SD Council OKs revised payment plan for business districts

City News Service

The City Council voted unanimously Monday to change the way money is distributed to Business Improvement Districts, which are made up of organizations such as the La Jolla Village Merchants Association that band together to promote their geographic areas.

The districts were created by businesses so they could promote themselves on a collective basis — since the pool of money would be larger, they could get more visibility for their bucks. The results include advertising for events that take place along streets in the business districts.

The city had collected assessments on 12,000 firms in 17 BIDs citywide and reimbursed each district, but the business groups claimed that bureaucratic inefficiency led to cash-flow problems, with revenues often delivered after events that they had to fund.

The change cuts out the middleman, so the assessments will go straight to each BID, which will have to file reports to the city on their expenditures. The BIDs contract with the city to manage the funds.

During the discussion, First District Councilwoman Sherri Lightner stressed the need to review the new process to make sure it was working properly. As a result, the council’s Public Safety and Neighborhood Services Committee, will receive a report on this new process within six months.

In an e-mail after the vote, she noted, “the business community asked us to help out and we responded. Streamlining the process should help these districts flourish, which is good for our local businesses and for our neighborhoods. The key is to have proper oversight in place to make sure these tax dollars are being used properly and effectively.”

Councilman Todd Gloria, during the council meeting said, “We in government should be helping them in what they do.”

Councilman Carl DeMaio said he was pleased the city was asking business how they can be helped.

“This is a great day because we’re cutting red tape at City Hall,’' DeMaio said. “We should get used to this.’'

According to city staff, the first payments that will go right to the districts will be in October.

Alleged accounting irregularities and duplicate requests for reimbursement led to a city audit of the former La Jolla business district manager, Promote La Jolla. The matter was resolved when PLJ’s insurance provider agreed to cover the costs, which totaled $112,070.