City Council Meeting:
September 13, 2005
TO: Mayor
and City Council
FROM: City
Staff
SUBJECT: Recommendation to Modify Policy and
Guidelines for Extended Licensing of a Portion of the 1550
Introduction
This report
recommends modifying the policy and guidelines that Council adopted in 2004
authorizing licensing of a portion of the 1550 beach parking lot for extended
periods during the off-season to generate revenue. Staff recommends extending the time period
beyond fall and winter months, calculating the available portions of the lot in
parking spaces rather than in square feet, and limiting the maximum space for
extended licensing to one quarter of the parking spaces.
Last year, Council
approved a policy and guidelines that allowed for the extended licensing of a
portion of the 1550 lot during the period of November through February. The intent of this policy was to generate
substantial net revenue to the Beach Fund by licensing part of the lot for
entertainment/cultural shows when parking demand is seasonally low. The guidelines specified that up to half of
the 1550 lot may be licensed for events which protected public use of the
remainder of that lot. The guidelines
also called for charging market rate rent for use of the lot. Council asked staff to return in one year
with an evaluation of the guidelines.
Staff has assessed
the current guidelines in regard to revenue generation for the Beach Fund and
effectiveness in managing extended use of the lot.
Revenues to the
Beach Fund pay for the cost of operating and maintaining the beach. These costs include grooming the sand,
maintaining the restrooms, maintaining beach parking lots, and paying for beach
capital improvement projects such as renovating older restrooms, upgrading
parking lot equipment and renovating the lifeguard headquarters. Costs have increased over the last several
years reflecting increases in utilities, insurance, and materials. Although revenues from the Beach Fund still
support these expenditures, it is becoming increasingly difficult to cover
costs without increasing fees. Staff’s recommendation to modify the current
guidelines to include the shoulder season of March through May should generate
additional revenue for the Beach Fund.
The current
guidelines for licensing of a portion of the 1550 lot for extended use by
appropriate commercial activities require that the event generate substantial
net revenue, that the licensee pay all City costs, and that the licensee comply
with all standard City requirements. Events
are permitted in the off-season, which is defined in the guidelines as November
through February. The licensee is
required to provide a traffic, off-site parking and shuttle plan, and the event
must consist of primarily entertainment or cultural enrichment open to the
public and suitable for all ages. The
licensed area within the lot can encompass between ¼ and ½ of the lot.
Modification to Rental Area
During the 2004-05
season, when half of the lot was occupied by a licensed event, parking was
generally available in the 1550 lot for beach and event visitors. There were a total of 11 days when the lot
filled to capacity. These were all
Saturdays and Sundays. Overflow parking
was available in the south beach parking lots and the event producer operated a
shuttle that transported visitors between the Pier and the south lots. However, there was not enough capacity in the
1550 lot during the period of the licensed event to accommodate filming base
camp parking and other community events.
From November through February 2004-05, there was one community event
and there were no film base camps in the 1550 lot compared to a three year
average of 2 community events and 9 film base camps during the same time period
Filming is an
important revenue source to both the Beach Fund and to the Pier and its
tenants. In FY 2004-05, the Beach Fund
experienced a 21% reduction in parking revenue from filming and events the
previous year during the occupation of the lot by the licensed event.
Because the 1550
lot provides a critical parking resource to Pier businesses, the use of the lot
for extended licensing must remain compatible with the regular operation of the
Pier and must continue to meet the parking demand from beach visitors and other
community events. If the portion of the
lot for licensed events is reduced from ½ to ¼, 1/8 of the lot is left
available for events and filming and the remainder of the lot for regular
parking. For these reasons, staff is
recommending that the guidelines be changed to provide that the maximum portion
of the lot that can be used for extended licensing be limited to ¼ of the lot.
Modification of Time Period for Licensed Events
Staff has received
several inquiries from event producers regarding licensing beyond the November
through February timeframe at market rent. The period between March and May is
considered a shoulder season for the beach.
Although spring break occurs during this period and is a busy time at
the Pier, it is generally not considered peak beach season.
Staff has contacted
both
Recalculation of Available Portion
In 2004, staff
entered into a license agreement for use of 160,000 square feet of the
lot. Although the footprint of the event
did not exceed the approved square footage, it consumed more than half of the
available parking spaces. The resulting
configuration resulted in fewer spaces available for parking and other
community events. Staff proposes to
address this issue by calculating the event portions of the lot based on number
of parking spaces rather than square feet.
One quarter of the lot would equal 241 spaces. This allows for more efficient use of the lot
and maximizes the remaining space for beach/event parking, filming base camps and
community events.
Budget/Financial
Impact
In FY 2004-05, the
licensing of the 1550 lot for 13 weeks generated $240,500 in rent. The rental
revenue to the Beach Fund in FY 2005-06 is projected at $450,000 based on
current market rates.
If Council approves
the proposed modification, there will be additional space available in the lot
to accommodate other events and small to medium filming base camps. In FY 2004-05, the Beach Fund experienced a
21% reduction in parking revenue from filming and events from the previous year
during the occupation of the lot by the licensed event. This coincided with one of the rainiest
periods on record. Based on the number
of events and base camps utilizing 1/8 of the lot over the last two years,
staff anticipates that approximately 12 events/base camps can be accommodated
going forward resulting in approximately $21,800 in revenue.
In FY 2004-05,
general parking revenue in the 1550 lot was down by $162,431 during the 13
weeks of the event. General parking
revenue from the south beach parking lot (
No additional
appropriation is needed at this time however the department will monitor usage
and if necessary include a budget adjustment at mid-year.
Recommendation
Staff recommends
that the City Council modify the policy and guidelines for licensing of the
1550 lot to generate additional revenue to the Beach Fund by:
·
Limiting
the available portion of the parking lot for extended licensed events to a
maximum of ¼ of the lot
·
Re-calculating
the available portion of the lot in parking spaces rather than in square feet.
·
Extending
the time period for licensed events to the Friday before Memorial Day weekend
PREPARED BY:
Elaine
Polachek, Open Space Manager
Marsha
Moutrie, City Attorney