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Staff Report PREPARED BY : RYAN BAKER Library Director Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, and Finance Director 110 E. Main Street Los Gatos, CA 95030 ●A 40 8 -354 -68 32 www.losgatosca.gov TOWN OF LOS GATOS COUNCIL AGENDA REPORT MEETING DATE: 06/19 /2018 ITEM NO: 1 6 D ATE : JUNE 19, 2018 TO : MAYOR AND TOWN COUNCIL FROM: LAUREL PREVETTI, TOWN MANAGER SUBJECT: RECEIVE THE ARTS AND CULTURAL COMMISSION’S PUBLIC BENEFIT ASSESSMENT FOR PUBLIC ART RESEARCH STUDY AND PROVIDE DIRECTION ON THE COMMISSION’S RECOMMENDATION TO PREPARE AN ORDINANCE DESIGNATING ONE HALF OF ONE PERCENT OF ALL PRIVATE BUILDING PROJECTS WITH TOTAL CONSTRUCTION COSTS GREATER THAN $200,000 FOR FUNDING PUBLIC ART PROGRAMS IN THE TOWN RECOMMENDATION : Receive the Arts and Cultural Commission ’sA Public Benefit Assessment for Public Art Research Study and p rovide direction on the Commission’sArecommendationAtoAprepareAanAordinanceA designating one half of one percent of all private building projects with total construction costs greater than $200,000 for funding public art programs in the Town. BACKGROUND : This report is the result of the work of the Arts and Cultural Commission addressing the Strategic Arts Plan goal of exploring funding options to establish an ongoing arts funding source. In August of 2015 the Arts and Cultural Commissio n began a strategi c planning process to create a public arts plan and develop public art goals. At the January 19, 2016 Town Council m eeting, Council received an update on the Commission’s strategic plan, approved the art plan goal areas and voted to allocate $5,000 to the Commission to continue the strategic planning process. The three major identified goals included public art, funding, and community engagement and outreach. PAGE 2 OF 3 SUBJECT: RECEIVE THE ARTS AND CULTURAL COMMISSION’S PUBLIC BENEFIT ASSESSMENT FOR PUBLIC ART RESEARCH STUDY AND PROVIDE DIRECTION ON THE COMMISSION’S RECOMMENDATION TO PREPARE AN ORDINANCE DESIGNATING ONE HALF OF ONE PERCENT OF ALL PRIVATE BUILDING PROJECTS WITH TOTAL CONSTRUCTION COSTS GREATER THAN $200,000 FOR FUNDING PUBLIC ART PROGRAMS IN THE TOWN J UNE 19, 2018 S:\COUNCIL REPORTS \2018 \06 -19 -18 \17 Arts Assessment \Staff Report.FINAL.docx 6/14/2018 11:26 AM BACKGROUND (Continued): The Arts and Cultural Commission created s ubcommittees to further develop sub -goals within each area . The s ubcommittees reported on progress and facilitated discussion at subsequent Arts and Cultural Commission meetings. At the April 18, 2017 Town Council meeting, the Commission presented the possibility of investigati ng a development assessment fee for arts funding as one of two priority goals . DISCUSSION : Since that time, t he Commission began investigating successful public arts funding programs in other municipalities and determined that implementing a potential co mmercial or residential development assessment fee, often referred toAasAaA“percent -for -art”Afee,AwasA a common basis for creating public arts funding. The Commission researched 23 cities of various sizes that had implemented some form of development asse ssment focusing on understanding the details of such programs. The research done by the Commission is contained in the Public Benefit Assessment for Public Art Research Study (Attachment 1). Based on this study , the Commission has concluded that adopting a similar model of development assessment fees through an ordinance process would be successful for the Town of Los Gatos . Based on its research, the Commission recommends preparing an ordinance that would assess a development fee set at one half of one percent (0.5 %) of the total cost of private building projects with total construction costs greater than $200,000 to be allocated for public arts funding . The Commission is not recommending any development assessment on public construction projects. If the Council is in favor of considering theA rtsAandACulturalACommission’sArecommendation , funding would need to be allocated to complete necessary next steps for s taff to determine feasibility. These steps at minimum would include a legal analysis , comple tion of any required n exus study for new impact fees, and a financial analysis prior to the development of an ordinance . PAGE 3 OF 3 SUBJECT: RECEIVE THE ARTS AND CULTURAL COMMISSION’S PUBLIC BENEFIT ASSESSMENT FOR PUBLIC ART RESEARCH STUDY AND PROVIDE DIRECTION ON THE COMMISSION’S RECOMMENDATION TO PREPARE AN ORDINANCE DESIGNATING ONE HALF OF ONE PERCENT OF ALL PRIVATE BUILDING PROJECTS WITH TOTAL CONSTRUCTION COSTS GREATER THAN $200,000 FOR FUNDING PUBLIC ART PROGRAMS IN THE TOWN J UNE 19, 2018 S:\COUNCIL REPORTS \2018 \06 -19 -18 \17 Arts Assessment \Staff Report.FINAL.docx 6/14/2018 11:26 AM FISCAL IMPACT : The potential i mpact to the G eneral F und to conduct the legal analysis of proposed development fees, n exus study, and financial analysis is estimated to be approximately $20,000. This work is not programmed in the Fiscal Year 2018/19 Operating Budget . If Council is interested in pursuing these studies, staff recommends that the Council consider a budget adjustment at the November 6, 2018 meeting with the First Quarter Budget Report. ENVIRONMENTAL ASSESSMENT : This is not a project defined under CEQA, and no further action is required. Attachment s : 1. Arts and Cultur e Commission ’s Public Benefit Assessment for Public Art Research Study 2. Public Comments received through 11:00 a.m. June 14, 2018