City of Sacramento
City Council - 5PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2023-00894 8/22/2023 Consent Item 2.
Fiscal Year (FY) 2023/24 Central Midtown Restaurant Business Improvement District Annual Proceedings
File ID: 2023-00894
Location: District 4, Represented by Councilmember Valenzuela Recommendation: Adopt a Resolution approving the Central Midtown Restaurant Business Improvement District Annual Report for FY2023/24.
Contact: Susanne Tam, Development Project Manager, (916) 808-7535; Sheri Smith, Special Districts Manager, (916) 808-7204, Department of Finance Presenter: None
Attachments:
1-Description/Analysis
2-Resolution
3-Exhibit: Annual Report for FY2023/24
Description/Analysis
Issue Detail: On June 14, 2022, the Central Midtown Restaurant Business Improvement District (BID) was renewed for a ten-year term by City Council. The Central Midtown Restaurant BID was originally formed for a five-year term on June 20, 2017 (Resolution No. 2017-0255). The Central Midtown Restaurant BID was formed under the Property and Business Improvement Law of 1994, which requires that an Annual Report (Report) be filed with the City Clerk for City Council approval.
The purpose of the District is to provide services and improvements intended to increase restaurant sales within the District.
The Midtown Association has prepared the FY2023/24 Annual Report, which is on file with the Finance Department Infrastructure Finance Division, designated by the City Clerk as the custodian of such records. The Report addresses the estimated budget, assessment, and services to be provided.
The Report does not change the District boundaries, scope of services, the assessment rate, or any other aspect of the Central Midtown Restaurant BID’s legal structure as established in the Management District Plan.
File ID: 2023-00894 8/22/2023 Consent Item 2.
Policy Considerations: The actions in the recommended resolution are required by the California Streets and Highways Code Part 7, (beginning with Section 36600) of Division 18.
Economic Impacts: None.
Environmental Considerations: Under the California Environmental Quality Act (CEQA) Guidelines, administration of assessment districts does not create any additional impact on the environment, does not constitute a project and is thereby exempt from review [14 Cal. Code Regs. §15378(b)(2) & (5))].
Sustainability: Not applicable.
Commission/Committee Action: None.
Rationale for Recommendation: State law requires approval of the annual report for the Central Midtown Restaurant BID.
Financial Considerations: Financing is provided by the levy of assessments upon businesses that benefit from the improvements and services. The Central Midtown Restaurant BID does not plan to issue bonds. The operating budget fluctuates with market conditions and retail sales and is adjusted annually to reflect Council approved assessments and expenditure plans.
Based on the collected levies from the current year, the total assessment budget is estimated to be $96,000. Budget details are provided in the Annual Report. The Central Midtown Restaurant BID is self-supporting and has no impact on the General Fund.
Local Business Enterprise (LBE): Not applicable.
RESOLUTION NO.
Adopted by the Sacramento City Council
August 22, 2023
RESOLUTION APPROVING THE ANNUAL REPORT FOR THE CENTRAL MIDTOWN RESTAURANT BUSINESS IMPROVEMENT DISTRICT FOR FISCAL YEAR 2023/24
BACKGROUND
A. On June 20, 2017, by Resolution No. 2017-0255, City Council approved the formation of the Central Midtown Restaurant Business Improvement District No. 2017-02 (District), depicted in Exhibit A of the Annual Report, for a five-year term commencing on July 1, 2017. On June 14, 2022, the Central Midtown Restaurant Business Improvement District was renewed for a ten-year term by City Council.
The purpose of the District is to provide services and improvements intended to increase restaurant sales within the District.
B. The City Council established the District under the Property and Business Improvement District Law of 1994 (California Streets and Highway Code, Sections 36600 to 36671) (PBID Law) and has previously levied assessments on businesses in the District to pay for improvements and services to be provided within the District, in accordance with the PBID Law.
C. Expenditures of assessment revenues provide for improvements and services within the District, all of which are intended to make the District safer, cleaner, and increase the commercial activity for restaurants and food service establishments in the District. These improvements and services include: (1) lighting and safety projects such as installation of landscaping, streetscaping, bicycle and ambient lighting; (2) placemaking, arts, and events such as social media promotion of district businesses and special events; (3) advocacy and administration such as overhead expenses and advocacy support of the City’s Al Fresco dining program. All specific improvements and services are defined within the Annual Report and by reference made a part of this resolution.
D. The Fiscal Year (FY) 2023/24 rate and methodology of assessment is not changed from the prior year.
BASED ON THE FACTS SET FORTH IN THE BACKGROUND, THE CITY COUNCIL RESOLVES AS FOLLOWS:
Section 1. The City Council finds and determines that background statements A through D are true.
Section 2. The City Council finds and determines that businesses within the District benefit from the activities funded by the proposed assessment.
Section 3. The City Manager or the City Manager’s designee is authorized to make any necessary budgetary adjustments associated with the District budget estimates for FY2023/24 as shown in the attached.
Section 4. The annual budget estimates and assessments as set forth in the FY2023/24 Annual Report are confirmed, and the Annual Report is hereby approved.
Section 5. The Annual Report is a part of this resolution.
Table of Contents:
Exhibit: Annual Report for Fiscal Year 2023/2024
BUSINESS IMPROVEMENT DISTRICT
ANNUAL REPORT CHECKLIST
FY
BID NAME: CONTRACT #
AUTHORITY
(CS&H Code Section) REQUIREMENT PAGE
FOUND
36650(b) Specify BID name
-Does the BID name exactly match the previous year’s BID name? (Check one) YES NO 36650(b) Specify fiscal year to which report applies
36650(b)(1) Any proposed changes in the boundaries
36650(b)(1) Any proposed changes in any benefit zones
-Do the boundaries and benefit zones exactly match the previous year? (Check one) YES NO (If not, describe change(s) in the NOTES section)
36650(b)(2) The improvements and activities for that fiscal year -Are the improvements and activities in line with the Original MDP? (Check one) YES NO 36650(b)(3) An estimate of the cost of providing the improvements and activities for that fiscal year
- How does the overall budget compare to last year? (Check one) HIGHER SAME LOWER - What is the greatest change (by percentage) between line items from last year to this year ______ 36650(b)(4)
The method of levying the assessment in sufficient detail to allow each real property owner/business owner to estimate the amount of the assessment to be levied against his or her property for that fiscal year 36650(b)(4)
The basis of levying the assessment in sufficient detail to allow each real property/business owner to estimate the amount of the assessment to be levied against their business/property for that fiscal year -Does the Method and Basis match the MDP? (Check one) YES NO -Is there a CPI increase for this year? (Check one) YES NO - If so: What is the rate? _______
36650(b)(5) The amount of any surplus revenues to be carried over from a previous fiscal year
-Is the surplus identified for use in specific categories? (Check one) YES NO if yes, What category(ies) ____________________________________________ 36650(b)(5) The amount of any deficit revenues to be carried over from a previous fiscal year 36650(b)(6) The amount of any contributions to be made from sources other than assessments levied pursuant to this part
-Are the contributions identified for use in a specific category? (Check one) YES NO -Did an authorized representative of the nonprofit Board sign the report? (Check one) YES NO -Does the report state the date the Board approved the Report/Budget? (Check one) YES NO NOTES:
Exhibit A
7/24/2023
Susanna Tam
Development Project Manager
City of Sacramento
Finance Department
915 I Street, 5th Floor
Sacramento, CA 95814
Re: 2023-2024 Fiscal Year Budget – Central Midtown Business Improvement District - CMRBID D
ear Sini,
O
n behalf of the Board of Directors of the Midtown Sacramento PBID Corporation dba Midtown Association, I have enclosed our 202 3-2024 fiscal year annual budget pursuant to the State of California Parking and Business Improvement Area law of 1994, Streets and Highways Code section 36600 et seq.
The total CMRBID budget for FY 2023/2024 is $96,000.00
T
hank you for your continued support of Midtown, and the Central Midtown Restaurant Business Improvement District. If you have questions or need additional information, I can be reached by phone at (916) 442-1500.
S
incerely,
E
mily Baime Michaels
Executive Director
1 Central Midtown Restaurant Business Improvement District 2023-2024 Annual Report
Overview: The Central Midtown Restaurant Business Improvement District (CMRBID), or Midtown Central, is an assessment district proposed to provide specific benefits to payers managed by the Midtown Association. CMRBID was established on June 13, 2017 and renewed July 1, 2022.
Loc
ation: The CMRBID includes all restaurant businesses with an within the po rtion of Midtown Sacramento generally bound by Jazz Alley to the north, 2 4th Street to the east, Kayak Alley to the south, and the Union Pacific Railroad to the west, as shown on the map in Exhibit A.
S
ervices: The CMRBID is designed to provide specific benefits directly to payers by increasing restaurant food sales and revenue therefrom. Lighting and safety; placemaking, arts, and events; and advocacy and related administration programs are provided.
B
udget: The total CMRBID annual budget is projected at $96,000. The annual assessment rate is 1.5 percent of gross food sales revenue plus a fixed amount based on occupancy.
Based on the benefit received, the assessment shall not be collected on: gross alcoholic beverage sales; gross catering or banquet sales; and gross retail sales (such as coffee mugs, t-shirts, etc.). The fixed assessment amount (based on occupancy) is in addition to the gross food sales assessment and is shown in the table below:
Go
vernance: The Board of the Midtown Association has established an CMRBID advisory committee made of assessed business owners. Membership includes: Azul, Kin Thai Street Eatery, LowBrau, Mango’s, Roscoe’s Brews & Burgers, Burger Patch, Flamingo House, Midtown Cantina Alley, Der Biergarten, Golden Bear, Good News Wine , and Pizza saurus Rex.
Occupancy Threshold Annual Occupancy
Assessment
Under 49 customers
50-99 customers
$500
$1,000
100-199 customers $2,500
200+ customers $5,000
2 Programs & Financial Overview:
Li
ghting & Safety: The lighting and safety program focuses on safety services and amenities that make the CMRBID businesses safer and more welcoming for visitors. The program includes police services for activities such as Second Saturdays and on street events adjacent to assessed businesses, and also includes ambient lighting installation.
P
lacemaking, Arts, & Events: The placemaking, arts, and events program focuses on attracting patrons to assessed businesses by funding family/neighborhood friendly programming in public s paces such as streets, alleyways , parking lots , and the development of a connective landscaping project between 20 th and 24th Streets, across the
district. The program focuses on arts and annual signature events that drive r estaurant sales, such as Second Saturday, Oktoberfest, Midtown Sundaes, and parking programs for assessed businesses. These funds are not used to enhance events or promotions that take place exclusively inside businesses. Program costs can include special event insurance, street closure costs, entertainment fees, advertising, and placemaking projects such as CMRBID welcome signage, banners , and public art installations adjacent to assessed businesses. Assessment funds are not used to rebate businesses for their specific marketing efforts or event planning costs.
A
dvocacy & Administration: In order to provide the lighting and safety and placemaking, arts, and events services, the Midtown Association incurs various administrative costs, such as staffing, rent, advocacy, insurance, legal, and accounting fees. Advocacy programs will utilize dedicated staff time to provide unified attention, communication, and responsiveness throughout the CMRBID on regulations and policies affecting assessed restaurant businesses.
C
ollections/Contingency/Reserve: In order to ensure effective provision of services, a contingency will be established to account for uncollected assessments or unanticipated program costs. The reserve fund may be spent on programs described in this Plan in any proportion deemed appropriate by the Midtown Association. This category includes the cost of City administrative fees, not to exceed $ 9,000 per year, for collection and disbursement of the assessment. Collection fees from the City of Sacramento are calculated prior to the monthly disbursement checks received. 3 Specific Projects & Budget Overview:
Li
ghting and Safety projects include:
• Powerwashing entertainment areas, including private patios • Landscaping improvements next to adjacent businesses
• Support with the city Al Fresco Program
• Police costs for THIS Midtown , Midtown Sundaes, Oktoberfest, and other public space events.
Placemaking, Arts & Events projects include:
• Administration and production of Midtown Second Saturday • Development of a connective landscaping project between 20th and 24th Streets • P
ermitting support and specific event costs for Oktoberfest • Permitting support and specific event costs for Midtown Sundaes • Permitting support and specific event costs for THIS Midtown • Refresh design and branding of Midtown Central including new banners. • Instagram and social media promotion of district businesses Advocacy and Administration projects include:
• A fairly allocated share of overhead expenses
• Advocacy support such as the city al fresco dining program 4 Exhibit A: Map
5 Central Midtown Restaurant Business Improvement District Annual Budget
Fiscal Year 2023/24
BIA
Resources
Beginning Reserves $
Other Revenues $ -
Business Tax Collections/ County Billing $ 96,000.00
Total Resources $96,000.00
Expenses
Maintenance, Lighting & Safety
Maintenance & Streetscape $ 4,056.00
Lighting and Prevention $ -
City Police $ 10,000.00
Total Lighting & Safety $ 14,056.00
Placemaking Arts & Events
Pilot Projects $ 44,652.00
Total Placemaking Arts & Events $ 44,652.00
Advocacy & Administration
PR & Marketing $ 25,724.00
Administration $ 9,000.00
Total Advocacy & Administration $ 34,724.00
Total Expenses $ 93,432.00
6 BUSINESS IMPROVEMENT AREA FEES:
ANNUAL FEES AS OF January 2023
CMRBID: Minimum Occupancy Assessment Fee:
$41
Maximum Occupancy Assessment Fee:
$417
Assessment (1.5% of total Prepared Food Sales)
Establishment Occupancy
Greater than 200
100-199
50-99
Less than 49
Monthly Charge
$417
$208
$83
$41
7