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HomeMy WebLinkAbout2018-08-20 ECONOMIC DEVELOPMENT, INFRASTRUCTURE , BUDGET & TECHNOLOGYCITY OF SANTA ANA CITY COUNCIL COMMITTEE ON ECONOMIC DEVELOPMENT, INFRASTRUCTURE, BUDGET AND TECHNOLOGY SPECIAL MEETING MINUTES CALL TO ORDER: ATTENDANCE: MEMBERS ABSENT: STAFF PRESENT: AUGUST 20, 2018 City Hall 20 Civic Center Plaza, Room 1600 Santa Ana, CA 5:06 D.M. Council Committee members: Michele Martinez, Chairperson P. David Benavides (5:11 PM) Vicente Sarmiento None Raul Godinez II, CMO Jorge Garcia, CMO Steven A. Mendoza. CDA Sergio Vidal, FMSA Jack Ciulla, ITD Candida Neal, PBA Teresa Ramirez, FMSA Mario Espindola, PBA Fuad Sweiss, PWA Nabil Saba, PWA Marc Morley, CDA Verny Carvajal, PBA Gabriela Lomeli, PWA Julie Castro -Cardenas, CMO Daisy Perez, CMO GUESTS PRESENT: Lucy Santana, Relampago del Cielo; Amanda Aguilar, Relampago del Cielo; Peter Whittingham, WPAA; Bruce Hamlin, Guaranty Chevrolet; Mike Harrah, Caribou Industries; John Sackriston, OCADA; Martin Howard, Howard CDM; Steven Phillips, Howard CDM; Jennifer Le, Howard CDM; Dawn Reese, The Wooden Floor; Christie Fischetti, CM Partners Group; Ralph Opacic, OCSA; Teren Shaffer, OCSA; Michael Bohn, Studio III; Brian Heney, The Sound; Terry Miller, The Sound; Bethany Scheiner, The Sound; Bela Gecsey, The Sound; John Parker, Visioneering Studios; Alex Jung, City Fabrick; Kyle Paine, Community Development Partners; Chris Schmidt; Jan Van Diis August 20, 2018 1 Economic Development, Infrastructure, Budget & Technology Minutes AGENDA DISCUSSION ITEMS MOTION: Sarmiento SECOND: Martinez VOTE: AYES: Martinez, Sarmiento (2) NOES: None (0) ABSENT: Benavides (1) 1. Approval of Minutes from Regular Economic Development, Infrastructure, Budget and Technology Committee Meeting of May 14, 2018. 2. Approval of Minutes from Special Economic Development, Infrastructure, Budget and Technology Committee Meeting of June 14, 2018. (Item 5 taken out of order) 5. Santa Ana Resident Vehicle Incentive Program — Staff Recommendations (Strategic Plan No. 3, 1f) - (CDA) Steven A. Mendoza, Community Development Executive Director, provided presentation on the Santa Ana Resident Vehicle Incentive Program — The Orange County Auto Dealers Association requested from the City to develop a Resident Vehicle Incentive Program where Council Members directed staff to expand the "Shop Local Program". The VIP Program is to offer a $500 rebate to Santa Ana residents who purchases a new or pre -owned automobile from a franchise Santa Ana Auto Dealership. The VIP Program becomes a new component of the "Shop Santa Ana" encouraging residents to spend the $500 in our local shops and restaurants. It will help boost our local economy. It will also provide an opportunity for the local auto dealerships to expand increasing the number of jobs for our residents. Details of how the money will be reimburse to the dealerships still in progress. It will be effective upon Voter approval of Measure X. The VIP Program will exclude leases. Franchised dealerships only within the City boundaries. They will exclude dealers with city agreements. Looking at budgeting $100,000 annually for the rebate and $25,000 for marketing. After feedback tonight, we will come with a final draft at City Council Meeting on September 18th for consideration. And start on April 1st, 2019 with a 5 -year extension. Peter Whittingham, Founder and CEO of Whittingham Public Affairs Advisors spoke in support of the Vehicle Incentive Program. Suggested the program run the length of the sales tax. Mr. Whittingham stated that the rebate will go to the residents not the dealers. Suggested that those dealers that have incentives directly with the City be excluded. The city will still receive the share of the existing sales tax from the proceeds of sales to the Santa Ana residents. Mr. Whittingham encourages to include Leases to the program as these vehicles are higher priced, more money spent, more revenue to the city. Question and answer period ensued. August 20, 2018 1 Economic Development, Infrastructure, Budget & Technology Minutes John Sackriston'Executive Director of OCADA there are 10 dealerships in Santa Ana. Provided information about dealers with more expensive cars i.e. BMW will have less rebates than that of less expensive vehicles such as Honda. Westminster $500 was proportion to the sales tax increase on an average vehicle purchase. Leases are 1/3 of all vehicles sold. Make it consistent. The need of the program the majority the sales tax is where you buy not where you live. When the increase of sales tax is increase it affects the consumer. Question and answer period ensued. Bruce Hamlin, Owner of Guaranty Chevrolet implored to approve this program. Most people think that where they buy product is what the sales tax is what sales tax is what they are paying for. Added 33% of sales go to residents of Santa Ana. 20% of sales area leases, the tax is based on the payment. Added that Santa Ana residents tend to lease car more often since the payments are more affordable and a sales tax increase will affect these consumers. Looking at the $500 rebate looks more appealing to the consumers helping the vehicle sales increase. Keeping the business in Santa Ana. Raul Godinez, City Manager mentioned that lease situation is different. Provided an example of the sales tax on a purchase versus a lease. Added that Westminster is only considering the incentive program for purchases. They will look into leases differently. Committee Member Benavides, spoke in support of the incentive as a positive motive to encourage residents to continue shopping in Santa Ana. He would like for the program to re -consider the cap. Asked if the source of funds will come from General Funds. Jorge Garcia, Assistant to the City Manager explained that the source of the fund will come from the General Fund come in as sales tax dollars. The details of how the funds will come in still in the planning stage with the Finance Department. Added that the sales tax increase. The VIP Program will begin on April 1, 2019. Mr. Garcia explained that the dealers with the tax incentives are not similar to purchases. Incentive 1 will benefit residents; Incentive 2 will benefit dealerships. Committee Member Benavides, suggested the cap to be removed or increase if staff sees the need to for a cap. Encourages to include leases into the VIP program. He would like to see the program to extend to 10 years. Steven Mendoza explained that the VIP Program is to benefit the residents of Santa Ana. Other incentive programs are mainly for dealerships to invest in their property. Committee Member Sarmiento, making sure there is no impact on stakeholders. The VIP program will proceed upon passing the sales tax increase. Inquired about the data purchases of new vehicles versus pre -owned, do they lease more. Wants to make sure the measures taken will tailored to our demographics. Asked what happens to the independent dealerships as it is known that the majority of vehicle sales come from the August 20, 2018 1 Economic Development, Infrastructure, Budget & Technology Minutes independent dealerships. He would like for staff to seek some kind of agreement with the independent dealerships to be included in the VIP Program. Chair Martinez provided a background on the sales tax and property tax that comes into the city of Santa Ana and how businesses and residents are affected. Added that if the city files bankruptcy it does not look good for anybody. In order for Santa Ana to be a successful city we all need to look at it as a whole. Stated that before looking at programs as the VIP program, to look at where Santa Ana is going. As a resident she cares for the community. Stated that she was not against the program but to bring things into context. Committee Member Sarmiento added that they have made difficult decisions and always looking at what is best for the residents and local businesses. (Item 7 taken out of order) 7. Update on the YMCA RFP (Strategic Plan No. 3, 5a) - (CDA) Steven Mendoza, Executive Director of Community Development, provided a background on the YMCA building. Four presenters will provide proposals which will be rated during their presentations then they will move forward for City Council recommendation. Question and answer period ensued. PUBLIC COMMENTS • Lucy Santana, resident of Santa Ana and Board Chair of Relampago del Cielo, spoke in support of Orange County High School of Arts YMCA Proposal. • Amanda Aguilar, teacher of Relampago del Cielo, spoke in support of Orange County High School of Arts YMCA Proposal. YMCA Presentations Brian Heney, The Sound — Presented proposal, resident of Santa Ana. The Sound has been serving Santa Ana since the 1920's. The proposal is to have a place for gathering, a cafe, health center, learning labs, community garden, studio for local artists, events hall, co -working center, kids zone. What they need is people who are willing to reach out to the community and a team of developers who can handle the concept. Willing to restore the structure and the original mission and intent of the site. Mike Harrah, Caribou Industries — Presented proposal to convert the YMCA building to a high end Hotel lobby. Proposing in the first 180 days to clean up and paint the structure costing $825,000. The proposal will donate $500,000 to the city, for a total cost of $1,325,000 in the first 180 days of the project. Proposing to complete the entire project in 24 months costing $15,146,000 total. The project will generate property tax, retail tax and sales tax to the city. August 20, 2018 1 Economic Development, Infrastructure, Budget & Technology Minutes Ralph Opacic, Founder and Director of the Orange County High School of the Arts — Presented proposal partnering with Wooden Floor and Relampago del Cielo. Together they have been serving over 3,000 families in Santa Ana and with the YMCA project they would like to serve 500 more families. The facility will be a thriving hub for arts in partnership with the Wooden Floor and Relampago del Cielo. Community room available for the community, an art gallery for local artists and student to display their art work, a small performance venue, classrooms. The focus will be a design center to be available to the community. In addition, they will bring other non -profits community users to provide more services. Michael Bohn, provided information of the project. The concept is to restore the building to its historic branch, set up landscaping, create a place for students and community to congregate. Approximate the total cost of the project will be $20,000,000 with a completion period of 24 months. Provided information of construction schedule and financing strategy. Kyle Paine, Community Development Partners — proposing a 50 permanent supportive units for Veterans and a veterans serving center. The Community Development Partners focuses on affordable housing for low income seniors, families, homeless and veterans. Provided completion schedule of approximate one year. Committee Member Sarmiento thanked all presenters. Provided information of the YMCA building that six years ago they thought it was going to work, but things did not work as expected. The YMCA is a very important asset to the City not only economically but also historically. Asked Community Development Partners what the financing would be like for their proposed project. Question and answer period ensued. Chair Martinez thanked all presenters. Added that all have an opportunity to work together. Create an anchor of economic, social and cultural opportunity and actively listen to the community of what their needs are. All the Committee Members care about the community those social educational make the city special. The 2 most important assets the city have are people and land. The four "Ps", People, Public, Private, Partnerships. Putting people first everything goes, having an opportunity to make the first P here in Santa Ana. Committee Member Sarmiento recommended giving staff direction, comments, remarks from the other Committee Members. Steven Mendoza added that if Committee Members had any additional questions or comments, they will gather the missing information for Council before submitting a final recommendation. Committee Member Sarmiento commented that all the presentations were very impressive and very unique in their own way, providing a vile need for the community. One major component of all the presentations is the financing portion. Question and answer period ensued. Chair Martinez would like the same information presented tonight to be forward to all Council Members for review before they bring it to City Council meeting. August 20, 2018 1 Economic Development, Infrastructure, Budget & Technology Minutes ITEMS MOVED TO NEXT COMMITTEE MEETING 1. Affordable Housing Funding Solutions Presentation by AFL-CIO Housing Investment Trust and LA/OC Building and Construction Trades Council 2. Use of Cannabis Revenues (Robert Cortez, CMO) 3. Discussion and Consideration to Amend City Manager Authority to Execute Public Works Contracts and Agreements {Strategic Plan No. 4,1 & 7,5} (Nabil Saba, PWA) PUBLIC COMMENTS: None STAFF MEMBER COMMENTS: City Manager thanked committee for their patience through the presentations. Added that CDA Director, Steven Mendoza is the lead on this project and they are focusing to complete the YMCA project in a timely manner. COMMITTEE MEMBER COMMENTS: ►[.7T NEXT MEETING: • Monday, September 10, 2018 Adjournment — 7:01 PM Audio of meeting available at: http://www.ci.santa-ana.ca.us/coc/granicus.asp Bianca L. Zurita Recording Secre dry, CDA August 20, 2018 1 Economic Development, Infrastructure, Budget & Technology Minutes