New
Downtown Assessment District Passes |
By Jorge Casuso
July 11 – For the first time in two decades, Downtown
Santa Monica will get a new management structure and more than $3
million to spruce up and become more inviting after property owners
approved a new assessment district.
Weighed by the amount each of the 256 Downtown property owners
would pay, the election saw 57 percent of the vote cast for the
new Property Based Assessment District (PBAD) -- with property owners
paying some $1.6 million voting for the district and those paying
$1.2 million voting against it. (Some property owners did not vote
by the Tuesday deadline.)
If approved by the City Council later this month, the new district
will generate $3.6 million in new assessments. The money will be
used to boost maintenance, enhance marketing efforts and create
an “ambassador program” to inform visitors and help
keep the streets safe.
“We’re very pleased with the margin,” said Kathleen Rawson,
executive director of the Bayside District, which runs the Downtown. “It’s
a nice solid win.
“The community realizes how important it is to reinvest,” Rawson
said. “While it may not be a perfect plan in many people’s eyes,
it certainly is a step in the right direction.”
Two of the largest landlords -- Macerich, which owns Santa Monica Place, and
the City, which owns about ten percent of the assessed property -- voted for
the plan, while Douglas Emmett, which owns eight office buildings and one apartment
highrise voted against it.
Douglas Emmett, which owns 100 Wilshire, Santa Monica’s tallest building
and the most expensive office space in Southern California, was joined by several
non-profits in an effort to lobby the council against the proposed district
on Tuesday.
Opponents worried that they would not reap enough of the services bankrolled
by the PBAD to warrant paying the assessment.
Allan Golad, senior vice president for Douglas Emmett, came before the council
Tuesday to “adamantly voice our strong opposition” for a plan that
is “critically flawed and grossly unfair.
“The formula isn’t off by a little, it’s off by a lot,”
Golad said. “The office properties are shouldering way too much of the
cost.”
Representatives of Christian Towers, a HUD senior building, also opposed the
assessments, saying they would ultimately be paid by tenants on fixed incomes
who live in the building’s 163 units.
“If this passes, every resident will have to pay $31 (a year),”
said Donna Alvarez, a member of the Christian Towers board. “We just feel
it is inequitable.”
The district – bounded by Ocean Avenue, Wilshire Boulevard, Colorado
Avenue and 7th Street – is “too large, too diverse and too expensive,”
Alvarez said, adding that cleaning the streets “should be the responsibility
of the City.”
YMCA officials also opposed the assessments, saying they would either be paid
by the club’s 7,222 members or be taken from its scholarship fund.
“We should not have to pass our assessment to our membership,”
said Dan Cohen, president of the YMCA board of directors. “Why impose
such a hefty assessment on us.”
Council member Ken Genser countered at Wednesday’s special council meeting
that when spread out, the assessments were miniscule. A tenant of 100 Wilshire,
where office rents average $8 a square foot, would have to add $35 to an $8,000-a-month
lease.
YMCA members, Genser said, would pay 75 cents more a year to cover the $5,500
in new assessments.
“I just have trouble thinking these numbers are significant hardship,”
Genser said.
On Wednesday, City Attorney Marsha Moutrie responded to the council’s
request to explore if changes could be made to the district.
“You could change certain parameters, for example, change the boundaries
of the assessments, so you have some flexibility,” Moutrie said. “You
could probably change the rate for all non-profits.”
Rawson said the Bayside opted to include non-profits based on the advice of
consultants who helped put together the assessment district.
“We worked hard to try to exempt non-profits, and all the legal advice
we got was that we couldn't,” Rawson said.
She added that if the City Attorney thought non-profits could be excluded,
Bayside officials would favor the move.
Unlike the current Downtown Assessment District, which only taxed retail properties,
the new PBAD taxes office and apartment buildings, restaurants, hotels and properties
owned by government and non-profit agencies.
Under the proposed plan, assessments would be based on the property’s
size, type of use and location in an expanded district divided into three zones
– one comprised by the Promenade, another along 2nd and 4th streets and
Ocean Avenue and a third between 5th and 7th streets.
A property on the Promenade would pay the most at 76¢ a square foot per
year, properties on neighboring 2nd and 4th streets and Ocean Avenue would pay
34¢, while those on 5th to 7th streets would pay 19¢.
Under the plan, the streets would reap benefits proportional to the assessments
paid by their property owners.
In addition to the new assessment, the plan dramatically overhauls the way
the Bayside is managed, giving property owners more power over who makes policy
decisions.
Under the plan, the existing 11-member Bayside Board currently appointed by
the council would be replaced with a 13-member board, six of whose members would
be appointed by the council, six by the property owners and one by the City
Manager.
Proponents say the plan – which institutes a $1.3 million ambassadors
program, funds $1.2 million in additional maintenance and pumps $500,000 into
marketing the Downtown – is necessary if the area is to remain competitive
with newer venues such as The Grove.
The council is expected to adopt the assessment at its meeting July 22.
“The City Council may adopt or modify the proposed assessment by reducing
it, modify the activities to be funded, and/or change the boundaries
of the proposed district to any exclude territory that will not
benefit from the activities to be funded,” according to City
staff.
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