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8.2 Levy BID 2004 Fees CITY OF SALINA REQUEST FOR CITY COMMISSION ACTION DATE 11/24/03 TIME 4:00 P.M. AGENDA SECTION NO: 8 ORIGINATING DEPARTMENT: APPROVED FOR AGENDA: ITEM NO: 2 CITY MANAGER'S OFFICE BY: Dennis M. Kissinger City Manager BY: ITEM: Second reading of Ordinance Number 03-10172 levying Salina Business Improvement District Number 1 service fees for 2004. BACKGROUND: The ordinance was passed on first reading October 27, 2003. The ordinance includes no increase in service fee rates for 2004. Second reading was postponed to allow completion of the planned B.I.D. business survey. No other comments have been received regarding 2004 B.I.D. service fees since first reading. SUPPLEMENTAL INFORMATION ENCLOSED: 1. Executive Summary of Salina Business Improvement District Survey - 2003 (Prepared by City staff) 2. Tabulated Responses to Survey. 3. Status Report on PUMA Market-based Downtown Plan and Summary of Activities Report (Prepared by Salina Downtown, Inc. staff) 4. October 27,2003 Bluesheet on Ordinance No. 03-10172. ACTION: 1. Comments, questions and discussion on B.I.D. Survey and Downtown Plan Status Report. 2. Consider Ordinance No. 03-10172 on Second Reading. Attachment November 21, 2003 EXECUTIVE SUMMARY Salina Business Improvement District Survey 2003 Backqround: In accordance with the Progressive Urban Management Associates (P.U.M.A.) master plan goals, a survey of business satisfaction and attitudes was completed in November 2003. The survey was prepared by city staff and reviewed by the B.I.D. Board of Advisors before sending. The survey was sent to business representatives whose downtown business pays B.I.D. service fee assessments. Surveys were not sent to downtown entities exempt under state law, e.g. not-for-profit or fraternal organizations. Owners with more than one business location were only sent one survey. 257 surveys were mailed. 85 surveys were completed and returned. 172 surveys were not returned. Response rate was 33% Tabulated Survey Results: A copy is enclosed including verbatim answers to questions 13 and 15. Kev Questions Summary Results: Note: Some respondents did not answer all questions. Statement No.1 I am generally familiar with the goals established for downtown Salina in the P.U.M.A. master planning process completed last year. Total responses = 84 Agree or Strongly Agree = 44 (52%) Disagree or Strongly Disagree = 21 (25%) Neutral or Don't Know = 19 (23%) Statement No.2 I am satisfied with the progress made in the past year in implementing the Downtown Plan. Total responses = 83 Agree or Strongly Agree = 28 (34%) Disagree or Strongly Disagree = 28 (34%) Neutral or Don't Know = 27 (32%) Statement No.3 Salina Downtown, Inc. does a good job of promoting the interests of downtown. Total responses = 84 Agree or Strongly Agree = 37 (44%) Disagree or Strongly Disagree = 27 (32%) Neutral or Don't Know = 20 (24%) Statement No.7 The Board of Salina, Downtown, Inc./Business Improvement District #1 effectively represents the desires and interests of the business membership. Total responses = 80 Agree or Strongly Agree = 28 (35%) Disagree or Strongly Disagree = 29 (36%) Neutral or Don't Know = 23 (29%) Statement No.1 0 Through the S.D.I. monthly newsletter, public meetings, etc. S.D.I. does a good job of informing the membership of downtown news, issues, and plans. Total responses = 82 Agree or Strongly Agree = 51 (62%) Disagree or Strongly Disagree = 6 (7%) Neutral or Don't Know = 25 (31 %) Statement No. 12 Downtown businesses generally get good value for the B.I.D. service fees they are required to pay. Total responses = 84 Agree or Strongly Agree = 28 (33%) Disagree or Strongly Disagree = 46 (55%) Neutral or Don't Know = 10 (12%) TABULATED RESULTS - 85 SURVEYS RECEIVED Salina Business Improvement District Survey 2003 Return survey no later than Thursday, November 20,2003 Mail in enclosed envelope to: City Manager's Office City of Salina PO Box 736 Salina, KS 67402-0736 Please circle the answer which most closely indicates your level of agreement with each of the following statements: 1. I am generally familiar with the goals established for downtown Salina in the P.U.M.A. master planning process completed last year. 11 33 10 12 9 9 Strongly Agree Agree Neutral Disagree Strongly Don't Know Disagree 2. I am satisfied with the progress made in the past year in implementing the Downtown Plan. 6 21 16 19 9 Strongly Agree Agree Neutral Disagree Strongly Disagree 3. Salina Downtown, Inc. does a good job of promoting the interests of downtown. 11 Don't Know 11 Strongly Disagree 4. S.D.I.'s repositioning itself as a downtown business support office (recruitment and retention), has been a positive change brought about by the planning process. 9 Strongly Agree 28 Agree 18 Neutral 16 Disagree 2 Don't Know 8 Strongly Disagree 5. S.D.I. is effectively implementing the Downtown Plan recommendation to focus on "destination marketing", (e.g. promoting downtown shops, restaurants and entertainment collectively as an attraction ). 10 Strongly Agree 25 Agree 15 Neutral 14 Disagree 11 Don't Know 7 Strongly Disagree 6. S.D. I. is doing a good job in its involvement as a facilitator on economic development issues affecting downtown: (e.g. hospital-medical district creation; Roosevelt-Lincoln school re-use). 6 Strongly Agree 20 Agree 19 Neutral 20 Disagree 9 Don't Know 9 Strongly Disagree 7. The Board of Salina, Downtown, Inc./Business Improvement District #1 effectively represents the desires and interests of the business membership. 8 Strongly Agree 7 Strongly Agree 28 Agree 13 Neutral 21 Agree 15 Neutral 15 Disagree 16 Disagree (Over for Page 2) 10 Don't Know 13 Strongly Disagree 8 Don't Know TABULATED RESULTS - 85 SURVEYS RECEIVED Page 2 8. S.D.I. does a good job of seeking business member input before making important decisions. 7 20 16 18 10 Strongly Agree Agree Neutral Disagree Strongly Disagree 9. When downtown businesses have a concern, S.D. I is responsive. 12 Don't Know 9 Strongly Disagree 10. Through the S.D. I. monthly newsletter, public meetings, etc. S.D. I. does a good job of informing the membership of downtown news, issues and plans. 9 Strongly Agree 22 Agree 21 Neutral 11 Disagree 11 Don't Know 11 40 23 4 2 2 Strongly Agree Agree Neutral Disagree Strongly Don't Know Disagree 11.lt is important for the S.D.I. office to be open 8:00am-5:00pm, Monday through Friday. 6 Strongly Disagree 12. Downtown businesses generally get good value for the B.I.D. service fees they are required to pay. 12 Strongly Agree 16 Agree 22 Neutral 15 Disagree 10 Don't Know 30 Strongly Disagree 13. What one action or change can you identify which you believe would positively affect the downtown Business Improvement District? *See attached 6 Strongly Agree 22 Agree 8 Neutral 16 Disagree 2 Don't Know 14. Do you currently volunteer for S.D.I. Board, Committee or Special Events positions? 26 Yes 53 No 15. General Comments? *See attached OPTIONAL: I would like someone to contact me to discuss more specifically my interests and questions regarding the B.I.D/S.D.I. and downtown Salina. Salina Business Improvement District Survey 2003 Question 13: What one action or change can you identify which you believe would positively affect the downtown Business Improvement District? . Get more business downtown. . Sell Brown Mackie building. The retention of an "anchor" tenant - a major retail business. . . Keep sidewalks cleaner (leaves, cigarette butts, etc.). Do away with downtown parking meters. SDI spends member fees that promote events and other things that do not promote downtown. . . . SDI needs a higher profile - with strong support from the City of Salina, Chamber of Commerce, and Airport Authority. More public parking. Need to promote restaurant, bar and entertainment in order to have a nightlife downtown as well as daytime. More security force and lighting need to be used. Try to work with city officials to show them that THEY are the problem with downtown Salina. . . . . . Pedestrian signals at crosswalks (intersections). More business - that attracts like the mall does. . . Improvements should include all areas that pay in to BID, i.e. past Ash Street. Dissolve BID. Don't get too many bars downtown. . . . Close BID. . Easier access from Interstates - improved signage and corridor image. Dissolve SDI/BID. . . Promote all of downtown, not just Santa Fe Ave. Have an annual get-together of downtown business owners and staff (make downtown businesses more aware of other downtown businesses. . . Get more of the retail that all citizens need or have to have. Improve parking downtown to attract out of town visitors. Refurbish second stories of buildings along Santa Fe. Downtown should be something other than Santa Fe, 5th and y'h Streets, what about 8th and 4th Streets? but are forgotten about. We pay fees . . . . Invoke a sunset clause so the SDI can serve all businesses downtown and to see whether the downtown owners want to continue. . You could have signs showing where downtown is - from 9th Street. Free parking - no tickets. We need something for downtown but the present system doesn't work. I would like to see more effort put into the retail promotions committees - more retail volunteers. Strongly recommend doing away with the BID/SDI, for it does no good. More retail - fewer professionals. . . . . . . Like all of us, do what they do every day a little better. Salina Business Improvement District Survey 2003 Question 13: What one action or change can you identify which you believe would positively affect the downtown Business Improvement District? . Less spending on "promotional" activities - Halloween/Christmas, etc. Turn it into a volunteer only. The Rotary, Kiwanis, Lions, and other organizations seem to make it. Lower the quarterly BID assessments to a reasonable amount, so businesses aren't saddled with another tax and discouraged from moving into the BID area. . . . Form some sort of vision and then DO IT. Stop talking and do something! Don't make fees much higher. I already pay $1,000 a year. It is ridiculous that I have to shovel sidewalks, etc. No one pays me. . . Discontinue the program. Get rid of it and the dues. . . More aggressive business recruitment and retention activity. Removal of downtown assessments would make renting easier in downtown Salina; tenants don't like it. Property owners should be on SDI/BID Board of Directors. I don't feel we get anything out of it. Every time there is a promotion, they want you to pay more. I feel all money goes to salaries and benefits not enough to downtown. . . . . Focus efforts on ONE downtown signature event as the PUMA study suggests. Far more enthusiasm in assisting new business locating downtown. . 2 Salina Business Improvement District Survey 2003 Question 15: General Comments? . Gayle is doing a great job, but I would like to see more new business, especially retail, into downtown and less bars. Every business should be allowed to participate on a "voluntary" basis. If I were a merchant in Kraft Manor, Sunset Plaza, or North Salina, I would request matching City funding. This entity has outgrown usefulness. City of Salina should not continue to fund it. Is the City discriminating due to location? . . We do not feel our business has received one positive thing from the BID. As a property owner, I feel the BID affects the amount I can charge for rent in a negative way. . Our business spends more money in one month than SDI spends in a whole year promoting business, and therefore downtown; but that is what we are told we are being charged the fee for. . I have volunteered in the past and have not been called upon. We no longer need the BID. . . It is beginning to look like downtown Salina will be an office district with small specialty shops in the area. The alleys flood and they are dirty; we have bird problems; and the City officials do NOTHING about it! Gayle is doing a good job - energetic, active. As a business owner passed Ash Street, I feel it is a total waste of money. . . . . Dissolve BID. Service-providing businesses don't need to be included in BID. I've seen NO difference since my BID tax tripled this year; the design review process is too cumbersome and critical; "good ole boy" network comes to mind. . . . Being on the fringe, we get NO benefits. However I am a supporter of a thriving downtown! I feel my special assessment benefits Main Street. There should be more of a buy-in and burden on THOSE businesses. . One of the biggest rip-offs and getting worse. If your business is not on Santa Fe, you really get limited benefit from this program, but subsidizing the Santa Fe merchants' advertising. . . I don't feel like I know enough about the SDI or its members. I've always wished our Iron and Santa Fe could be more like downtown Lawrence. Don't we have a high-pressure machine to wash off bird poop? I am a professional service company and don't rely on street traffic for business. I am located downtown because of the professional atmosphere. I despise paying the fees to be located downtown and would investigate moving if fees increase. . . . . Please dissolve the BID, no benefits for non-retail businesses, just another tax. SDI has historically over-assessed fees to service businesses and those businesses do not benefit from SDI generally. . . SDI does a good job. Decent routing signage to get to downtown is still the biggest annoyance. I have seen this since 1989 goals for Salina, yet the Chamber and the City seem to keep losing this project. . . You should promote the antique shops - without them you would not have much downtown; other cities do. The only good thing about the BID is that I can write it off as a business expense during tax time! I think they do nothing for the $40,000 a year that they make. . Salina Business Improvement District Survey 2003 Question 15: General Comments? . What about the arts influence on bringing people to the area? I was on a committee that voted and recommended that Santa Fe Days be eliminated and the Board reinstalled it. What a waste of time! If they tied it to the River Festival, then it might work. . . I think overall it is great - BID and Gayle are doing a great job. Get more retail business downtown instead of bars and restaurants, or the rest of us may have to move out South too. Certain businesses receive no value at all and should be exempt. Because of my lack of involvement/knowledge about SDI, I have chosen not to respond to this survey. . . . . I would note that SDI was of limited help as a resource when planning repair of the façade of my downtown property. Gayle is doing an excellent job! I believe the downtown merchants need to produce their own customer base through the quality of product, service, and price. . . . Current Director, Gayle Martin, appears to be doing a better job that prior Directors. Good job overall. . . Just seems expensive for non-retail. I like the direction downtown is going. Businesses should be ranked in order of importance - entertainment/food, offices, specialty retail, hospital-health services, and lofts. . . I've been involved in the past with promotions. A lot of things stay the same from previous years instead of making improvements. I would like to see a change instead of doing it the way it's always been. . Try something different, this isn't worth the money we pay. Too many bars. I strongly feel that signage is going too slow and the downtown (SDI) as a whole needs to be far more active in assisting the 4th Street project. Public restrooms in parking lot on North Santa Fe (they have them in the South 100 block). . . . 2 PUMA MARKET-BASED DOWNTOWN PLAN Status Report - November, 2003 SDI/BID Lead Agency Issues - Year 1 Action Plan Twenty-two action items are recommended in the 2002 Market-Based Downtown Plan produced by Progressive Urban Management Associates and adopted by the Salina Downtown, Inc. board of directors and the Salina City Commission. lead agencies include Salina Downtown, Inc., City of Salina, Saline County, Salina Area Chamber of Commerce, and downtown banks. Following is a summary of the Year 1 plan items that list SDI as the sole or as one of two lead agencies. Economic Development (1) Reposition SDI as a downtown business support office - completed. Executive director hired. Focus realigned to property manager; special events analyzed, two events eliminated. (2) Downtown investor marketing package (with Chamber) - new folder and inserts to be printed in December. Reaulatorv Climate (1) Policies for bars and restaurants - developing Good Neighbor Policy for distribution in December to SDI members. Environmental Improvements (1) Decorative Lighting Enhancements - year-round building outline lighting issue tabled until 2004. Staff and volunteer committee to investigate architectural lighting options and cost. (2) Parking management (with City of Salina) - issue tabled. (3) Defeat the pigeons (with City) - completed. City retrofitted truck for water hauling and washing of surface public areas downtown. Destination marketina (1) Downtown map & directory - completed. (2) Cross-promotions - completed. Map/directory and other publications distributed to Salina Regional Health Center, City-County Building, Chamber of Commerce, hotels, Bicentennial Center and other attractions. New combined retailers' holiday open house. New events supplement existing downtown events (example, new March of Dimes barbecue teams up with annual Blues Masters at the Crossroads). "Discover Downtown Salina" six-month advertising campaign. (3) Special events plan - completed. Events analyzed, eliminated two events. Salina Downtown, Inc. Summary of Activities November 14, 2003 From September 2002 to November, 2003, SDI has provided the following services to the 290 business improvement district members in a 31-block area of downtown and to the community: Communications & Advocacy . Served as facilitator for the hospital-medical district working group, estimated staff time 45 hours, volunteer time 50 hours (total for 2 individuals) . Published 15 monthly newsletters to highlight SDI activities and provide property vacancy information to refer possible tenants in support of business recruitment . Monitored downtown business issues at city commission, county commission, heritage commission, planning commission . Formed a task force to guide implementation of Progressive Urban Management Associates (PUMA) recommendations on reorganization of SDI committees . Facilitated 45 meetings of newly-formed SDI volunteer committees . Organized and conducted 11 monthly meetings of the (Downtown) Retailers Roundtable . Participated in seven PUMA steering committee meetings . Presented as guest speaker to 12 civic and economic development groups Business Support & Recruitment . Tracked and circulated information on downtown space available for sale or lease . Communicated regularly with real estate development companies regarding Roosevelt-Lincoln Middle School adaptive re-use and the sale of the United Building . Provided meeting space for Fourth Street project developers and neighboring property and business owners . Assisted City staff and the Design Review Board in issuing certificates of compatibility . Attended a seminar on historic tax credits . Cooperated with and referred clients to new Small Business Development Center at Cloud County Community College Destination Marketing . Produced and distributed reformatted four-color downtown business directory and guide, self-mailer . Sponsored "Discover Downtown Salina" advertising campaign involving local and regional media . Conducted quarterly downtown social mixer events, (75 average attendance) . Conducted annual Santa Fe Day (4300 attendance), Parade of Lights (5000), and December carriage rides . Coordinated volunteers to decorate 380 downtown lanterns for Christmas . Supported publication of annual Historic Downtown Salina guide . Sponsored Terence Newman recognition day (1000) . Evaluated special events and eliminated two CITY OF SALINA REQUEST FOR CITY COMMISSION ACTION DATE 10/27/03 TIME 4:00 P.M. AGENDA SECTION NO: ORIGINATING DEPARTMENT: APPROVED FOR AGENDA: 8 ITEM NO: 2 CITY MANAGER'S OFFICE BY: Dennis M. Kissinger City Manager BY: ITEM: Ordinance No. 03-10172 AN ORDINANCE lEVYING SALINA BUSINESS IMPROVEMENT DISTRICT NUMBER 1 SERVICE FEES FOR 2004, IN ACCORDANCE WITH K.S.A. 12-1791, AND REPEALING ORDINANCE NUMBER 02-10108. GENERAL BACKGROUND: Kansas State law (K.S.A. 12-1781 et seq) governs the procedure for the creation and financing of one or more Business Improvement Districts within cities, for the purpose of providing administration and financing of additional and extended services to businesses within such districts. These services are intended to restore or promote the economic vitality of the district and the general welfare of the City. Financing of a B.I.D. is through service fees applicable to all businesses within a district. In 1983, the City Commission approved the creation of Business Improvement Number 1 covering certain downtown areas of Salina, along with the associated service fees. The concept of "self-governance" for downtown has continued for the past 20 years. Cities may provide B.I.D. services directly through city employees or by contract with a not-for-profit corporation. From 1983 to 1987, the City directed B.I.D. programs and services. Since 1987, that effort has been delegated to Salina Downtown, Inc. (S.D.I.), a not-for-profit advocacy and marketing organization which primarily has used the "Kansas Main Street" model for downtown economic and community development. State law provides for each B.I.D. to have a City appointed Board of Advisors, who may also serve as the Board for the not-for-profit corporation. In Salina, the B.ID. Board and S.D.I. Board are made up of the same individuals serving a dual role. S.D. I. provides for annual elections to the Board, and the City Commission has chosen to use those election results in its B.I.D. Board appointment process to help assure the Board of Advisors is made up of a broad base of persons representing downtown businesses impacted by the programs and service fees. DOWNTOWN PLAN: The downtown B.I.D. remained relatively static from 1987 to 2001. In late 2001, Progressive Urban Management Associates, Inc. (PUMA) was hired to perform an economic analysis to determine a benchmark for our downtown's economic vitality and to assist in developing a comprehensive economic development and organization plan specifically tailored to Salina's business and community climate. The planning process during 2002 included very extensive public involvement, particularly focused on downtown stakeholders. The final plan was presented to the City Commission at a Study Session to assure it met the Commission's goals and desires for downtown. 2003 was the first implementation year for PUMA plan policies and objectives. CITY OF SALINA REQUEST FOR CITY COMMISSION ACTION DATE 10/27/03 TIME 4:00 P.M. AGENDA SECTION NO: ORIGINATING DEPARTMENT: APPROVED FOR AGENDA: 8 ITEM NO: 2 CITY MANAGER'S OFFICE BY: Dennis M. Kissinger City Manager BY: Page 2 SERVICE FEES: A B.ID. program of services is financed through a service fee on businesses (as defined by state law) within a district. These annual service fees are mandatory payments as established by City ordinance. The PUMA plan involved an extensive review of the methodology of the service fee structure and recommended a major revision to improve equity and administrative efficiency. In November 2002, the City Commission approved Ordinance No. 02-10108 establishing a 2003 service fee schedule using the new methodology as recommended by the consultants, the B.ID. Board of Advisors, and city staff. As a City of Salina fee, it is billed and collected by the City's Finance Department with the assistance of S.D. I. staff. The 2003 service fee plan is performing as expected in 2003, from both a financial and administrative perspective. Anticipated service fee income for 2003 is $89,900. Originally, the plan was to implement a "Phase 2" of the service fee schedule designed to generate a total of $100,000 for the B.I.D. budget in 2004. Using the same methodology as developed, this would have required a substantial increase in the fee schedule. However, city staff, S.D. I. staff and board officers have over the past 60 days worked to evaluate carefully the full financial status and budgetary needs of the B.I.D. This fiscal evaluation included a special financial overview study session with the full Board to review preliminary financial planning and analysis with the City Manager. Based on that analysis, staff and the B.I.D. board reached the conclusion that they could meet their 2004 service goals and financial targets without a B.I.D. service fee rate increase in 2004. The operating expenses for the B.I.D. are somewhat lower than originally anticipated, and the year-end 2002 financial status was better than projected. Those factors combine to result in a projected year-end 2003 fiscal condition with reserves higher than their targets; with those funds available for 2004 use. With no rate change for 2004, $89,900 is also the estimated revenue (no change from 2003). 2004 BUDGET: A preliminary Salina Downtown, Inc. 2004 budget was presented to the City Commission in May. Enclosed is the latest update to that projected 2004 budget. Their budget delineates projected expenditures for downtown service operations, as well as Business Support, Destination Marketing, Communications and Advocacy and Special Events. Work in each of the above areas is guided by Committees comprised of downtown business representatives. The 2004 S.D.I. budget is the mechanism used for the B.I.D. service plan, following the outline of the PUMA master plan. Some downtown plan components are led by the City and some by S.D.I. CITY OF SALINA REQUEST FOR CITY COMMISSION ACTION DATE 10/27/03 TIME 4:00 P.M. AGENDA SECTION NO: ORIGINATING DEPARTMENT: APPROVED FOR AGENDA: 8 ITEM NO: 2 CITY MANAGER'S OFFICE BY: Dennis M. Kissinger City Manager BY: Page 3 STAFF COMMENT: Since the originally proposed 2004 fee schedule increase is not now recommended by the B.LD. Board of Advisors nor the city staff, the adoption of the rate schedule ordinance is much more "routine" than expected. Without any rate increase for next year, there is a continued opportunity to work toward the goals of the PUMA plan in its second full year and show value added. Good progress has been made in year one, but there is much more to do. City staff is recommending you consider this ordinance on first reading today, with second reading in two weeks (November 10). One of the PUMA plan objectives is to have an annual business satisfaction survey accomplished within the B.ID. area. That work is underway and a status report will be available November 10. In addition, city staff is evaluating our billing, collection and accounts receivable issues for B.ID. service fees. We may also have a report on that by November 10. ACTION: Consider Ordinance No. 03-10172 on first reading, levying B.ID. No.1 service fees for 2004 and set the November 10, 2003 agenda for second reading. Enclosures