Requests for public redevelopment funds by local organizations
are not new, but this year are colored by increasing financial
difficulties and a heightened insistence on improved efficiency.
The Morgan Hill Chamber of Commerce last week presented the city
with a proposal for how they would spend up to $85,500 in
redevelopment agency funds on local economic development efforts to
supplement the RDA’s activities during the fiscal year that begins
July 1.
Requests for public redevelopment funds by local organizations are not new, but this year are colored by increasing financial difficulties and a heightened insistence on improved efficiency.
The Morgan Hill Chamber of Commerce last week presented the city with a proposal for how they would spend up to $85,500 in redevelopment agency funds on local economic development efforts to supplement the RDA’s activities during the fiscal year that begins July 1.
Chamber board chairman Jeff Burrus said the proposal should be considered less of a funding request than an offer of services to the RDA, as the funds would allow the organization to expand the reach of its promotion of Morgan Hill and efforts to attract tourists here outside the city.
“It is essentially an extension of our services to extend our reach, to make Morgan Hill more attractive to a larger geography than our existing budget (allows),” Burrus said. “The chamber is simply extending our outreach beyond the city.” Specifically, the chamber hopes to reach as far as the Central Coast.
The city council, acting as the RDA board, will accept the proposal for review at Wednesday’s meeting, and decide in the coming weeks whether or not to grant the request. If approved, the funding will be provided in accordance with a contract for services.
The chamber has entered similar contracts with the RDA in years past. Recently their request has declined due to their efforts – inspired by RDA and chamber board members – to reduce costs, according to city staff.
Last year, the chamber asked for a maximum of about $106,600, so the most recent request is a 20 percent decline and, according to city staff, a continued move toward self-sufficiency. And the chamber has reduced its funding requests by 45 percent over the past three years, according to a letter from chamber president and CEO Christine Giusiana to the RDA.
The letter also describes the chamber’s economic development activities that are funded through other revenue sources in the organization’s regular budget.
“We know that our aggressive marketing of Morgan Hill through advertising, participation in industry and tourism conferences and shows, and conducting local programs and events more people are coming to Morgan Hill to eat at our restaurants, visit our wineries, play at our sports and entertainment venues and attend our community events,” Giusiana’s letter states.
The chamber also partners with other organizations and events including the Independence Day celebration, Mushroom Mardi Gras, city programs and Morgan Hill Downtown Association events.
Individual costs proposed by the chamber’s RDA request include about $29,000 for advertising, and $42,600 for marketing.
The city manager’s recommended budget for fiscal year 2011-2012 already lists substantial service cuts in the form of the elimination of 18 positions that could leave 11 employees without their jobs. Plus, the need to raise water and sewer rates for roughly 14,000 customers in the city limits by 10 percent or more highlight growing financial problems and inadequate revenues for the city.
And the RDA, the source of the funds for the chamber and MHDA contracts in years past, might not even exist next year as Gov. Jerry Brown’s proposed state budget eliminates the agency and diverts its revenues to other services to make up for a $15-billion state budget deficit.
As a product of the need to reduce RDA and economic development costs, a new aspect of the chamber’s contract this year is a request by city staff and the board for the chamber and MHDA to work together on special events in downtown Morgan Hill, director of business and housing assistance Garrett Toy said.
The RDA board reviewed a proposal by the MHDA last week requesting $71,200, also a 20 percent decline from the previous year – a reduction that is equivalent to 25 percent of its staff. However, executive director Jorge Briones said the MHDA is also committed to becoming self-sufficient, and has pursued avenues to maintain the same amount of revenues or more from other sources “that will keep the Downtown Association in a position to retain two full-time staff employees.”
The MHDA proposed using its RDA contract the same way it has in the past – to conduct a “Main Street” program to promote downtown Morgan Hill and attract visitors. The program includes efforts to promote and conduct outdoor concerts during the summer, downtown “wine stroll” events, educational programs and seminars for businesses, outreach with downtown restaurants and shops, and advertising campaigns.
“What we have done successfully is decrease the amount of the contract and also the dependence on the RDA for revenue,” Briones said.
The MHDA has a narrower scope than the chamber, focusing solely on the downtown area and more so on events than on promoting individual businesses.
