Santa Clarita Approves 21-Point Economic Plan

Santa Clarita hopes to boost the local economy by implementing a new 21-point plan to allocate, generate and re-allocate funds to new projects.

In an effort to boost the local Santa Clarita economy, the Santa Clarita City Council has approved a 21-point plan aimed at improving the general economic outlook of the Santa Clarita area. Projects range from infrastructure improvement and encouraging the use of Enterprise Zone tax credits to the City giving itself (i.e. Bob Kellar) permission to get into the residential real estate business in the City’s name.

Seems some of these 21 items have definite merit, and others appear to have been added just to get to the magic number of 21. Highlights of the plan are defining the use of Federal funds for infrastructure and other upgrades, micro-loans for highly-qualified low-risk businesses, a new film incentive program, streamlining the development and permit processes, and programs to help homeowners improve their neighborhoods (the ongoing Extreme Neighborhood Makeover program). The scariest aspect of the plan is the authorization for the City to purchase homes (residential real estate) to either fix and flip or rent out (how do you spell conflict of interest?).

Here are the basics of the 21-point plan:

1. Enterprise Zones: $50k has been set aside to market the use of Enterprise Zones more effectively. Enterprise Zones allow businesses to claim tax credits for hiring and other activities, which makes it more attractive to do business within the City of Santa Clarita.
2. Recycling Market Development Zones (RMDZ): Designed to encourage the use of recycled materials in product manufacturing, RMDZ’s encourage reduction of waste from manufacturing. Qualifying businesses are eligible for low interest loans, financial assistance referrals, and waste exchange. City staffers will help design new marketing brochures for the RMDZ program, at no additional cost to the City.
3. Think Santa Clarita and Shop Local Programs: $250k has been set aside for marketing efforts within the Santa Clarita area and extending into the Los Angeles area, using direct mail, cable tv, bus benches and the like. Per the City’s propaganda: “The greater Los Angeles outreach will promote Santa Clarita as THE place to shop, locate a business and live as a way to import sales tax revenue, attract businesses that may not know of our low tax environment, and attract homebuyers with higher incomes who may not know of our excellent schools, parks, commuter services, quality of life, etc.”
4. Film Incentive Program: $200k has been set aside, including $50k in tax rebates for film-related hotel stays, to incentivize increased film production in the Santa Clarita area. Santa Clarita is within the “30 mile zone” for filming, and this incentive is an attempt to attract more feature filming to the area. There is already a lot of filming in the area, including Stevenson Ranch being used as “Weeds” on the popular tv show.
5. SBDC Program for Business: $100k has been set aside for micro-loans for businesses who do not qualify for regular SBA loans and are low-risk borrowers.
6. Westfield Partner Program: $100k has been set aside in the form of potential lost revenues to explore possible incentives for Westfield to expand and thus add more sales tax revenues to the area.  Incentives could be in the form of a rebate or future expansion permit subsidization.
7. Development Process: $500k has been set aside to help streamline the development process within the City of Santa Clarita. This plan includes implementing technology solutions to accept plans and permits electronically, streamlining permit processes, formalizing a free one-stop review for projects, and relocating related City permitting services to the first floor for of the City Hall building as “Development One Stop”.
8. Incentives for Business that Create Jobs: $50k has been set aside to subsidize permit fees for business that create “quality” jobs.
9. Event Sponsorship Program: Creates a multi-year program where businesses could support City events (i.e. Concerts in the Parks) and enjoy the marketing from these sponsorships for a longer term with deferred payments. Or, in other words, sign up for a 5-year contract and postpone all payments until Year 2. Financial impact is not projected for this item. [Deja vu from the Vital Express scandal with the Performing Arts Center... will companies take the Year 1 freebie and then walk away?]
10. Staff Re-Allocation: Move staff from other areas within the City to the Economic Development area to implement new and ongoing programs. This would shift $250k in costs to Economic Development.
11. WorkSource Center Restructuring: This program will be moved to the Economic Development Division, and will work to create alliances and seek funding for the WorkSource program.
12. Business District Improvements: $2 million has been set aside to improve signage and upgrade street medians in the City’s primary sales tax-generating areas, the Valencia Town Center Mall and the Valencia Auto Center. Other areas that may receive a portion of these funds are the Bouquet Canyon area from Soledad to Seco, Railroad Ave. from Via Princessa to Bouquet Junction, the corner of Newhall Ranch Rd. and Copperhill, the Centre Pointe area, and the intersection of Sierra Highway and Via Princessa.
13. Stimulus Dollars for Infrastructure Projects: Over $10.3 million in secured Federal funds has been put aside for City infrastructure projects, including bridge rehabilitation, traffic circulation and improvements, expansion of parking at the Newhall Metrolink station, and the McBean regional transit center Park and Ride.
14. Stimulus Dollars for Non-Infrastructure Projects: Over $3.2 million in secured Federal funds has been set aside fund projects that support businesses, including justice (COBRA), community development block grants (CDBG), energy efficiency and conservation, and neighborhood stabilization.
15. Economic Development Corporation: The City will explore the formation of an Economic Development Corporation, with costs to be determined. Per the City: “One function of EDC would be implementation of registry of all businesses to maximize business-to-business opportunities, to more accurately identify business industry clusters, and to identify potential attraction targets from vendor/supplier, customer chain.”
16. “Give Me 10″ Promotion: Increases the City’s incentives to buy local from 5% to 10%, and supplements the Shop Local program. Encourages other organizations to offer discount programs as well (COC, school districts, HMNMH, etc). [Not sure how different this is from the 25Score program?]
17. Hotel Business Improvement District (BID): $400k has been allocated to create a new Hotel Business Improvement District, to be funded from new revenues generated by an additional 2% hotel tax. Funds would be used to attract additional economic high impact events to the Santa Clarita, such as the current AMGEN Tour and others.
18. Old Town Newhall Facades: $150k has been allocated to create new facades in the Old Town Newhall area. [Don't get me started on this black hole... I still don't see why someone would go out of their way to travel to Newhall to shop when it is so far from the freeways, and the economic study to support this project was counting on over 50% of the projected revenues to be generated from people 30+ minutes away.]
19. Use Tax Incentive for Business Expansion: Sets up a program where businesses can offer a $20k one-time use tax payment to the City (which is like sales tax and is generally charged for items purchased without sales tax, typically from out of state), and get half of that allocated back to them as payment for permit fees or other rebates. [HUH? Not sure what the benefit is for this from the business owner's standpoint.] Cost for this program would be potential lost revenues.
20. Neighborhood Stabilization Program: Almost $1.2 million has been allocated, supposedly to help areas that have been hit hardest by foreclosures. According to the City, “Funds can be used to purchase and rehabilitate foreclosed homes to sell or rent to lower income buyers; demolish blighted structures; and assist in redevelopment efforts for both residential and commercial properties.” [Kudos to the programs to assist homeowners in improving their homes, but wondering what can be scarier than the City going into the residential real estate biz? Why not let investors and regular buyers buy and fix these homes instead?]
21. One Valley One Vision (OVOV) Economic Element: Creates a stand-alone element of the OVOV plan to adress economic concerns. There are no stated costs for this program.