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HomeMy WebLinkAbout1993-04-13 - AGENDA REPORTS - ECONOMIC RECOVERY WORKSHOP (2)NEW BUSINESS DATE: SUBJECT: DEPARTMENT: BACKGROUND AGENDA REPORT April 13, 1993 City Manag Item to be Lynn M. Harris�j Economic Recovery Workshop Reports and Recommendations Community Development The City's first Economic Recovery Workshop was held in October 1992. The purpose of the meeting was to provide a forum of public and private leadership of the .Santa Clarita business community to discuss economic Issues, set priorities, and focus on several action strategies for regaining strength of the local economy. Entitled "Leaders Do;' the workshop was the first of Its kind drawing upon private and public leadership to undertake solutions to community -wide economic problems. From this meeting, five (5) ad hoc committees were formed with representatives from both public and private sectors: the New Business, Marketing, Development Process, Business Climate, and Be Competitive Committees. The Committees met from November to February. Strategies and recommendations for the City's economic recovery were produced. At the follow-up Economic Recovery Workshop, held on February 25, 1993, each committee presented its ideas to a group of public and private representatives. Attached is a report summary which provides commentary and budget impacts for the recommended action plans and outlines areas of future public - private cooperation for Implementation of these ideas. RECOMMENDATION Staff recommends that the City Council: Receive the report and compliment all participants In this historic effort. 2. Encourage future private/public sector efforts implementing the report. 3. Direct approval and implementation of workshop action items. 4. Adopt the following policies and direction to staff as the City's first Implementation step: Action: Continue City's existing "case-by-case" economic incentive policy and recognize need for creativity based on each project. Action: Direct staff to develop a non -monetary recognition program that encourages Identification of Industry attraction in the business community. �PPRnuF� :itj int��11•gtl�,��t--iv Economic Recovery Workshop Reports and Recommendations Agenda Report - City Council Meeting 4113- Page 2 Action: Request the City and Chambers of Commerce to meet to define attraction efforts to avoid duplication, and to prioritize and add to the proposed targeted Industry list. Action: Complete draft marketing plan, hold public participation meetings and present plan to City Council by July 1, 1993. Action: Direct staff to present Economic Development Marketing program and funding request for FY 93-94 in the amount of $94,000. Action: Direct staff to develop marketing plan with Committee and Workshop attendees Input; Invite all to participate for City advertising campaign. Action: Direct staff to repeat customer service surveys in six month Intervals. Action: Refer to staff the subject of development fee deferral for additional analysis In consultation with the City Attorney. Action: Refer to staff the subject of bond deferral for additional analysis in consultation with the City Attorney. Action; Direct staff to develop a list of regulatory agencies in addition to AQMD. The City should be acting as liaison for local businesses; schedule additional Informational workshops In Santa Clarity Action: Approve the concept and direct staff to develop an ombudsman -type position within the Community Development Department from existing staff resources. Action: Direct staff to be available to participate in an effort to form a new Economic Development Advisory Group; that the City Council encourage the private sector to take the lead in forming a new broad-based Economic Development Committee. Action: Direct staff to be available to continue participation In this effort to develop a formalized retention program; the Canyon County and Santa Clarita Valley Chambers of Commerce are the lead agencies. Action: Direct staff to prepare (1) Comprehensive fee Information to be available at Community Development public counters by May 1, 1993, and reviewed and updated every six months thereafter; (2) a policy to guarantee the fees for 90 days will be presented to City Council In June 1993, ATTACHMENT Summary of Recommendations coundAw. rw.ddp SUMMARY OF ECONOMIC RECOVERY WORKSHOP COMMITTEE RECOMMENDATIONS April 1993 INTRODUCTION The City's first Economic Recovery Workshop meeting was convened In October of 1992. The objective was to bring together both the public and the private community leadership into a partnership to address the economic Issues facing Santa Clarita. From that starting point, five ad hoc committees who Investigated potential areas for economic recovery and then were formed and developed a series of recommendations for action. The following is staff review and comments on each of the recommendations that resulted from the Economic Recovery Workshop Committees, and staff recommendation to City Council to continue the joint public-private partnership. COMMITTEE RECOMMENDATIONS: New Business Committee: The City Council should continue with Its existing policy statement In regards to City economic development incentives; the city Is willing to discuss development proposals on a case by case basis, with consideration for Incentives based on public revenue enhancement, job growth, or other public benefits. Staff Comments: Santa Clarita's case-by-case economic incentive policy has worked most effectively with respect to new retail attraction investments where there is potential in certain circumstances to negotiate a -program of public improvements based on future revenue returns.The challenge for the coming near future is to develop a basis to negotiate with corporate/manufacturing distribution or headquarter job creation attractions. Action: Continue City's existing "case-by-case" economic incentive policy and recognize need for creativity based on each project. Cost: Ongoing staff effort; cost of incentive package is assessed on a case-by-case basis. Implementation Responsibility: City is responsible for implementation of existing economic incentive policy. Continued dialogue is welcome from the private sector. 2. The City Council should direct staff to consider offering a "bounty" for referrals or leads that result in new business relocations. Staff Comments: Although offering incentives for the purpose of encouraging the "generation of leads" is an attractive concept, it is difficult to operationalize. The idea has merit it clear cut criteria can be established to determine who can claim credit for a lead? How, when and in what form would a claim be valid? What would determine when a claim would be valid? Could public funds be used appropriately in this setting? The encouragement of lead generation through some form of non-financial recognition would be a less complicated way of accomplishing this objective. Focusing financial incentives to the direct benefit of end users (industry investors), would be a more effective focus of incentives than for the purpose of generating leads. Implementation Action Develop a non-rrionetary recognition program that encourages identification of leads in the business community. Cost: Can be incorporated into ongoing staff effort. Implementation Responsibility: Business community, City. Follow-up: Develop program by October 1, 1993. 3. The City should not make direct fiscal incentives as Its primary means of attracting new economic development, but rather, promote labor force, schools, low crime, quality of life, etc. Staff Comments` We agree the City has the potential to sell itself once we are better known. Current efforts support both the focus on promoting quality-of-Iffe and direct fiscal incentives as a means of economic development. Action: Economic Development has specifically targeted the development of a quality -of -life marketing brochure to be the center piece of its economic marketing promotional effort. We expect this to be printed and ready for distribution by May 1993. It speaks directly to the quality of our schools, labor force, low crime rate, etc. in characterizing the Santa Clarita Valley. Cost: Brochure costs included in approved FY 92-93 budget. Implementation Responsibility: Both public and private sectors should take responsibility for the marketing of Santa Clarita's quality -of -fife. Design and printing of quality -of -fife brochure is responsibility of City. Follow-up: Evaluate results of economic development marketing campaign in January 1994; encourage business community, Chambers of Commerce, etc., assistance. 4. The following are targeted Industries area for attraction efforts: Finance Insurance Banking Printing Health Care Missing suppliers to existing Industry. High techJhlgh growth, computer systems etc. Recycling/environmental industry Mail order/distribution, keying off the post office as an anchor. Research & Development Corporate Office - Tourism Retail, Restaurants etc. Staff Comments: The City has developed a basic attraction strategy that defines filming, tourism, retail and corporateCndustrial as primary market segments. Examples of attraction efforts to date include projects in filming, hotels, restaurants, a fun center, corporate, R&D and discount retailers. The recommended targeted industries of above greatly assist in further defining attraction targets. Action: Request the City and Chambers of Commerce should meet to define attraction efforts to avoid duplication and to prioritize and add to the proposed targeted industry list. 2 Cost: Can be incorporated into ongoing staff effort. Implementation Responsibility: Chambers of Commerce, City. Follow-up: CIty and Chambers to prioritize attraction list in next 30 days, and to establish and approach for periodic progress reports. Marketing Committee: 1. Economic Marketing Plan, (Slide presentation). Description: The Committee reviewed a draft of the 3 -year City Economic Development Marketing Plan. The Plan identified four market targeted segments of 1) retail, 2) office/industrial, 3) film, and 4) tourism, and then developed a separate communication program for each.. The Committee expressed support for this effort. Staff Comments: Thank youl Action: Complete draft marketing plan, hold public participation meetings, and present plan to City Council by July 1, 1993. Cost: Determined by level of effort defined for implementation after above efforts are completed. Implementation Responsibility: City; for plan adoption. Joint public-private plan implementation would be most effective. Follow-up: Evaluate marketing results in January 1994. 2. To Incorporate the results of the survey Into the quality of life brochure. Staff Comments: As a recommendation from the initial October 1992 Economic Recovery Workshop, a survey of all workshop attendees was administered. The objective of the survey was to determine the uniqueness, positive attributes, strengths and weaknesses of the Santa Clarita Valley. The results were tabulated and presented for discussion to the ad hoc Marketing Committee. The findings taken, together with previous public opinion polling research, provided a basis for designing an effective communication message and design concept to be integrated into the economic development marketing materials. The Marketing Committee critiqued examples of quality -of -life brochure from other communities and provided additional direction for the design concept of the City's quality -of -fife brochure. Action: Input from the quality -of -life survey and other direction from the Committee have been most helpful and have been incorporated into the design of economic marketing materials. These marketing materials will be printed and available for distribution in May 1993. Cost: Funds have been appropriated for the quality -of -life brochure in the first year's economic development marketing funds. Implementation Responsibility: Item completed. Follow-up: Evaluate marketing results in January 1994 3 3. Recommend that the City Council should carry over the first years funding level of $94,000, Into years two and three of the proposed three year marketing campaign. Staff Comments: In order to achieve impact with economic development promotion, staff has previously recommended that a sustained communication program for a minimum of three years .is required. This concept was supported and recommended by the ad hoc Marketing Committee. Action: Direct staff to present program and funding request for FY 93-94, in the amount of $94,000. Cost: $ 94,000 (FY 93-94) Year 2 94,000 (FY 94-95) Year 3 $188,000 TOTAL Implementation Responsibility: City Council action. Follow-up: Evaluate marketing results in January 1994. 4. To reconvene the marketing committee to review and recommend an advertising and public relations campaign for the proposed three year marketing plan. Staff Comments: Although the ad hoc Marketing Committee has provided input to the economic development marketing materials and reviewed the marketing plan, an advertising and public relations communication program remains to be developed as part of a citizen participation program to complete the proposed 3 -year marketing plan. Action: Develop participation plan with committee and workshop attendees input; invite all to participate for City advertising campaign. Cost: There are no new costs, as this effort is a part of first year's marketing budget. Implementation Responsibility: City and all interested members of the public and private sectors, residents and business people. Follow-up: Evaluate marketing results in January. 1994. Development Process Committee: 1. Continue with surveys to all Community Development Department customers tomonitorand measure City's procedures and services. Staff Comments: The initial customer service survey undertaken by the Development Process Committee provides an excellent benchmark from which to develop periodic measurement of customer service Action: Repeat customer service surveys in six month intervals. Cost: Can be incorporated into ongoing staff effort. Implementation Responsibility: City Community Development Department. Follow-up: Next survey to be done September 1993. 4 2. Defer collection of major Infrastructure fees until construction is completed, certificate of occupancy is ready and the project Is in a position to pursue permanent financing. Staff Comments: This is an incentive strategy that could provide financial assistance to a developer to reduce the "up -front" development costs which often occur at the same time that the applicant may experience the largest amount of capital cost. The City would not lose the payment it would only be deferred. Key concerns that have been expressed in an internal review are 1) addressing a perceived "loss of leverage" to capture fees at a later stage in the development; and 2) how does the City establish "assurance" that conditions of the project will be met. For example, the issuance of certificate of occupancy as a means to collect deferred fees would be ineffective the development company were no longer viable before the project reached a point of occupancy. Some means of establishing an acceptable level of assurance needs to be designed through means such as the use of a letter of credit, a development agreement or. bonding. From an economic development perspective, this is a very attractive incentive package. Also, there is precedent for a similar deferred fee payment program in Simi Valley. In reviewing Simi Valley's program, they have not had any difficulties to date, but it has a very short life history. Simi Valley's program is limited to sewer and water fees, which are not under City purview in Santa Clarita.. Action: Refer the subject of development fee deferral to staff for additional analysis in consultation with the City Attorney. Cost: Fees would be deferred, but not eliminated, with the objective of achieving a break-even cost stmtlar to a non -deferred situation. Implementation Responsibility: City Community Development Department. Follow-up: Staff to report back to the City Council no later than August 15, 1993. 3. Consider deferring bonds for non immediate infrastructure projects. Staff Comments: The requirement of bonding is a long established approach, sanctioned in State law, that allows a developer to proceed with a project by. guaranteeing up from that project approved.requirements will be in place. The guarantee (bond( cost is usually a small percentage of actual cost of the infrastructure. There may be cases where other alternatives rather than a bond are available, and the City should examine its policies in assisting developers to use other alternatives to "meet project conditions. Internal review of deferred bonding was not supported because of perceived risk on the City to do that. However, there was support for the notion that the City should only request bonding when there is a high degree of certainty that bonding is necessary, and that it not be arbitrary. It was felt that initiation of bonding requests based on this premise, should address the issue being raised here by the Development Process Committee. Action: Refer to staff the subject of bond deferral for additional analysis in consultation with the City Attorney. Cost: To be determined in conjunction with any risk costs City may assume if committee's recommendation is implemented. Implementation Responsibility: City Community Development Department. Follow-up: Staff to report back to the City Council no later than August 15, 1993 4. City should use Its relationship with AQMD and other regulatory agencies to assist existing and new local businesses. Staff Comments: The City F�conomic Development Office has made a concerted effort to establish an active working relationship with AQMD and other regulatory agencies to assist businesses. There have been three AQMD public hearings on behalf of businesses the City participated in from . a pro-business standpoint. We convened a successful AQMD workshop in cooperation with the Santa Clarita Valley Chamber of Commerce in Santa Clarita this past year to help facilitate review, approval, and possible modification of.AQMD requirements. Action: Direct staff to develop a list of agencies in addition to AQMD, the City should be acting as liaison for local business; schedule additional informational workshops in Santa Clarita. Cost: Can be included in ongoing staff efforts. Implementation Responsibility: Economic Development Division of Community Development Department. Follow-up: City completion of action item by September 1, 1993; one workshop to be held prior to 1993 calendar year end. 5. Establish ombudsman position to assist businesses in going through the entitlement process. Staff Comments: Comments from the Economic Recovery Workshop suggest that the City of Santa Clarfta could create a strong competitive advantage it it could have a neutral, centralized position of contact within the Community Development Department to assist businesses in the entitlement process. This person would act as an advocate of developers or the business community addressing internal process issues of the City. Staff feels that such a position could assist in creating a more pro-business attitude perception for Santa Clarita, as well as enhance the City's stated customer service objectives. Action: Approve the concept and direct staff to develop an ombudsman -type position within the Community Development Department from existing staff resources. Cost: No new funding requirements are anticipated. Implementation Responsibility: Community Development Department. Follow-up: Have program in place and staff trained by September 1, 1993. Business Climate Committee: 1. The Sub -Committee recommends that the City Council appoint an ad hoc, ongoing, broad- based advisory group as a vehicle for communicating and educating the public concerning economic development within the City of Santa Clarita. In an effort to develop consensus (speak with a unified voice) the sub -committee has suggested participation by the following groups or Individuals: The Advisory Group would Include representation from the City Council, the Canyon Country Chamber of Commerce, the SCV Chamber of Commerce, the Valencia Industrial Association, Newhall Land and Farming and involvement by the participants from the Economic Recovery Workshop. • The Advisory Committee could meet on a quarterly basis, and receive reports from the Community Development Director, other committees such as the Film, Tourism and Chambers of Commerce Economic Development groups, as well as other city staff and governmental representatives. Feedback from the committee will be important and will be actively encouraged. • The Advisory Committee would review and comment on the strategic plan, policies and work efforts for Economic Development. While it is recognized this Advisory Committee has no decision-making authority, it may develop influence as a diverse, broad-based advisory body. • Periodically, after consensus has been reached on economic Issues, the Advisory Committee could address the City Council and may recommend a course of action. Annually, or as frequently as needed, a written report from the Advisory Committee will be given to -the City Council with concepts, suggestions and budgetary recommendations. Staff Comments: Staff agrees that an effort to pull together the many fragmented economic efforts and forums that currently exist in the community would be a valuable objective. This is an excellent basis to develop a trial private -public sector partnership for economic recovery in Santa Clarita. Several options are available for implementation: The Santa Clarita Valley Chambers Economic Development Committee is the most active group that regularly meets to address economic development issues only. They could be expanded to formally include the Canyon Country Chamber and others like Valencia Industrial Association. • An entirely new advisory committee could be formed based on the recommendation outlined by the Business Climate Committee. This year there will be major community -wide conferencestworkshops with an economic development theme or focus: 1) The College of the Canyons; 2) the Santa Clartta Valley Chamber of Commerce; and 3) the City of Santa Clarita. Possibly, one annual forum such as the Santa Clarita Valley Economic Outlook Conference could be utilized by all to focus in on economic. For example, this would provide the City an effective means to report to the business community; seek feedback and develop consensus around economic issues. Action: Direct staff to be available to participate in an effort to forma new Economic Development Advisory Group; and City Council encourage the private sector to take the lead informing anew broad-based economic development committee. Cost: None. Implementation Responsibility: Both Chambers of Commerce and other business leaders in the community. Follow-up: As determined 2. Staff recommends: 1) That a formalized business retention program would greatly enhance the local business climate; and 2) consideration of a formalized business retention call program to be coordinated by both the Canyon Country and Santa Clarita Valley Chambers of Commerce. Staff Comments: City staff agreesl Based on the results of several meetings with the Santa Clarita Valley Chamber of Commerce and the City's Development Department to determine where each could most effectively complement each in achieving economic development, there was consensus that the Chambers of Commerce could best lead the implementation of a -formalized business retention program. The City Economic Development Office offered to assist in developing and training for a retention call program, and to provide computer data management resources. Staff will also coordinate a centralized source to catalog retention call information. This would greatly expand the resources available to implement a comprehensive economic development program that could address both retention and attraction. Action: Direct staff to be available to continue participation in this effort to develop a formalized retention program; the Canyon Country and Santa Clarita Valley Chambers of Commerce are the lead agencies. Cost: Included in ongoing staff efforts. Implementation Responsibility: Canyon Country and Santa Clarita Valley Chambers of Commerce. Follow-up: As outlined above and as determined as joint retention efforts progress. Be Competitive Committee: 1. Schedules for all fees should be available to any applicant early In the development stage and secured for a 90 -day period. A City staff member should maintain a comprehensive listing of City development fees and provide estimates for non -City fees (i.e., utilities, etc.). A periodic comparison among other cities should be conducted by City staff on a periodic basis. City staff should forward Information on the appropriateness of development fee adjustments. Staff Comments: We agreel All development related fees should be made available to applicants in one location. This function can be incorporated into the ombudsman -type position responsibilities. Action: (1) Direct staff to prepare comprehensive fee information will be available at Community Development public counters by May 1, 1993, and reviewed and updated every six months thereafter; (2) a policy to guarantee the fees for 90 days will be presented to City Council in June 1993. Cost: Included in ongoing staff efforts in Community Development Department. Implementation Responsibility: City. Follow-up: An annual fee information report will be made to the City Council and available to the public. cnurwjt tt.ddp