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2002-117-Approve Economic Vitality Program.RESOLUTION 2002 -117 ~" RESOLUTION OF THE TOWN COUNCIL APPROVING THE. TOWN OF LOS GATOS ECONOMIC VITALITY PROGRAM WHEREAS, the Economic Vitality Program (the "Program") is a means to implement goals and ;policies of the adopted Town of Los Gatos General Plan; WHEREAS, the Program will preserve and enhance the Town's charm and high quality of life; WHEREAS, the Program will help provide .goods and services desired by Los Gatos residents; WHEREAS, the Program will .increase the economic vitality and diversity of the Town; WHEREAS, the Program will help maintain and increase Town revenues and thereby allow the Town the ability to continue to provide high quality municipal services; WHEREAS, the Program will help strengthen local businesses and recognize the contributions that they make to the Town; WHEREAS, the Program will help the Town anticipate changes. in the local economy and deal with them in a proactive .manner THEREFORE BE IT RESOLVED., that the Town Council of the TOWN OF LOS GATOS does hereby approvethe Economic Vitality Program (Attachment 2), with any changes that it deems necessary. ~ ~. PASSED AND ADOPTED at a regular meeting of the Town Council held on the 1st day of July, 2002, by the following vote: COUNCIL MEMBERS.: AYES: Steven Blanton, Sandy Decker, Steve Glickman, Joe Pirzynski, .Mayor Randy Attaway. NAYS: None .ABSENT: None ABSTAIN: None -~/ SIGNED: MAYO F THE TO OF LOS GATOS LOS G TOS, CALIF RNIA ATTEST: CLERK OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA S:\RDA7-1-02.35 2 THE TOWN OF LOS GATOS ECONOMIC VITALITY PROGRAM JULY, .2002 Prepared by the Los Gatos .Redevelopment Agency 110 E. Main St. Los Gatos, CA 95030 Attachment 2 ~~ THE TOWN OF LOS GATOS ECONOMIC VITALITY PROGRAM TABLE OF CONTENTS .Page 1. Introduction 1 2. Purpose and Mission 2 3. Guiding Principals 3 4. Economic Vitality Program Summary 3 5. The Town of Los Gatos - A Brief Overview 3 6. Strengths, Weaknesses, Opportunities and Threats (SWOT) 4 7. Detailed Economic Vitality Work Program A. Business Retention and Expansion 6 B. Targeted Business Attraction and Development 8 C. Worl~ing with Specific Groups of Businesses/Properties 8 D. Annual Monitoring g 1. Introduction The Economic Vitality Program is one of the manytools used to implement the Town of Los Gatos General Plan. The General Plan is the community's constitution for development, the foundation upon which all land use .decisions are to be based. The General Plan is a legal document that reflects the interests of the citizens of Lose Gatos in terms of how they would like their community to loop and feel. The Los Gatos General Plan was recently updated after extensive citizen involvement, including the involvement of two major tasks forces which met for seven months each reviewing issues. These tasks forces included members from all neighborhoods, :area, and business districts of the Town in order to .represent all interests. The Economic Vitality Program will directly or indirectly implement the following General Plan Goals: L.G. 1.1 To preserve, promote, and protect the existing small town character and quality of life within Los Gatos. L.G. 5.1 To provide residents with adequate commercial :and industrial services. L.G. 5.2 To maintain a balanced, economically stable community within environmental goals. L.G. 6.2 To preserve downtown Los Gatos as the historic center of the Town with goods and services for local residents while maintaining the existing Town identity, environment .and commercial viability. L.G. 7.4 To promote commercial activity that complements the whole Town. L.G. 7.5 To provide a dependable source of income, employment opportunities, goods and services T.G, 1.1 To develop transportation systems that meet current and future needs of residents and businesses. T.G. 6.1 To provide adequate parking for existing and proposed uses, and to minimize impacts on surrounding residential neighborhoods, including construction new public or private parking structures, and valet parking. V.G. 1.1 To promote the construction of Vasona Light Rail and mass transit facilities in the Route 85 median. The Economic Vitality Program will serve the citizens of Los Gatos in several direct ways. First, it will work to maintain, expand and attract successful businesses that serve the needs of local residents. These businesses include retail, service and food related businesses upon which residents .depend. By having businesses local, residents do not have to drive longer distances to neighboring communities and it helps foster a true sense of community. In addition, local sales tax dollars remain within the community for uses to serve its residents. Second, the Program will help keep the Town of Los Gatos Government fiscally stable, thereby allowing for continued high quality services to its residents. Although Los Gatos is an affluent area, the Town government has limited resources and limited ability to increase revenues. High quality Town services are an important .component in maintaining. the high quality of life in the Town, Services such as public safety, land use review and approval, parks and recreation, and street repairs are critical to the Town, but costly. Under California Law, the Town has limited ability to increase tax revenues to pay for services. Maintaining and increasing sales tax and hotel tax revenues are one of the few areas where the Town has come control, without increasing taxes to residents, Therefore, the Economic Vitality.Program focuses on business .retention, attraction and expansion as means to generate Town revenue in .order to provide services to its residents. However, in doing o the Town has the ability to be selective about the businesses it .assists while maintaining the'high quality standards for which Los Gatos is known, Third, the Program will help to generate jobs for Los Gatos residents. By having a diversity of business types, a variety of local jobs are created for which Los Gatos residents maybe eligible. Employment within a community in which residents live is extremely desirable, thus avoiding lengthy commutes that may otherwise be required. Finally, many of the businesses in Los Gatos are locally owned and operated. The Economic Vitality Program strives to help local businesses be successful. This benefits not only the Town and its .residents but also the local owners of these businesses. In summary, the Economic Vitality Program shall serve as an important tool in implementing the goals and policies of the Town's General .Plan. It will serve the community by assuring the provision of local goods, services and employment for residents while ;generating revenue for the Town in order to provide municipal services. Through this proactive approach, the Town is more likely maintain a stable economy and a healthy community. 2. Purpose .and Mission The purpose and mission of the Town of Los Gatos Economic Vitality Program is to: Preserve and enhance the Town's charm and high quality of life • Provide goods and services desired by Los Gatos .residents Increase the economic vitality and diversity of the Town • Maintain and increase .sales tax revenues • Maintain and increase Transient Occupancy Tax (i.e., Hotel or TOT) • Maintain and increase tax increment revenue to the Redevelopment Agency • Create jobs for Town residents • Diversify and balance the local economy • Recognize the contributions that businesses make to the Town • Anticipate changes in the local economy and deal with them in a proactive manner 2 3. Guiding Principles The Los Gatos Economic Vitality Program is based on the following principles: • Protecting the Town's high quality of life while balancing the need for goods and services for Town residents and tax revenues to support the Town's municipal operations • Providing a wide variety of good and services to serve the community in order to :minimize the need for residents to travel to other communities • Recognizing that the Town is not an island, and that it is subject to the economic changes of Silicon Valley, California and the nation, thus requiring a proactive approach in protecting and enhancing its local economy • Being "User Friendly" which provides the best Customer Service for all of the Town's customers Using a Team Approach to bring .all Town departments .and resources together to work cooperatively with businesses 4. Economic Vitalitygram Summary The .focus of the Town of Los Gatos Economic Vitality Program is developed .around the following core programs which will be detailed later in this document: A. Business retention and expansion, including business visitations, business recognition, business surveys, and working with the Chamber of Commerce B. Targeted business attraction of key businesses that have been determined to be absent in the Town but desirable by residents to have here. C. Working with specific .groups of businesses and property owners including, but not limited to the auto dealers, hotels/motels .and the "North Forty." D. Annual monitoring of activities and reporting to the Town Council 5. The Town of Los Gatos - A Brief Overview The Town of .Los Gatos is nestled at the base of the Santa Cruz Mountains, "approximately 60 miles south of San Francisco in the southwestern portion of Santa Clara County. The Town is bound by the City of San Jose to the north and east, the City of Campbell to the north, and the cities ofMonte'Sereno and Saratoga to the west, and unincorporated County of Santa Clara and the County of Santa Cruz to the south. Los Gatos is one of Santa Clara County's oldest communities, being incorporated in 1887. It has a population of approximately 30,000 persons and encompasses about 14 square miles. The Town originally developed at a distance from other population centers and therefore 3 evolved as an independent community having. residential, commercial and industrial .areas. The economics of the Town have changed from wheat farming, milling, logging, orchard .and cannery businesses in the 19`" and 20"' centuries to the suburban, "high tech" visitor destination businesses of today. The Town is situated within the largest metropolitan .area of northern California, and is closely tied to Silicon Valley and its fast paced economy. Los'Gatos, however, retains a mix of residential, commercial and light industrial uses, attracts many visitors, and continues to retain its small town image. .Los Gatos prides itself as a "self contained community." Hundreds of businesses serve the residents and act as a destination point for visitors who are attracted to its restaurants, hotels and variety of shops within a pedestrian oriented downtown .setting. The Town is .also an "inclusive" community with the .full mix of ages, family sizes and incomes. Los Gatos has many parks and ..greenbelt areas, as well as a vibrant downtown area. Downtown Los Gatos is listed on the National Register of Historic Places and is the model of what communities strive to achieve in a downtown. What makes Los Gatos special is its small town atmosphere,. strong sense of place, varied architecture, reminders of the past, traditions, unique physical setting, good schools, low crime rate,. and the concerned .and involved people who make up the community. The overall community .consensus is that :Los Gatos: • Be a full-serve .community that is also environmentally sensitive; Maintain a balanced, well-designed mix of residential, commercial, service and open space uses, fostering apedestrian-oriented community with a small town, village-like character; • Support an active business community that provides a wide variety of goods and services and a broad :range of employment opportunities, minimizing the need to travel to other communities; Provides awell-run, efficient municipal government that is fiscally healthy, with high'levels of public safety, recreational, art, cultural amenities and that is committed to high quality education. This Economic Vitality Program is one of many tools that the Town will use to strive to achieve the .aforementioned goals. 6. Los Gatos Strengths, Weaknesses, O~~ortunities and Threats (SWOT Analysis A. Strengths • .Highly desirable community with high incomes • Small town atmosphere and strong sense ofplace • Well educated and involved residents 4 • Strong land use protection policies • .Excellent public education system • Extremely successful downtown .area • Located in Silicon Valley, the most successful high-tech region in the world Redevelopment Agency and Chamber of Commerce to assist businesses • Significant Town revenue from auto sales and hotel taxes Balance of retail, professional and high technology uses • Stable Town government and budget • Good access from Highway 17 and Highway 85, and future light rail B. Weaknesses • Town has limited funding for needed capital improvements ouch as street upgrades, repair of storm drain lines, downtown parking .and trafhc improvements Limited vacant commercial/office/industrial land for new development • High cost of land • High lease rates for commercial buildings • High cost of housing • High cost of labor • Large portion of sales. tax revenue (27% comes from a single sector -auto sales) • Traffic in the Town and in the region • Town "perceived" as expensive -may hurt certain uses • Town has little room for expansion of commercial/retail uses • Town has limited ability to increase revenues for municipal services C. Opportunities • Enhancements to the downtown including beautification improvements and parking which will further strengthen the downtownand increase tax revenues • Development of "North Forty" -largest piece of .land available in the Town for commercial uses - could be significant revenue generator, employment center, and provide uses that are desirable but currently lacking in the Town. • Sobrato .Development -Winchester Blvd. & Highway 85 -one of the largest office sites remaining in the Town. Nearly 300,000 sq. ft. of office space and 135 apartment units to be constructed- could house a corporate headquarters with name recognition for the Town .and potential tax revenues depending on the use Redevelopment/retenanting of certain older properties in town to bring in new and desirable uses, improve the appearance of these buildings., and increase tax revenues • New hotels {e.g. Los Gatos Hotel on Main St.) and expansion of older hotels (e.g., Los Gatos Lodge, Toll House) thereby increasing TOT and tax increment revenue to the Redevelopment Agency • Enhance the image of Los Gatos Blvd. to strengthen this important business district in the Town Protect and enhance the viability of neighborhood shopping area throughout the Town as an important resident serving use D. Threats • Loss of some of the auto dealers as they move to "auto rows" or "auto malls" {McHugh recently moved to Capital Expressway Auto Mall). Could have significant impact on sales. tax revenue .for the Town • Slowing local economy -reduction in sales tax {particularly auto dealers) and lower occupancy rates in hotels thus reducing TOT • Loss of one or more high-tech firms that .generate significant tax revenue and provide a significant number of jobs for the community • Attempts to address .downtown parking issues through parking management plan :may not go far enough • Reduced Town revenues resulting in a reduction of municipal services and deterioration of Town infrastructure 7. Detailed Economic Vitality Work Program A. Business Retention and Expansion Al. Business Visitations: The Town should develop a structured business visitation program whereby the most significant businesses in Town in terms of revenues generated and employment will be met with annually. The purpose of the visitations will be to develop relationships with the businesses, discuss how the business is doing (plans to expand or downsize) and offer any assistance that the Town may provide. Staying in touch with businesses will allow the Town to monitor business activity in Town better and project Town revenues. A2. Business Recognition Annual Event• Annually, the Town should hold a business recognition .event. This may take the form of a reception or lunch where the larger businesses are invited to meet with Town officials and .appreciation is extended by the Town. A3. Letters to New Businesses: When a new business license is issued, a letter from the Town welcoming the business to Town should be sent out along with other Town and/or Chamber information. 6 A4. Annual Letter to Businesses with renewal of business license: Annually in December of each year,. business licenses are renewed. This is an .opportunity to send out with the renewed license a letter from the Town expressing appreciation for the business being in Los Gatos AS. Survey of Businesses: Periodically, a brief business survey should be mailed out to specified businesses asking for input on how their business is doing and seeking input on how the Town can be more responsive to business. A6. Business Expansion: When staff learns of an existing business that plans to expand, :every effort should be made to facilitate an expansion at their current .location or with a relocation to a large space within the Town of Los Gatos. 'The Redevelopment Manager may serve as a iaison in helping to facilitate the permitting process. A7. Business Liaison: The Redevelopment Manager should serve as a liaison between the business community and Town Hall. Businesses that have a concern or problem may contact the Redevelopment Manager who can assist them in resolving the matter. Assistance may include referral to the proper person or department that should handle a matter, scheduling meetings with appropriate Town officials and. offering advice. A8. Sbecial Meetings for Non-Downtown Shopping Dstricts• The shopping centers/district that are not in the downtown area have sometimes expressed concern that they don't feel part of the Town. For these three or four areas, an annual meeting should be held in the area with Town officials to discuss issues .and express appreciation for these businesses. A9. Monitor Sales Tax: The Town receives quarterly sales tax reports from its consultant, MBIA. The Redevelopment Manager and Finance Director .should review these on a regular basis and !look for trends or areas of concern and then contact businesses as may be necessary to determine problems or trends. A10. Worlc with Chamber of Commerce: The Chamber plays a very important role in working with businesses throughout the Town. The Town .and Chamber need to continue to work as partners in assisting the business .community. A11. Marketing Materials/Gifts: Simple, .yet high quality, :marketing materials and/or gifts should be developed and distributed when making business visits or during recognition events.. These materials should portray the look .and feel of the Town. They may take the form of coffee cups, paper weights, a professionally designed Town brochure or similar items. 7 B. Targeted Business Attraction & Development B 1. Targeted Business Attraction: Through citizen surveys and resident contact, the Town should identify uses that are desirable in Town, but currently absent. The Redevelopment Manager on an ongoing basis should contact these businesses and work with there to see if it is possible for them to expand into Los Gatos. Such uses must be in keeping with the Town's vision and character and be of the highest quality design. B2. Targeted Tenanting of_Specific Buildings: The Redevelopment Manager should network with the real estate brokerage community and business and property owners in order to be .aware when ley buildings will have a vacancy. The Redevelopment Manager .should work with the building owner, their broker and prospective tenants to find a tenant desirable to the community and assist them through the permitting process. B3. Development of Key Parcels: There maybe specific vacant or underutilized parcels that the Town takes a specific interest in their development or redevelopment. The Redevelopment Manager should work to develop a list of potential parcels and then work with the property owners should the wish to pursue development. C. Working with :Specific Groups of Businesses/Properties C1. Auto Dealerships: The seven auto dealerships in Los Gatos provide a number of benefits to the Town including sales and service to Town residents, significant sales tax to the Town {nearly $2 million annually), and jobs for Town resident's. The auto dealers need assistance from the Town in order to update their facilities and make improvements that will keep them competitive in Los Gatos. The Town should meet periodically with the auto dealers to .discuss ways to strengthen the automobile sales business in Los Gatos while remaining sensitive to the concerns. of surrounding neighborhoods and other land use considerations. C2. Hotels/Motels: The Town has six hotels/motels with a seventh one to be completed by summer 2002. The hotels/motels are an important part of the Los Gatos economy for several reasons. They provide lodging for business and vacation travelers coming to Los. Gatos and .Silicon Valley. Those travelers also spend money in the Town which support local businesses as well as generates sales tax .for the Town. The hotels/motels provide employment .for Los Gatos residents and other. Finally, they are an important source of revenue for the Town -Transient Occupancy Tax (TOT) of over $1 million annually. The Redevelopment Manager should meet with the owners/managers of the hotels/motels .and provide recommendations or suggestions in terms of how the Town may assist them. This could include plans for expansion and/or renovation of facilities, marketing, and other logistical issues. C3. North Forty: The "North Forty" also know as the "Yuki" property is primarily an orchard area located adjacent to Highway 17 and Highway 85 at the northen end of the Town. This property represents the largest and most significant commercial development opportunity for the Town. Potential for the property includes providing retail uses desired, but currently lacking in the Town,. as well as generating significant tax revenues for the Town. The Town should continue to work closely with the Yuki family and the community in completing the .Specific Plan to :guide future development in this ley area. D. Annual Monitoring D1. Annual Monitoring Report: Annually, the Redevelopment Manager should prepare a report for the Town Council summarizing the previous years economic development efforts, reporting trends, areas of concerns,. and areas to focus on .for the upcoming year. N:\DEV\Marty\econdevitem\econdevplan2002.wpd 9