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TITLE: |
Consideration and Adoption of Resolution No. 2023-63: A resolution of the City Council of the City of Flagstaff, Arizona renewing the Special Taxing District of the “Flagstaff Downtown Business Improvement and Revitalization District” (FDBIRD)
Consideration and Adoption of Resolution No. 2023-64: A resolution of the City Council of the City of Flagstaff, Arizona, approving an Intergovernmental Agreement for services with the “Flagstaff Downtown Business Improvement and Revitalization District” (FDBIRD) |
STAFF RECOMMENDED ACTION: |
1. Read Resolution No. 2023-63 by title only
2. City Clerk reads Resolution No. 2023-63 by title only (if approved above)
3. Adopt Resolution No. 2023-63
4. Read Resolution No. 2023-64 by title only
5. City Clerk reads Resolution No. 2023-64 by title only (if approved above)
6. Adopt Resolution No. 2023-64
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Executive Summary: |
On February 4, 2014, the City of Flagstaff adopted Resolution 2014-06, forming the Flagstaff Downtown Business Improvement and Revitalization District.
Revitalization Districts are special taxing districts that have the authority to design, plan, improve, construct and maintain infrastructure improvements. The term “infrastructure” is defined by law, and includes a wide variety of improvements. The districts also have the authority to provide enhanced municipal services. The term “enhanced municipal services” is defined by law and means services that are in addition to or exceed the level of services provided outside the district. The district may engage in other activities permitted by law.
The district is governed by an elected board of five (5) directors. The district is responsible for managing its own finances and properties within the district are subject to the levy of taxes or assessments. The district may adopt fees and charges, may receive grants, and may enter into various kinds of agreements. A City, County, or Tribe may financially participate in the district.
Notable accomplishments of the district over the past 10 years include:
- Instrumental in helping to design and conceive the Comprehensive Parking Plan.
- Funded fabrication and installation of 10 custom Downtown Flagstaff bike racks designed and made by local artists.
- Implementation of a Clean Team Ambassador program providing public space maintenance and hospitality services. The team works daily to sweep sidewalks and alleys, remove graffiti and stickers, clean trash/recycle bin lids, assist with snow removal at crosswalk and berms, answer parking questions, provide business information and assist visitors.
- Partner with Flagstaff Police Department and support Downtown Walking Beat for added visibility and safety.
- Work with City staff to ensure City services and infrastructure are maintained, including tree wells, lighting, trash removal, snow operations
- Maintain a website and robust digital media presence to inform residents, business owners, and visitors of the latest downtown news and happenings.
- Played a key role throughout the COVID-19 pandemic: secured and administered micro-grants to help support small businesses created expansion of outdoor dining areas in partnership with the City of Flagstaff, served as a primary resource for guidance on closures and modified hours, kept downtown businesses top-of-mind with industry-leading marketing and social media messaging, and supported free parking and customer pick-up zones to help downtown businesses survive the pandemic.
The district has perpetual succession, except that the district must be dissolved ten (10) years after the date of formation unless the governing bodies of the participating municipalities (in this case the City of Flagstaff) by resolution extend the district by an additional period of ten years. Arizona Revised Statutes § 48-6809.
The district may elect to dissolve the district at any time, subject to the conditions set forth in Arizona Revised Statutes § 48-6819. The district has not elected to dissolve the district and there is general support for extending the district. |
Financial Impact: |
The district is funded by a secondary property tax, not to exceed $2.39 per $100 of assessed valuation. The district has levied less than that maximum rate. The City owns real property located within the district. All governmental property is exempt from property tax, per the State Constitution. However, if the IGA is renewed, in consideration for district services, the City may pay an amount equal to the district-levied Ad Valorem Taxes that would be due if the City owned properties were privately held. (Currently $10,256 per year). |
Policy Impact: |
The renewal will continue the existing policy and maintain the benefits provided by the district. |
Connection to PBB Priorities/Objectives, Carbon Neutrality Plan & Regional Plan: |
High Performing Governance
- Implement innovative local government programs, new ideas and best practices; be recognized as a model for others to follow
Livable Community
- Create a welcoming community through partnerships, strong neighborhoods, civic engagement, and resident participation.
- Provide amenities and activities that support a healthy lifestyle
Robust Resilient Economy
- Embrace and invest in tourism opportunities to promote economic development
Inclusive and Engaged Community
- Foster community pride and civic engagement
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Has There Been Previous Council Decision on This: |
- Resolution No. 2008-05: A Resolution Adopting the Downtown Flagstaff Management Plan.
- Resolution No. 2014-03: A Resolution of the City Council of the City of Flagstaff, Arizona, declaring its Intention to Form the “Flagstaff Downtown Business Improvement and Revitalization District”, a Special Taxing District; and Providing for a Public Hearing Prior to Formation of the District to Consider any Objections of Property Owners (Attached).
- On January 7, 2014, the City Council authorized the City Manager to execute the petition(s) on behalf of City-owned properties seeking to initiate the District formation process.
- Resolution No. 2014-06: A Resolution of the City Council of the City of Flagstaff, Arizona, Forming the “Flagstaff Downtown Business Improvement And Revitalization District”, a Special Taxing District; and appointing the initial Board of Directors.
- Resolution No. 2014-07: A Resolution of the City Council of the City of Flagstaff, Arizona, Approving an Intergovernmental Agreement for Services with the Flagstaff Downtown Business Improvement and Revitalization District.
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Background and History: |
Like any other part of a city, downtowns need basic city services such as street maintenance, public safety, and other standard services. However, successful downtowns have more intense needs of those services and often require additional and/or specialized services. Downtowns are often the principal draw of a city and collect a significant portion of the taxes, especially when measured on a per square foot basis.
In looking at downtowns across America, and Arizona as well, the most successful are those that receive specialized services. Successful downtowns typically have district marketing, retail promotion, special event planning, downtown advocacy, downtown landscaping and beautification, environmental management (litter, graffiti, etc.), safety and security, business attraction, retention and expansion, business assistance, project planning and facilitation, and strategic planning.
There is one trait in common among successful downtowns: There is some form of self-governance organization that collectively manages the district and works toward the equitable provision of needed services.
Prior to the formation of the FDBIRD, the management of downtown Flagstaff had historically been on an intermittent and ad hoc basis with limited funding and other resources. There was a heavy reliance on volunteers and City staff to work on matters of concern to the downtown property owners.
Arizona Revised Statutes (ARS) provide for thirty-six special taxing district types. The FDBIRD is a “Business Improvement and Revitalization District,” governed by A.R.S. §§ 48-6801 - 48-6819. |
Key Considerations: |
- Value to stakeholders (events, advocacy, promotion, services)
- Value to the City of Flagstaff (management, collaboration, provision of services)
- Financial value (sales tax revenue) derived from a thriving, successful downtown
- A vote to renew the district would continue the success of the past 10 years of professional downtown management.
- A vote against renewal would result in the elimination of professional downtown district management.
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Community Involvement: |
In itself, downtown is a significant component of the City’s sales tax (7.5%), BBB Tax (15%), and property tax revenues. The total assessed value of downtown is approximately $54 million, slightly less than all of Flagstaff’s principal taxpayers combined. (Flagstaff's principal taxpayers include APS, W L Gore, Fidelity National Title Insurance, Qwest, Nestle-Purina, the Flagstaff Mall, Walgreens, Consolidated Investments, Hopi Tribe Economic Development Corp., and SACO Management.)
The economic impact of downtown is far greater than the taxes generated within the district itself. Downtown is the most-visited attraction in the city, visited by more than 70% of our four million visitors. These visitors visit other attractions, stay in hotels, eat in restaurants, and shop in other areas of the city as well, leveraging the impact of downtown on Flagstaff’s economy.
The general economic vitality and the visitor experience of the district is best served by the renewal of the FDBIRD. Thus, while the district is a mechanism that improves the economic vitality of the district, it also benefits the entire city. |
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