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HomeMy WebLinkAbout1999-02-09 - AGENDA REPORTS - DOWNTOWN NEWHALL FACADE PGM (2)DATE: SUBJECT: DEPARTMENT: AGENDA REPORT Executive Director Item to be present February 9, 1999 DOWNTOWN NEWHALL FAQADE IMPROVEMENT PROGRAM Newhall Redevelopment Project RECOMMENDED ACTION Adopt Resolution No. RDA 99-2, approving the Downtown Newhall Fagade Incentive Program, which would include the staff recommended alternative to allow pre- existing legal uses to participate in the Program for an eighteen -month period. BACKGROUND The overriding objective of the Downtown Newhall Improvement Program and Newhall Redevelopment Plan is to eliminate or alleviate blighting conditions within the project area. One method in which to eventually achieve this objective is the offering of incentives to property owners and merchants to improve existing buildings/properties within the affected area. In an effort to implement the recommendations of the Freedman Plan and Newhall Redevelopment Plan, the Council and Committee identified several "high priority" projects. A fagade improvement program is identified as one of these "high priority" projects. A copy of the Downtown Newhall Fagade Improvement Program has been included in the Council packet. A summary is also attached to this agenda report and staff will provide a detailed overview of the Program at the meeting. Staff expects three to four property owners or merchants to take advantage of the Program this fiscal year, which would have a significant impact on the physical appearance of Downtown Newhall. If approved, staff and the Committee would review the Program at the end of the fiscal year and report back to the Agency on its effectiveness and any need for changes. Newhall Redevelopment Committee Action Staff and the Design Sub -Committee have been working on the elements of a fagade improvement program over the last six months. As part of the formulation of the Agenda bm, program, staff contacted numerous redevelopment agencies to obtain information on their fagade improvement programs. Many of the agencies contacted offer this or a similar type of commercial rehabilitation incentive program. Most of these programs have been very successful in improving the physical appearance of the program area and have triggered significant private investment. At its December meeting, the Committee completed its review of the Downtown Newhall Fagade Improvement Program, recommending approval of the Program to the Agency. Eligibility / Pre -Existing Legal Uses One of the more prominent issues raised by the Committee during their discussions on the Program was whether to exclude pre-existing legal uses (such as automotive uses) from participating in the Program. Though these types of uses are not considered a part of the long-term picture for Downtown Newhall, the Committee strongly felt that it was necessary to include them in this Program. They believed that the primary goal of the Program was to improve the aesthetics of Downtown Newhall and to exclude pre-existing legal uses from this Program would discourage these and other nearby owners or merchants from "fixing up" their buildings. The Committee pointed out that approximately 30% of the uses in Downtown Newhall are considered pre-existing legal and excluding them from participating could be detrimental to the effectiveness of this Program. Staff is concerned with allowing pre-existing legal uses to participate in the Program. Offering an incentive to owners or merchants operating a pre-existing legal use may encourage these uses to remain in Downtown Newhall for a longer period of time, which may be detrimental to the overall revitalization plan. The City has continually indicated that we will not "force out" pre-existing legal uses in Downtown Newhall and would rather let the "market" complete this action over time due to revitalization. However, a property owner or merchant who has recently made a significant investment into a building may be less likely to abandon the use in the future. A staff recommended alternative to this issue would include the establishment of an eighteen -month time period in which pre-existing legal uses could apply for assistance from this Program. At the end of this time period, a pre-existing use would be excluded from participating in the Program. With this alternative, the Agency may provide short-term assistance for facade improvements to pre-existing legal uses, which may improve the effectiveness of the Program. Additionally, it would prevent pre-existing legal uses from utilizing the program in the future when the use mix and "market" begin to change in Downtown Newhall. ALTERNATIVE ACTIONS 1) Do not approve the Program at this time 2) Direct staff to revise the Program. 3) Other action as directed by the Agency. FISCAL IMPACT The City Council approved a mid -year budget adjustment in the amount of $125,000 in the Redevelopment Contractual Services Account (1900-8001) to accommodate this program for the remainder of the fiscal year. These funds are a part of the $500,000 loaned to the Agency for operation over the next three years. Summary — Downtown Newhall Fagade Improvement Program Resolution No. RDA 99-2 GEA: nwh1ydv\ar012699 SUMMARY DOWNTOWN NEWHALL FAQADE IMPROVEMENT PROGRAM The following summary touches on some of the more important elements of the Downtown Newhall Fagade Improvement Program. PROGRAM OBJECTIVE The overriding objective of the Downtown Newhall Improvement Program and Newhall Redevelopment Plan is the elimination of blighting conditions within the project area. The Fagade Improvement Program would create an avenue for property owners and merchants within Downtown Newhall to work in partnership with the Agency to improve the physical appearance of the area and assist with the elimination or alleviation of blighting conditions. The Fagade Program would provide a financial mechanism by which the Agency can assist, complement, and coordinate public and private development, redevelopment, revitalization and overall enhancement of the area. PROGRAM AREA The Program area would include those properties fronting on San Fernando Road and Railroad Avenue between 4`" Street and Lyons Avenue. A map is attached. PROGRAM DESCRIPTION Through this program, eligible business/property owners would be encouraged to improve the exterior appearance of their buildings consistent with the Downtown Newhall Design Guidelines, Downtown Newhall Special Standards, Newhall Redevelopment Plan and Downtown Newhall Improvement Program. Additionally, signage would have to be brought into conformance with the Special Standards. The program is expected to result in the enhancement and improvement of the Downtown commercial core. Under this Program, the Agency would hire an architect on an as needed basis to provide preliminary technical assistance to the Agency and each participant. The Executive Director (upon recommendation from the Newhall Redevelopment Committee) would be delegated the approving authority on all applications for assistance. Appeals of their decisions would be forwarded to the Agency for consideration. Expenses eligible for rebate under the program would include those related to fagade restoration (including signage), general building architectural enhancements, new windows, awnings, utility relocation, exterior lighting, building and planning permits, new entrances, design expenses, visible roofs and any exterior improvements related to handicapped accessibility requirements. With the exclusion of permitting and design costs, all of the above listed eligible improvements would be made to the exterior of the building. Interior improvements would not be eligible under this program. Additionally, new development would not be eligible under this program. The Program would be retroactive to include any eligible work completed in 1998. The Program provides that funding would be available on a limited basis and that business/property owners would be eligible to participate on a first-come, first- served basis. Staff will return to the Agency in several months with a separate "Screening Program" for Agency consideration. This Program is being created to encourage property owners to screen unattractive areas from public view. FINANCIAL ASSISTANCE PROCEDURE For purposes of this program, a project would be defined as a 50 -foot storefront. Assistance for each storefront would be provided as follows: a) Fifty -percent of the total eligible project costs for projects costing up to $25,000. b) An additional twenty-five percent of the total eligible project costs for project costs between $25,000 and $75,000. c) The maximum assistance provided on a project would be $25,000 and the minimum assistance would be $500. HOW THE PROGRAM WORKS The business/property owner would work with staff, the Newhall Redevelopment Design Sub -Committee and the Agency -hired architect during the preliminary stages. This work would result in the creation of a conceptual plan. The business/property owner would then be responsible for the hiring of an architect to develop formal building plans. The Design Sub -Committee would then approve these plans prior to construction. The full Committee would be responsible for approving the formal application for assistance. The business/property owner would then be responsible for hiring his or her own contractor to complete the work. Staff has also added protections within the Program that require the applicant to maintain the fagade or improvements in an acceptable manner. Failure on the part of the participant to maintain the fagade or improvements may result in the Agency determining that the structure is a public nuisance subject to abatement by the Agency. The Agency could then complete the necessary maintenance work and bill the property owner or assess the cost of the work on property taxes. GEA: Nwhlydv\s mfcd Exhibit "A" CITY OF SANTA CLARITA REDEVELOPMENT AGENCY DOWNTOWN NEWHALL FAQADE IMPROVEMENT PROGRAM The Newhall Redevelopment Agency adopted the Newhall Redevelopment Plan and the Downtown Newhall Improvement Program in order to improve the physical appearance and economic conditions in the project area, including Downtown Newhall. The Fagade Improvement Program creates an avenue for property owners and businesses to work in partnership with the Santa Clarita Redevelopment Agency to improve the physical appearance of buildings within the Downtown Newhall commercial core. This Program utilizes redevelopment funds to promote fagade and signage improvements throughout Downtown Newhall. The primary goals of redevelopment are to eliminate blighted conditions in the physical appearance of Downtown, and to improve the economic vitality of the area. The Fagade Program provides a financial mechanism by which the Agency can assist, complement and coordinate public and private development, redevelopment, revitalization and enhancement of the community. The rehabilitation of old, obsolescent, and deteriorating structures in the Downtown will result in the creation of an attractive "Main Street" shopping environment. This Fagade Improvement Program exists to encourage cooperation and participation of Downtown Newhall property owners and businesses with the Agency. The Agency and Downtown Newhall businesses share the goal of creating an economically vital "Main Street" shopping district. The Fagade Improvement Program provides a method to reach these shared goals and objectives. 1. PROGRAM GOALS a) Implement the Newhall Redevelopment Plan and the Downtown Newhall Improvement Program which encourage improvements to Downtown Newhall that upgrade the physical appearance of the area. b) Utilize redevelopment funds to promote private investment in fagade and signage improvements throughout the Downtown in order to eliminate blighting conditions and improve commercial vitality in the area. c) Create an attractive "Main Street" environment in the Downtown to attract new shoppers and businesses. d) Create an attractive, memorable image that expresses Downtown Newhall's history and character. 2. PROGRAM OBJECTIVES a) Encourage the cooperation and participation of Downtown Newhall property owners in the elimination of blighting conditions and the promotion of new or improved development in the area. b) Provide a financial mechanism by which the Agency can assist, complement and coordinate public and private development, redevelopment, revitalization and enhancement of the community. c) Develop and implement programs and incentives for the rehabilitation of old, obsolescent, and deteriorating structures within the area. 3. PROGRAM AREA The Program Area includes those properties fronting on San Fernando Road and Railroad Avenue from e Street to Lyons Avenue. 4. PROGRAM DESCRIPTION Through this program, eligible business/property owners will be encouraged to improve the exterior appearance of their buildings consistent with the Downtown Newhall Design Guidelines, Downtown Newhall Special Standards, Newhall Redevelopment Plan and Downtown Newhall Improvement Program. This program is expected to result in the enhancement and improvement of the Downtown Newhall commercial district. The Program will be retroactive to include any eligible work completed in 1998. In an effort to assist with the successful implementation of this program, the Santa Clarita Redevelopment Agency will hire an architect to provide preliminary technical assistance to the City and each participant. The Newhall Redevelopment Committee (Design Sub -Committee) must approve all applications. All signage associated with the business or property shall be brought into conformance with the Downtown Newhall Special Standards District. Expenses eligible for rebate under this program include: a) Fagade restoration (front and rear), including signage b) Architectural enhancements c) New Windows d) Awnings e) Utility relocation f) Exterior lighting g) Building and Planning Permits h) New entrances i) Architectural design expenses (provided that the improvement is constructed) D Visible Roofs k) Exterior improvements related to handicapped accessibility requirements 5. FINANCIAL ASSISTANCE PROCEDURE The Santa Clarita Redevelopment Agency will provide the following assistance to eligible businesses and/or property owners for a project within the Program Area for approved eligible renovations of existing buildings. For purposes of this Program, a project is defined as a 50 -foot storefront. Assistance for each storefront shall be as follows: a) Fifty -percent of the total eligible project cost for project costs up to $25,000. b) An additional twenty-five percent of the total eligible project costs for project costs between $25,000 and $75,000. c) If the total eligible costs exceed $75,000 the maximum assistance shall be $25,000. d) Regardless of the above, the minimum amount of assistance to each property owner/business shall be $500. Examples of how the amount will be calculated: Example #1: A property owner or business adds new signs, awnings, and repaints his/her storefront. The total cost for the design, construction and installation is $10,000. Calculation of assistance funds: $10,000 total eligible costs x 50% _ $5,000; total funds to property or business owner = $5,000 Example #2: A property owner completely renovates the exterior of his/her building (which includes two storefronts totaling 100 linear feet in width) including the addition of numerous architectural features. The total design and renovation costs amount to $30,000 per storefront. Calculation of assistance funds : First $25,000 of eligible project costs x 50% _ $12,500; remaining eligible project costs are $5,000 x 25% _ $1,250; funds to property owner or business per storefront= $13,750; total funds to property owner or business = $27,500 Payment of Assistance Funds — Disbursement Procedures a) Projects Costing Up to $10,000 — payments will be issued on the following schedule: 1) 1/3 of the Agency contribution will be issued upon completion of 1/3 of the project. 2) An additional 1/3 of the Agency contribution will be issued upon completion of 2/3 of the project. 3) The remaining balance will be issued upon 100% completion of the project, which includes the release of all mechanic liens on the project. b) Projects Costing Over $10,000 — payments will be issued on the following schedule: 1) 20% of the Agency contribution upon approval of the application. 2) Balance of the Agency contribution at 100% completion of the project, which includes the release of all mechanic liens on the project. In either case, the applicant shall be required to submit payment request letters with supporting documents including cancelled checks, detailed invoices and photographs of the completed work to the City of Santa Clarita Redevelopment Agency. Agency staff will review and approve this information to ensure conformance with the approved application, plans, and other requirements of this Program prior to issuing funds to the applicant. Failure of the participant to complete the improvements in accordance with the approval shall result in the repayment to the Santa Clarita Redevelopment Agency of funds forwarded to the participant. All work must be complete and inspected by the City to ensure that all improvements are in place as indicated in the written request and application. A business/property owner must submit appropriate receipts, lien releases and proof of payment in order to receive this assistance. 6. HOW THE PROGRAM WORKS The Agency will hire an architect to prepare preliminary schematic design development sketches for buildings within the Program Area. The property owner and/or business may utilize these sketches in their formal design drawings. The Agency- hired architect will also be made available to the property owner/business for technical consultation during the preliminary stage of each project. The property owner/business will be responsible for the hiring of an architect (or other designer) to develop the formal building plans for the fagade improvements. The Design Sub -Committee prior to initiation of the project must approve these plans. The cost of architectural services is an eligible expense within the program. The property owner and/or business will be allowed to select his/her own contractor for completion of the fagade improvements and/or construction of other eligible exterior improvements. After completion of all work, the Agency requires that the applicant (property owner and/or merchant) maintain the fagade or improvement in an acceptable manner for a minimum period of five to ten years depending upon the amount of funds provided. Failure on the part of the participant to maintain the fagade in an acceptable manner shall result in a formal notice from the Agency to the applicant and property owner requiring correction of the situation by providing the maintenance at a level that meets the Agency standards. Failure of the applicant and property owner to take the steps necessary to bring the fagade into compliance within sixty (60) days will constitute a public nuisance that is subject to abatement by the Agency. This provision includes the right of the Agency, upon failure to comply with the notice, to repair or rehabilitate the nuisance. The Agency has the right to enter upon the property for the purpose of performing this work and thereafter demand, collect and/or assess the cost of the work against the property on its property tax bill. 7. ELIGIBILITY The Santa Clarita Redevelopment Agency will make funding for this program available on a limited basis. Therefore, eligible businesses/property owners are encouraged to apply immediately for consideration. Submittal of an application by an eligible business/property owner does not guarantee participation by the Agency. All businesses and property owners located within the Program Area will be eligible to participate in the program on a first-come, first-served basis. If a tenant business is requesting the assistance, the legal property owner of the building will be required to consent to participation by the business owner within the program. All tenant businesses must also have a current business license, if applicable, to be eligible for program assistance. All fagade improvements must be consistent with the goals and objectives of the Downtown Newhall Design Guidelines, Downtown Newhall Special Standards, Downtown Newhall Improvement Program and Newhall Redevelopment Plan, and must be approved by the City. S. EXCLUSIONS The following businesses/properties, or projects, are not eligible for assistance through the subject program: a. New construction b. Interior improvements 9. PARTICIPANT REQUIREMENTS a) Participant shall be required to maintain the fagade improvements in accordance with the terms established in the approved application. b) Notarized letter of approval from the property owner when the applicant/participant is not the property owner. The property owner shall provide a signed letter which at a minimum states that " the property owner is aware of the project, consents to the applicant making improvements and will maintain the improvements if the applicant fails to ." c) Certificate of Additional Insured for general liability on the applicant's policy naming the City of Santa Clarita and Santa Clarita Redevelopment Agency as an additional insured with at least $500,000 in coverage. 10. APPLICATION/APPROVAL PROCESS a) Set up a preliminary project review meeting with staff and the Agency -hired architect. b) Submit conceptual drawings and schedule a preliminary review before the Design Sub -Committee. c) Complete and submit a formal facade/storefront improvement application and provide: 1) a copy of a current business license (if applicable), 2) proof of property ownership (if you are not the property owner you must submit the consent letter from the owner), 3) photographs of the existing fagade/storefront and photographs of facades of adjacent buildings, 4) drawings or sketch of proposed exterior improvements, and 5) three complete bids for the work to be performed. d) Once the Design Sub -Committee and City have approved the construction plans, the business/property owner will receive an assistance "commitment" letter from the Agency. The business/property owner may then proceed with the improvements. All work must be completed within six months of issuance of the commitment letter. Assistance disbursement shall be in accordance with this Program. 11. CONCLUSION If you are interested in participating in this Program established for existing buildings with the Program Area, pick up an application form at the Planning and Building Services Department located at 23920 Valencia Boulevard, Santa Clarita, CA 91355. If you should have any questions regarding the Program or application process please feel free to contact Glenn Adamick, Economic Development Associate, at the City of Santa Clarita (805) 255-4352. GEA: Nwhlydv\Rdpro Exhibit "A" rl 2