San Rafael business district assessment up for renewal

The city has collected $65,044 from the fee this year, less than the pre-pandemic average of $83,000.

Despite another year of below-average assessment revenue for the Downtown San Rafael Business Improvement District, city staffers are recommending the fee it charges proprietors remain unchanged in 2024.

Over the next year, city officials, in partnership with the San Rafael Chamber of Commerce and the business district, will be exploring a switch to property-based assessment as a means to boost the revenue.

A public hearing to renew the fee formula for another year is set for the City Council’s meeting at 7 p.m. Monday.

Earlier this year, the pandemic-strained business improvement district, or BID, was thrown a lifeline as it was facing a potential third year of revenue losses. The City Council voted unanimously to approve a two-year contract with the Chamber of Commerce to help re-energize the district.

The city also approved a economic development strategy that focuses on business expansion, attraction and retention. One of the plan’s objectives is switching to a property-based assessment fee to engage the landlords and generate more revenue toward improving the downtown corridor.

“This past year saw a monumental and important change in that the BID is now housed within the chamber, which will ensure a coordinated and effective approach to supporting and promoting businesses in the downtown core,” Mayor Kate Colin said. “We are deeply grateful to BID director Sarah Tipple as well as the volunteer BID board for their engagement and leadership as San Rafael continues to grow our local economy.”

The district formed in 1979 with 125 businesses along Fourth Street between Lincoln Avenue and E Street. In 2013, the City Council approved an expansion to the West End and some side streets, growing the membership base to about 700.

Assessments, which are collected during the business license renewal process, are on a scale based on business type and location. Businesses along the main Fourth Street corridor pay a premium, while those in the West End pay lower rates.

The assessments range from $25 for a personal service practitioner, like a salon in the West End, up to $425 for a bank or financial institution on the main drag.

For 2023, the city has collected $65,044 in assessment revenue, which is lower than the pre-pandemic average of $83,000, indicating that some payments are delinquent or unpaid.

However, there is some good news, said Tipple, whose position is part time. The district has been able to cut costs and increase fundraising through marketing and events, she said.

“One of the biggest accomplishments was hiring a part-time social media specialist, who worked to promote not just events but specific businesses to show how awesome the downtown corridor is for small businesses,” Tipple said.

The district began showcasing different businesses through social media daily, adding 100 social media followers a month and increasing its digital reach by more than 200%, Tipple said.

The district-sponsored May Madness car show netted more than $18,000 in profit, and the Hops and Vines Stroll event cleared $4,000.

The district also launched a few new initiatives, including a “downtown eats passport,” in which participants collect stamps via a smartphone app on a digital passport by eating at participating restaurants, Tipple said. Those who filled out their passports were eligible to enter to win a $100 gift card.

“We wanted to create activity in our downtown and get people into our businesses,” Tipple said.

Micah Hinkle, the city’s director of economic development, said the city, the district and chamber “have been working together to stabilize the BID operations.”

“The BID board had focused on limiting deficit spending and given the revenue projections, modified their event programming to reflect their budget constraints,” Hinkle said.