HomeMy WebLinkAbout1996-06-11 - AGENDA REPORTS - NEWHALL IMPROV PGM (2)NEW BUSINESS
DATE:
SUBJECT:
DEPARTMENT:
BACKGROUND
AGENDA REPORT
City Manager Approval 7*
Item to be presented by:
George Caravalho
June 11, 1996
DOWNTOWN NEWHALL IMPROVEMENT PROGRAM
Community Development
On May 7, 1996 a study session was facilitated by Michael Freedman of the urban design firm, Freedman, Tung
and Bottomley (FTB) to discuss the "Downtown Newhall Improvement Program" that was developed over an
eighteen month time period and included seven public workshops,, a combined study session, and additional group
meetings between staff and property owners\mcrchants. The study session was attended by approximately two
hundred persons at the Newhall Senior Center..
The Downtown Newhall Improvement Program recommended by FTB includes the following:
• The establishment of design standards and guidelines that includes Victorian, Spanish and Western
architecture;
• A market analysis that recommends the creation of an attractive main street environment on San Fernando
Road that facilities a pedestrian -friendly commercial district;
• Redesigning San Fernando Road for 3-lane/2-way traffic and improving Railroad Avenue for trucks to slow
traffic on San Fernando Road and accommodate traffic as a major north/south artery through the City, and;
• Improving the parking supply by encouraging shared parking and constructing improvements that would
make existing parking areas attractive for customers.
A major component of the Program is the recommended financing strategy that identifies a $12 million program
broken into $6.3 million for Capital Improvements, and $5.7 million for Revitalization Programs. FTB has
identified the following funding sources: Assessment District/Business Improvement District ($1.5 million),
EDA/CDBG federal fiords ($2.8 million), and redevelopment monies ($7.7 million). FTB is recommending the
proposed "Broad -Based Redevelopment Districte'to establish the redevelopment funding component, This would
generate enough money to sell $7.5 million of bonds by Year 1 of the adopted program.
The comments raised by the audience at the May 7, 1996 study session included revitalizing Newhall in a timely
manner based on the time and resources that have been invested to date and the need to halt the current
disinvestment cycle in the district. Increased code enforcement in the area was recommended. It was
recommended to separate Canyon Country from the redevelopment proposal and conduct a similar process to
identify that area's needs. It was also recommended to pursue the creation of a Theater/Performing Arts District
that capitalizes on the community's existing performing arts organizations and expands the use of the Newhall
School auditorium.
E 0 Agenda Item:. � rI
Country from the redevelopment proposal and conduct a similar process to identify that
area's needs. It was also recommended to pursue the creation of a Theater/Performing Arts
District that capitalizes on the community's existing performing arts organizations and
expands the use of the Newhall School auditorium.
Among the issues raised by the merchants included the expansion of Railroad Avenue, the
use of angled parking, voluntary relocation, and continuous participation that includes the
merchants. Staff has received a copy of a letter from a merchant's group that prioritizes
certain improvements included in the Downtown Newhall Improvement Program. Among
the items identified is the elimination of any immediate plans for a couplet on San Fernando
Road with Railroad Avenue until traffic flow warrants it or until the very last phase of the
project development. Should this occur, staff recommends that the Council re -appropriate
the CDBG / EDA funds ($2.8 million) because of the specific time constraints associated with
these funds. It was also identified by the group to continue the public participation process
by forming a committee that includes property owners and merchants.
Since the study session, staff has received the attached "Errata Sheet" from FTB which
indicates minor clarifications to the Finance Strategy, particularly Table 6 which estimates
total monthly assessments for San Fernando Road properties.
Attached please find an executive summary of the "Downtown Newhall Improvement
Program" which provides additional detail on the issues identified in the document.
RECOMMENDATION
Staff recommends that the City Council: 1) Receive and adopt the report in concept; 2)
Authorize the formation of a redevelopment project area that would generate bond proceeds
of $8 million in Year 2 of an adopted program; 3) Authorize staff to retain consultant services
for environmental and redevelopment plan adoption; and 4) direct staff to continue the public
participation via a committee process that includes business and property owners in the
Newhall district.
ATTACHMENTS
Executive Summary
Memorandum from Michael Freedman
APV:
econdev\061196.ar
EXECUTIVE SUMMARY
The intent of the Downtown Newhall Improvement Program was to prepare a plan of action aimed
at revitalizing Downtown Newhall's economy, preserving and enhancing its historic heritage, and
insuring its vitality as a thriving community center. The "Downtown Newhall Improvement Program"
document prepared by Freedman, Tung and Bottomley (FTB) represents the completion of a public
workshop process and the conceptual planning phase of the revitalization effort, describing what the
community intends to accomplish and how its resources should be invested,
The Program describes a course of action that will result in the restoration of economic and physical
vitality to Downtown Newhall. The action plan is made up of a particular combination of community
sponsored policies, programs and projects designed to effect the behavior of the marketplace in a way
that begins to benefit Downtown Newhall.
The Revitalization Planning Process
The eighteen month process included seven public workshops, a joint City Council, Planning
Commission, and Parks and Recreation Commission workshop midway through the process, and
additional meetings between City staff and a group of property owners, merchants, and others. The
workshops were well advertised and well attended through an extensive notification program that
included: direct mail, print ads, public access television, and press releases. Spanish translation was
available for the Spanish-speaking audiences.
When it suggested by a property owners \ merchants group that the participation process was
inadequate, staff facilitated three additional group meetings (without Michael Freedman) to further
discuss the proposed Program,
The final component of the planning process was the May 7, 1996 study session held at the Newhall
Senior Center and attended by approximately two hundred persons. Issues identified by the public
included the need for increased code enforcement, the creation of a separate planning process and
redevelopment project area that benefits Canyon Country, and the creation of a Theater \ Performing
Arts district that capitalizes on the community's existing performing arts organizations and expands
the use of the Newhall School auditorium.
Revitalization Goals and Strategy
The Market Analysis that was prepared as part of the program identifies the economic trends that
have affected Downtown Newhall. Based on these trends, including the construction of newer retail
shopping centers in the area, FTB has identified the following eight basic Revitalization Goals'.
1. Expand the convenience and comparison / specialty economic niches.
2. Create an attractive Main Street environment on San Fernando Road to attract new shoppers
and businesses.
3, Create a memorable image that expresses Newhall's history and character.
4. Establish programs to promote private sector investment.
5. Enhance the role of Downtown Newhall as a community center.
6. Maintain and capitalize upon the visibility and access associated with through -traffic.
7. Improve parking supply.
Among these items is the intention to voluntary relocate existing auto uses in order to make way for
investment in specialty and convenience oriented businesses, and to create the kind of main street
environment envisioned by the community. FTB also recommends that the City assist with special
permitting needed to accommodate auto services in other locations, and possibly the packaging of
a large "auto service center" for multiple businesses.
In order to accomplish the revitalization goals, FTB recommends the following:
• Design Standards and Guidelines- Adopt standards consistent with traditional main street
environments that include Victorian, Spanish and Western architecture.
• Improve the Streetscape - This could include expanding the sidewalk on San Fernando Road
and providing ornamental street lights, new planters, new street trees, decorative paving and
kiosks.
• Create a Memorable Image that expresses Newhall's History and Character - The most
significant component of this notion is the proposed clock tower at the intersection of San
Fernando Road and Market Street.
• Circulation Improvements - Provide two-way traffic on both Railroad Avenue and San
Fernando Road, with three lanes (two through lanes and a shared center tum lane) on each
of the thoroughfares. It would allow for the diversion of truck traffic from the center of the
business district, and will allow the preservation of the two-way traffic convenient to local
shoppers. These improvements would require "couplet openings" at the northern and
southern ends of the district. Parallel parking will remain on both sides of the streets.
Parking Improvements - This includes making construction improvements to the existing
parking supply to make the areas attractive for shoppers, such as encouraging shared parking,
making aesthetic improvements behind buildings including alleys, and enhancing curbside
parking spaces. Angled parking was explored, but discouraged as part of the program
because of its affect on the community -wide circulation needs, as a major north / south artery.
FTB believes that this would require the diversion of between seventy to eighty percent of
through traffic to Railroad Avenue - creating a "Downtown Newhall bypass."
Other Recommended Capital Improvements - These are recommended to include the
"Newhall Town Plaza" at the northeast comer of San Fernando Road and Market Street, a
Downtown Transit Center at the southeast corner of Railroad Avenue and Market Street, and
improving the connection to Hart Park.
Revitalization Programs - these would include the following:
• Business Recruitment
• Business Relocation
• Facade Renovation
• Marketing
• Publicity and Special Events
• Technical Assistance
Financine
Estimated Costs
(Capital Improvements $63
Streetscape (i.e. clock tower, plaza) $3.3 M
Railroad Avenue expansion $3.0 M
(Revitalization Programs $5.7M)
Relocation
$1.5 M
Recruitment
$3.0 M
Facade Improvements
$0.5 M
Marketing
$0.5 M
Technical Assistanc
$0.2 M
Total
$12 M
Property Owners\Businesses $1.5 M
(Assessment District \ Business Improvement District)
Federal funding (CDBG\EDA) $2.8 M
Redevelopment $7.7 M
Total $12 M
Other financing options were explored and presented by Michael Freedman that included the use of
Utility User taxes, Business License taxes, City General Fund reallocation, and Private investment
acting alone. These options were voted against by the workshop participants.
A proposed Assessment District would generate funding through assessments on property owners,
based on lot area. According to the report, if all commercial and industrial properties in the district
were to pay equals rates to generate funding for $1.5 million, the annual assessment per square foot
would be $0.15. If these properties were expected to fund $750,000, the annual assessment per
square foot would be $0.07. Other options include the possibility of creating "Benefit Zones" where
properties which front on San Fernando Road could pay higher assessments at a 100%, 75%, or 50%
share of the total costs. It is estimated that the most common sized parcel along San Fernando Road
(6,250 sq. ft.) would require a monthly assessment of approximately $114 if it were responsible 75%
of the total cost.
A Business Improvement District (BID) would generate funding through annual assessments on each
business located within the. district. Based on the estimated 277 business, the report indicates that
each business would pay $465 per year to support the entire cost of $1.5 million, and $232 per year
to support the cost of $750,000.
FTB believes that it would be reasonable to divide $1.5 million equally between the two types of
districts, in order to share responsibility for funding between the property owners and business
owners. FTB assumes financing both districts at seven percent (7%) interest for a term of 25 years.
Freedman, Tung and Bottomley's Proposed Redevelopment Options
(based on a 20 year life)
I) Narrow Based Area (Downtown Newhall from 16th street to Highway 14)
• Year 2 supports bond proceeds of $1.2 million.
Year 5 supports bond proceeds of $3.2 million.
• Year 10 supports bond proceeds of $6,7 million.
• Year 20 supports bond proceeds of $12 million.
• It takes until Year 12 to have enough money to sell $7.7 million of bonds.
II) Moderate Based Area (All of Newhall, except Placenta Cyn.)
• Year 2 supports bond proceeds of $3.7 million.
• Year 5 supports bond proceeds of $9.5 million
• Year 10 supports bond proceeds of $20 million.
• Year 20 supports bond proceeds of $36 million.
• It takes until Year 4 to have enough money to sell $7.5 million of bonds.
111) Broad Based Area (All of Newhall -without Placenta Cyn. and portions of Canyon Country)
• Year 2 supports bond proceeds of $15 million.
• Year 5 supports bond proceeds of $40 million.
• Year 10 supports bond proceeds of $89 million.
• Year 20 supports bond proceeds of $176 million.
It takes until Year 1 to have enough money to sell $7.5 million of bonds.
Michael Freedman is recommending Option III because it generates at least $7.7 in two years to
accomplish immediate revitalization.
High Priority Actions
FTB recommends that the following steps be taken together and at once.
• City Council review and adoption of the Downtown Newhall Improvement Program.
• Set up funding mechanism.
• Build on existing momentum - Start Right Away.
• Set up development guidance system - Adopt the Downtown Newhall Development:
Standards & Guidelines.
• Make the town plaza happen.
• Insure all policies are working together.
econdcNczec.smy
93/U5 ao 1i;-11 t -i1 bot ''316121 COHQ
fR1F0MAN
T U N G 6
B0T10MLEY
Urban Design ,$ Planning
District Rev talization
Street a Plaza Design
MEMORANDUM
VIA FAX
DATE: May 22, 1996
TO: Mr. Alex Vasquez
Assistant Planner - Economic Development
City of Santa Clarita
FAX #: (805) 259-8125
FROM: Michael Freedman
(Our Fax S is 415-191-9455)
At PAGES: 5
RE: Downtown Newhall Improvements Program Financing Strategy Report Errata
Sheet
We have received the attached Financing Strategy Report Errata Sheet from Suzanne Lampert. if you
have any questions about this information, please do not hesitate to call. Best regards. -MF
47 Kearny Street
Suite Sao
San Francisca CA
941DB-5522
415.291.9455
a
10001
23'05 'fl6 11 11 FAX 662 2315121 COHO 0002
Downtown Newhall Improvement Program
Financing Strategy
Errata
Net, an e
List of Tables In the title of Tahle 11, insert "Cities" after "Cslifamia."
Paragraph titled "Twirl Assessment on Parcelt of Yarlans Mzrs": In the sentence
b4aaiag —fable 6," change "(ooe-tains and mnual)` to -(one-time and monthly).., In
the nest sentence, change "S586 per year" to "about $38 per murdh" and "$1,172 per
Year" to `about $76 per mnnth." In the last stntenee of the paragraph, chaagc "$879
per yea " to "357 per monthW' and "$1,758 per year" to it 14 per month."
With these changes, the paragraph will read as follows:
?ural Assessment on Parcels of Various Siter. The total assessment on each
PMPcrty would &Vatd on the Sias of the parceL 'fable 5 mrm awes the distribution
of parcel sizes in tho defined district. Tlx lablc indicans than nearly half of the parcel;
are 6,000 square feet or smaller, turd nmrly 70 percent arc 7,000 square feet or
smaller. Only 11 Parrele (less than 10 percent of the total) are largcrthan 15,000
squdm feet. Table 6 translate the levies cala,Wnrl in Table d arto the total assessment
(one-time and monthly) far vuiuus properties by applying the assessment per uprare
foot to selected parcel sizes. To goocraw sufficient rcvcuue W support a debt of
$750,000, a lot of the most commoa size — 6,250 square feet would pay an assess-
ment of about S38 per month if the COS13 art: allnated evenly among core and non-core
Properties; to support a debt of S1.5 mMotL it would pay about 576 per month. If the
cote Properties were respansiblc for 75 Pctccut ureunLs, then the Same lot would pay
$57 per month for the smaller cost and 5114 per month for the higher Lxrsl.
12 In the subuilo of Table 6, change the fust line fmm "Total Assessment Assuming" to
"Total Matnhly Assessra arts Assuming."
In the body of Table 6 (both parts), change the toW me __U and asscmlimuts
Pcr
syusrc foot to the figures Shown in the tattle on the following page.
23105 9tl 11:.4Y F:A1 66Y 2318121 COHQ
List of Tables
16 003
Title
1.
Estimated Cost of Revitalization
3
2,
Annual and Total Cost Of Revitalization with Debt Financing
4
3-
Illustrative Business Improvement District Assessments
9
4.
illustrative Assessment District Levies
10
5,
Distribution of Parcel Sizes
11
6.
Assessments for Selected Parcel'. Sizes: Parcels Fronting on San Fernando Road
12
7.
Potential Impact of Assessment District Levies on Commercial Rents in
Downtown Newhall
14
8,
Potential Funding: Strategy 2
1s
9.
Business License Tax as a Percent of General Fund Revenue:
Comparison of California Cities
21
10.
Business License Tax Revenue per Capita: Comparison of California Cities
22
11.
Selected California Cities with Utility Users Taxes in 1992-93
23
12.
Utility Users Tax Revenue as Percent of General Fund Revenue:
Comparison of California Cities
23
13.
Utility Users Tax Revenue per Capita: Comparison of Califomia Cities
24
14.
Potential Funding, Strategy 3
26
15.
Comparison of Projected Revenue and Funding Capacity
for Alternate Redevelopment project Areas
27
16.
Summary of Tax Increments: Narrow -based Redevelopment Area
30
17-
Potential Funding: Strategy 4
33
18.
Summary of Tax Increments: Moderate -based Redevelopment Area
34
19-
Potential Funding: Strategy 5
37
20.
Summary of Tax Increments: Broad-based Redevelopment Area
38
21.
Potential Funding. Strategy 6
41
22•
Capital Projects Budgeted -for 1995-96 through 1997-98:
Sources of Revenue Poteatially Available for Reassignment to Newhall Projects
43
23,
Capital Projects Budgeted for 1995-96 through 1997-98:
Projects Funded by Reveme Potentially Available for Reassignment to Newhall Projects
44
24,
Recommended Financing Strategy for Downtown Newhall Revitalimtion
47
16 003
23/05 96 11:12 FAS 662 2313121 COHQ
(equivalent to an assumption that the district would include only those properties with frontage on San Fer-
nando Road), than they would have to pay $0.29 per square foot per year to repay a debt of $1.5 million.
7tn act of an Assessment District To understand the meaning of the estimated assessment$ per
square foot to owners of property in Downtown Newhall, it is useful to examine (1) the total levy tbat
would be assessed on parcels of various sizes, (2) the ratio of debt to the assessment base of the dist i
and (3) the impact of the levy on average rents, assuming than property owners would be able to pass
through the levy to their tenants.
Total Assessment on Parcels of various Sizes The total assessment on each property would depend
on the size of the parcel Table 5 summarizes the distribution of parcel sizes in the defined district The
table indicates that nearly half of the parcels are 6,000 square feet or smaller, and nearly 70 percent are
7,000 square feet or smaller. Only 11 parcels (less than 10 percent of the total) are larger than 15,000
square feet.
Table 5
Distribution of Parcel Sizes
Lot Area (Sq. Ft)
Parcels
ane
Number
Percent
Cum. Pct
0 - 1,000
2
1.7°/n
1.7%
1,001 - 2,000
2
1.7%
3.4%
2,001 - 3,000
13
11.0%
14,4%
3,001 - 4,000
21
17.8%
32.2%
4,001 - 5,000
.4
3,4%
35.6%
5,001 - 6,000
12
10.2%
45.8%
6,001 - 7,000
28
23.7%
69.5%
7,001 - 8,000
5
4.2%
73.7%
8,001 - 9,000
1
0.8%
74.6%
9,001 - 10,000
8
6.8%
81 45/o
10,001 - 12,500
6
5.1%
86.4%
12,501 - 15,000
5
4.2%
90.7%
15,001 - 17,500
3
2.5%
93.2%
17,501 - 20,000
5
4.2%
97.5%
20,001 - 30,000
1
0.8%
983%
30,001 +
2
1.7%
100.0%
Total
118
.100.0%
S`4'c ae-.,' ateS bawd
one ssmWes parcel maps.
Table 6 translate the levies calculated is Table 4 into the total assessment (one-time and monthly) for
various properties by applying the assessment per square fact to selected parcel sizes. To generate
sufficient revenue to support a debt of 5750,000, a lot of the most common size - 6,250 square feet -
would pay an assessment of about S38 per month if the costs are allocated evenly among core and non-core
properties; to support a debt of S1.5 ndllion, it would pay about S76 per month. If the core properties were
responsible for 75 percent of costs, then the same lot would pay $57 per month for the smaller cost and
S 114 per mouth for the higher cost
11
Z004
23/05 '96 11: 43 F.k1 662 2318121 COHO
Table 6
Assessments for Selected Parcel Sizes: Parcels Fronting on San Fernando Road
Total Monthly Assessment Assuming
San Fernando_Road Properties' Share of Tota] Cost is:
Assessment District to Pay for 5750, 000 ofRewralization Strategy Costs
Parcel Size
(SCI. Ft.)
875
2,625
3,125
5,250
6,250
6,750
10,000
12,500
15,000
18,870
28,688
34,740
40,500
100%
Total
Per So. Ft.
$10.67
50.012
32.00
0.012
38.10
0.012
64.00
0.012
76.19
0.012
82.29
0.012
121.91
0.012
152.39
0.012
182.86
0.012
230.04
0.012
349.73
0.012
423.51
0.012
493.73
0.012
75%
Total
Per Sq. Ft.
58.00
50.009
24.00
0.009
28.57
0.009
48.00
0.009
57.14
0.009
61.72
0.009
91.43
0,009
11429
0.009
137.15
0.009
172.53
0.009
26229
0-009
317.63
0.009
370.30
0.009
Assessment District to Pay for $1.5Million ofReWtahzation Strategy Costs
Parcel Size
(Sq. Ft.
875
2,625
3,125
5,250
6,250
6,750
10,000
12,500
15,000
18,870
28,688
34,740
40,500
75%
Total
100%
Total
Per Sq. Ft
$21.33
50.024
64.00
0.024
76.19
0.024
128.00
0.024
152.39
0.024
164.58
0,024
243.82
0.024
304.77
0.024
365.73
0.024
460.08
0.024
699,45
0.024
847.02
0.024
987-46
0.024
75%
Total
Per So, Ft
516.00
SO.018
48.00
0.018
57.14
0.018
96-00
0.018
114.29
0.018
123-43
0.018
182.86
0.018
228.58
0.018
274.29
0.018
345.06
0.018
524.59
0.018
635.27
0.018
740.60
0.018
50%
Total
Per So. Ft.
$5.33
50.006
16.00
0.006
1905.
0.006
32.00
0,006
38.10
0.006
41.14
0.006
60.95
0.006
76.19
0.006
91.43
0.006
115.02
0.006
174.86
0.006
211.76
0.006
246.37
0.006
500/0
Total
Per Sq. Ft.
$10.67
$0.012
32.00
0.012
38.10
0.012
64.00
0.012 -
76.19
0.012
82.29
0.012
121.91
0.012
152.39
0.012
182.86
0.012
230.04
0.012
349.73
0.012
423.51
0.012
493-73
0.012
Note; The most common parcel sizes are 3,125 sq. R (10 parcels) and 6,250 sq. @. (21 parcels).
Annual cost asmmmcs financing at 7 pacer interest for a tam of 25 years.
IOUtr& M=d=& AssacmIes.
12