 2 are from the respective counties’ Council of Governments Forecasts.
Table 1 shows that Modesto’s households are projected to grow relatively slower over the first 15-year period (2020-2035), with the City projected to add just over 10,704 households during this period. This growth is slightly below the rate of Stanislaus County, which is expected to have 16.1% household growth over that period.
Similarly, between 2035-2050, Modesto’s households are expected to grow by 9.04%, while the County’s households are expected to grow by 10.54%.
TABLE 1. REGIONAL GROWTH PROJECTIONS:
MODESTO AND STANISLAUS COUNTY (2019-35 AND 2035-50)
Area
2020-35 2035-50
# Change % Change # Change % Change
Households
Modesto 10,704 14.37% 7,702 9.04%
Stanislaus County 28,861 16.10% 21,935 10.54%
Employees
Modesto 15,650 14.85% 9,475 7.83%
Stanislaus County 38,373 16.10% 25,893 9.36%
Source: Stanislaus Council of Governments; TNDG.
Compared to the counties containing the benchmark cities, Stanislaus County’s expected household growth of
16.1% between 2020-2035 and 10.54% between 2035-2050 is relatively low, as only Fresno County is expected to have less relative household growth during both periods.
Similarly, Stanislaus County’s forecasted employee growth of 16.1% is relatively low between 2020-2035, with only Kern County expected to have less relative growth during that period. However, between 2035-2050, the County’s expected employee growth of 9.36% sits at the middle of the five counties’ forecasts. #12..
- 505 -
CITY OF MODESTO, CA | EDSP
PAGE | 26
TABLE 2. REGIONAL GROWTH PROJECTIONS:
SELECTED COMPARISON COUNTIES (2019-35 AND 2035-50)
Area
2020-35 2035-50
# Change % Change # Change % Change
Households
Stanislaus County 28,861 16.10% 21,935 10.54%
Fresno County 43,014 13.61% 21,405 5.96%
Kern County 45,251 16.58% 43,896 13.80%
Merced County 21,694 24.51% 22,083 20.04%
San Joaquin County 42,841 17.91% 30,245 10.73%
Employees
Stanislaus County 38,373 16.10% 25,893 9.36%
Fresno County 69,600 18.55% 30,200 6.79%
Kern County 33,754 9.90% 27,467 7.33%
Merced County 14,896 18.16% 19,128 19.74%
San Joaquin County 55,206 16.68% 41,265 10.69%
Source: Stanislaus Council of Governments, Fresno County Council of Governments, Kern Council of Governments, University of the Pacific, San Joaquin Council of Governments; TNDG.
Labor Force Data
The BLS provides unemployment rate estimates through its Local Area Unemployment Statistics (LAUS) program.
Figure 4 below provides annual average unemployment rate estimates for Modesto, Stanislaus County, and California for the 10-year period from 2013 to 2022. Table 3 and Table 4 on the following page provide the same for the benchmark cities. As shown in the figure and table below, all geographies experienced a similar trend in unemployment rates during this period. Due to the coronavirus pandemic, all evaluated geographies experienced a significant increase in unemployment rates, with Modesto experiencing a significant increase (5.6 percentage points between 2019 and 2020). However, by 2022, the unemployment rate in Modesto had fallen all the way back to below 2019 levels (4.9% in 2022), lower than Stanislaus County’s rate but relatively high compared to the benchmark cities (only four cities higher than Modesto in 2022). #12..
- 506 -
CITY OF MODESTO, CA | EDSP
PAGE | 27
FIGURE 4. UNEMPLOYMENT RATE ESTIMATES:
MODESTO, STANISLAUS COUNTY, AND CALIFORNIA (2015-22)
Source: Bureau of Labor Statistics (BLS), Local Area Unemployment Statistics (LAUS) program; TNDG.
TABLE 3. UNEMPLOYMENT RATE ESTIMATES: MODESTO AND SELECTED COMPARISON CITIES (2015-22) Area
Average Annual Unemployment Rate (%)
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Modesto 12.8 11.1 9.4 7.8 6.8 5.9 5.5 11.1 8 4.9
Bakersfield 10.6 9.4 9.2 7.8 6.5 5.6 5.3 11.4 7.9 4.8
Clovis 10.5 9.1 7.9 5.3 4.6 4.0 3.8 8.0 5.4 3.3
Elk Grove 10.5 9.1 7.9 5.3 4.6 4.0 3.8 8.0 5.4 3.3
Fresno 14.5 12.7 11.1 7.7 6.8 5.9 5.8 11.1 8.2 5.0
Merced 13.9 12.3 10.8 8.6 7.7 6.9 6.8 11.8 9.2 6.4
Roseville 7.4 6.0 4.8 4.2 3.7 3.0 3.0 7.5 4.9 3.0
Sacramento 9.5 7.8 6.4 5.5 4.8 4.0 3.8 9.9 7.3 4.1
Stockton 13.4 11.5 9.7 9.1 8.1 7.1 6.9 13.1 9.9 6.0
Tracy 10.6 9.0 7.5 5.7 4.8 3.9 3.8 9.8 6.5 3.6
Tulare 12.4 11.3 9.9 7.0 6.5 6.1 6.0 10.5 8.1 5.2
Visalia 11.8 10.8 9.4 6.2 5.5 5.0 5.1 10.0 6.9 4.3
Source: Bureau of Labor Statistics (BLS), Local Area Unemployment Statistics (LAUS) program; TNDG. 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Modesto 12.8 11.1 9.4 7.8 6.8 5.9 5.5 11.1 8 4.9
Stanislaus County 13.1 11.3 9.6 8.6 7.5 6.5 6.1 11.0 8.3 5.4 California 9.0 7.6 6.3 5.5 4.8 4.2 4.1 10.1 7.3 4.2
Modesto
Stanislaus County
California
0 2
4 6
8 10
12 14
Unemployment Rate (%)
#12..
- 507 -
CITY OF MODESTO, CA | EDSP
PAGE | 28
FIGURE 4. UNEMPLOYMENT RATE ESTIMATES:
MODESTO AND SELECTED COMPARISON CITIES, 2022
Source: Bureau of Labor Statistics (BLS), Local Area Unemployment Statistics (LAUS) program; TNDG.
Taxable Sales Data
Table 5, below, provides retail taxable sales data, as provided by the CDTFA, for the City of Modesto between 2015 and 2022 (the most recent year for which data are available). As shown in the table, City-wide taxable retail sales have increased by about $630 million during this period, or by 28.8%. Food Services and Drinking Places and Gasoline Stations experienced the most significant relative increases, with sales increasing by 44.7% and 78.3%, respectively.
TABLE 5. TAXABLE RETAIL SALES ($000S), CITY OF MODESTO, 2015-22 Category 2015 2017 2019 2021 2022 % Change
Motor Vehicle and Parts Dealers 246,567 252,304 225,114 287,959 285,297 15.7% Home Furnishings and Appliance
Stores 137,561 153,682 155,334 179,746 154,258 12.1%
Building Material and Garden
Equipment and Supplies Dealers 154,052 172,798 177,144 229,818 208,333 35.2% Food and Beverage Stores 149,024 155,484 160,002 189,237 190,114 27.6% Gasoline Stations 200,713 211,768 258,243 280,349 357,969 78.3% Clothing and Clothing
Accessories Stores 260,777 261,562 262,974 312,711 294,789 13.0% General Merchandise Stores 434,676 439,803 432,202 498,672 497,746 14.5%
2.0 2.5
3.0 3.5
4.0 4.5
5.0 5.5
6.0 6.5
7.0 2022 Unemployment Rate (%)
#12..
- 508 -
CITY OF MODESTO, CA | EDSP
PAGE | 29
Category 2015 2017 2019 2021 2022 % Change
Food Services and Drinking
Places 366,841 403,575 434,472 485,841 530,905 44.7%
Other Retail Group 239,830 239,772 244,262 304,882 301,592 25.8% Total Retail and Food Services 2,190,042 2,290,749 2,349,747 2,769,215 2,821,003 28.8% Source: California Department of Tax and Fee Administration (CDFTA); TNDG.
Figure 5 on the next page, compares Modesto’s taxable retail sales performance relative to Stanislaus County and California. The figure normalizes the base year sales data (2015 = 100) to provide relevant comparisons among the five geographies. As discussed above, the 2022-year value of 129 implies that Modesto’s taxable retail sales increased by 29% during this period, the least significant increase compared to the other two geographies. #12..
- 509 -
CITY OF MODESTO, CA | EDSP
PAGE | 30
FIGURE 5. TAXABLE SALES TRENDS: MODESTO, STANISLAUS COUNTY, AND CA, 2015-2022 Source: CDTFA; TNDG.
Modesto
129
Stanislaus
151
California
137
70 80
90 100
110
120
130
140
150
160
2015 2016 2017 2018 2019 2020 2021 2022
Index 2015 = 100
#12..
- 510 -
CITY OF MODESTO, CA | EDSP
PAGE | 31
TARGET INDUSTRY/CLUSTER ANALYSIS
This section provides a summary of industry growth/retraction trends in Modesto, comparing the local economy’s recent and longer-term performance to regional and national benchmarks. The study breaks down the local economy in terms of industry “clusters.” Clusters are groups of inter-related industry sectors whose growth potentials within a region tend to be closely aligned. The tendency of individual industries to co-locate in clusters reflects linkages through supply-chain relationships, as well as commonalities in terms of workforce requirements and infrastructure needs.
Overview of Employment in Modesto
Total current (2023) employment in the Modesto area (“Modesto”) is estimated at 117,149 jobs The local clusters currently represent a total of 93,895 jobs in Modesto, while the traded clusters account for 29,115 jobs. Total cluster employment adds up to slightly more than total employment given that some industries are included in more than one cluster1
.
Whereas local and traded clusters are both critically important components of a balanced economy, they have distinct roles and characteristics, and these distinctions can be helpful in terms of planning economic development programs. Some of these distinctions are summarized as follows:
• Local clusters typically form the core of a region’s economy; they primarily provide goods and services for the local (resident) population. They tend to account for the majority of jobs in a region (in the case of Modesto, local clusters represent about 76% of total jobs), and support a high quality of life by ensuring the availability of a diverse range of goods and services. In Modesto, important local clusters include Local health Services and Local Hospitality Establishments. These clusters account for about 23% of Modesto’s total jobs.
• Traded clusters are “export-oriented” in the sense that they include industries that are engaged in producing goods and services for end customers outside the region. Traded clusters account for about 24% of the jobs in Modesto, and are especially important from an economic development perspective given that they tend to have higher wages and higher “multiplier impacts” compared to local clusters.
That is, they have a strong potential to inject new dollars into the local economy and thereby serve as “drivers” for broader economic growth. In Modesto, important traded clusters include Distribution and Electronic Commerce, Food Processing and Manufacturing and Agricultural Inputs and Services. These three clusters account for about 60% of Modesto’s total jobs in traded clusters.
Existing Important Clusters in Modesto, Stanislaus County and the North San Joaquin Valley
Table 6 lists all traded clusters that had 200 or more jobs in Modesto in 2023, and provides the following information about each listed cluster:
• Total number of jobs in Modesto in 2023 (the latest full year for which data are available) 1 EMSI has made some adjustments to the cluster definitions to account for changes in the NAICS industry structure between 2012, 2017, and 2022 NAICS industry definitions.
#12..
- 511 -
CITY OF MODESTO, CA | EDSP
PAGE | 32
• Location quotient (compared to U.S. benchmark) in 2023. The location quotient (LQ) measures how concentrated/important an industry cluster is in a region compared to national benchmarks. An LQ value greater than 1.0 indicates that a cluster is more concentrated in the region than it is nationally. This is generally regarded as an indication that the region has a comparative advantage relative to a particular cluster, although (especially for local clusters) an LQ below 1.0 can indicate a potential growth opportunity.
• Average annual wage for jobs in Modesto2
• Change in the number of jobs for the most recent 10-year period, 2013-2023 Table 7 provides the same data for local clusters that had more than 3,000 jobs in Modesto in 2023. Tables 8 through 11 provide comparable data for Stanislaus County and the North San Joaquin Valley (North SJV) region (Stanislaus, San Joaquin and Merced Counties combined). For the Stanislaus County summary tables, the jobs threshold is 500 for traded clusters and 5,000 for local clusters. For the North SJV summary tables, the jobs threshold is 1,500 for traded clusters and 10,000 for local clusters.
Tables 12 and 13 summarize cluster job growth/retraction performance in Modesto, Stanislaus County, and the North SJV region compared to national trends. This part of the study is based on a “shift-share” analysis for each cluster that estimates an “expected” job change based on national trends. If Modesto (or Stanislaus County or the North SJV region) has higher job growth (or experiences less severe job losses) compared to the expected change, it indicates that the local area (Modesto, Stanislaus County, or the North SJV region) has performed better than national trends. Conversely, if Modesto/Stanislaus County/North SJV region has less job growth (or experiences more severe job losses) compared to the expected change, it indicates that the specific region has performed worse than national trends.
TABLE 6. SUMMARY CHARACTERISTICS AND TRENDS, MODESTO’S LARGEST TRADED CLUSTERS (LIST INCLUDES ALL CLUSTERS WITH MORE THAN 200 JOBS IN 2023)
Traded Cluster Jobs LQ County
LQ*
Avg Ann
Wage
10-Yr Job
Change
Food Processing and Manufacturing 8,089 8.9 8.0 98,449 1,386 Distribution and Electronic Commerce 6,412 1.0 1.0 78,235 551 Agricultural Inputs and Services 2,880 2.2 5.8 64,051 (88) Business Services 2,735 0.3 0.3 96,902 (245)
Education and Knowledge Creation 1,981 0.4 0.5 65,774 294 Downstream Metal Products 883 2.6 1.8 92,537 (168)
Transportation and Logistics 637 0.4 0.8 80,842 (424)
Hospitality and Tourism 588 0.3 0.4 34,621 (134)
Financial Services 587 0.4 0.3 126,741 (78)
Plastics 564 1.2 0.7 95,219 220
Marketing, Design, and Publishing 386 0.3 0.2 59,250 (91) Wood Products 363 1.2 1.5 68,161 155
Furniture 357 1.3 1.0 61,614 75
2 Wage data are for jobs (not residents) based in Modesto. #12..
- 512 -
CITY OF MODESTO, CA | EDSP
PAGE | 33
Traded Cluster Jobs LQ County
LQ*
Avg Ann
Wage
10-Yr Job
Change
Performing Arts 344 0.6 0.4 41,299 89
Construction Products and Services 320 0.5 0.5 105,995 208 Printing Services 214 0.8 0.6 86,403 (6)
Production Technology and Heavy Machinery 209 0.3 0.8 84,480 (30) GROUP TOTAL / AVG 27,548 0.87 1.01 $83,972 1,713
CITY TOTAL 117,419 N/A N/A $72,249 18,706
Note: LQ = Location Quotient; 10-year job change is from 2013 to 2023. *County LQ provided for comparison purposes. “—” = insufficient data.
Source: U.S. Cluster Mapping Project; EMSI;TNDG.
TABLE 7. SUMMARY CHARACTERISTICS AND TRENDS, MODESTO’S LARGEST LOCAL CLUSTERS (LIST INCLUDES ALL CLUSTERS WITH MORE THAN 3,000 JOBS IN 2023)
Local Cluster Jobs LQ County
LQ*
Avg Ann
Wage
10-Yr Job
Change
Local Health Services 17,664 1.3 1.1 116,261 3,885
Local Hospitality Establishments 10,639 1.1 1.1 33,098 1,602 Local Community and Civic Organizations 9,380 2.3 1.5 28,442 2,512 Local Real Estate, Construction, and Development 8,761 0.9 1.0 72,399 1,317 Local Education and Training 8,236 1.3 1.6 83,120 3,713 Local Commercial Services 7,295 1.0 0.8 56,895 656
Local Food and Beverage Processing and Distribution 6,348 1.3 1.2 51,661 388 Local Motor Vehicle Products and Services 4,472 1.3 1.2 64,308 1,155 Local Government Services 4,120 1.0 1.2 116,946 1,714
Local Retailing of Clothing and General Merchandise 4,101 1.2 1.2 38,365 (773) Local Personal Services (Non-Medical) 3,784 1.0 1.1 39,358 1,050 GROUP TOTAL / AVG 84,799 1.23 1.14 $68,515 17,220
CITY TOTAL 117,419 N/A N/A $72,249 18,706
Note: LQ = Location Quotient; 10-year job change is from 2013 to 2023. *County LQ provided for comparison purposes.
Source: U.S. Cluster Mapping Project; EMSI; TNDG.
#12..
- 513 -
CITY OF MODESTO, CA | EDSP
PAGE | 34
TABLE 8. SUMMARY CHARACTERISTICS AND TRENDS, STANISLAUS COUNTY’S LARGEST TRADED CLUSTERS (LIST INCLUDES ALL CLUSTERS WITH MORE THAN 500 JOBS IN 2023)
Traded Cluster Jobs LQ
Avg
Ann
Wage
10-Yr
Job
Change
Agricultural Inputs and Services 14,227 5.8 64,370 (1,190) Food Processing and Manufacturing 13,447 8.0 95,220 2,026 Distribution and Electronic Commerce 11,785 1.0 79,156 2,404 Education and Knowledge Creation 4,710 0.5 73,000 342
Business Services 4,066 0.3 98,589 (183)
Transportation and Logistics 2,343 0.8 81,385 (79)
Livestock Processing 1,768 2.4 48,394 (37)
Hospitality and Tourism 1,527 0.4 35,281 71
Paper and Packaging 1,227 2.6 102,375 181
Downstream Metal Products 1,143 1.8 90,821 (135)
Production Technology and Heavy Machinery 1,002 0.8 80,473 192 Financial Services 855 0.3 122,828 (101)
Wood Products 814 1.5 68,761 363
Marketing, Design, and Publishing 641 0.2 63,166 (78)
Construction Products and Services 615 0.5 105,052 352
Plastics 590 0.7 94,303 238
Furniture 510 1.0 62,085 128
GROUP TOTAL / AVG 61,269 1.05 $79,440 4,496
REGION TOTAL 219,114 N/A $71,278 31,287
Note: LQ = Location Quotient; 10-year job change is from 2013 to 2023.
Source: U.S. Cluster Mapping Project; EMSI; TNDG.
#12..
- 514 -
CITY OF MODESTO, CA | EDSP
PAGE | 35
TABLE 9. SUMMARY CHARACTERISTICS AND TRENDS, STANISLAUS COUNTY’S LARGEST LOCAL CLUSTERS (LIST INCLUDES ALL CLUSTERS WITH MORE THAN 5,000 JOBS IN 2023) Local Cluster Jobs LQ Avg Ann
Wage
10-Yr Job
Change
Local Health Services 26,648 1.1 107,932 4,819
Local Hospitality Establishments 20,255 1.1 30,975 4,960 Local Education and Training 18,407 1.6 83,824 3,881
Local Real Estate, Construction, and Development 18,116 1.0 74,578 4,101 Local Community and Civic Organizations 11,130 1.5 30,465 2,562 Local Food and Beverage Processing and Distribution 10,808 1.2 49,854 1,237 Local Commercial Services 10,463 0.8 57,554 1,306
Local Government Services 8,871 1.2 116,946 866
Local Motor Vehicle Products and Services 7,595 1.2 62,000 1,651 Local Personal Services (Non-Medical) 7,173 1.1 39,998 1,848 Local Retailing of Clothing and General Merchandise 7,110 1.2 38,423 (679) Local Logistical Services 5,566 1.3 71,686 1,052
GROUP TOTAL / AVG 152,144 1.15 $67,996 27,604
REGION TOTAL 219,114 N/A $71,278 31,287
Note: LQ = Location Quotient; 10-year job change is from 2013 to 2023.
Source: U.S. Cluster Mapping Project; EMSI; TNDG.
#12..
- 515 -
CITY OF MODESTO, CA | EDSP
PAGE | 36
TABLE 10. SUMMARY CHARACTERISTICS AND TRENDS, NORTH SJV REGION’S LARGEST TRADED CLUSTERS (LIST INCLUDES ALL CLUSTERS WITH MORE THAN 1,500 JOBS IN 2023) Traded Cluster Jobs LQ
Avg
Ann
Wage
10-Yr
Job
Change
Distribution and Electronic Commerce 56,160 1.7 72,525 26,885 Agricultural Inputs and Services 44,645 6.4 60,562 (2,965) Food Processing and Manufacturing 25,125 5.2 91,704 3,537 Education and Knowledge Creation 14,106 0.6 75,248 331
Business Services 12,788 0.3 93,904 1,099
Transportation and Logistics 9,996 1.2 82,535 2,537
Livestock Processing 5,742 2.8 55,990 445
Hospitality and Tourism 5,172 0.4 37,608 1,044
Downstream Metal Products 3,147 1.7 91,898 536
Paper and Packaging 2,325 1.7 95,203 617
Production Technology and Heavy Machinery 2,274 0.6 78,807 760 Financial Services 2,208 0.3 119,791 50
Plastics 2,120 0.8 88,187 555
Wood Products 2,119 1.4 74,443 821
Construction Products and Services 1,952 0.5 103,696 759 Marketing, Design, and Publishing 1,927 0.3 67,957 (256) Automotive 1,769 0.4 97,703 420
GROUP TOTAL / AVG 193,576 1.15 $74,851 37,176
REGION TOTAL 624,797 N/A $70,081 121,179
Note: LQ = Location Quotient; 10-year job change is from 2013 to 2023.
Source: U.S. Cluster Mapping Project; EMSI; TNDG.
#12..
- 516 -
CITY OF MODESTO, CA | EDSP
PAGE | 37
TABLE 11. SUMMARY CHARACTERISTICS AND TRENDS, NORTH SJV REGION’S LARGEST LOCAL CLUSTERS (LIST INCLUDES ALL CLUSTERS WITH MORE THAN 10,000 JOBS IN 2023) Local Cluster Jobs LQ Avg Ann
Wage
10-Yr Job
Change
Local Health Services 60,987 0.9 99,998 7,951
Local Hospitality Establishments 49,702 1.0 29,638 12,054 Local Education and Training 49,447 1.5 87,655 9,795
Local Real Estate, Construction, and Development 47,848 1.0 77,084 12,577 Local Food and Beverage Processing and Distribution 31,164 1.2 51,815 5,157 Local Commercial Services 29,756 0.8 56,048 5,981
Local Community and Civic Organizations 29,006 1.3 30,537 7,965 Local Government Services 24,296 1.2 113,149 2,710
Local Logistical Services 22,250 1.9 68,772 9,568
Local Motor Vehicle Products and Services 20,439 1.1 62,789 3,972 Local Retailing of Clothing and General Merchandise 19,717 1.1 39,195 (321) Local Personal Services (Non-Medical) 19,169 1.0 38,936 4,712 Local Household Goods and Services 10,081 0.9 48,692 1,017 GROUP TOTAL / AVG 413,861 1.07 $66,049 83,137
COUNTY TOTAL 624,797 N/A $70,081 121,179
Note: LQ = Location Quotient; 10-year job change is from 2013 to 2023.
Source: U.S. Cluster Mapping Project; EMSI; TNDG.
#12..
- 517 -
CITY OF MODESTO, CA | EDSP
PAGE | 38
TABLE 12. JOB GROWTH/RETRACTION PERFORMANCE COMPARED TO NATIONAL TRENDS FOR LARGEST TRADED
CLUSTERS, MODESTO, STANISLAUS COUNTY, AND NORTH SJV REGION 2013-23 Growth Performance Based on Shift Share Analysis Traded Cluster Modesto Stanislaus County North SJV
Aerospace Vehicles and Defense
Agricultural Inputs and Services
Apparel
Automotive
Biopharmaceuticals
Business Services
Coal Mining
Communications Equipment and Services
Construction Products and Services
Distribution and Electronic Commerce
Downstream Chemical Products
Downstream Metal Products
Education and Knowledge Creation
Electric Power Generation and Transmission
Environmental Services
Financial Services
Fishing and Fishing Products
Food Processing and Manufacturing
Footwear
Forestry
Furniture
Hospitality and Tourism
Information Technology and Analytical Instruments
Insurance Services
Jewelry and Precious Metals
Leather and Related Products
#12..
- 518 -
CITY OF MODESTO, CA | EDSP
PAGE | 39
2013-23 Growth Performance Based on Shift Share Analysis Traded Cluster Modesto Stanislaus County North SJV
Lighting and Electrical Equipment
Livestock Processing
Marketing, Design, and Publishing
Medical Devices
Metal Mining
Metalworking Technology
Music and Sound Recording
Nonmetal Mining
Oil and Gas Production and Transportation
Paper and Packaging
Performing Arts
Plastics
Printing Services
Production Technology and Heavy Machinery
Recreational and Small Electric Goods
Textile Manufacturing
Tobacco
Trailers, Motor Homes, and Appliances
Transportation and Logistics
Upstream Chemical Products
Upstream Metal Manufacturing
Video Production and Distribution
Vulcanized and Fired Materials
Water Transportation
Wood Products
Note: " + " = growth performance better than expected; " - " worse than expected.
Source: U.S. Cluster Mapping Project; EMSI; TNDG.
#12..
- 519 -
CITY OF MODESTO, CA | EDSP
PAGE | 40
TABLE 13. JOB GROWTH/RETRACTION PERFORMANCE COMPARED TO NATIONAL TRENDS FOR LARGEST LOCAL
CLUSTERS, MODESTO, STANISLAUS COUNTY, AND NORTH SJV REGION 2013-23 Growth Performance Based on Shift Share Analysis Local Cluster Modesto Stanislaus County North SJV
Local Commercial Services
Local Community and Civic Organizations
Local Education and Training
Local Entertainment and Media
Local Financial Services
Local Food and Beverage Processing and Distribution
Local Government
Local State Government Services
Local Federal Government Services
Local Health Services
Local Hospitality Establishments
Local Household Goods and Services
Local Industrial Products and Services
Local Logistical Services
Local Motor Vehicle Products and Services
Local Personal Services (Non-Medical)
Local Real Estate, Construction, and Development
Local Retailing of Clothing and General Merchandise
Local Utilities
Note: " + " = growth performance better than expected; " - " worse than expected.
Source: U.S. Cluster Mapping Project; EMSI; TNDG.
“Candidate” Clusters for Modesto Target Industry Program Table 14 provides a list of candidate clusters for the City of Modesto’s industry targeting program (i.e., business retention, expansion and attraction). The candidate clusters are based on two strategic approaches to industry targeting:
1. Build on Modesto’s existing core strengths. Modesto’s existing strengths were identified based on the employment-trend criteria (location quotient, total existing jobs, and 10-year job change). In addition, the #12..
- 520 -
CITY OF MODESTO, CA | EDSP
PAGE | 41
analysis identifies “emerging” clusters that have experienced positive growth trends, as identified in the Shift-Share Analysis summary on Tables 12 and 13.
2. Tap into dominant regional clusters that are not currently well represented in Modesto. This strategic approach would seek to leverage Modesto’s competitive strengths to capture increasing shares of projected employment growth in the surrounding region Stanislaus County and the larger North SJV Region. This component of the County’s business attraction/marketing program would focus on Modesto’s unique “selling points” relative to the larger regional economy (including the city’s strategic location in Stanislaus County, along with a resident workforce that includes large numbers of commuters potentially eager to work closer to home). In developing the list of candidates for the second strategy, the consultant has focused on clusters meeting the following criteria:
a. Traded clusters (local clusters are addressed in the first strategic approach) b. Clusters with a high specialization of employment in Stanislaus County and the North SJV c. Clusters primarily oriented towards private business investment (in contrast to clusters that are substantially composed of government/nonprofit employment – which are generally considered to have lower economic “spin-off” opportunities)
Table 15 provides a narrative description of the candidate clusters. In addition, the table provides key component industries within each cluster based on employment totals for each industry in the relevant geographies.
TABLE 14. PRELIMINARY LIST OF POSSIBLE TARGET INDUSTRIES (CLUSTERS) FOR MODESTO Strategic Approach Local-Serving Clusters "Traded" Clusters
1. Build on Modesto’s existing
dominant strengths and
emerging clusters
• Local Commercial Services
• Local Community and Civic
Organizations
• Local Education and Training
• Local Food and Beverage
Processing and Distribution
• Local Government Services
• Local Health Services
• Local Hospitality Establishments
• Local Motor Vehicle Products and
Services
• Local Personal Services (NonMedical)
• Agricultural Inputs and Services
• Distribution and Electronic
Commerce
• Downstream Metal Products
• Food Processing and
Manufacturing
• Furniture
• Plastics
• Upstream Chemical Products
• Wood Products
2. Tap into dominant/emerging
regional clusters that are not
currently well represented in
Modesto
• Livestock Processing
• Paper and Packaging
• Transportation and Logistics
• Construction Products and
Services
Source: TNDG.
#12..
- 521 -
CITY OF MODESTO, CA | EDSP
PAGE | 42
TABLE 15. NARRATIVE DESCRIPTIONS AND KEY COMPONENT INDUSTRIES
FOR PRELIMINARY LIST OF CANDIDATE CLUSTERS
Cluster Narrative Description Key Component Industries
Group 1 – Modesto – Existing Core and Emerging Strengths Agricultural Inputs
and Services
This cluster includes establishments primarily engaged
in farming and related services. Farming includes soil
preparation, planting, cultivation, harvest, fertilizer creation, and post-harvest activities. It also includes services that supply farm labor, support for animal
production, and additional operations management.
• Farm Labor and Crew
Leaders
• Crop Production
• Animal Production
• Postharvest Crop Activities
(except Cotton Ginning)
• Soil Preparation, Planting,
and Cultivating
Distribution and
Electronic
Commerce
This cluster consists primarily of traditional
wholesalers as well as mail order houses and
electronic merchants. The companies in this cluster
mostly buy, hold, and distribute a wide range of
products such as apparel, food, chemicals, gasses,
minerals, farm materials, machinery, and other
merchandise. The cluster also contains firms that
support distribution and electronic commerce
operations, including packaging, labeling, and
equipment rental and leasing.
• General Warehousing and
Storage
• Warehouse Clubs and
Supercenters
• Pharmacies and Drug
Retailers
• Refrigerated Warehousing
and Storage
Downstream Metal
Products
This cluster contains establishments that manufacture
metal containers, prefabricated metal structures, and
end user metal products. These end user products
include ammunition, kitchenware, hardware, metal
bathroom fixtures, and similar metal products used in
home finishing such as doors, windows and
ornamentation.
• Metal Can Manufacturing
• Prefabricated Metal
Building and Component
Manufacturing
• Metal Window and Door
Manufacturing
Food Processing and
Manufacturing
This cluster includes firms involved in the processing
of raw food materials and the manufacturing of
downstream food products for end users. This
includes millers and refineries of rice, flour, corn,
sugar, and oilseeds. These upstream products
contribute in part to producing specialty foods, animal foods, baked goods, candies, teas, coffees, beers,
wines, other beverages, meats, packaged fruits and
vegetables, and processed dairy products.
• Wineries
• Fruit and Vegetable
Canning
• Other Snack Food
Manufacturing
• Roasted Nuts and Peanut
Butter Manufacturing
• Dried and Dehydrated
Food Manufacturing
• Fluid Milk Manufacturing
Furniture This cluster contains establishments that manufacture furniture, cabinets, and shelving for residential homes and offices. It also includes establishments that
produce manufactured homes. The products in this
• Nonupholstered Wood
Household Furniture
Manufacturing
• Wood Kitchen Cabinet and
Countertop Manufacturing
#12..
- 522 -
CITY OF MODESTO, CA | EDSP
PAGE | 43
Cluster Narrative Description Key Component Industries
cluster can be made of wood, metal, plastic, and/or
textiles.
Local Commercial
Services
This cluster contains local professional establishments that provide legal services, accounting services,
temporary help, and office administrative activities.
This cluster also contains building support and security services, commercial printing and sign making,
professional laundry services (including drycleaning),
testing laboratories, and office supply stores.
• Temporary Help Services
• Janitorial Services
• Other Accounting Services
• Offices of Lawyers
• Security Guards and Patrol
Services
Local Community
and Civic
Organizations
Establishments in this cluster primarily consist of local social service organizations such as community food
and housing services and advocacy organizations. This
cluster also contains grantmaking foundations,
business associations, and political and religious
organizations.
• Services for the Elderly and
Persons with Disabilities
• Religious Organizations
• Other Individual and
Family Services
• Child and Youth Services*
• Civic and Social
Organizations*
Local Education and
Training
Establishments in this cluster include local educational institutions. These include schools for elementary and
secondary education, technical and vocational
training, fine arts instruction, as well as automobile
driving.
• Elementary and Secondary
Schools (Local
Government)
• Elementary and Secondary
Schools
• Vocational Rehabilitation
Services
• Other Technical and Trade
Schools
Local Food and
Beverage Processing
and Distribution
This cluster contains firms that sell food and
beverages at the wholesale and retail levels. Products
sold include meat, seafood, fruit and vegetables,
general groceries, tobacco, alcoholic beverages, and
specialty foods. The cluster also includes related
distribution methods such as vending and direct
selling.
• Supermarkets and Other
Grocery (except
Convenience) Stores
• All Other General
Merchandise Retailers
• Pharmacies and Drug
Retailers
• Beer, Wine, and Liquor
Retailers
Local Government
Services
N/A • Local Government,
Excluding Education and
Hospitals
Local Health
Services
Firms in this cluster include local health care
establishments and services such as hospitals, medical
laboratories, home and residential care, and funeral
services and crematories. This cluster also includes
pharmacies and optical goods retail stores
• General Medical and
Surgical Hospitals
• HMO Medical Centers
#12..
- 523 -
CITY OF MODESTO, CA | EDSP
PAGE | 44
Cluster Narrative Description Key Component Industries
• Offices of Physicians
(except Mental Health
Specialists)
Local Hospitality
Establishments
Establishments in this cluster primarily consist of local hospitality establishments that serve food and
beverages (alcoholic and non-alcoholic), as well as
recreational facilities including country clubs, fitness clubs, and bowling centers. This cluster also contains
gift and souvenir retail stores.
• Full-Service Restaurants
• Limited-Service
Restaurants
• Snack and Nonalcoholic
Beverage Bars
• Fitness and Recreational
Sports Centers
Local Motor Vehicle
Products and
Services
Establishments in this cluster consist of local motor
vehicle wholesalers and dealers, as well as auto repair services, gas stations, parking lots, car washes, and
vehicle towing.
• New Car Dealers
• Motor Vehicle Towing
• Automotive Parts and
Accessories Retailers
• Gasoline Stations with
Convenience Stores
• New Car Dealers*
• General Automotive
Repair*
• Automotive Body, Paint,
and Interior Repair and
Maintenance*
Local Personal
Services (NonMedical)
Establishments in this cluster provide local personal
services including self-service laundry, hair care,
photofinishing, repair services, and child care. This
cluster also contains pet stores and retail stores for
certain personal merchandise such as cosmetics.
• All Other General
Merchandise Retailers
• Beauty Salons
• Child Day Care Services
• Veterinary Services
Plastics Establishments in this cluster manufacture plastic materials, components, and products. The plastics
and foams are manufactured for packaging, pipes,
floor
• All Other Plastics Product
Manufacturing
• Plastics Bottle
Manufacturing
Upstream Chemical
Products
This cluster consists of firms that manufacture basic
organic and inorganic chemicals and gases. The
chemicals are usually separate elements that could be
used as inputs for more complex downstream
chemical products.
• All Other Basic Organic
Chemical Manufacturing
• Pesticide and Other
Agricultural Chemical
Manufacturing
• Plastics Packaging Film and
Sheet (including
Laminated) Manufacturing
Wood Products The establishments in this cluster are primarily engaged in making upstream wood materials and
manufacturing non-furniture wood products.
Upstream
• Wood Container and Pallet
Manufacturing
• Engineered Wood Member
Manufacturing
#12..
- 524 -
CITY OF MODESTO, CA | EDSP
PAGE | 45
Cluster Narrative Description Key Component Industries
Group 2 – Dominant/Emerging Regional Clusters
Construction
Products and
Services
The establishments in this cluster supply construction
materials, components, products, and services.
Construction materials and components include those
• Water Supply and
Irrigation Systems
• Industrial Building
Construction
• Power and Communication
Line and Related
Structures Construction
• Other Heavy and Civil
Engineering Construction
Livestock Processing This cluster contains establishments engaged in processing meat from livestock and livestock
wholesaling.
• Poultry Processing
• Meat Processed from
Carcasses
Paper and
Packaging
This cluster contains the paper mills and
manufacturers of paper products used for shipping,
packaging, containers, office supplies, personal
products, and
• Corrugated and Solid Fiber
Box Manufacturing
• Other Paperboard
Container Manufacturing
Transportation and
Logistics
This cluster contains all air, rail, bus, and freight
transportation services. It also includes related
operation services and support activities such as
inspections,
• General Freight Trucking,
Long-Distance, Truckload
• Rail Transportation
• Freight Transportation
Arrangement
• Other Support Activities
for Road Transportation
• Specialized Freight (except
Used Goods) Trucking,
Long-Distance
Source: U.S. Cluster Mapping Project; TNDG.
#12..
- 525 -
CITY OF MODESTO, CA | EDSP
PAGE | 46
MARKET DEMAND FOR
COMMERCIAL/INDUSTRIAL LAND USES
As part of the EDS process, The Natelson Dale Group, Inc. (TNDG) completed a real estate market analysis to provide 10-year forecasts of demand for new retail, office, and industrial space in Modesto. Tables 16 through 18 on the following pages provide an abbreviated summary of the market analysis (which is more fully documented in a separate report). Given the wide range of variables that can affect development opportunities over an extended timeframe, the demand projections for office and industrial land uses are presented in terms of ranges (rather and single definitive forecasts) of potential building absorption.
Market Factors Industrial Office Retail
Market
strengths/
opportunities
for Modesto
• Potential to capture demand
“overflow” from strong
Stanislaus County industrial
market and North San
Joaquin Valley (SJV) industrial
market
• Global demand surge for
industrial space due to ecommerce growth
• Potential repatriation of outcommuting workers could generate demand for
industrial tenants
• Potential nexus to
entrepreneurial
development initiatives /
target clusters
• Potential repatriation
of out-commuting
workers could create
office-using firms
• Potential to position
Modesto as a center
for medical-office
related space
• Potential to position
Modesto as a location
for shared office space
attractive to “hybrid”
remote workers
• Potential nexus to
entrepreneurial
development
initiatives
• Established/
prominent retail
destination within
Stanislaus County
• Potential to leverage
downtown as visitor
destination (and an
attractor of expanded
regional demand for
retail/restaurant
spending)
Market Factors Industrial Office Retail
Market
challenges for
Modesto
• Lack of available/competitive
industrial space inhibits
business attraction,
especially for growing
logistics-type space
• Limited land/zoning capacity
for additional business park
facilities (need to focus on
redevelopment/repurposing
of existing underutilized
properties)
• Remote work trend
may reduce overall
demand for new office
space
• Modesto is unproven
as a Class A Office
Market
• Global trends are
reducing footprint of
brick-and-mortar retail
(causing spike in long
term vacancies)
• Need to proactively
plan for reuse / repurpose older retail
properties (e.g., vacant
strip centers and
vacant big box stores)
#12..
- 526 -
CITY OF MODESTO, CA | EDSP
PAGE | 47
Summary of Retail Demand Analysis
Table 16, below, provides a summary of potential demand for new retail space in the trade area’s PMA. The demand projections are provided from 2023 (base year in this analysis) to 2034, the study period evaluated in this analysis.
TABLE 16. POTENTIAL DEMAND FOR NEW SQUARE FEET OF RETAIL SPACE IN MODESTO (ALL NUMBERS ARE CUMULATIVE)
Retail Category 2023 2025 2029 2034
GAFO1 categories 970,039 1,015,916 1,109,403 1,229,585
Food and Beverage 7,279 21,454 50,335 87,454
Food Services and Drinking 4,545 18,449 46,789 83,234
Bldg. Matrl. And Garden Equip. and Supplies 16,480 21,273 31,038 43,585 Auto Parts 10,840 12,047 14,505 17,664
Services Space at 15% of Total 178,091 192,201 220,953 257,916 Total 1,187,275 1,281,341 1,473,023 1,719,437
Incremental Demand (2023-25) 94,066 285,749 532,163
1. GAFO is a retail industry acronym for the shopper goods retail categories: General Merchandise, Apparel, Furniture/Appliances, Other Specialty
Source: TNDG, Land Use Market Study.
As shown on Table 16, above, the City is currently (base year 2023) estimated to be able to support about 1.2 million square feet of retail space over and above existing development levels. This estimate is based on comparing total demand potential with actual retail sales in the city to determine the extent to which there is current residual demand (or “leakage”) that could support the development of new retail space in the city.
Accounting for future growth in the market, the City could support about 1.7 million square feet of new retail space by 2034.
The table also shows the incremental demand for new retail space between 2023 and 2034, which is estimated at about 532,000 square feet. As discussed further the Land Use Market Study, this projection provides the more realistic amount of new retail space that could be developed in the City by 2034. #12..
- 527 -
CITY OF MODESTO, CA | EDSP
PAGE | 48
Summary of Office Demand Analysis
Highlights of the office demand analysis and projections are provided in Table 17 below. As shown in the table, the City is projected to be able to support between 798,400 (baseline forecast) and 848,300 (aggressive forecast) square feet of new office space. The baseline forecast assumes a City capture rate of 80% of Stanislaus County office space demand, while the aggressive forecast assumes an 85% capture rate. The baseline scenario reflects a continuation of existing trends (Modesto currently accounts for about 80% of County office space), while the aggressive scenario assumes the City accounts for an increasing share of new office space demand in the County.
TABLE 17. OFFICE DEMAND PROJECTIONS, CITY OF MODESTO (2024-2034) Demand Variable Amount
Existing Office in Modesto: 8,863,767
Projected Demand for New Space in Stanislaus County, 2024-2034: 998,000 Modesto Share of Stanislaus County Demand:
-- Baseline Forecast 80%
-- Aggressive Forecast 85%
Projected Demand for New Space, Modesto:
-- Baseline Forecast 798,400
-- Aggressive Forecast 848,300
Sources: TNDG, Land Use Market Study.
#12..
- 528 -
CITY OF MODESTO, CA | EDSP
PAGE | 49
Summary of Industrial Demand Analysis
Highlights of the analysis and projections are provided in Table 18 below. As shown in the table, the City is projected to be able to support between 2.7 million (baseline forecast) and 3.0 million (aggressive forecast) square feet of new industrial space. The baseline forecast assumes a City capture rate of 50% of Stanislaus County industrial space demand, while the aggressive forecast assumes a 55% capture rate. The baseline scenario reflects a continuation of existing trends (Modesto currently accounts for about 52% of County office space), while the aggressive scenario assumes the City accounts for an increasing share of new office space demand in the County.
TABLE 18. INDUSTRIAL DEMAND PROJECTIONS, CITY OF MODESTO (2024-2034) Demand Variable Amount
Existing Industrial in Modesto: 59,756,285
Projected Demand for New Space in Stanislaus County, 2024-2034: 5,479,000 Modesto Share of Stanislaus County Demand:
-- Baseline Forecast 50%
-- Aggressive Forecast 55%
Projected Demand for New Space, Modesto:
-- Baseline Forecast 2,739,500
-- Aggressive Forecast 3,013,450
Sources: TNDG, Land Use Market Study.
#12..
- 529 -
CITY OF MODESTO, CA | EDSP
PAGE | 50
6.EDSP ACTION PLAN
OVERVIEW OF ACTION PLAN
The EDSP Action Plan is designed to achieve the following major goals:
• Expand economic opportunities for Modesto’s resident workforce by fostering creation of a diverse range of quality jobs accessible to residents across the spectrum of education/skill levels • Leverage the economic development potentials of Modesto’s historic downtown and waterfront areas through placemaking initiatives and targeted business/development attraction • Revitalize Modesto’s other commercial and industrial areas by encouraging private investment that responds to anticipated real estate market demand
• Strengthen the City’s fiscal position by attracting land uses and business types that have the potential to generate General Fund revenue
Whereas these goals largely revolve around attracting and retaining targeted business investment, the Action Plan recognizes that the strength of the local business/development environment will ultimately depend on Modesto’s strategic attention to a range of “foundational” conditions such as:
• Modesto’s “brand”
• The City’s reputation for business/development friendliness • Land, zoning and infrastructure capacity
• Entrepreneurial development resources
• Education/workforce development systems
• Placemaking initiatives that leverage Modesto’s unique locational advantages and sense of community • Overall image and quality of life
#12..
- 530 -
CITY OF MODESTO, CA | EDSP
PAGE | 51
PRIORITIZATION OF CITY RESOURCES
The EDSP is intended to provide a “roadmap” to guide activities and programs of the City’s economic development function over the next five years (FY 2025-20256 through FY 2030-2031). As such, the Action Plan is intended to assist the City in aligning its program priorities to match the market opportunities identified during this planning effort. Whereas the Action Plan covers an ambitious range of economic development activities, the overall program recommendations reflect the following assumptions:
• The City’s existing economic development staff (6.0 FTE housed within the Community and Economic Development Department) will have primary responsibility for implementing the Action Plan, which may require adjustment of existing duties and/or augmentation of staffing levels over time; • Some of the proposed strategies involve activities that the City is already undertaking to some extent, so they are not all new commitments;
• New activities/programs could be phased-in over several years; and • Consistent with existing practices, most of the strategies would be carried out in collaboration with various non-City partner organizations (many of which have participated in the development of this plan). #12..
- 531 -
CITY OF MODESTO, CA | EDSP
PAGE | 52
EDSP Strategies
The EDSP Action Plan is organized around eleven major focus areas and a total of 22 strategy recommendations:
outlined below and detailed on the following pages/tables.
Foundational / Capacity Building
Focus Area 1:
Brand and Image
Recommendation 1: Upgrade City's economic development website Recommendation 2: Implement image enhancement campaign (replace negative/inaccurate perceptions with positive messaging) Focus Area 2:
Community
Engagement and
Inclusion
Recommendation 3: Include community engagement as an ongoing/core function of ED program; implement a broad community engagement plan to enhance stakeholder dialogue/trust and raise public awareness of the value of the City's ED function Recommendation 4: Integrate the practice of inclusive economic development into all aspects and phases of EDSP implementation
Focus Area 3:
Placemaking
Recommendation 5: Promote development opportunities in Downtown Recommendation 6: Implement a range of programs and policies aimed at enhancing the placemaking potentials of the Downtown and other distinct subareas (these programmatic investments would complement the development-focused investments in Recommendation 5)
Focus Area 4:
Development
Capacity and
Business
Friendliness
Recommendation 7: Expand industrial space/development capacity Recommendation 8: Promote revitalization and expansion of Modesto's commercial development footprint
Recommendation 9: Integrate City's housing-related policies/programs with economic development opportunities
Recommendation 10: Implement across-the-board improvements in Modesto business/development permitting and approval processes; promote Modesto as the "most business friendly" City in California
Focus Area 5:
Talent
Development
Recommendation 11: Establish Modesto Workforce Development Consortium (City led and coordinated) to facilitate regular information exchange of among partners Recommendation 12: Develop City-specific support services to supplement partner-led workforce development programs
Focus Area 6:
Regional
Collaboration
Recommendation 13: Position Modesto as a leader in BEAM Circular initiative; maximize Modesto's capture of opportunities generated by BEAM Circular Recommendation 14: Leverage small business support system being launched by Stanislaus 2030 (Small Business Strategy and Implementation Roadmap) Recommendation 15: Leverage research and strategic framework of North Valley Thrive (NVT)
Recommendation 16: Actively collaborate with regional partners to improve region-wide conditions related to state/federal regulations and funding, essential infrastructure, and program delivery
#12..
- 532 -
CITY OF MODESTO, CA | EDSP
PAGE | 53
Foundational / Capacity Building
Business Development / Job Creation
Focus Area 7:
Entrepreneurship
and Innovation
Recommendation 17: Establish City Office of Entrepreneurism and Innovation with an overall mission of maximizing local access to business startup resources and positioning Modesto as the premiere North Valley location for technology-oriented entrepreneurial ventures
Focus Area 8:
Business Attraction
and Recruitment
Recommendation 18: Implement business attraction program focused on targeted industries in "traded" clusters
Recommendation 19: Implement retail/restaurant tenant attraction program Focus Area 9:
Business Retention
and Expansion
(BRE)
Recommendation 20: Implement "boots on the ground" business retention/expansion (BRE) program to identify "red flags" for businesses needing retention/expansion services; customize assistance package based on challenges/opportunities facing identified firms Focus Area 10:
Small Business
Development
Recommendation 21: Implement small business startup and assistance program (separate and distinct from entrepreneurial development programming) Focus Area 11:
Tourism and
Visitation
Recommendation 22: Lead coordination of various organizations and initiatives focused on expanding tourism (and visitor-related real estate development) in Modesto Focus Area 12:
EDSP
Administration
Recommendation 23: Allocate staff time for initial and ongoing EDSP administration Entrepreneurial Development and Small Business Development: Overlap and Distinctions Small businesses and entrepreneurial startups are both important parts of a thriving economy, but they are not synonymous with each other. The EDSP addresses their unique needs through two separate programs:
Recommendation 17 relates to entrepreneurial development and Recommendation 21 relates to small business assistance. Small businesses, as defined in the context of municipal economic development, are typically independently owned companies focused on serving primarily a local clientele (e.g., small storefront retail, restaurant and service businesses). Small businesses are important in that they can create busine and employment opportunities for local residents, generate sales tax, and have placemaking value by virtue of providing a range of goods and services that have a “hometown flavor.” Entrepreneurial ventures typically start small (sometimes just the founder) but since they are often concentrated in technology-oriented industries with national or global market potential, they can ultimately “scale” to become much larger employers. As such, their needs for programmatic support are quite different from the needs of small businesses in terms of worker training, access to capital, site location assistance, and overall growth strategy.
Recommendation 21 would leverage (and locally supplement) Stanislaus 2030’s focus on small business creation.
As currently conceived, Stanislaus 2030 would not specifically focus on technology startups – hence the potential need for a more significant City-level investment in entrepreneurial development support (Recommendation 17). #12..
- 533 -
CITY OF MODESTO, CA | EDSP
PAGE | 54
Action Steps and Implementation Timeframes
Within the 11 major focus areas on the Action Plan tables that follow there are 23 Recommendations, each with associated action steps, all of which are intended to be implemented over the next five years. The recommended implementation timeframe for each action item is provided on the tables below, based on the following color coding:
Gold = Year 1
Green = Year 2
Purple = Year 3 or later
BRAND AND IMAGE
1 Upgrade City's economic development website
Brief Description of Recommendation
The economic development website will be a key component of asserting a positive image for the City on the part of any interested parties, as well as providing information for them, including prospective investors. The two implied components of this recommendation are 1) to generate the upgraded website, and 2) to establish a system for monitoring and maintaining its currency and relevancy.
Action Steps
1a Update and expand ChooseModesto.com website to align with EDSP programs and priorities; position ChooseModesto.com as the primary online presence of the City's ED program (ED page on City's main website should redirect to ChooseModesto.com)
1b Continually update/enhance website to provide more data resources and information to Modesto business community and potential investors
Other Potential Implementation Tools/Investments
Professional marketing agency (with economic development expertise) Year 1 Milestones/Checklist
• Website(s) aligned to EDSP; content updated weekly
2 Implement image enhancement campaign (replace negative/inaccurate perceptions with positive messaging)
Brief Description of Recommendation
This recommendation will require addressing a broad range of issues, beginning with the image/perception of the San Joaquin Valley generally, as well as Modesto's place in the Valley. The messaging will help illustrate how Modesto can leverage its proximity to the “superstar” tech hub of Silicon Valley and the Bay Area generally. Growth activity and its associated data (with growth representing one of the distinguishing features of Modesto and the region) will also need to embody the relationship of growth to enduring value propositions of the City and region. Other points to consider addressing include:
• Leveraging North San Joaquin Valley's recent BDO Zone Designation (as part of a larger list of assets). • Positioning Modesto as a residential option for remote workers tied to tech jobs in Bay Area (and data can probably show that this is happening already).
• Promoting Modesto's water availability and competitive pricing as a significant "selling point" for business attraction (also as part of the data set).
#12..
- 534 -
CITY OF MODESTO, CA | EDSP
PAGE | 55
BRAND AND IMAGE
• Consider messaging (e.g., banner program) and special events specifically aimed at promoting community pride.
Action Steps
2a Establish branding taskforce to identify specific misconceptions and/or negative images to be addressed; define focused list of assets/selling points to be included in messaging 2b Engage professional branding/marketing firm to design image enhancement campaign 2c Develop process/metrics for annually measuring the impact of the branding investment 2d Implement image enhancement campaign based on steps 2a-2c above 2e Sustain and expand branding/marketing budget annually during full term of EDSP implementation Other Potential Implementation Tools/Investments
Professional marketing agency (with economic development expertise) Year 1 Milestones/Checklist
• Facilitate 2 meetings with taskforce
• Completed image enhancement campaign (ready to be launched in Year 2)
COMMUNITY ENGAGEMENT AND INCLUSION
3 Include community engagement as an ongoing/core function of ED program; implement a broad community engagement plan to enhance stakeholder dialogue/trust and raise public awareness of the value of the City's ED function
Brief Description of Recommendation
This recommendation will in part build off of Recommendation #2, the image enhancement campaign, by communicating to stakeholders how promotional efforts are being handled, and how that benefits the local business community as well as residents. It would also have ties to the overall public relations efforts within the City. It may be appropriate to inaugurate this activity (and/or observe it annually) with a special event targeted to stakeholders.
Action Steps
3a Actively manage and expand City's economic development contact list(s); use database to promote mutually-beneficial connections between ED/WFD organizations, industry, jobseekers, other community stakeholders and the general public (City has already initiated contract with Salesforce for CRM platform)
3b Coordinate with other front-facing City departments to merge database and CRM for efficiencies and quality customer service.
3c Distribute monthly electronic newsletter (highlighting ED programs and success stories) to all contacts 3d Utilize regional/partner channels as tools for City's ED messaging (these channels might include, for example, the North Valley Thrive newsletter and distribution list, regional events where City could have a presence, Chamber of Commerce networking opportunities, etc.) 3e Increase presence of ED staff at community events to raise public awareness of this important municipal function; consider organizing special events specifically aimed at promoting community pride
3f Annualize stakeholder engagement events launched as part of the EDSP process (e.g., ED Summit, Central Valley Real Estate Summit, topical partner forums); position these events as corporate sponsorship opportunities
#12..
- 535 -
CITY OF MODESTO, CA | EDSP
PAGE | 56
COMMUNITY ENGAGEMENT AND INCLUSION
3g Report to Modesto City Council (or Economic Development Committee) on a regular (e.g., quarterly) basis to keep economic development issues "top of mind" and to receive direction on priorities; tie reporting to performance measures established for EDSP
3h In order to engage young professionals in ED-related civic affairs, organize inaugural networking and social event (potentially in partnership with Chamber of Commerce, CSU Stanislaus, and/or UC Merced)
3i Based on results of inaugural event, organize follow-up events 1-2 times per year to engage young professionals in City's ED messaging
Other Potential Implementation Tools/Investments
Contact management software, configured for multiple categories of stakeholders Year 1 Milestones/Checklist
• Staff memorandum documenting database management procedures • 6 newsletters in Year 1
• Articles placed in 5-10 partner newsletters (or other media) • Attend 4 events in Year 1
• Organize CV Real Estate Summit and Workforce Development Forum • 4 reports to EDC in Year 1
4 Integrate the practice of inclusive economic development into all aspects and phases of EDSP implementation
Brief Description of Recommendation
Although applicable throughout the EDSP, this recommendation affects some aspects of the EDSP more significantly than others, including:
• Business retention/expansion (BRE) strategies and activities. • Identifying, and tracking in performance measures, those industry promotional activities that relate to job needs associated with all communities.
• Ensuring that NPOs are part of stakeholder outreach/involvement in future EDSP updates. This also relates to North Valley Thrive initiatives.
Action Steps
4a Implement marketing/outreach effort to raise awareness of business support resources (especially in underserved and underrepresented communities); create and promote "library of resources"; engage local NPO's as partners in reaching underserved communities 4b Expand Spanish language resources and outreach for business startup/assistance programs 4c Conduct baseline study of economic conditions of Modesto's BIPOC communities; establish metrics to annually track changes in these conditions as the EDSP is implemented and resources are prioritized Other Potential Implementation Tools/Investments
Creative systems to address language barriers
Year 1 Milestones/Checklist
• Online "Library of Resources" completed, with selected elements translated into Spanish • Baseline study completed (by staff, potentially with consultant support) #12..
- 536 -
CITY OF MODESTO, CA | EDSP
PAGE | 57
PLACEMAKING
5 Promote development opportunities in Downtown
Brief Description of Recommendation
This key recommendation embodies many objectives, both directly (Downtown and waterfront revitalization) and indirectly (expanding business base, promoting tourism, expanding housing supply options, and promoting creative use of land). It can serve as the linchpin for raising the profile of Modesto as a visitor destination. With these many facets, it will be important to coordinate this recommendation with other aspects of the EDSP, and also with other community assets, present and future (e.g., Children's Museum, Graffiti Museum). Activities within this recommendation that support visitor attractions can also be positioned not just as investments in tourism but also as amenities that promote quality of life and community pride for residents. Revitalization efforts would also support the City achieving its RHNA goals. Among the technical challenges in this work will be planning for future floodproofing while applying a visionary approach to the unfolding issue of possible floodplain change.
Action Steps
5a Convene City-led working group for "Activating Downtown Modesto" (this working group could be coconvened by the Downtown Modesto Partnership) 5b Through working group, engage with development community to define "action agenda" for promoting housing as a core focus of DT placemaking; action agenda should identify targeted housing types, key opportunity sites, and incentives/policies that would encourage housing production in the DT
5c Prioritize implementation of Downtown Master Plan (particularly as it relates to potential catalyst projects and mixed-use zoning designations); build on the Plan's implementation framework based on EDSP priorities (and the working group's recommendations) 5d Promote development of co-working (i.e., shared office) and co-housing facilities in the Downtown, potentially as part of future mixed-use development project(s) 5e Update City Capital Improvement Program (CIP) to leverage grant funding for utility infrastructure upgrades
5f Encourage redevelopment/catalyst projects in Downtown; define City actions/roles for supporting the following redevelopment goals for the Downtown:
• Redevelopment of the Courthouse
• Approve two new mixed-use projects
• Approve 50 new housing units
• Attract one new business headquarters
• Support bio-industrial testbed in partnership with BEAM Circular 5g Comprehensively review development policies (zoning, etc.) affecting DT and remove any barriers to targeted development types
5h Implement retail/restaurant tenant attraction program focused on Downtown (see also Recommendation 19)
5i Promote transit-oriented development (TOD), consistent with opportunities and priorities identified by DT working group
5j Investigate potentials for relocating/ expanding farmer's market (and larger open-air market concept) to "flood plain" riverfront area (the feasibility of this concept may depend on mitigation of flood risks before any expanded use of this area occurs)
5k Create master plan for riverfront development/use (tie to DT placemaking efforts) #12..
- 537 -
CITY OF MODESTO, CA | EDSP
PAGE | 58
PLACEMAKING
5l Complete infrastructure to implement Quiet Zones
5m Implement an Enhanced Infrastructure Financing District (EIFD) in partnership with the County Other Potential Implementation Tools/Investments
Downtown Master Plan (2020): https://www.modestogov.com/2404/Downtown-Master-Plan Year 1 Milestones/Checklist
• Facilitate 3 meetings with working group
• Meetings with 6 developers
• Staff memorandum defining recommended ongoing roles of ED staff in supporting DTMP implementation • Meetings with 6 developers
6 Implement a range of programs and policies aimed at enhancing the placemaking potentials of the Downtown and other distinct subareas (these programmatic investments would complement the development-focused investments in Strategy Recommendation 5) Brief Description of Recommendation
Regional-level considerations will also be integral to this multi-faceted recommendation. For example, in the NVT Strategic Plan (Strategy Area 5: Placemaking and Amenities), “Enhancing the region's quality of life through the development of culturally relevant amenities, events, and programs is a key focus. This strategy includes developing an Arts, Culture, and Creative Economy Plan, and a Regional Node/Corridor Plan to promote sustainable growth, connectivity, and economic vitality while enhancing the experience economy across the region.” The NVT Plan also embodies concepts of how strategies can “enhance the region's climate resilience, address longstanding challenges, and ensure inclusive access for all residents and visitors.” In this sense, regional programs can leverage local acceptance of a broad approach to working with this recommendation’s multiple objectives. Locally, the recommendation will also relate to engagement strategies, RHNA goals, and support for small businesses, among other things.
Action Steps
6a Evaluate potentials and define action steps for designating and branding an Arts/ Entertainment District
6b Define specific strategy and action steps to leverage the potential ED benefits of pending "catalyst development projects" (e.g., ACE train, new courthouse, potential sports stadium, etc.) 6c Investigate potentials (as part of larger initiative focused on a Modesto Arts/ Entertainment District) for designating an area for open alcohol containers (pursuant to SB 969 Entertainment Zone provisions)
6d Create unified community events calendar (where possible, leverage existing meta calendars such as ModestoView, chambers of commerce, etc.)
6e Systematically focus City resources, programs and policies to address homeless issues impacting the viability and attractiveness of the Downtown
6f Continue and expand special events supportive of "food culture" (e.g., Taco Fest, Porch Fest, Bacon Fest, etc.)
6g Design and implement original art mural program
6h Design and implement "shop local" program focused on individual neighborhoods (e.g., McHenry Village)
6i Prioritize the development of the Tuolumne River Regional Park including trails, bikeways, and recreational spaces to enhance the urban vibrancy.
#12..
- 538 -
CITY OF MODESTO, CA | EDSP
PAGE | 59
PLACEMAKING
6j Promote interconnection of Modesto's neighborhoods through placemaking/ mobility initiatives (including wayfinding); this effort could also include new design guidelines and zoning for specific neighborhoods, to create a character and sense of place 6k Consider "bike share" program attached to transit center 6l Promote home-based and micro businesses (e.g., cottage food industry) in places where such businesses would add to a neighborhood's unique identity 6m Invest in community amenities, programs, etc. that enhance attractiveness to higher-income residents (i.e., placemaking efforts focused on retail, restaurants, nightlife, quality of schools, etc.) 6n Develop mixed-use district (connected to downtown) within Tuolumne River Regional Park to enhance walkability, promote housing opportunities, and create a more vibrant urban core Other Potential Implementation Tools/Investments
Relevant NVT Strategic Plan elements.
Models from other cities pertaining to objectives within this recommendation including bike-share programs, home-based and micro businesses, special events to support food culture, etc.
Year 1 Milestones/Checklist
• Staff memorandum on recommended action steps
• Staff memorandum on recommended action steps (including coordination with Police Department) • Online community events calendar function within 6 months
DEVELOPMENT CAPACITY AND BUSINESS FRIENDLINESS
7 Expand industrial space/development capacity
Brief Description of Recommendation
Expanding the capacity for this land use is important from an economic development perspective, but also has a component of supporting efficient use of land in the City, including interrelationships of land uses and potentially repurposing certain uses. There is a study by BEAM Circular forthcoming in the fall of 2024 that will help identify places in the region where there is capacity for industrial growth. The recommendation can include maintaining an inventory of development-ready properties, and also City-owned property that may be surplus (recognizing the particular rules for such properties in the Surplus Land Act).
Action Steps
7a Leverage findings of BEAM Circular's 2024 industrial land inventory/study to identify potential priority/opportunity areas for industrial development
7b Within City's current General Plan Update process, advocate for keeping and expanding employment land (particularly industrial) that is development-ready for job creation projects 7c Evaluate opportunities to re-purpose high vacancy strip centers and big boxes with industrial space (recognizing that these properties may be proximate to residential land uses, which may limit or complicate industrial reuse options)
7d Establish and implement an annexation policy that aligns with the City's long-term financial sustainability principles
7e Evaluate older industrial sites/areas to determine potential for redevelopment with upgraded/contemporary industrial buildings; define incentives to encourage reinvestment in these sites; pursue financing mechanisms such as Industrial Development Bonds, Enhanced Infrastructure Financing Districts, etc.)
#12..
- 539 -
CITY OF MODESTO, CA | EDSP
PAGE | 60
DEVELOPMENT CAPACITY AND BUSINESS FRIENDLINESS
Other Potential Implementation Tools/Investments
TNDG’s Market Demand for Commercial/Industrial Land Uses, for Modesto, prepared as part of this EDSP.
City of Modesto Urban Area General Plan, 2019, especially Chapter II.
Case studies from other communities of successful retail center repurposing.
Year 1 Milestones/Checklist
• Staff memorandum on recommended action steps
8 Promote revitalization and expansion of Modesto's commercial development footprint Brief Description of Recommendation
Similarly to the preceding recommendation, this one both expands capacity for retail and restaurant uses (plus other uses) and includes the objective of supporting efficient use of land, land-use interrelationships, and potentially repurposing certain uses, in the City. Note that housing strategies can also affect outcomes for this recommendation (for example by expanding the market base in certain areas), and while this recommendation is listed under the heading of commercial development (given the importance of retail sales tax as a GF revenue source), actions here could also relate to some types of industrial-use development.
Action Steps
8a Continue (and potentially expand) existing City programs and incentives (including grants and/or lowinterest loans) that encourage commercial property owners to make needed building upgrades such as façade improvements (existing program will expire soon and needs to be re-evaluated) 8b Within the context of General Plan update, identify areas suitable for new shopping center development consistent with future demand growth (while still recognizing the anticipated global reduction in retail footprints)
8c Identify opportunities to shore up major existing shopping centers through such incentives as mixeduse overlays and revenue-sharing agreements to attract new retail tenants; prioritize high-vacancy centers
Other Potential Implementation Tools/Investments
TNDG’s Retail Demand Analysis, and Office Demand Analysis for Modesto, prepared as part of this EDSP.
Case studies of successful revitalization/repurposing projects from other communities (being mindful of how the availability of different incentives can be key to some projects’ success) Year 1 Milestones/Checklist
• Staff memorandum outlining program recommendations, costs and funding sources • Staff memorandum outlining recommended actions and policies 9 Integrate City's housing-related policies/programs with economic development opportunities Brief Description of Recommendation
This recommendation recognizes both the challenge of providing a full range of housing opportunities for residents and the fact that constrained housing supply is detrimental to economic development objectives. At the same time, economic development policies in this EDSP (including industry targeting (Recommendation #18) and workforce development (#11) as well as marketing plans (Recommendation #2) that promote Modesto as a great place to live, work, play and raise a family) will attract new-resident workers who will fall within certain residential market segments, creating a market that must be met in order for the policy objectives to be realized. Note that this recommendation will also relate to housing issues as addressed under Placemaking recommendations.
Action Steps
#12..
- 540 -
CITY OF MODESTO, CA | EDSP
PAGE | 61
DEVELOPMENT CAPACITY AND BUSINESS FRIENDLINESS
9a Request that City’s existing Developer Roundtable serve as an ad hoc housing strategy committee to support implementation of Action Steps 9b-9d below
9b Within context of General Plan Update, evaluate needs and opportunities to expand and diversity Modesto's housing stock to provide residential options for a range of targeted demographic groups 9c Continue to find ways to reduce barriers to developing vacant parcels in the City (prioritize infill and "building up" projects)
9d Review development policy and remove barriers to higher-density development (in response to any issues identified by housing strategy committee)
Other Potential Implementation Tools/Investments
City of Modesto General Plan, Housing Element (Chapter IV) and RHNA obligations Year 1 Milestones/Checklist
• Facilitate 2 meetings with ad hoc committee
• Staff memorandum outlining recommended actions and policies 10 Implement across-the-board improvements in Modesto business/development permitting and approval processes; promote Modesto as the "most business friendly" City in California Brief Description of Recommendation
This recommendation emulates strategies that are common in many communities, all focusing on improving customer service for those subject to local regulations. While most of the associated actions appear to be “common sense,” combining the spirit embodied in the recommendation with practical, incremental improvements to how things are done is the secret to achieving the goal of noteworthy business-friendliness.
In that sense, action items combine ways to streamline approvals by enhancing the flow of information with deliberate intentions to improve the burden of certain regulations and regulatory processes. This would include alignment with or responses to regulations at higher levels of government, such as Stanislaus County.
The recommendation also includes actions that would give regulated parties a greater sense of involvement with the City, which by itself increases their confidence in investing in Modesto.
Action Steps
10a Work with City's existing Developers Roundtable to identify issues and to guide City policy improvements related to business/development friendliness 10b Evaluate existing processes and identify opportunities to streamline development-approval and business-permitting services (including opportunities to replace discretionary reviews with by-right approvals)
10c Update and publicize City’s quick-reference zoning handout 10d Conduct internal customer service training, emphasizing that one of the primary jobs of City staff is to protect the reputation of the City
10e Provide mechanism whereby industry stakeholders can be actively involved in reviewing City's CIP and development impact fees; this could potentially be a function of the Developers Roundtable 10f Coordinate with County of Stanislaus to improve County regulations impacting Modesto businesses 10g Work with County to improve overly restrictive regulations affecting home-based food businesses (State has recently changed retail food code to facilitate this type of business development; County regulations should be at least as permissive as the State's) 10h Launch One Stop Business Permitting Center to facilitate new business openings 10i Launch One Stop Approval Center for commercial/industrial development projects #12..
- 541 -
CITY OF MODESTO, CA | EDSP
PAGE | 62
DEVELOPMENT CAPACITY AND BUSINESS FRIENDLINESS
10j Review County's Public Facilities Financing District (which overlays or overlaps with City's development impact fees) and ensure equity and competitiveness (this action item might best be carried out through an independent/impartial consultant) Other Potential Implementation Tools/Investments
Case studies of successful business-friendly programs implemented by other communities Year 1 Milestones/Checklist
• Facilitate 2 meetings with Developers Roundtable
• Comprehensive study completed (which is understood to be an update of a previous study) • Updated quick-reference handout
• Training program completed
• Stakeholder review completed and documented (annually) • Initial coordination with County completed; recommendations implemented to the degree practical
WORKFORCE DEVELOPMENT
11 Establish Modesto Workforce Development Consortium (City led and coordinated) to facilitate regular information exchange of among partners
Brief Description of Recommendation
Workforce development everywhere shares certain common challenges:
• Workforce training and retraining needs are constantly evolving, particularly in these days of rapid technological change, and there are many providers in this arena, many with particular areas of emphasis. • Partly because of this, education/training institutions are typically in catch-up mode with respect to industry needs, generally and for specific local firms. • Communication among industry and training representatives, and even among institutions, is seldom formalized in ways that are fully productive.
• Keeping the workforce informed about job training/retraining resources is an ongoing challenge, partly because of evolving modes of communication, along with available and accepted channels through which such communications could occur.
NVT-related strategies can be leveraged for this recommendation, along with the Stanislaus 2030's Manufacturing Strategic Workforce Plan.
Note: whereas this working group would be billed as a “consortium” for marketing purposes, the intended structure would be an informal alliance working on essentially an ad hoc basis to address mutual interested related to workforce development.
Action Steps
11a Create online resource/directory (managed by City) highlighting programs offered by Consortium partners
11b In coordination with partners, evaluate feasibility of expanded vocational training to facilitate career transitions of seasonal agricultural workers (e.g., to construction trades) 11c Evaluate the cost, desirability and feasibility of adopting "Go Educate" (or similar platform) as a possible partner or consortium resource (this investment would potentially be funded by consortium partners)
#12..
- 542 -
CITY OF MODESTO, CA | EDSP
PAGE | 63
WORKFORCE DEVELOPMENT
Other Potential Implementation Tools/Investments
Case studies of successful workforce-coordination programs implemented by other communities.
California State Workforce Development Board, and national workforce organizations. 12 Develop City-specific support services to supplement partner-led workforce development programs Brief Description of Recommendation
The preceding recommendation is likely to result in identifying gaps in workforce training, including training needs specific to local industries and firms, plus ways in which local K-12 education can help support local employment needs. In Modesto as in many other agricultural centers, “soft skills” of prospective workers are likely to need bolstering, and communicating with the local workforce can be particularly challenging. As with the preceding recommendation, this one should also benefit from consulting NVT-related strategies, along with those in the Stanislaus 2030 Manufacturing Strategic Workforce Plan.
Action Steps
12a Within the context of the City's ongoing outreach to the business community, implement processes for identifying the workforce development/training needs of local employers; work with WFD partners to identify appropriate mechanisms (e.g., business surveys) to gain insight into the training needs of local employers
12b Work with partners to implement survey of graduates of partner-sponsored training programs to track placement and career-path outcomes (scope of City's role in this process would require buy-in of partners and might be focused on specific training programs most relevant to City's ED objectives) 12c Consider expanded local-hire policy encompassing City employee recruitment and businesses and/or development projects receiving City financial support
12d Work with WorkSource and WIB to investigate the desirability and feasibility of pursuing regionwide designation for Certified Work Ready Communities (CWRC) 12e Supplement resources available (through partner organizations) to address significant literacy challenges in the community; as a pilot effort, investigate feasibility of investing in Cell-Ed (or similar resource) as a way to focus attention on this issue
Other Potential Implementation Tools/Investments
Information about current trends in apprenticeship programs, and about specific programs
REGIONAL COLLABORATION
13 Position Modesto as a leader in BEAM Circular initiative; maximize Modesto's capture of opportunities generated by BEAM Circular
Brief Description of Recommendation
This recommendation is likely to have a particularly high profile in terms of defining Modesto’s role within a major regional initiative. BEAM Circular is administratively headquartered in Modesto and the City likely has other assets that support a leadership role for this program. Programmatically, the City can also demonstrate leadership by aligning entrepreneurial development resources with the characteristics of this initiative, and take an active role in communicating the higher level, high-tech aspects of this initiative (going beyond recycling activities). Through the Circular Bioeconomy Innovation (CBIO) Collaborative/BEAM Circular, the City can leverage Stanislaus County's commitment of $8,740,000 in funding to BEAM Circular to advance regional bioeconomy efforts, and also leverage $9.7 investment in BioCircular Valley (co-led by Lawrence Berkeley National Laboratory, BEAM Circular, and UC Berkeley with partners including UC Merced, USDA, and UCANR). #12..
- 543 -
CITY OF MODESTO, CA | EDSP
PAGE | 64
REGIONAL COLLABORATION
Action Steps
13a Actively participate in Circular Bio Collaborative (CBIO) associated with BEAM Circular 13b Contract with BEAM Circular organization to provide a Modesto-specific assessment of site selection strengths/weaknesses relative to bioeconomy opportunities 13c Focus City-level entrepreneurial development resources (incubators, etc.) on emerging opportunities in the bio-circular economy (see also recommendations and action items under Entrepreneurism and Innovation) - see Action Item 17a for funding strategy for City's entrepreneurial development programming
Other Potential Implementation Tools/Investments
There is extensive literature associated with the activities related to this initiative, the most relevant aspects of which can be documented within an annotated bibliography, as one way of helping to focus strategic direction.
Year 1 Milestones/Checklist
• Staff memo summarizing Year 1 involvement with CBIO (TBD based on status of CBIO) • Assessment completed
14 Leverage small business support system being launched by Stanislaus 2030 (Small Business Strategy and Implementation Roadmap)
Brief Description of Recommendation
The Stanislaus 2030 document is mostly about strategies to expand opportunities for small business development, so relating to this program from Modesto’s perspective would be first of all a matter of monitoring how the strategies have translated into particular efforts and accomplishments, then picking up on those that would seem to offer the best fit with Modesto entrepreneurs and other programs.
Action Steps
14a Proactively engage with Stanislaus 2030 leadership to identify specific opportunities for City to tie local programming to countywide resources being developed as part of Small Business Strategy and Implementation Roadmap; identify potential opportunities to maximize connection to countywide resources through supplemental City investments in marketing, service delivery to underserved communities, satellite offices, etc.
14b Leverage Stanislaus 2030's "Nurture" program (training and micro grants) to expand the availability of home-based childcare businesses
Other Potential Implementation Tools/Investments
Case studies of successful related programs in other communities Year 1 Milestones/Checklist
• Staff memo summarizing Year 1 involvement with Stanislaus 2030 15 Leverage research and strategic framework of North Valley Thrive (NVT) Brief Description of Recommendation
North Valley Thrive describes itself as “a growing coalition of community organizations, government entities, educational institutions, and economic development agencies to develop a tri-county proposal for the California Jobs First Fund.” As such, this comprehensive program addresses many topics with the intent of integrating strategic initiatives among them, including inclusivity, caring for the land, opportunities for climatefriendly industries, and the like. The NVT plan and program framework provides one foundation from which Modesto can pursue similar interests, while also supporting a regionally cooperative posture. #12..
- 544 -
CITY OF MODESTO, CA | EDSP
PAGE | 65
REGIONAL COLLABORATION
Action Steps
15a Leverage NVT programs related to hazard mitigation, climate action and climate resilience; use NVT baseline assessments and monitoring framework to establish comparable measures to track these issues at the city level
15b Establish city-level framework (based on NVT metrics) to track Modesto's socioeconomic progress over time
15c Coordinate with Stanislaus County to develop an Integrated Multi-Jurisdictional Climate Action, Adaptation, and Resiliency Plan (ICAARP); integrate ICAARP implementation with City programs related to BEAM Circular and NVT initiatives
Other Potential Implementation Tools/Investments
Case studies of successful related programs in key areas of hazard mitigation, climate action, etc., in other communities
Year 1 Milestones/Checklist
• Staff memo summarizing Year 1 involvement with NVT
• Completed ICAARP (pending partner/grant funding to support cost) 16 Actively collaborate with regional partners to improve region-wide conditions related to state/federal regulations and funding, essential infrastructure, and program delivery Brief Description of Recommendation
The multitude of regional programs associated with this recommendation will help to accomplish the overall objective of improving conditions in the categories listed, and Modesto representatives can always be on the lookout for other programs through which regional collaboration represents an advantage (e.g., competitive advantage in securing funding). Activities within this recommendation also implicitly relate to marketing efforts referenced in previous recommendation categories, and in that regard the regional Central Valley Business Expo could be a marketing resource/partner. For the specific industries mentioned in the action steps below, some utility companies may have their own economic development staff, and coordination with rail and commercial air service providers can be part of the City’s business retention/expansion (BRE) program (Recommendation #18).
Action Steps
16a Working with the City Manager's Office, define a process and priorities for influencing federal, state, and county legislation that improves the region's preparedness for business development 16b Define practicable ways to support regional and state-level partners in positioning the NSJV to gain better access to federal funding and incentive programs (e.g., CHIPS Act) 16c Support partners (e.g., MCCD, MID, etc.) in managing air/water quality regulations that impact local business development; participate in monthly MCCD working committees 16d Coordinate with utility service providers to identify ways City could facilitate increasing the capacity of power, water, natural gas, and telecom/fiber infrastructure 16e Advocate for retaining and expanding region's rail freight capabilities (conduct outreach to rail companies to define best ways for City to facilitate expanded capacity) 16f Work with regional partners to improve local road and state highway systems; work with Caltrans to improve landscaping and overall visual appeal of State Route 99 Other Potential Implementation Tools/Investments
#12..
- 545 -
CITY OF MODESTO, CA | EDSP
PAGE | 66
REGIONAL COLLABORATION
State-level economic development support entities such as GO-Biz and CALED; also, representatives of major federal funding entities such as EDA and USDA can be consulted
ENTREPRENEURISM AND INNOVATION
17 Establish City Office of Entrepreneurism and Innovation with an overall mission of maximizing local access to business startup resources and positioning Modesto as the premiere North Valley location for technology-oriented entrepreneurial ventures
Brief Description of Recommendation
This recommendation, as with a number of others in this EDSP, relates closely to programs in partner organizations, especially regional partners, which have programs in place upon which Modesto can leverage to firm up a leadership role within tech-oriented entrepreneurism. These regional programs may themselves have many partners, each with their own specific agendas. Consequently, Modesto’s relationships with them will need to be individually analyzed in order to be optimized, and also continuously updated as programs evolve.
In doing so, the City can define its most appropriate contributions: programmatically, financially, promotionally, etc., to support its own objectives as well as the overall regional entrepreneurial ecosystem.
Action Steps
17a Develop overall funding/financing strategy to support implementation of a robust, City-led entrepreneurial development initiative; the following categories of funding opportunities should be investigated: federal grants (e.g., EDA funding for incubator/accelerator programming); fees for services; corporate sponsorships; City participation in regional funding allocations related to (e.g.) BEAM Circular implementation; and private banks (for business lending); partner with entrepreneur/startup education programs such as WEI
17b Based on strategy defined in Action Item 17a, pursue EDA funding to implement incubator/accelerator programming
17c (Through Stanislaus 2030) Develop robust, streamlined referral network such that there are direct pathways for entrepreneurs to access support across their journeys (potentially in the form of a onestop-shop solution), including providing wraparound support in the form of technical assistance as a precursor to accessing capital from CDFIs
17d Expand access to capital / business financing; become clearinghouse for funding programs offered by partner organizations
17e (Through Stanislaus 2030) Evaluate the feasibility of establishing a revolving loan fund to offset risk from CDFI partners (contingent on identifying viable funding sources, pursuant to Action Item 17a) 17f Develop (or support partner-led development) of an "Innovation Center" where prospective entrepreneurs can pitch business ideas; sponsor "pitch fest" (either as part of an Innovation Center concept or as a stand-alone event) - sponsorships would be key to supporting this effort; this action item could have linkage to CSU's Warrior Entrepreneurship & Innovation (WEI) program 17g Explore ways City could implement "open data" concepts/tools to enhance business environment and support entrepreneurial development (the initial research for this idea should answer the question, "What sharable data does the City have that entrepreneurs need?") 17h Contingent on the availability of funding support (per Action Item 17a), develop and promote (directly and/or through partners) incubator and accelerator facilities and programming in Modesto; position these as key site selection assets for regional target industries such as the Bioeconomy (see also Recommendation 13 related to the BEAM Circular initiative) #12..
- 546 -
CITY OF MODESTO, CA | EDSP
PAGE | 67
ENTREPRENEURISM AND INNOVATION
Other Potential Implementation Tools/Investments
VC firm HawkTower, which has committed $30 million to advance CBIO's Innovation Engine.
Open Data guide: https://opendatahandbook.org/.
Year 1 Milestones/Checklist
• Staff report outlining recommended funding sources and strategies • Application submitted to EDA
• Online referral network setup and operational
BUSINESS ATTRACTION AND RECRUITMENT
18 Implement business attraction program focused on targeted industries in "traded" clusters Brief Description of Recommendation
“Traded” clusters – composed of industries and firms that serve national and global markets – are typically the highest-priority targets for business attraction and recruitment programs. The prioritization of traded clusters is premised on the recognition that, on average, these industries create-higher paying jobs than local-serving industries, inject new dollars into a region’s economy (versus just “recirculating” existing wealth), and have a higher “multiplier” effect in terms of creating secondary jobs and incomes in related (supply chain) industries.
Action Steps
18a Implement business attraction program focused on targeted industries in "traded" clusters (see Chapter 7 for details)
Year 1 Milestones/Checklist
• Year 1 progress report detailing marketing investments, events attended, leads generated, businesses attracted
19 Implement retail/restaurant tenant attraction program Brief Description of Recommendation
Details pertaining to this recommendation are held in abeyance pending completion of the forthcoming Retail Strategies report commissioned by the City.
Action Steps
19a Pursue implementation recommendations of forthcoming Retail Strategies report Other Potential Implementation Tools/Investments
Retailstrategies.com is currently completing an analysis and recommendations for Modesto.
TNDG prepared a Retail Demand Analysis as part of this EDSP.
Year 1 Milestones/Checklist
• Year 1 progress report detailing marketing investments, events attended, leads generated, businesses attracted
BUSINESS RETENTION AND EXPANSION (BRE)
20 Implement "boots on the ground" business retention/expansion (BRE) program to identify "red flags" for businesses needing retention/expansion services; customize assistance package based on challenges/opportunities facing identified firms
#12..
- 547 -
CITY OF MODESTO, CA | EDSP
PAGE | 68
BUSINESS RETENTION AND EXPANSION (BRE)
Brief Description of Recommendation
This recommendation represents “classic” business retention/expansion (BRE) activity, common to most economic development organizations, which highlights the importance of supporting existing local firms both as a way to boost the local economy and also balance attention given to the function of recruiting new firms to the area. The BRE process embodies both outreach and specific incentives or other assistance tailored to the needs of local firms. It is also typically the channel through which specialized needs of traditionally underserved members of the business community are recognized and addressed. Modesto can leverage these efforts through regional organizations that address this specific aspect of local businesses. BRE outreach can also give economic development practitioners a forum for communicating support programs for local businesses, how marketing for economic development also helps them, and other details. Given practical constraints on the level of resources the City can devote to business retention services and incentives, the BRE program should especially target larger employers at risk for closure or relocation.
Action Steps
20a Conduct regular visits to local businesses; consider other mechanisms (e.g., meetings, online surveys, etc.) for outreach to the existing business community; focus on traded-sector companies; utilize Salesforce CRM platform to track contacts
20b Develop and implement business assistance program (incentives/resources to customize responses to businesses needing retention services); incorporate partner resources in BRE "tool box" as appropriate
20c Partner with statewide business advocacy organizations (e.g., Small Business Majority) to provide input on local, culturally-sensitive needs and issues
Other Potential Implementation Tools/Investments
Regional programs that include recognizing the value of inclusivity in economic development, such as Stanislaus 2030 and NVT.
Coordinate with Modesto Chamber of Commerce and its programs.
Year 1 Milestones/Checklist
• Year 1 progress report detailing number of businesses contacted, services provided, and outcomes
SMALL BUSINESS SUPPORT
21 Implement small business startup and assistance program (separate and distinct from entrepreneurial development programming)
Brief Description of Recommendation
This wide-ranging recommendation also interfaces with a number of others, including Business-Friendliness (#10), the Stanislaus 2030 Small Business Strategy and Implementation Roadmap (#14), Entrepreneurism and Innovation (#17), and Business Retention/Expansion (#20). The intent is to expedite processes associated with starting and running a small business, provide and call attention to resources for doing so, and address other specific known problems facing certain members of the local business community. The set of Action Steps also includes recognition that special efforts promoting inclusivity within the business community are warranted.
Action Steps
21a Launch "business concierge" program aimed at streamlining the startup process for small/micro businesses
#12..
- 548 -
CITY OF MODESTO, CA | EDSP
PAGE | 69
SMALL BUSINESS SUPPORT
21b Assist businesses with access to SBA loans and other discounted financing (City's role would be focused on referring cases to SBA and possibly supporting clients in navigating the SBA application process)
21c Address issue of unpermitted business operations (facilitate educating these operators on legal requirements; provide bilingual access to licensing awareness/training followed by a limited amnesty; consider developing incubator space to legitimize these microenterprises; in longer term, address unpermitted operations through stricter enforcement measures) 21d Evaluate potential approaches to facilitating small business opportunities within the fledgling cannabis industry (research and adapt best practices from other CA cities) 21e Actively promote small business networking in Modesto (e.g., through online forum); this effort should initially be launched as a pilot/ test program to determine the level of demand for these services
21f In collaboration with SBDC, promote mentor/mentee relationships for entrepreneurs and small business operators
21g Assess existing City procurement policies that provide opportunities for Modesto-based small businesses and identify opportunities to strengthen this incentive 21h Conduct outreach to local banks/credit unions to identify opportunities to expand access to capital for small business expansions; prioritize attraction of new banking institutions to neighborhoods/ districts that are currently underserved
21i In collaboration with SBDC, assist smaller firms in incorporating new technologies (e.g., AI) into their business operations
21j In collaboration with SBDC, research and respond to topics of concern to the local business community (e.g., potential challenges getting insurance due to proximity to rising-risk fire areas) Other Potential Implementation Tools/Investments
SCORE programs typically associated with Chambers of Commerce Regional programs that include recognizing the value of inclusivity in economic development, such as Stanislaus 2030 and NVT.
Year 1 Milestones/Checklist
• Program launched; annual report detailing program investments and results (firms assisted, etc.) • Staff report recommending policies and resources for addressing issue of unpermitted businesses in Crow's Landing area
• Staff report outlining recommended strategic approach to cannabis industry
TOURISM AND VISITATION
22 Lead coordination of various organizations and initiatives focused on expanding tourism (and visitorrelated real estate development) in Modesto Brief Description of Recommendation
This recommendation recognizes the uniquely important role of tourism in Modesto and the region, plus the fact that tourism has its own ecosystem for developing and supporting this activity. The taskforce concept recognizes this ecosystem and will also be part of the City’s ongoing efforts to coordinate effectively with regional programs. Marketing/branding efforts as discussed in this EDSP (Recommendation #2) will be coordinated with the activities outlined here, and recommendations for Placemaking (#5) will also interface with this one. As part of the process of engaging with the community on economic development activities #12..
- 549 -
CITY OF MODESTO, CA | EDSP
PAGE | 70
TOURISM AND VISITATION
(Recommendation #3), stakeholders and the community at large can be reminded that tourism promotion and development also provides assets that enhance the community’s quality-of-life for residents.
Action Steps
22a Convene tourism development taskforce focused on attracting additional visitor facilities and providing programmatic support (events, etc.) to visitor attraction efforts; identify specific roles City can play within this consortium (which would ultimately be led by Visit Modesto) 22b Support active implementation of Visit Modesto strategic plan (2024) 22c Prioritize attraction/development of businesses that can attract tourists and capture visitor expenditures; this effort would include a focus on attracting affordable sports and entertainment opportunities to Modesto and should include the following steps/goals:
• Explore market gaps and “leakage” to determine facility types that would be the best fit/targets for Modesto
• Enter into Memorandum of Understanding (MOU) with United Soccer League (USL) regarding potential stadium development in Modesto
• Pursue redevelopment of former Muni Golf Course property • Pursue reuse of John Thurman Field
• Explore inclusion of Tuolumne River Regional Park in marketing for affordable recreation 22d Attract another "branded" hotel to Downtown Modesto 22e Investigate potentials for casino development in Modesto Other Potential Implementation Tools/Investments
Case studies of other communities that have implemented creative approaches to tourism in agricultural areas, or agritourism, and the USDA has resources on this topic Year 1 Milestones/Checklist
• Facilitate 2 meetings with taskforce
• TBD defined based on direction of Visit Modesto
• Meetings with 6 developers
EDSP ADMINISTRATION
23 Allocate staff time for initial and ongoing EDSP administration Brief Description of Recommendation
This recommendation recognizes that the EDSP is designed to be a “living document” and that implementation of the EDSP will be a dynamic process requiring ongoing evaluation of progress and refinement of priorities. In order to ensure that the EDSP remains effective, the City should annually develop new implementation milestones (i.e., update Appendix A of the EDSP) and anticipate a full update of the Plan (and supporting technical studies) in 5 years.
Action Steps
23a Consider positioning of City's ED program within overall organization structure (i.e., determine optimal City department to house program)
23b Prepare annual EDSP progress report
23c Prepare 5-year update of EDSP
Other Potential Implementation Tools/Investments
#12..
- 550 -
CITY OF MODESTO, CA | EDSP
PAGE | 71
EDSP ADMINISTRATION
Appendix B of the EDSP outlines Key Performance Indicators (KPIs) that can provide a framework for annual performance reporting.
Year 1 Milestones/Checklist
• Determination made regarding preferred positioning of ED program • Staff report summarizing Year 1 progress, and defining milestones and recommended staff allocations (FTE) by action item for Year 2
#12..
- 551 -
CITY OF MODESTO, CA | EDSP
PAGE | 72
7.BUSINESS ATTRACTION STRATEGY
Recommended Business Retention/Expansion/Attraction Targets The target industry analysis completed for the EDSP process revealed a number of industry cluster candidates based on the 2023 Location Quotient, the number of jobs in 2023 and job growth over the last decade (2013- 2023).
Food Processing and Manufacturing Cluster has the highest LQ (8.9) of all clusters in Modesto. The 10th highest LQ (1.3) is in the Local Food and Beverage Processing and Distribution Cluster. The top 10 clusters in terms of LQs are shaded. The same shading pattern is also applied to the top 10 clusters in terms of total jobs and 10-year job change.
CLUSTER LQ JOBS 10-YR JOB
CHANGE
AVG.
ANN
WAGE
Agricultural Inputs and Services 2.2 2,880 (88) 64,051
Distribution and Electronic Commerce 1.0 6,412 551 78,235 Downstream Metal Products 2.6 883 (168) 92,537
Food Processing and Manufacturing 8.9 8,089 1,386 98,449 Furniture 1.3 357 75 61,614
Local Commercial Services 1.0 7,295 656 56,895
Local Community and Civic Organizations 2.3 9,380 2,512 28,442 Local Education and Training 1.3 8,236 3,713 83,120
Local Food and Beverage Processing and Distribution 1.3 6,348 388 51,661 Local Government Services 1.0 4,120 1,714 116,946
Local Health Services 1.3 17,664 3,885 116,261
Local Hospitality Establishments 1.1 10,639 1,602 33,098 Local Motor Vehicle Products and Services 1.3 4,472 1,155 64,308 Local Personal Services (Non-Medical) 1.0 3,784 1,050 39,358 Local Real Estate, Construction, and Development 0.9 8,761 1,317 72,399 Upstream Chemical Products 1.6 197 164 109,034
Note: LQ = Location Quotient; 10-year job change is from 2013 to 2023.
Source: U.S. Cluster Mapping Project; EMSI; TNDG.
Modesto has several key industries that it could focus on to drive economic growth and development. Considering the target industry analysis and the economic analysis, the top industry clusters are presented below along with recent industry analysis.
#12..
- 552 -
CITY OF MODESTO, CA | EDSP
PAGE | 73
Agribusiness and Food Processing
Given Modesto's location in the Central Valley, agriculture and food processing remain a vital opportunity for growth and expansion. The city can leverage its agriculture heritage, existing infrastructure and expertise in this sector.
The agribusiness industry is experiencing key growth areas that are shaping the future, including:
• Sustainable Practices: There's a significant push towards sustainability in agribusiness. This includes adopting organic farming methods, preserving biodiversity, and reducing the carbon footprint of agricultural activities.
• Technological Advancements: The integration of technology, such as AI, IoT, and drones, is revolutionizing farming practices. These technologies help optimize processes, improve crop monitoring, and enhance water management.
• Changing Consumer Preferences: Consumers are increasingly demanding "clean label" products, which are minimally processed and free from artificial ingredients. This shift is driving changes in how food is grown and produced.
• AgTech Development: The development and adoption of agricultural technologies (AgTech) are on the rise. Innovations in precision farming, regenerative agriculture, and data-driven farming practices are becoming more prevalent.
The food processing industry is similarly evolving rapidly, driven by several key growth trends:
• Technological Innovation: The industry is seeing significant advancements in automation, AI, and IoT, which are improving efficiency and safety in food processing. These technologies help streamline operations, reduce waste, and enhance product quality.
• Sustainability: There is a growing emphasis on sustainable practices, including reducing food waste, using eco-friendly packaging, and minimizing the carbon footprint of food processing operations. Companies are increasingly adopting green technologies and sustainable sourcing practices. • Health and Wellness: Consumer demand for healthier food options is driving the industry to innovate with products that are lower in sugar, fat, and artificial additives. There is also a rise in the production of organic and clean-label products.
• Convenience Foods: The busy lifestyles of consumers are boosting the demand for ready-to-eat and convenience foods. This trend is particularly strong in urban areas where time for meal preparation is limited.
Advanced Manufacturing
Expanding manufacturing capabilities, particularly in advanced manufacturing and technology-driven processes, can create jobs and diversify the local economy. Trends driving the advance manufacturing sector include:
• Digital Transformation: The adoption of Industry 4.0 technologies, such as AI, IoT, and robotics, is revolutionizing manufacturing processes. These technologies enhance productivity, improve quality control, and enable predictive maintenance.
#12..
- 553 -
CITY OF MODESTO, CA | EDSP
PAGE | 74
• Sustainability: There is a strong focus on sustainable manufacturing practices. Companies are investing in energy-efficient technologies, reducing waste, and adopting circular economy principles to minimize environmental impact.
• Reshoring and Localization: Due to geopolitical tensions and supply chain disruptions, many manufacturers are moving production closer to their end markets. This trend, known as reshoring, helps reduce dependency on global supply chains and improves resilience. • Advanced Materials: The development and use of advanced materials, such as composites and nanomaterials, are enabling the creation of lighter, stronger, and more durable products. These materials are particularly important in industries like aerospace and automotive. • Climate Adaptive Technology: Current federal and state research and development investments are aimed at scaling up industries in areas such as semiconductor chip manufacturing, direct air capture, carbon engineering, additive manufacturing (3D), hydrogen technology, and advance recycling. A focused evaluation of these innovations as they develop may warrant analysis by Modesto to offer an opportunity for R&D or development to take place as well as invest in infrastructure necessary to support these advance industries.
• Workforce Development: As technology evolves, there is a growing need for a skilled workforce capable of operating advanced manufacturing systems. Companies are investing in training and development programs to upskill their employees.
Healthcare and Biotechnology
Modesto is becoming a regional hub for healthcare, with several major medical centers and specialty providers.
This makes it an ideal location for healthcare services, medical equipment suppliers, and biotechnology firms.
With an aging population and increasing demand for healthcare services, investing in healthcare facilities and biotechnology can provide significant economic benefits. Recent industry trends include:
• Personalized Medicine: There is a growing focus on personalized medicine, which tailor treatments to individual patients based on their genetic profiles. This approach is becoming more feasible with advancements in genomics and bioinformatics.
• Telehealth and Remote Monitoring: The adoption of telehealth and remote patient monitoring has surged, especially post-pandemic. These technologies enhance access to healthcare services and enable continuous patient monitoring.
• Biotechnology Innovations: The biotechnology sector is seeing rapid advancements in areas such as gene editing (e.g., CRISPR), regenerative medicine, and biopharmaceuticals. These innovations are opening new avenues for treating previously incurable diseases.
• Technological Advancements: Continuous innovations in gene editing technologies like CRISPR, bioinformatics, and computational biology are significantly influencing the market. Additionally, advancements in Polymerase Chain Reaction (PCR) technologies and the development of miniaturized portable instruments are enhancing research capabilities. #12..
- 554 -
CITY OF MODESTO, CA | EDSP
PAGE | 75
• Increased Funding and Investments: There is a substantial increase in investments, funds, and grants for biotechnology research. This financial support is crucial for driving innovation and development in the sector.
• Agricultural Biotechnology: There is growing demand for biotechnology tools in agriculture, such as genetically modified crops, tissue culturing, and molecular breeding. These technologies help improve crop yields and resistance to pests and diseases.
These trends indicate a dynamic and rapidly evolving landscape in healthcare and biotechnology, driven by technological advancements, personalized approaches, and supportive regulatory environments.
Tourism, Hospitality and Retail
With a growing population and increasing tourism, retail stores, restaurants, and hotels can do well. Enhancing the local tourism infrastructure can further boost this sector. Enhancing tourism infrastructure and promoting local attractions can boost the hospitality industry and bring in additional revenue.
Technology and Professional Services
As the city continues to develop, there is a growing need for IT services, consulting firms, and other professional services. This sector can benefit from the proximity to major tech hubs like the Bay Area.
Market Generated Industries
There are a number of industries that are not highlighted in the list of targets that are likely to be attracted to the market because of location, demand or other factors. For example, distribution and logistics industries tend to locate where land availability and proximity to markets is ideal. While the City should evaluate these types of businesses for their benefit to the City, the emphasis should be on adding value added businesses from the industries recommended. Consequently, the City should allow the market to generate these industries and focus its attention on the higher wage and benefit industries recommended.
Regional Alignment of Modesto’s Target Industries
The primary regional economic development strategies include the 2023-28 Stanislaus County Comprehensive Economic Development Strategy (CEDS), the Stanislaus 2030 Plan and North Valley Thrive, the latter of which is more focused on planning than implementation. While areas like agriculture are identified in some of the plans, the there is some alignment between the proposed Modesto targets and those of the regional plans. The following table shows the industries that are aligned () somewhat aligned () or not aligned. #12..
- 555 -
CITY OF MODESTO, CA | EDSP
PAGE | 76
Modesto Targets Regional Strategies
2023-28
Countywide
CEDS
Stanislaus
2030
North Valley
Thrive BEAM Circular
Agri-business
Food Processing
Advance Manufacturing
Healthcare
Biotechnology
Tourism/Hospitality
Retail
Tech & Professional Services
The absence of alignment, such as areas like retail and hospitality, are locally traded clusters which tend to not typify a regional strategy. Other industries like distribution and logistics, while part of the regional targets, are not included as primary targets for Modesto, given the focus on higher wages and impactful businesses.
Assessing Modesto from a Site Selector’s Perspective
Site selection is a competitive environment where having a strong positive identity among industry and decision makers, real estate developers and support for the growth of industry intersect to provide a ideal opportunity for new investment. The business attraction strategy considers the targeted industries, current site selection trends, and Modesto’s competitive position to create a strategy that can produce results for the City.
Site Selection Analysis
The Site Selectors Guild, the premier membership organization for individuals and companies involved in advising companies searching for new industrial and office facilities, conducts an annual survey of the membership to determine the latest trends in site selection. The Site Selectors Group likewise published a list of critical factors involved in corporate site selection and Research FDI conducts regular analysis of the top factors in the site selection factors. Based on this research and individual interviews and meetings with site consultants, the following represent the top 10 site selection factors for evaluation for the City of Modesto business recruitment strategy.
#12..
- 556 -
CITY OF MODESTO, CA | EDSP
PAGE | 77
How Does Modesto Measure Up?
The City of Modesto is well positioned in most of the categories and can place a strong case for a competitive location in the California marketplace.
Labor Availability and Skills
Modesto has a diverse labor pool with strengths in agriculture, manufacturing, and healthcare. However, attracting highly specialized talent is an opportunity to meet competition posed by larger metro areas.
Accessibility and Transportation Infrastructure
Modesto is well-connected via major highways (e.g., Highway 99) and is relatively close to major ports and airports in the Bay Area. The only thing Modesto lacks is a major airport of its own, however, it is not a key limiting factor for site locations other than corporate headquarter locations.
Business Climate and Regulatory Environment
California's regulatory environment can be challenging due to stringent regulations and higher taxes. However, Modesto offers a more business-friendly local government compared to larger cities in the state. Opportunity for case study examples of investment can overcome any potential question of the business climate.
Cost of Doing Business
The cost of doing business in Modesto is generally lower than in major California cities and an advantage for the City. This includes lower real estate costs, utilities and wages, which can be attractive to targeted industry sectors.
Quality of Life
Modesto offers a good quality of life with affordable housing, good schools, and a variety of recreational activities.
Close proximately to natural resources and major metro areas provides Labor Availability
and Skills
Accessibility and
Transportation
Infrastructure
Business Climate
and Regulatory
Environment
Cost of Doing
Business Quality of Life
Utilities and
Infrastructure
Market Access and
Proximity to
Customers
Economic
Incentives
Real Estate
Availability and
Costs
Risk Factors
#12..
- 557 -
CITY OF MODESTO, CA | EDSP
PAGE | 78
Utilities and Infrastructure
Modesto has reliable utilities and infrastructure, but ongoing investments will need to be mare to keep up with growth and technological advancements.
Market Access and Proximity to Customers
Being in the Central Valley, Modesto has good access to major markets in California. Its proximity to the Bay Area and Sacramento is a significant advantage.
Economic Incentives
A robust array of economic development incentives will bridge the competitive gap with the substantial incentives often offered by other states with more aggressive economic development programs.
Real Estate Availability and Costs
Real estate in Modesto is more affordable compared to coastal cities in California. There is also a good availability of industrial and commercial properties, with Modesto having the highest share of industrial inventory in the county (24 million square feet).
Risk Factors
Modesto is relatively safe from natural disasters like earthquakes and wildfires, which are more common in other parts of California. However, as with other parts of California, it does face challenges related to water supply and drought conditions. Political environment is stable and casts a probusiness outlook.
Business Recruitment Strategy
The business recruitment strategy is designed to attract businesses that will drive economic growth for the City of Modesto. The strategy focuses on leveraging Modesto’s strengths, including the strategic location, workforce, infrastructure and location. By focusing on key areas to stimulate job creation, the resulting increased investment will help support the City of Modesto’s long-term fiscal sustainability.
Relationship with corporate decision makers & influencers • Expand database of real estate developers, commercial and industrial brokers and site location consultants.
• Organize regular networking events, forums, and roundtable discussions to engage with corporate site locators and understand their needs.
• Host in-bound event(s) for decision makers.
• Collaborate with industry associations to gain insights and foster relationships with potential corporate site locators.
#12..
- 558 -
CITY OF MODESTO, CA | EDSP
PAGE | 79
Leverage existing business for recruitment
• Work with local businesses (particularly manufacturing and businesses in target sector) to identify emerging industry trends.
• Ask existing businesses to identify one or two companies with which they do business that would “add value” if they were located locally, such as suppliers and other service providers. • Partner with local businesses to co-brand and promote Modesto. This can include joint marketing campaigns, sponsorships, and events.
• Work with local businesses to identify success stories of businesses who have located and grown in Modesto to leverage their story for recruitment of new businesses.
Leverage and influence state and regional economic development partners • Respond to all inquiries and requests for information/proposals from state and regional partners • Be an active participant and influencer for regional economic development planning and marketing. • Host familiarization tours for state and regional economic development partners • Host statewide economic development conferences/events • Educate state and regional leaders on the positioning of Modesto for growing opportunities in advanced manufacturing, biotechnology and climate adaptive technology.
Expand/Enhance Business Assistance Programs
• Offer tax incentives and access to financial assistance credits for businesses that relocate or expand in Modesto.
• Provide and support access to grants and low-interest loans to support business startups and expansions. • Ensure that permit process is streamlined, reduce bureaucratic hurdles and ensure that targeted industry and businesses receive exceptional treatment.
• Hosting tech conferences and meetups can help build a vibrant tech community that will help support job growth. Creating co-working spaces and incubators can also foster collaboration and innovation. • Promote and expand destination such as FTZ, NMTZ, OZ and other incentive programs.
Develop marketing strategies and activities focused on target industries Modesto’s strategic location, quality of life and seemingly business-friendly environment can be emphasized and developed with success stories and case studies to establish a brand image and enhance the viability of Modesto as a key location within Central California.
The table shows the targeted marketing segment, their primary interests, recommended outreach tools which can be used to develop key messages for use in recruitment marketing. #12..
- 559 -
CITY OF MODESTO, CA | EDSP
PAGE | 80
Segment Primary Interests Outreach Tools Key Messages
Corporate
Executives, Site
Selectors, Real
Estate Location
Advisors
• Available and applicable
workforce
• Transportation accessibility
• Locational attributes
• Predictable development
process
• Credible and trustworthy
information
• Reduce risk
• Hosted events in
Modesto
• Meetings at industry
events
• Website and online
media
• Partnerships and industry
networks
Developers • Quality of development
• Return on investment
• Rapid tenant placement
• Predictable development
process
• Applicable zoning and land
use designations
• Risk reduction
• Briefings, tours, events
• City business
reports/updates
• Website and online
media
• Engagement in planning
and visioning processes
• Trade media visibility
Economic
Development
Partners
• Promoting regional
economic development
• Growing success rate of
organization
• Expanding local economic
development opportunities
• Community fact sheets
• Briefings and tours
• Participation in business
events
#12..
- 560 -
CITY OF MODESTO, CA | EDSP
PAGE | 81
8. TRACKING EDSP PROGRESS
The EDSP Action Plan (Chapter 6) outlines an ambitious economic development “road map” for the City of Modesto to follow over the next five years. Many of the recommended action items are established City functions that will be refocused around new priorities identified in the EDSP, thus requiring minimal new resources for implementation; others are new initiatives that can be readily implemented as soon as the EDSP is launched and can be accomplished fairly quickly; still others are longer-term investments that will require significant commitments of new City resources and may not be fully realized within the initial 5-year implementation timeframe.
Appendices A, B and C of the EDSP provide guidance on implementation and performance measurement:
• Appendix A (EDSP Action Plan Details by Year) – includes estimated City staff hours by year and action item; potential costs for contracted services (for selected action items); and Year 1 milestones (specific work products or outputs expected to be generated during the first year of implementation).
• Appendix B (Menu of Key Performance Indicators) – provides a list of potential metrics for tracking EDSP progress. Some of the indicated metrics are closely tied to specific EDSP activities (such as marketing), whereas others relate to the health of the broader Modesto economy. As a practical matter, it is not recommended or intended that the City track all of the Key Performance Indicators (KPIs) listed in Appendix B (since the list is very long). Instead, it is expected that City staff will define a workable subset of KPIs to be tracked from year to year, using the larger “menu” as a framework (see description of Appendix C below).
• Appendix C (Two-Year Goals / Performance Indicators) – identifies specific targets for selected (“Priority Focus”) actions.
#12..
- 561 -
CITY OF MODESTO, CA | EDSP
APPENDIX A: EDSP ACTION PLAN
DETAILS BY YEAR
#12..
- 562 -
Year 1 Year 2 Year 3 Year 4 Year 5
1a
Update and expand ChooseModesto.com
website to align with EDSP progams and
priorities; position ChooseModesto.com as the
primary online presence of the City's ED program
(ED page on City's main website should redirect
to ChooseModesto.com)
1,000 N/A N/A N/A N/A $25,000
Website(s) aligned to
EDSP; content updated
weekly
-0.5 FTE in Year 1 for
initial upgrades and
realignment.
-Plus .25 FTE in-house
graphics if not
contracted
New
1b
Continually update/enhance website to provide
more data resources and information to Modesto
business community and potential investors
500 500 500 500 $5,000 0.25 FTE for ongoing
maintenance of website Ongoing
2a
Establish branding taskforce to identify specific
misconceptions and/or negative images to be
addressed; define focused list of assets/selling
points to be included in messaging
24 N/A N/A N/A N/A N/A Faciliate 2 meetings with
taskforce
Short-term taskforce to
guide process for
engaging marketing firm
New
2b Engage professional branding/marketing firm to
design image enhancement campaign N/A N/A N/A N/A
2c Develop process/metrics for annually measuring
the impact of the branding investment N/A N/A N/A N/A
2d Implement image enhancement campaign based
on steps 2a-2c above 500
2e
Sustain and expand branding/marketing budget
annually during full term of EDSP
implementation
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) $150,000 - $200,000
Completed image
enhancement campaign
(reeady to be launched
in Year 2
Indicated hours are for
staff time to coordinate
contracted marketing
services; contract costs
would potentially be
shared with partners
180
R1: Upgrade City's ED website
Estimated Annual Staff Hours
R2: Implement image enhancement campaign
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations New
500 500 500 $$ per year New
Assume 0.25 FTE for
ongoing staff time for ED
marketing (maintenance
effort)
#12..
563
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 3a
Actively manage and expand City's economic
development contact list(s); use database to
promote mutually-beneficial connections
between ED/WFD organizations, industry,
jobseekers, other community stakeholders and
the general public (City has already initiated
contract with Salesforce for CRM platform)
3b
Coordinate with other front-facing City
departments to merge database and CRM for
efficiencies and quality customer service.
3c
Distribute monthly electronic newsletter
(highlighting ED programs and success stories) to
all contacts
180 360 360 360 360 N/A 6 newsletters in Year 1
Assumes 30 hours per
month to develop
newsletter content
New
3d
Utilize regional/partner channels as tools for
City's ED messaging (these channels might
include, for example, the North Valley Thrive
newsletter and distribution list, regional events
where City could have a presence, Chamber of
Commerce networking opportunities, etc.)
48 48 48 48 48 N/A
Articles placed in 5-10
partner newsletters (or
other media)
Assumes 1/2 day per
month devoted to
repackaging newsletter
content to share with
partner organizations
Ongoing
3e
Increase presence of ED staff at community
events to raise public awareness of this
important municipal function; consider
organizing special events specifically aimed at
promoting community pride
80 160 160 160 160 $10,000 Attend 4 events in Year 1
Assumes 20 staff hours
per event; 4 events per
year
Ongoing
3f
Annualize stakeholder engagement events
launched as part of the EDSP process (e.g., ED
Summit, Central Valley Real Estate Summit,
topical partner forums); position these events as
corporate sponsorship opportunities
300 300 300 300 300 $60,000
Organize CV Real Estate
Summit and Workforce
Development Forum
Assumes CV Real Estate
Summit would be
annual; 1-2 topical
forums per year (on
rotating basis)
Ongoing
Assumes 1 day per
month devoted to
database management
(after consolidation into
CRM)
R3: Include community engagement as an ongoing function of ED program 96 Ongoing
Staff memorandum
documenting database
management procedures
96 96 96 96 N/A
#12..
564
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 3g
Report to Modesto City Council (or Economic
Development Committee) on a regular (e.g.,
quarterly) basis to keep economic development
issues "top of mind" and to receive direction on
priorities; tie reporting to performance measures
established for EDSP
40 40 40 40 40
N/A (costs for data, etc.
are included in other
action items)
4 reports to EDC in Year
1 Assumes 10 hours of
staff time to prepare
report for each of the 4
presentations
New
3h
In order to engage young professionals in EDrelated civic affairs, organize inaugural networking and social event (potentially in
partnership with Chamber of Commerce, CSU
Stanislaus, and/or UC Merced)
200 N/A N/A N/A $5,000 - $10,000 per
year
3i
Based on results of inaugural event, organize
follow-up events 1-2 times per year to engage
young professionals in City's ED messaging
400 400 400 $$ per year
4a
Implement marketing/outreach effort to raise
awareness of business support resources
(especially in underserved and underrepresented
communities); create and promote "library of
resources"; engage local NPO's as partners in
reaching underserved communities
300 60 60 60 60 N/A
Assumes 6 weeks of staff
time (240 hours) to
develop "library of
resources" plus 60 hours
per year to coordinate
with NPO's
New
4b Expand Spanish language resources and outreach
for business startup/assistance programs 160 60 60 60 60 N/A Staff time to coordinate
translation of "library of
resources" into Spanish
(potentially using free
resources for translation
and proofreading)
New
New
One event in Year 2; two
events per year
thereafter
Online "Library of
Resources" completed,
with selected elements
translated into Spanish
R4: Integrate practice of inclusive ED into all aspects and phases of EDSP implementation #12..
565
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 4c
Conduct baseline study of economic conditions
of Modesto's BIPOC communities; establish
metrics to annually track changes in these
conditions as the EDSP is implemented and
resources are prioritized
300 100 100 100 100
$$ for initial study ;
ongoing cost $$ per year
(potentially including
costs for conveners)
Baseline study
completed (by staff,
potentially with
consultant support)
Potential resources
include the "People's
Plan for Economic
Justice" and the Census
Bureau's "Community
Resilience Estimates
(CRE) Equity
Supplement"
New
5a Convene City-led working group for "Activating
Downtown Modesto" 120 60 60 60 60 N/A Faciliate 3 meetings with working group
Initial year hours include
time needed to organize
working group
New
5b
Through working group, engage with
development community to define "action
agenda" for promoting housing as a core focus of
DT placemaking; action agenda should identify
targeted housing types, key opportunity sites,
and incentives/policies that would encourage
housing production in the DT
60 60 60 60 60 N/A Meetings with 6
developers
Staff time for outreach
to development
community (assume 5
hours per month,
specific to this topic)
New
5c
Prioritize implementation of Downtown Master
Plan (particularly as it relates to potential
catalyst projects and mixed-use zoning
designations); build on the Plan's
implementation framework based on EDSP
priorities (and the working group's
recommendations)
80 60 60 60 60 N/A
Staff memorandum
defining recommended
ongoing roles of ED staff
in supporting DTMP
implementation
ED staff time for
coordination with
Community
Development and other
entities involved in DT
Master Plan
implementation
New
5d
Promote development of co-working (i.e., shared
office) and co-housing facilities in the Downtown,
potentially as part of future mixed-use
development project(s)
60 60 60 60 60 N/A Meetings with 6
developers
Staff time for outreach
to development
community (assume 5
hours per month,
specific to this topic)
New
R5: Promote develoment opportunities in Downtown
#12..
566
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 5e
Update Capital Improvement Program (CIP) to
leverage grant funding for utlity infrasructure
upgrades
40 40 40 40 40 N/A
Staff memorandum
recommending priority
projects from ED
perspective (tied to
identified grant funding
opportuinities)
ED staff time for
coordination with other
departments involved in
CIP prioritization
Ongoing
5f Encourage redevelopment/catalyst projects in
Downtown
120 120 120 120 120 N/A
Staff memorandum
(prepared annually)
identifying highest
priority catalyst projects
for Downtown
redevelopment and
outlining City
resources/policies that
can expedite
development of these
projects
ED staff time for
coordination with private
and public development
partners (for key pending
projects in Downtown)
Ongoing
5g
Comprehensively review development policies
(zoning, etc.) affecting DT and remove any
barriers to targeted development types
60 N/A N/A N/A $$ one-time cost
ED staff time for
coordination with
Community
Development
Department (CDD)
New
5h
Implement retail/restaurant tenant attraction
program focused on Downtown (see also
Recommendation 19)
Potential focus on "food
culture" businesses Ongoing
5i
Promote transit-oriented development (TOD),
consistent with opportunities and priorities
identified by DT working group
60 60 60 N/A
Staff time for outreach
to development
community (assume 5
hours per month,
specific to this topic)
Ongoing
Hours and costs included under Recommendation 19
#12..
567
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 5j
Investigate potentials for relocating/ expanding
farmer's market (and larger open-air market
concept) to "flood plain" riverfront area (the
feasibility of this concept may depend on
mitigation of flood risks before any expanded use
of this area occurs)
240 N/A N/A $ (possible one-time cost
for consultant support)
ED and CDD time to
research issues and
opportunities
New
5k Create master plan for riverfront
development/use (tie to DT placemaking efforts) 180 N/A N/A $$$ one-time cost (this
program would likely be
dependent on grant
funding)
Staff time to coordinate
contracted
planning/consultant
services
Ongoing
5l Complete infrastructure to implement Quiet
Zones
80 80 80
$$$ one-time cost (this
program would likely be
dependent on grant
funding)
ED staff time to
coordinate with other
City departments
New
5m Implement EIFD in partnership with County 80 80 80 $$$ (one-time cost for consultant services)
Assumed to be a
consultant-led process
with costs shared by
County
New
6a
Evaluate potentials and define action steps for
designating and branding an Arts/ Entertainment
District
80 TBD TBD TBD TBD N/A Staff memorandum on
recommend action steps
Staff time to research
and recommend action
steps
New
6b
Define specific strategy and action steps to
leverage the potential ED benefits of pending
"catalyst development projects" (e.g., ACE train,
new courthouse, potential sports stadium, etc.)
80 TBD TBD TBD TBD N/A Staff memorandum on
recommend action steps
Staff time to research
and recommend action
steps
New
6c
Investigate potentials (as part of larger initiative
focused on a Modesto Arts/ Entertainment
District) for designating an area for open alcohol
containers (pursuant to SB 969 Entertainment
Zone provisions)
40 TBD TBD TBD TBD N/A
Staff memorandum on
recommend action steps
(including coordination
with Police Department)
Staff time to research
and recommend action
steps
New
R6: Implement a range of programs/policies aimed at enhancing the placemaking potentials of Downtown and other distinct subareas #12..
568
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 6d
Create unified community events calendar
(where possible, leverage existing meta
calendars such as ModestoView, chambers of
commerce, etc.)
140 120 120 120 120 N/A
Online community
events caledar function
within 6 months
80 hours to develop
(over six months); plus
10 hours per month to
maintain
New
6e
Systematically focus City resources, programs
and policies to address homeless issues
impacting the viability and attractivness of the
Downtown
80 TBD TBD TBD TBD N/A Staff memorandum on
recommend action steps
Coordination time for ED
staff; would also require
resource commitments
by other departments (in
additon to ED hours
estimated here)
Ongoing
6f
Continue and expand special events supportive
of "food culture" (e.g., Taco Fest, Porch Fest,
Bacon Fest, etc.)
200 400 400 499 $-$$ per year
One event in Year 1; two
events per year
thereafter
New
6g Design and implement original art mural program 200 200 200 200 $-$$ per year Staff time to coordinate
contracted (or volunteer
services)
New
6h
Design and implement "shop local" program
focused on individual neighborhoods (e.g.,
McHenry Village)
240 480 480 480 $-$$ per year
Pilot (Year 2) program in
McHenry Village; expand
in later years
New
6i
Prioritize the development of the Tuolumne
River Regional Park including trails, bikeways,
and recreational spaces to enhance the urban
vibrancy
80 80 80 $-$$ per year Staff time for planning
and coordination New
6j
Promote interconnection of Modesto's
neighborhoods through placemaking/ mobility
initiatives (including wayfinding); this effort
could also include new design guidelines and
zonning for specific neighborhoods, to create a
character and sense of place
6k Consider "bike share" program attached to
transit center
80 80 80 $$ per year New
ED staff time to
coordinate with CDD
staff and possible
specialty consultants
#12..
569
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 6l
Promote home-based and micro businesses (e.g.,
cottage food industry) in places where such
businesses would add to a neighborhood's
unique identity
60 60 60 $ per year
Supplemental marketing
resources and staff time,
specific to this topic
New
6m
Invest in community amenities, programs, etc.
that enhance attractiveness to higher-income
residents (i.e., placemaking efforts focused on
retail, restaurants, nightlife, quality of schools,
etc.)
80 TBD TBD TBD
Staff time to research
models and define
relevant follow-up
actions/investments
New
6n Develop mixed-use district within Tuolumne
River Regional Park 80 80 80 $-$$ per year Staff time and budget for planning and marketing New
7a
Leverage findings of BEAM Circular's 2024
industrial land inventory/study to identify
potential priority/opportunity areas for industrial
development
40 TBD TBD TBD TBD N/A Staff memorandum on
recommend action steps
Staff time to review
BEAM Circular report
and define relevant
follow-up actions
Ongoing
7b
Within City's current General Plan Update
process, advocate for keeping and expanding
employment land (particularly industrial) that is
development-ready for job creation projects
40 TBD TBD TBD TBD N/A Staff memorandum on
recommend action steps
ED staff time to review
and comment on GPU
(specific to this topic)
and coordinate with CDD
staff on opportunities to
expand industrial
capacity
New
7c
Evaluate opportunities to re-purpose high
vacancy strip centers and big boxes with
industrial space (recognizing that these
properties may be proximate to residential land
uses, which may limit or complicate industrial
reuse options)
40 TBD TBD TBD N/A
ED staff time to
coordinate with CDD
staff to define
recommended actions
and policies
New
R7: Expand industrial space/development capacity
#12..
570
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 7d
Establish and implement an annexation policy
that aligns with the City's long-term financial
sustainability principles
40 TBD TBD TBD N/A
ED staff time to
coordinate with CDD
staff to define
recommended actions
and policies
New
7e
Evaulate older industrial sites/areas to
determine potential for redevelopment with
updgraded/contemporary industrial buildings;
define incentives to encourage reinvestment in
these sites; pursue financing mechanisms such as
Industrial Development Bonds, Enhanced
Infrastructure Financing Districts, etc.)
120 TBD TBD $$$
ED staff time to
coordinate with CDD
staff and development
community to define
recommended actions
and policies; contract
costs include
professional services
necessary to put
financing mechanisms in
place
New
8a
Continue (and potentially expand) City programs
and incentives that encourage commercial
property owners to make needed building
upgrades (façade improvements, etc.)
120 120 120 120 120 $$ per year (once
implemented)
Staff memorandum
outlining program
recommendations, costs
and funding sources
ED staff time to research
models and recommend
program for Modesto
Ongoing
8b
Within the context of General Plan update,
identify areas suitable for new shopping center
development consistent with future demand
growth (while still recognizing the anticipated
global reduction in retail footprints)
40 TBD TBD TBD TBD TBD
Staff memoradum
outlining recommended
actions and policies
ED staff time to review
and comment on GPU
(specific to this topic)
and coordinate with CDD
staff to target areas for
new shopping center
development
New
8c
Identify opportunities to shore up major existing
shopping centers through such incentives as
mixed-use overlays and revenue-sharing
agreements to attract new retail tenants;
prioritize high-vacancy centers
40 TBD TBD TBD TBD TBD
Staff memoradum
outlining recommended
actions and policies
ED staff time to
coordinate with CDD
staff to identify priority
areas for revitalize
existing shopping centers
New
R8: Promote revitalization and expansion of Modesto's commercial development footprint #12..
571
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 9a
Request that City's existing Developer
Roundtable serve as ad hoc housing strategy
committee
30 60 60 60 60 N/A Faciliate 2 meetings with
ad hoc committee
2-4 meetings per year
with ad hoc committee New
9b
Within context of General Plan Update, evaluate
needs and opportunities to expand and diversity
Modesto's housing stock to provide residential
options for a range of targeted demographic
groups
24 TBD TBD TBD TBD TBD
Staff memoradum
outlining recommended
actions and policies
ED staff time to review
and comment on GPU
(specific to this topic)
and coordinate with CDD
staff on opportunities to
expand an diversify
housing stock
New
9c
Continue to find ways to reduce barriers to
developing vacant parcels in the City (prioritize
infill and "building up" projects)
9d
Review development policy and remove barriers
to higher-density development (in response to
any issues identifed by housing strategy
committee)
10a
Work with City's existing Developers Roundtable
to identify issues and to guide City policy
improvements related to business/development
friendliness
40 40 40 40 40 N/A Faciliate 2 meetings with
Developers Roundtable
2-4 meetings per year
with Developers Round
Table
Ongoing
10b
Evaluate existing processes and identify
opportunities to streamline developmentapproval and business-permitting services (including opportunities to replace discretionary
reviews with by-right approvals)
160 N/A N/A N/A N/A $$$ one-time cost
Comprehensive study
completed (which is
understood to be an
update of a previous
study)
ED staff time to
coordinate review by
CDD and/or contracted
consultant
New
10c Update and publicize City’s quick-reference
zoning handout 60 16 16 16 16 N/A Updated quick-reference handout
ED staff time (may also
require CDD time not
included here)
New
40 TBD TBD TBD TBD Ongoing
Staff memoradum
outlining recommended
actions and policies
ED staff time to
coordinate with CDD
staff on opportunities to
reduce barriers to infill
and higher-density
housing development
TBD
R9: Integrate City's housing-related policies/programs with ED opportunities R10: Implement improvements in permitting/approval processes; promote Modesto as "business friendly" #12..
572
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 10d
Conduct internal customer service training,
emphasizing that one of the primary jobs of City
staff is to protect the reputation of the City
60 N/A N/A N/A N/A $$ one-time cost Training program
completed
ED staff time to
coordinate training led
by contracted consultant
(or could be done inhouse by HR
Department)
New
10e
Provide mechanism whereby industry
stakeholders can be actively involved in
reviewing City's CIP and development impact
fees; this could potentially be a function of the
Developers Roundtable
24 24 24 24 24 N/A
Stakeholder review
completed and
documented (annually)
ED staff time to
coordinate with
Developers Roundtable
(specific to this topic)
New
10f
Coordinate with County of Stanislaus to improve
County regulations impacting Modesto
businesses
10g
Work with County to improve overly restrictive
regulations affecting home-based food
businesses (State has recently changed retail
food code to facilitate this type of business
development; County regulations should be at
least as permissive as the State's)
10h Launch One Stop Business Permitting Center to
facilitate new business openings 1,000 500 500 500 $$ one-time cost
0.5 FTE to design and
launch; 0.25 FTE to
maintain
New
10i Launch One Stop Approval Center for
commercial/industrial development projects 1,000 500 500 500 $$ one-time cost
0.5 FTE to design and
launch; 0.25 FTE to
maintain
New
10j
Review County's Public Facilities Financing
District (which overlays or overlaps with City's
development impact fees) and ensure equity and
competitiveness (this action item might best be
carried out through an independent/impartial
consultant)
40 N/A N/A N/A $$ one-time cost Staff time and/or
consultant cost New
$60
Initial coordination with
County completed;
recommendations
implemented to the
degree practical
ED staff time for
coordination with
County staff (assumed to
occur on an ongoing
basis)
60 60 60 60 60 New
#12..
573
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 11a
Create online resource/directory (managed by
City) highlighting programs offered by
Consortium partners
500 96 96 96 N/A
0.25 FTE to setup
directory; 1 day per
month to maintain
New
11b
In coordination with partners, evaluate feasibility
of expanded vocational training to facilitate
career transitions of seasonal agricultural
workers (e.g., to construction trades)
80 TBD TBD N/A (partner-funded
costs)
ED staff time to research
models and coordinate
with partners
New
11c
Evaluate the cost, desirability and feasibility of
adopting "Go Educate" (or similar platform) as a
possible partner or consortium resource (this
investment would potentially be funded by
consortium partners)
80 TBD TBD
TBD - potentially a
significant cost that
would be shared by
partners
ED staff time to research
models and coordinate
with partners
New
12a
Within the context of the City's ongoing outreach
to the business community, implement processes
for identifying the workforce
development/training needs of local employers;
work with WFD partners to identify appropriate
mechanisms (e.g., business surveys) to gain
insight into the training needs of local employers
160 60 60 N/A
Staff time for setting up
and implementing
annual online survey of
local employers (initial
survey would be treated
as a pilot project, with
continuation in future
years subject to
effectiveness of initial
effort
New
12b
Work with partners to implement survey of
graduates of partner-sponsored training
programs to track placement and career-path
outcomes (scope of City's role in this process
would require buy-in of partners and might be
focused on specific training programs most
relevant to City's ED objectives)
160 60 60 N/A
Staff time for setting up
and implementing
annual online survey of
training program
graduates
New
R11: Establish Modesto Talent Development Consortium
R12: Develop City-specific support services to supplement partner-led workforce development programs #12..
574
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 12c
Consider expanded local-hire policy
encompassing City employee recruitment and
businesses and/or development projects
receiving City financial support
40 N/A N/A N/A
Staff time to research
models and recommend
policy changes
New
12d
Work with WorkSource and WIB to investigate
the desirability and feasibility of pursuing
regionwide designation for Certified Work Ready
Communities (CWRC)
40 N/A N/A
Staff time to research
models and recommend
action steps
New
12e
Supplement resources available (through partner
organizations) to address significant literacy
challenges in the community; as a pilot effort,
investigate feasibility of investing in Cell-Ed (or
similar resource) as a way to focus attention on
this issue
80 TBD TBD
Staff time to research
models and recommend
actions and investments
New
13a Actively participate in Circular Bio Collaborative
(CBIO) associated with BEAM Circular 180 180 180 180 180 N/A Staff memo summarizing
Year 1 involvement with
CBIO (TBD based on
status of CBIO)
Assume an average of 15
hours per month for
meetings and
coordination
Ongoing
13b
Contract with BEAM Circular organization to
provide a Modesto-specific assessment of site
selection strengths/weaknesses relative to
bioeconomy opportunities
40 N/A N/A N/A N/A $$ one-time cost Assessment completed ED staff time to oversee
work contracted to
BEAM Circular
New
13c
Focus City-level entrepreneurial development
resources (incubators, etc.) on emerging
opportunities in the bio-circular economy (see
also recommendations and action items under
Entrepreneurism and Innovation) - see Action
Item 17a for funding strategy for City's
entrepreneurial development programming
Hours and costs covered
by Recommendation 17 Hours and costs covered by Recommendation 17 New R13: Position Modesto as a leader in BEAM Circular initiative #12..
575
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 14a
Proactively engage with Stanislaus 2030
leadership to identify specific opportunities for
City to tie local programming to countywide
resources being developed as part of Small
Business Strategy and Implementation Roadmap;
identify potential opportunities to maximize
connection to countywide resources through
supplemental City investments in marketing,
service delivery to underserved communities,
satellite offices, etc.
180 180 180 180 180 N/A
Staff memo summarizing
Year 1 involvement with
Stanislaus 2030
Assume an average of 15
hours per month for
meetings and
coordination
New
14b
Leverage Stanislaus 2030's "Nurture" program
(training and micro grants) to expand the
availability of home-based childcare businesses
48 48 48 48 48
$$$ one-time cost to
support Stanislaus
2030's training and
microgrant program (City
has already commited
these funds)
Staff memo summarizing
Year 1 involvement with
Stanislaus 2030
Assume an average of 4
hours per month for
coordination with
Stanislaus 2030, specific
to this program
Ongoing
15a
Leverage NVT programs related to hazard
mitigation, climate action and climate resilience;
use NVT baseline assessments and monitoring
framework to establish comparable measures to
track these issues at the city level
180 180 180 180 180 N/A
Staff memo summarizing
Year 1 involvement with
NVT
Assume an average of 15
hours per month for
meetings and
coordination
Ongoing
15b
Establish city-level framework (based on NVT
metrics) to track Modesto's socioeconomic
progress over time
N/A N/A N/A N/A N/A N/A
15c
Coordinate with Stanislaus County to develop an
Integrated Multi-Jurisdictional Climate Action,
Adaptation, and Resiliency Plan (ICAARP);
integrate ICAARP implementation with City
programs related to BEAM Circular and NVT
initiatives
100 N/A N/A N/A N/A $$$ one-time cost
Completed ICAARP
(pending partner/ grant
funding to support cost)
One-tme, contracted
effort to develop
ICAARP; indicated hours
are for staff oversight
time
New
R14: Leverage small business support system being luanched by Stanislaus 2030 R15: Leverage research and strategic framework of North Valley Thrive (NVT) #12..
576
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 16a
Working with the City Manager's Office, define a
process and priorities for influencing federal,
state, and county legislation that improves the
region's preparedness for business development
16b
Define practicable ways to support regional and
state-level partners in positioning the NSJV to
gain better access to federal funding and
incentive programs (e.g., CHIPS Act)
16c
Support partners (e.g., MCCD, MID, etc.) in
managing air/water quality regulations that
impact local business development; participate in
monthly MCCD working committees
16d
Coordinate wth utility service providers to
identify ways City could facilitate increasing the
capacity of power, water, natural gas, and
telecom/fiber infrastructure
40 16 16 16 N/A
Year 1 hours cover staff
research and outreach to
utilities
Ongoing
16e
Advocate for retaining and expanding region's
rail freight capabilities (conduct outreach to rail
companies to define best ways for City to
facilitate expanded capacity)
40 16 16 16 N/A
Year 1 hours cover staff
research and outreach to
rail freight companies
Ongoing
16f
Work with regional partners to improve local
road and state highway systems; work with
Caltrans to improve landscaping and overall
visual appeal of State Route 99
20 8 8 8 N/A
Year 1 hours cover staff
research and outreach to
Caltrans and regional
partners
Ongoing
80 40 40 40 N/A New
Year 1 hours cover staff
research and outreach to
partners/ stakeholders
R16: Actively collaborate with regional partners to improve region-wide conditions #12..
577
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 17a
Develop overall funding/financing strategy to
support implementation of a robust, City-led
entrepreneurial development initiative; the
following categories of funding opportunities
should be investigated: federal grants (e.g., EDA
funding for incubator/accelerator programming);
fees for services; corporate sponsorships; City
participation in regional funding allocations
related to (e.g.) BEAM Circular implementation;
and private banks (for business lending); partner
with entrepreneur/startup education programs
such as WEI
500 N/A N/A N/A N/A N/A
Staff report outlining
recommended funding
sources and strategies
One-time effort to
research funding options
and recommend strategy
New
17b
Based on strategy defined in Action Item 17a,
pursue EDA funding to implement
incubator/accelerator programming
160 N/A N/A N/A N/A N/A Application submitted to
EDA
One-time effort for
preparation of grant
application
Ongoing
17c
(Through Stanislaus 2030) Develop robust,
streamlined referral network such that there are
direct pathways for entrepreneurs to access
support across their journeys (potentially in the
form of a one-stop-shop solution), including
providing wraparound support in the form of
technical assistance as a precursor to accessing
capital from CDFIs
500 180 180 180 180 N/A Online referral network
setup and operational
Assume one-time effort
of 0.25 FTE (Year 1) and
ongoing effort of 180
hours per year (Years 2-
5)
New
17d
Expand access to capital / business financing;
become clearinghouse for funding programs
offered by partner organizations
100 60 60 60 N/A
Staff time to coordinate
with partners, profile
programs, and
summarize on City's ED
website
New
R17: Establish City Office of Entrepreneurism and Innovation #12..
578
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 17e
(Through Stanislaus 2030) Evaluate the
feasibility of establishing a revolving loan fund to
offset risk from CDFI partners (contingent on
identifying viable funding sources, pursuant to
Action Item 17a)
200 N/A N/A N/A N/A
Staff to coordinate with
parters and complete
internal feasibility study
Ongoing
17f
Develop (or support partner-led development) of
an "Innovation Center" where prospective
entrepreneurs can pitch business ideas; sponsor
"pitch fest" (either as part of an Innovation
Center concept or as a stand-alone event) -
sponsorships would be key to supporting this
effort; this action item could have linkage to
CSU's Warrior Entrepreneurship & Innovation
(WEI) program
500 500 500 500 $$ per year (potentially
offset by sponsorships)
0.25 FTE to develop
program; 0.25 to repeat
annual event
New
17g
Explore ways City could implement "open data"
concepts/tools to enhance business environment
and support entrepreneurial development (the
initial research for this idea should answer the
question, "What sharable data does the City
have that entrepreneurs need?")
200 TBD TBD TBD N/A
Staff time to research
models and recommend
action items
New
17h
Contingent on the availability of funding support
(per Action Item 17a), develop and promote
(directly and/or through partners) incubator and
accelerator facilities and programming in
Modesto; position these as key site selection
assets for regional target industries such as the
Bioeconomy (see also Recommendation 13
related to the BEAM Circular initiative)
500 TBD TBD TBD
Staff time to develop
program (scaled to
available funding)
New
#12..
579
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 18a
Implement business attraction program focused
on targeted industries in "traded" clusters (see
Chapter 7 for details)
1,000 1,000 1,000 1,000 1,000 $$ per year (for travel to trade shows, etc.)
Year 1 progress report
detailing marketing
investments, events
attended, leads
generated, businesses
attracted
Assume 0.5 FTE Ongoing
19a Pursue implementation recommendations of
forthcoming Retail Strategies report 1,000 1,000 1,000 1,000 1,000 $65,000 per year (for
travel to trade shows,
etc.)
Year 1 progress report
detailing marketing
investments, events
attended, leads
generated, businesses
attracted
Assume 0.5 FTE New
20a
Conduct regular visits to local businesses;
consider other mechanisms (e.g., meetings,
online surveys, etc.) for outreach to the existing
business community; focus on traded-sector
companies; utilize Salesforce CRM platform to
track contacts
1,500 750 750 750 750 N/A
Year 1 progress report
detailed number of
businesses contacted,
services provided, and
outcomes
20b
Develop and implement business assistance
program (incentives/resources to customize
responses to businesses needing retention
services); incorporate partner resources in BRE
"tool box" as appropriate
20c
Partner with statewide business advocacy
organizations (e.g., Small Business Majority) to
provide input on local, culturally-sensitive needs
and issues
750 750 750
Assume 0.75 FTE
750 N/A
New
R18: Implement business attraction program focused on "traded" industry clusters R19: Implement retail/restaurant business attraction program R20: Implement "boots on the ground" BRE program
#12..
580
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 21a
Launch "business concierge" program aimed at
streamlining the startup process for small/micro
businesses
21b
Assist businesses with access to SBA loans and
other discounted financing (City's role would be
focused on referring cases to SBA and possibly
supporting clients in navigating the SBA
application process)
21c
Address issue of unpermitted business
operations (facilitate educating these operators
of legal requirements; provide bilingual access to
licensing awarness/training followed by a limited
amnesty; consider developing incubator space to
legitimize these microenterprises; in longer term,
address unpermitted operations through stricter
enforcement measures)
500 500 500 500 500 N/A
Staff report
recommending policies
and resources for
addressing issue of
unpermitted businesses
in Crow's Landing area
Assume 0.25 FTE New
21d
Evaluate potential approaches to facilitating
small business opportunities within the fledgling
cannabis industry (research and adapt best
practices from other CA cities)
80 24 24 24 24 N/A
Staff report oultining
recommended strategic
approach to cannabis
industry
Staff hours for
researching options and
implementing
recommeded actions
based on research
New
21e
Actively promote small business networking in
Modesto (e.g., through online forum); this effort
should initially be launched as a pilot/ test
program to determine the level of demand for
these services
500 180 180 180 N/A Staff time to setup online
networking platform New
21f
In collaboration with SBDC, promote
mentor/mentee relationships for entrepreneurs
and small business operators
180 180 180 180 N/A
Assume 15 hours per
month to coordinate
with SBDC
New
New
R21: Implement small business startup and assistance program N/A
Program launched;
annual report detailing
program investments
and results (firms
assisted, etc.)
1,000 1,000 1,000 1,000 1,000 Assume 0.5 FTE
#12..
581
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 21g
Assess existing City procurement policies that
provide opportunities for Modesto-based small
businesses and identify opportunities to
strengthen this incentive
40 N/A N/A N/A N/A
Staff time to research
models and recommend
policy changes
New
21h
Conduct outreach to local banks/credit unions to
identify opportunities to expand access to capital
for small business expansions; prioritize
attraction of new banking institutions to
neighborhoods/ districts that are currently
underserved
180 180 180 180 N/A
Assume 15 hours per
month for ongoing
outreach to banks
New
21i
In collaboration with SBDC, assist smaller firms in
incorporating new technologies (e.g., AI) into
their business operations
180 180 180 N/A
Assume 15 hours per
month to coordinate
with SBDC
New
21j
In collaboration with SBDC, research and respond
to topics of concern to the local business
community (e.g., potential challenges getting
insurance due to proximity to rising-risk fire
areas)
180 180 180 N/A
Assume 15 hours per
month to coordinate
with SBDC
New
22a
Convene tourism development taskforce focused
on attracting additional visitor facilities and
providing programmatic support (events, etc.) to
visitor attraction efforts; identify specific roles
City can play within this consortium (which
would ultmately be led by Visit Modesto)
60 60 60 60 60 $60 Faciliate 2 meetings with
taskforce 2-4 meetings per year New
22b Support active implementation of Visit Modesto
strategic plan (2024) 120 120 120 120 120 $120
TBD defined based on
direction of Visit
Modesto
Staff time for ongoing
support of Visit Modesto
(average of 10 hours per
month)
Ongoing
R22: Lead coordination of organizations/initiatives focused on expanding tourism #12..
582
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations 22c
Prioritize attraction/development of businesses
that can attract tourists and capture visitor
expenditures; this effort would include a focus
on attracting affordable sports and
entertainment opportunities to Modesto
240 120 120 120 120 N/A
Meetings with 6
developers; coordination
with USL
Staff time for outreach
to development
community (assume 12
hours per month during
Year 1 and 10 hours per
month in later years)
Ongoing
22d Attract another "branded" hotel to Downtown
Modesto 60 60 60 60 N/A
Staff time for outreach
to development
community (assume 5
hours per month,
specific to this topic)
Ongoing
22e Investigate potentials for casino development in
Modesto 60 N/A N/A $$ one-time cost
Staff time to support and
coordinate consultantled feasibility studyNew
23a
Consider positioning of City's ED program within
overall organization structure (i.e., determine
optimal City department to house program)
60 N/A N/A N/A N/A N/A
Determine made
regarding preferred
positioning of ED pgoram
Staff time to coordinate
initial City decisionmaking processNew
22b Prepare annual EDSP progress report 100 100 100 100 N/A N/A Staff report summarizing
Year 1 progress, and
defining milestones and
recommended staff
allocations (FTE) by
action item for Year 2
Staff reporting time
based on milestones and
metrics outlined in EDSP
New
22c Prepare 5-year update of EDSP 200 $$$ one-time cost Staff time to manage
consultant selection and
oversight of new EDSP
process
New
R23: Allocate staff time for initial and ongoing EDSP administration #12..
583
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations ME1a Administer and Clerk Entertainment Commission 156 156 156 156 156 N/A 5 hrs bi-weekly Ongoing ME1b Service Customers and Process Entertainment
Permits 1,000 1,000 1,000 1,000 1,000 N/A Ongoing
ME1c Prepare Annual Entertainment Commission
Report
40 40 40 40 40 N/A Ongoing
ME2a Facilitate USL Stakeholder Meetings 372 372 372 450 450 N/A Encourage alignment of
Stakeholders and Public
to kickstart project
Staff to attend and
facilitate weekly
meetings, manage
working sessions, create
reports, pioneer project
initiatives, and oversee
all other duties
corresponding to project
management.
Ongoing
ME2b Facilitate Former Courthouse Stakeholder
Meetings 372 372 372 450 450 N/A
Encourage alignment of
Stakeholders and Public
to kickstart project
Staff to attend and
facilitate weekly
meetings, manage
working sessions, create
reports, pioneer project
initiatives, and oversee
all other duties
corresponding to project
management.
Ongoing
ME2c Assist Developers with Permit Process and
Participate in Development Review Team 372 372 372 450 450 N/A Ongoing ME1: Entertainment Commission
Maintenance of Effort Staff Programming
ME2: Predevelopment Support
#12..
584
Year 1 Year 2 Year 3 Year 4 Year 5
New or
Ongoing/Existing
Program
(Key to cost estimates: $ = less than $50,000 | $$ = $50,000 to $100,000 | $$$ = more than $100,000) Estimated Annual Staff Hours
APPENDIX A: ACTION PLAN DETAILS BY YEAR
Potential Costs of
Contracted Services Year 1 Milestones Other Considerations ME3a DID/DoMo 208 208 208 208 208 Ongoing
ME3b Visit Modesto 208 208 208 208 208 Ongoing
ME3c EIFD 52 52 52 52 52 Ongoing
ME4a Kiernan Business Park Analysis 26 N/A N/A N/A N/A Ongoing ME4b Bloomberg Philanthropies Asphalt Art 208 208 N/A N/A N/A Ongoing ME4c Clean California Grant 52 N/A N/A N/A N/A Ongoing
ME4d ARPA Execution and Monitoring 156 156 N/A N/A N/A Ongoing ME4e Implement new software and systems (e.g.,
Salesforce, Zapier, etc.) 80 20 20 20 20 Ongoing
1a Strategic Leadership and Planning 728 728 728 728 728 Ongoing 1b Operations Management and Execution 637 637 637 637 637 Ongoing 1c Talent Management, Risk, and Compliance 455 455 455 455 455 Ongoing Total Hours by Year 17,056 19,900 20,272 19,046 19,125
Total FTE @ 1,820 person hours per FTE 9.4 10.9 11.1 10.5 10.5 *FTE=2,080 hours less 104 hours for holidays, 80 hours PTO, 76 hours Administration/Mandatory Training = 1,820 effective hours Total Strategic Plan Hours by Year 11,934 14,916 15,652 14,192 14,271 Total FTE @ 1,820 person hours per FTE 6.6 8.2 8.6 7.8 7.8 Total ME Hours by Year 5,122 4,984 4,620 4,854 4,854
Total FTE @ 1,820 person hours per FTE 2.8 2.7 2.5 2.7 2.7 Total New Hours by Year 8,902 10,734 11,090 9,810 9,889 Total FTE @ 1,820 person hours per FTE 4.9 5.9 6.1 5.4 5.4 Total Ongoing Hours by Year 8,054 8,416 8,032 8,086 8,086 Total FTE @ 1,820 person hours per FTE 4.4 4.6 4.4 4.4 4.4 ME3: Special District Implementation
ME4: Special Projects
ME5: Management
#12..
585
CITY OF MODESTO, CA | EDSP
APPENDIX B: MENU OF KEY
PERFORMANCE INDICATORS
#12..
- 586 -
Metric Quantified Goal
Business Engagements Total
Advisory Services count
Retention count
Expansion count
Attraction and Development count
Attraction count
Fulfillment count
Property Development count
Incentives count
New Business count
Tourism-Visitation count
Film count
Jobs retained by assisted firms count
Jobs created by attracted firms count
Jobs retained in target industries (subset) count
Jobs created in target industries (subset) count
Marketing & Networking
Total impressions Total
Outbound email count
City Social Impressions count
City Social Interactions count
Linkedin ED followers count
LinkedIn ED unique impressions
count
LinkedIn posts count
LinkedIN ED clicks count
LinkedIn CTR rate
LinkedIn Engagement Rate rate
Pageviews/sessions modestogov.com econ dev count
Articles modestogov.com count
KPI Category
#12..
587
KPI Category Metric Quantified Goal
Pageviews choosemodesto count
articles ChooseModesto.com count
Webinar attendees count
Film Permits count
Other count
Community Engagement & Events
CV Real Estate Summit participants
CV Real Estate Summit sponsorships / revenue ($)
Workforce Development Forum participants
Other Forums participants
Added contacts in ED database count
Newsletter circulation count
ED exposure at community events participants
Events for young professionals participants
Outreach events in underserved areas number of events
Outreach events in underserved areas participants
New Development / Investment
Downtown
Downtown housing units
Downtown housing assessed value
Downtown commercial space square feet
Downtown commercial space assessed value
Downtown hotels square feet
Downtown hotels assessed value
Other Downtown investment assessed value
New Downtown businesses count
Citywide
Housing units
Housing assessed value
Commercial space square feet
#12..
588
KPI Category Metric Quantified Goal
Commercial space assessed value
Hotels square feet
Hotels assessed value
Other Investment assessed value
New businesses count
Development Approval & Permitting*
Average timeframe for development approval weeks/months Average timeframe for business permitting weeks/months
*Could potentially be segmented by type/size of project Web Traffic for EDSP Online Initiatives
Library of Business Assistance Resources (English) count Library of Business Assistance Resources (Spanish) count Events Calendar count
Online resource directory for Talent Development
Consortium count
Entrepreneurial and Small Business Development*
Participation in Pitch Fest count (number of pitches)
Participation in Pitch Fest count (overall participants) SBDC business referrals count
SBDC mentor/mentee participants count
SBA loans (funding secured by cases referred by City)
number of cases; dollar
amount
Funding secured through partner organizations (funding
secured by cases referred by City)
number of cases; dollar
amounts by partner
Total contacts by prospective startups count
Entrepreneurial Development
Number of new startups count
Jobs created by new startups count
Job growth in prior-year startups count
Small Businesses
Total contacts by prospective startups count
Number of new startups count
#12..
589
KPI Category Metric Quantified Goal
Jobs created by new startups count
Job growth in prior-year startups count
*Where possible, track special targets (e.g. bio-circular startups) separately.
Broader Economic Indicators
Unemployment Rate percentage rate Compare trend to CA, US Taxable retail sales (Citywide) total dollar amount Compare growth rate to County Taxable retail sales (Downtown) total dollar amount Compare growth rate to County Real Estate Metrics
Modesto Property Assessed Valuation (segment by land
use) Compare growth rate to County
MultiFamily asking rent/sqft Compare growth rate to County Office asking rent/sqft Compare growth rate to County
Retail asking rent/sqft Compare growth rate to County
Industrial price/sqft Compare growth rate to County
#12..
590
CITY OF MODESTO, CA | EDSP
APPENDIX C: TWO-YEAR GOALS /
PERFORMANCE INDICATORS
#12..
- 591 -
CITY OF MODESTO, CA | EDSP
Potential Goals and Performance Measures
Fiscal Years 2025-2026 and 2026-2027
This appendix outlines potentials goals and performance measures for the first two years of implementation (FY 2025-2026 and FY 2026-2027). It is expected that these goals/measures will be refined as the City proceeds with implementation of the EDSP.
Priority Focus 1: Facilitate Development in Downtown
A. Stimulate Office Investment
1. Apply for EDA technical assistance to evaluate the feasibility of a tech co-working space incubator within 12 months.
2. Secure development agreement for one new Headquarters within two years.
3. Partner with Beam Circular to evaluate redevelopment needs for a new Biomanufacturing testbed within 12 months
B. Support Infrastructure Planning and Investment
1. Develop a comprehensive capital improvement plan to support infill in downtown within 12 months; identify grants and funding opportunities within 18 months; apply for grants within 24 months.
2. Apply for Office of Planning and Research Transient Oriented Development Overlay technical assistance within 12 months.
3. Develop a partnership strategy for the acquisition and development of the former courthouse within 12 months.
4. Complete engineering designs and plans for quiet zones within 12 months; launch quiet zones within 24 months.
Priority Focus 2: Develop a Sports and Entertainment District A. United Soccer League (USL): Establish a formal, ongoing, agreement with the United Soccer League to enhance community engagement and economic development through soccer-related events and activities
1. (3 months) Finalize the agreement with USL within three months. Outline the scope of partnership, including potential events, and activities. Hold a major press conference.
2. (6 months) Complete a comprehensive feasibility study to identify suitable locations for a temporary or permanent soccer venue in downtown
3. (9 months) Establish a temporary venue to host initial events #12..
- 592 -
CITY OF MODESTO, CA | EDSP
4. (12 months) Organize soccer clinics, youth camps, and fan meet-and-greets to build community support and excitement.
5. (18 months) Organize and promote a high-profile soccer match or tournament in the temporary venue.
6. (24 months) Secure investment, grants, sponsorships, and partnerships to support the construction of a permanent soccer stadium.
Priority Focus 3: Facilitate Business Investment
A. Develop a comprehensive marketing and support program for retaining, expanding, attracting, and forming business investments, including training, networking opportunities, financial incentives, and resources for scaling operations; focus on biomanufacturing traded sector investments.
1. Facilitate investment of $300 million through the attraction of new businesses/development over first five years.
2. Facilitate 300 new jobs within first five years
3. Launch a targeted marketing campaign aimed at industrial businesses within the next 6 months, measure results over 24 months. (Note: the feasibility of the indicated targets will depend on the amount of funding available to support advertising.)
a. Contribute 50 prospects to the CRM book of business
b. Generate 5 qualified leads from industrial sector prospects. c. Convert 20% of leads into new business investments
d. Create 10 new pieces of marketing collateral (articles, guides, brochures, flyers, etc.). e. Increase the distribution of marketing materials by 30%. f. Increase website traffic by 20% through targeted campaigns. g. Achieve a 15% increase in brand mentions across media outlet. h. Conduct 3 brand awareness surveys and achieve a 90% positive recognition rate. i. Grow LinkedIn followers by 5% across all platforms per quarter. j. Achieve an average engagement rate of 1% on LinkedIn posts. k. Increase the number of social media shares by 20% per quarter (for first two quarters; re-evaluate goal thereafter).
l. Track number of social media posts and followers.
4. Business Retention Program
a. 10% of existing businesses engaged with annually3
b. Achieve 90% retention rate
c. Maintain a NPS greater than 30
d. Maintain a CSAT greater than 60
3 In order to track business retention efforts, City will need to ensure that available business license data are an accurate resource for measuring annual changes in the number of businesses in Modesto. Some categories of businesses (e.g., part-time, one-person companies) may need to be tracked separately in order to yield meaningful comparisons from year to year.
#12..
- 593 -