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Public Hearing ~- Amendr~ent of Downtown <br />Management District Plan, Management agreement <br />with Downtown Inc., and loan Agreement <br />lay ~.~, 209 <br />Page <br />~~~USI~1~ <br />~n December 1,5~ OO, the city council adopted a resolution establishing <br />the Downtown ,Santa Ana community ~Ianagemer~t Dzstr.ict ~CNlD~ and the levy <br />~~ an assessment of the property owners within the D~.str~,ct to fund <br />var~.ous act,~vities in the Downtown. The ~~~ plan provided that the <br />initial tai assessment was to be levied in F ~~-~9, and the operating <br />term of the cMD w~ ~a~luary 1 f ~0~ t0 Dece~rlber 1, ~~.~, <br />Downtown Inc. is the newly created non~prof~,t organa~~atio~n that will <br />oversee the expenditure of the assessments collected during the five <br />dear term of the c~lD, The Hoard of Downtown Inc. recently taa an <br />action to defer the assessment levy until FY ~~~--~.~~ with the first <br />install~aent being due in ~ctobea~ ~~ The Hoard felt that the new <br />assessment nay place an undue hardship an the property owners ~.n the cMD <br />due to current challenging economic conditions. This charge in <br />assessment levy necessitates an amendment to the cMD plan approved by <br />the pity council ~Ehibit ~.~ . Further, the operating term of the c~ID <br />must also be modified to now reflect January ~., bolo to December 1, <br />X14. <br />Since the deferral. of the first year' s assessment to the property owners <br />~.n the 1~D would net y~.eld funds until January X010, each director on <br />the Board has agreed to made a loan to the corporation in artier to begin <br />implementat~.or~ of the cMD activities in calendar year ~~~~. The loans <br />are based on the ar~aunt of the first year' s assessment and wi11. be <br />repaid by the fifth gear. These loans gill generate approximately <br />~.~~, boo, which w~.11 be used for administrative, aperatzng, corporate <br />start-ups and ~tarl~eting~promational. activities as outlined on Exhibit , <br />The funds will enable Downtown Inc. to hire a new f fu1.1-time Executive <br />Director along with a support staff person as weld. as assuming certain <br />basic services currently provided by the city, <br />The c~,ty ,is the rec~.p~.ert of the annum. property tai assessments <br />therefore it is necessary to eater into a management agreement with <br />Downtown Inc. to oversee the implementation of the fzveTyear program as <br />authorised when the cMD was established. The decision to levy the <br />assessment w.i~.x be determined by the city council on an annual basis and <br />w~.ll be based on a program budget developed by Downtown Inc. <br />3-2 <br />