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CITY OF SAN SER..- '.RDIN~ REQUEST r'R COUNCIL ACTION
From: Kenneth J. Herrlerson, Drrector Subject: ENl'ERPRISE ZONE DI::ENI'l:VE
ORDDmK::E
Dept:
Community Develq:ment
Date:
March 13, 1990
Synopsis of Previous Council action:
In November, 1985, the Mayor am Cormron Council adopted Enterprise Zone
Incentive Ordinance (Ordinance has a life of four (4) years).
On October 2, 1989, the Mayor am Canrrk:m Council corrlucted first readin:J of the
revised Enterprise Zone Incentive Ordinance with a proposed life of four (4)
years (November, 1989 to November, 1993).
On October 16, 1989, the Mayor am Cormron Council continued this matter to
November 20, 1989, so staff could provide a report on developne:nt activity
durin:J first four (4) years of Enterprise Zone.
SYH>PSIS CXlNl'INUED 'lO NEXT PAGE
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Recommended motion:
OONDUCT FIRST REM>DG OF ~ ORDDmK::E
ORDDWa: OF THE cny OF SAN BERNMI)IH:l AMENDDG SECl'ION 3.18.070(B) (1) (2) OF
THE SAN BERNMI)IH:l MtlNICIPAL CDDE (ENl'ERPRISE ZONE DI::ENI'l:VE ORDDmK::E).
~f1A V. ~~~1
Ken Herrlerson
Contact person:
Phone:
5065
Supporting data attached:
staff Report; Ordinance
Ward:
1,2,3,5,6
FUNDING REQUIREMENTS:
Amount:
N/A
Source: (Acct. No.) N/A
(Acct. Description) N/A
Finance:
Council Notes:
75-0262
Agenda Item No. S ..- (
CITY OF SAN BERk RDINO - REQUEST r R COUNCIL ACTION
STAFF REPORT
.
On November 20, 1989, the Mayor am Camoon eooncil adopted Ordinance Number
Me-688, which took effect thirty (30) days later. '!he effect of this action
was to renew certain incentives asscx::iated with the City's Enterprise Zone,
with such incentives to be in effect fran December 20, 1989 to December 20,
1993. '!he Ordinance also called for an annual report to be developed am
submitted to the Mayor am Camoon eooncil detailin;J activity occurrin;J in
the Zone, am the iltpact on the General F'l1rrl caused by various tax rebates
am fee exemptions.
Urxler the Infill Housin;J portion of Me-688, the Ordinance renewed the infill
fee exemptions am within the l:lourdaries of the Enterprise Zone raooved the
limitation of cxmtiguous lots qualifyin;J for infill fee exenptions. '!he net
result of this change was to allCM sul:xlivisions in the Enterprise Zone to
qualify for infill fee exemptions.
At the request of the Mayor, staff has analyzed the iltpact on the General
F'l1rrl if the City were to grant infill fee exemptions to a one-hurrlred,
fourteen (114) unit subdivision in the Enterprise Zone, already the
recipient of City am Redevelopment Agercy financial assistance. Based upon
infonnation provided by the Directors of Public Works am Planning am
&1ildin::J Sel:vices, the iltpact on the General F'l1rrl would be as follCMS:
Plannilql EIVJineering
Hane Size Buildinc:r Fees Fees Total
1,573 sq. ft. $2,758.98 $506.40 $3,265.38
1,672 sq. ft. $2,876.50 $506.40 $3,382.90
1,859 sq. ft. $3,273.27 $506.40 $3,779.67
Based upon the rnnnber of units (114) am the number of homes of each size
proposed, the follCMin;J is what the City would not collect as a result of
the infill fee exemptions:
1,573 sq. ft. = $3,265.38 in fees x 37 units =
$120,819.06
1,672 sq. ft. = $3,382.90 in fees x 47 units =
1,859 sq. ft. = $3,779.67 in fees x 30 units =
$158,996.30
$113.390.10
'1U1'AL AM:>UNl':
$393.205.46
03/13/90
75-0264
ENTERPRmE 2ICIU!l 8'm.Fl ~'1IORr eontinued...
March 13, 1990
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'I\vo (2) iSSl.... _ocme :readily to mirrl, the first of TNhich is whether the City
can afford Will fee exe1tptions without regard to project size in the
EnteJ:prise Zale. '!be secord issue is whether, as a matter of policy, the
Mayor arrl a....lLMl Council wish to subsidize significant developnent with
General Furrl m:mi.es. Based upon preli.m:inal:y revenue forecasts for the
1990/1991 fiscal year, it appears there could be a General Furrl shortfall
even at exi.st.inJ sex:vice levels, so it is inportant that arrj' tax rebates or
fee exenptions be off-set by the econanic activity they produce.
As with arrj' City this size, the Mayor arrl Ccmoon Council have at their
disposal barrl proceeds, tax increment arrl COB:; :funjs to subsidize
developnent if it is determined such a subsidy is necessary. Because
General Furrl m:mi.es are used to provide basic ~lic sex:vices, arrj'
developnent subsidy fran this furrl could have a conesporrl.inJ i.nq:lact on such
~lic sex:vices if the economic activity is unsuccessful or W'lSUbstantial.
II
This it8ll was J)laced on the SUDD18lllmtal aaenda at the reauest of the Mawr.
~JIIII!l did not cennit adeauate analYSis of the iss"'" set forth in this staff
raDOrt J)rior to the reaular aaenda deadline.
I recxmnend adoption of the fonn Iro'tion.
RENNETII J.
Director of lhmn11'\i. ty
KJH,Ilab/3747
03/13/1990
SDI)1IBI8 a. PRBVXOCB OOONCIL ~ ocm+-111'JIed...
On Nov~ 20ft 1989, the Mayor an::l 0.....111 Council conducted the final
reac1i.n.J and ~ the EnteJ:prise Ilrentive 0rI:li.name. Said Ordinarx:le to
be in effect f'iliia ~..I.er 20, 1989 to ~ 20, 1993.
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ORDINANCB NtJXBBR
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~CB OF THE
3.1.~(.) (1) (2) OF
CITY OF SAN BERNARDINO AMENDING SBCTION
THE SAN BBRNARDINO MUNICIPAL CODB.
TBB MAYOR AND COMKON COUNCIL OF THE CITY OF SAN BERNARDINO DO
ORDAIN AS FOLLOWS:
SECTION 1.
section 3.18.030, Subsection "F" of the San Bernardino
Municipal Code is amended to read as follows:
"Infill Housing" as used in this chapter is single family
home construction built on lots which were vacant on the date of
adoption of this chapter, or such contruction which is built on
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lots where existing structures have been demolished or re~ved to
permit the construction of such single-family homes after the
effective date of this Chapter.
SECTION 2.
section 3.18.040 of the San Bernardino Municipal Code is
amended to read as follows:
Rebates -- Commercial Area.
For any qualifying new or expanding business which locates or
expands in the commercial area of the Enterprise Zone within the
second four (4) years of the life of the Enterprise Zone, City
shall, upon application therefore, rebate the following to such
qualifying businesses for a maximum rebate period of three (3)
24 years:
25 A. One hundred percent (100%) of the Service users' taxes
26 collected by City the from the business qualifying under San
27 Bernardino Municipal Code Chapter 3.44 for services used during
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the rebate period. Service shall include telephone, electricity,
nat~ qas and cable television service.
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~one-hundred percent (100%) of the business license tax
imposed during the rebate period upon the qualifying business
under Chapter 5.04 of the San Bernardino Municipal Code. The
City Clerk is hereby authorized to grant such rebate at the time
of initial and annual application for a business license to any
business in good standing with the City at the time of such
application.
C. For new businesses only, twenty-five percent (25%) of the
total water bill collected by the San Bernardino Board of Water
Commissioners from the new business during the rebate peri~d.
Only the water portion of such bill shall be considered for such
rebate.
D. Notwithstanding the provisions of Subsections A and B
above, the rebate to be granted to any expanding business shall
be based on the portion of the tax which is an increase of such
tax over and above a base amount. The base amount shall be the
total amount of each such tax paid by that business during the
twelve (12) month period immediately preceding the date it be-
comes an "expanding business" as defined at section 3.18.030(d)
above.
SBCTION 3.
section 3.18.050 of the San Bernardino Municipal Code is
amended to read as follows:
Fee ExemDtions -- Commercial Area.
Any qualifying new or expanding business which locates or
expands in the commercial area of the Enterprise Zone within the
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.~:.four (4) years of the life of the Enterprise Zone shall,
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upon.~lication t~erefore, be e~emPt from payment of the follow-
ing t . for a max1mum of exempt10n period of three (3) years:
A. All engineering fees, planning fees, building permit
fees, and mechanical fees imposed by the city. storm drain and
sewer capacity fee charges are expressly not exempt, except that;
7 B. Projects involving the rehabilitation of commercial
8 structures within the Commercial Area of the Enterprise Zone
9 shall be exempt from all engineering fees, planning fees,
10 building permit fees and mechanical fees imposed by the City,
11 when such commercial rehabilitation is privately financed;".
12 (i) storm drain and sewer capacity fee charges are
13 expressly not exempt, and;
14 (ii) Where such commercial rehabilitation is financed in
15 whole or in part by the City, the commercial property owner shall
16 pay all fees associated with said commercial rehabilitation.
17 SECTION 4.
18 Section 3.18.060 of the San Bernardino Municipal Code is
19 amended to read as follows:
20 Rebat.. -- Industrial Area.
21 During the first year of operation of any new industrial
22 business located within the Industrial Area of the Enterprise
23 Zone, City shall rebate to such qualifying industrial business,
24 upon application, the following:
25 A. Twenty-five percent (25%) of the utility service users'
26 taxes paid by such business during the rebate period under
27 Chapter 3.44 of the San Bernardino Municipal Code, relating to
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telephone, electricity, natural gas and cable television use
d~th.t period.
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~ Twenty-five percent (25%) of the business license tax
paid by such business during the rebate period under the
provisions of Chapter 5.04 of the San Bernardino Municipal Code.
The City Clerk is hereby authorized to grant the rebate at the
time of initial and annual application to any qualifying
industrial business in good standing with the City at the time of
such application.
SECTION 5.
section 3.18.070 of the San Bernardino Municipal Code is
amended to read as follows: .
Fee ExemDtions -- Infill Housina: Housina Rehabilitation.
A. Infill housing projects within the infill target area, as
defined in Section 3.18.070, subsection "B", shall be exempt from
all engineering fees, planning fees, building permit fees and
mechanical fees imposed by the city. storm drain and sewer capa
city fee charges are expressly not exempt, provided, however,
that the City's existing policy regarding exemptions where homes
and structures have previously been connected to the sewer and
have been demolished, shall continue in effect. Housing rehab
ilitation projects within the Enterprise Zone shall be exempt
from all engineering fees, planning fees, building permit fees
and mechanical fees imposed by the city. storm drain and sewer
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capacity fee charges are expressly not exempt.
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B. The target area for infill housing activities shall in-
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clude the area north of Highland Avenue, commonly referred to as
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Delmann Heights, and all areas south of Highland Avenue within
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the corporate boundaries of the City.
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~Within the boundaries of the infill target area, as
defined in Section 3.18.070, Subsection (B), the limitation as to
the number of contiguous lots qualifying for infill fee
exemptions, as defined in section 3.18.070 of this chapter, for
single-family dwelling unit construction is hereby established at
four (4) contiguous lots. In the case of multifamily develop-
ment, a duplex, triplex or fourplex shall qualify for infill fee
exemptions, and the limitation on contiguous lots qualifying for
infill fee exemptions shall remain at four (4).
SECTION 6.
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It is the intent of the Mayor and Common Council to analyze
the impact of the tax rebates on development in the designated
Commercial Area of the Enterprise Zone. The review and analysis
period shall occur no later than the end of the first four (4)
years of the life of the Enteprise Zone and at the end of each
four (4) year period thereafter, at which time the Mayor and
Common Council will take steps to enhance the needed overall
19 development strategy of the designated commercial Area.
20 SECTION 7.
21 This ordinance, upon adoption, renews all incentives to be
22 granted new business, expanding businesses, commercial rehabili-
23 tat ion projects, and infill housing activities located within the
24 Enterprise Zone and infill housing target areas of the City for a
25 period of four (4) years from the date said ordinance goes into
26 effect.
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OIlDUiAItCK OF THE CITY OF SAIl BBIUIARDUIO AMBRDUIG SECTIOR
3.18.070(B)(1)'~) OF THE SAIl BEIUIARDIBO MURICIPf COOl.
I HEREBY CERTIFY that the foregoing ordinance was duly
ad~}Jy
nard9at a
of
the Mayor and Common Council of the City of San Ber-
meeting thereof, held on the ___ day
, 1990, by the following vote, to wit:
AYES:
NAYES:
ABSENT:
Council Members
CITY CLERK
The foregoing ordinance is hereby approved this
day. of
, .
1990.
'"
BY:
W.R. "BOB" HOLCOMB, MAYOR
City of San Bernardino