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HomeMy WebLinkAbout09/22/2014 Work SessionCity of Springfield Work Session Meeting MINUTES OF THE WORK SESSION MEETING OF THE SPRINGFIELD CITY COUNCIL HELD MONDAY SEPTEMBER 22, 2014 The City of Springfield Council met in a work session in the Jesse Maine Meeting Room, 225 Fifth Street, Springfield, Oregon, on Monday, September 22, 2014 at 5:30 p.m., with Mayor Lundberg presiding. ATTENDANCE Present were Councilor President Wylie and Councilors VanGordon, Moore, Ralston, and Woodrow. Also present were Assistant City Manager Jeff Towery, City Attorneys Mary Bridget Smith and Lauren King, City Recorder Amy Sowa and members of the staff. Mayor Lundberg was absent (excused). 1. Discover Downtown Springfield (DDS) Program Update. Courtney Griesel, Management Analyst, presented the staff report on this item. Ms. Griesel said this was formerly called the Downtown Main Street Program. Tonight she is providing a quarterly update on the program as directed by Council. There will also be a time for questions and answers. She introduced Jim McHugh, manager of the Discover Downtown Springfield Program, as well as Dave Johnson, staff for the downtown food cart program. Mr. McHugh said a lot of work has occurred over the last 90 days, including working with the established committees. One of the biggest things they have launched is the Business to Business Roundtables. Through this program, they have been getting businesses together on a monthly basis and discussing ideas. One of the ideas that came out of those meetings was the Discover Downtown's Super Saturday Summer Sidewalk Summer Special. Over sixteen businesses participated in that event, ten of which purchased a co-op radio advertising campaign. The event was tied into the mural in progress which was called "Mural in Motion". They reached over 3000 people with that, the Chalk Art Festival and the Simpson's Mural Dedication. They are working on establishing the by-laws and hope to have those finalized in the next couple of months. Mr. McHugh said the Economic Committee has been working with existing businesses for potential expansions and recruiting new businesses. A new gallery studio will be occupying the former insurance building at 741 Main Street. They are working with two existing businesses to come into City owned properties, and are awaiting the opening of Mezza Luna Pizza. They are concerned about the health of all existing businesses so are offering learning opportunities through HATCH. The target of the Organization Committee is to get a Board of Directors in order to have a formalized organization to move forward, especially for the fundraising portion of the program. The monthly art walks continue to grow with over twenty businesses scheduled to participate this month. The walk has been integrated with the Duck Downtown Program. A lot of outreach has been done to the Gateway hotels and work has been done with the Springfield Chamber of Commerce to organize a hotel van tour bringing hotel staff to downtown to see the businesses, activities and programs. They hope to conduct those tours two or three times a year. City of Springfield Council Work Session Minutes September 22, 2014 Page 2 Mr. McHugh said they had three sponsors so far for the window decoration program as they come into the holidays. They may enter a float into the parade, as well as other family oriented activities. They are anxious to see the installation of the lights and will work with City staff on a celebration once those are in place. Mr. McHugh said next steps will include continuing to build on the Business to Business Roundtables, the lighting program, holiday activities, getting the organization formalized and moving forward, and expending all of the funds in the Fagade Improvement Program. They will continue to work with potential businesses who may want to come in to downtown. Many inquiries have been received and people are looking and are interested. They are making a transition within the organization to move forward with the Food Cart Program and looking to target certain areas. With many of the upcoming events, they hope to have a good program up and running. Ms. Griesel said management for the Food Cart Program will be shifting from NEDCO to the Discover Downtown Springfield Program. That change will not affect the program itself. Councilor Woodrow said she liked the idea of the FAM tours for the hotels. It is an encouraging way to advertise downtown and bring people over to see what is going on. The Art Walks have been a big hit, and more themes are a good draw. She is looking forward to the window decorations and is excited to see more going on for the holidays. The kick off for the holidays in Springfield is the weekend of the parade and she is willing to help if needed with the windows. She understood they did advertising for the sidewalk sale, but she had heard from a number of people who did not know about it. She asked if there were other advertising avenues that could be used. Mr. McHugh said there were other options, but it was a quick turnaround on the decision so they didn't have the time needed to better promote the event. Getting the businesses together at the same time was a challenge. They could do better with more time. Councilor Woodrow suggested choosing a date and event, and then invite businesses to participate rather than trying to coordinate with the businesses. She was disappointed that the food carts had not started this summer. She asked if part of that was the time it took to work out the issue regarding generators. Ms. Griesel said there was about a week turnaround from time she knew of the concern and when the City approved the use. Mr. Johnson said he sent the message out as soon as he received that information from Ms. Griesel. Most of the timing issues revolved around the seasonality of getting businesses off the ground. For a lot of mobile food businesses, they look at March or April to get started. Getting started with the launch of a program in late June and early July was late. They will look at taking opportunities to capitalize on special events with food vendors. That gives businesses a chance to test the waters and the market. Councilor Woodrow said she would like to see more marketing for the food carts to the vendors. She felt the program could enhance downtown and could add flavor and character. She would also like to see more of a connection between SPROUT and Main Street. The roundtables and communication between businesses might be a prime opportunity to bring that connection back. Mr. McHugh said the last roundtable was held at SPROUT. They will continue to work on that and provide better education through outreach. City of Springfield Council Work Session Minutes September 22, 2014 Page 3 Councilor VanGordon said he is happy with the progress. The presentation made it easy to see their progress. He referred to a chart showing the number of meetings. It listed twelve meeting this quarter with a goal of 54 meetings for the year. He asked when they started tracking those meetings. Ms. Griesel said this was a first quarter of the report. Councilor VanGordon said he understood the seasonality issue, but asked if they would take an active approach early to get people interested in the next season. Mr. McHugh said they need to move forward with it and have talked about strategies. One strategy is to target high school students. They will also continue to work towards expanding that program through the special events. As they move forward, they will build on the momentum. Councilor VanGordon asked if Council would see more activity on the Food Cart Program when staff reports back next quarter. Mr. McHugh said they would. Councilor VanGordon asked if there were any issues coming out of the Business to Business Roundtable discussions that the City could help to address. Mr. McHugh said as the new lights are put into place, there will be a dark period when the old wiring is removed. They are looking to see if they can get some type of temporary lighting during that time. The ongoing perception of Springfield is a safe, family friendly community and they want to collectively carry that message forward. Niel Laudati has been involved in some of the programs which have given them an opportunity to work with the City. Getting advertising and showcasing these new programs and activities is important. Businesses like what they see and want to come downtown. Mr. Johnson said the seasonality consideration encompassed two seasons throughout the year. Spring/summer is the bigger season, but there are also year-round operations. He had communicated with a lot of food truck owners about the program, getting feedback and answering questions. Much of the feedback has been to contact them again in the Fall. Other feedback and concerns from the vendors are regarding vending from public property and not being able to guarantee them a specific spot for a vendor. They can allocate regions of downtown, but not a specific spot. A lot of food truck operators park in one spot. The program expects a certain level of mobility and that is a bit of a challenge for some of the vendors. Because they are trying to be respectful not to be in direct competition with existing merchants, they are looking to find people that offer things not currently covered in other downtown businesses. That is also a bit challenging. Mr. Griesel said they felt food carts were a good fit for Discover Downtown Springfield Program and that is why it was moved under management of that program. Councilor VanGordon said the real challenge is not to wait another quarter before reaching out to the vendors, and it sounds like that is not happening and we are doing something now, which is good. Councilor Moore said she appreciates the work being done and moving it to the Discover Downtown Springfield Program. She asked about having food carts during the Christmas Parade. Councilor Woodrow said they are already collaborating to have that happen. City of Springfield Council Work Session Minutes September 22, 2014 Page 4 Councilor Moore said there are businesses in the Mohawk area that do business in the Gateway area. She asked if they had been approached about expanding into a downtown food cart. Mr. McHugh said many food carts are the secondary business. They would need to identify those opportunities as they moved forward. Councilor Moore said she appreciated having the Farmer's Market in the Centennial Plaza with a very wide variety of food carts. She knows people are going into SPROUT during the Friday market to purchase food, but there are only a couple of food carts. She would be interested in having an outdoor Farmer's Market which could extend from SPROUT to the Plaza during the summer. She asked about the purpose of giving hotel staff the tours of downtown. Mr. McHugh said the FAM tour would be a short tour of downtown. Ms. Griesel noted that FAM stood for "familiar". Mr. McHugh said he delivers posters and brochures to the hotels. During one of his visits, one of the hotel attendants who grew up in Springfield asked about P1ankTown. He explained that business and other businesses that were coming into downtown and what they served. Because these are the point of contact for visitors to Springfield, it is important that they are being informed on what there is in Springfield. The tour is for the hotel staff. The Discover Downtown Springfield group would lead the tour along with staff from the Springfield Chamber of Commerce and Travel Lane County. They may also work with LTD or another entity for transportation. Councilor Woodrow said she appreciates the concern and consciousness for the current restaurants in downtown, but she feels food carts are a different personality and not necessarily direct competition. She's not sure it needs to be such a rigid control. Anything that attracts people downtown attracts them to everything there. Councilor Wylie said they have a lot of concerns because they care so much for downtown. They want to see healthy businesses and restaurants and food carts. 2. Marijuana Tax Bob Duey, Finance Director, presented the staff report on this item. Mr. Duey said Ballot Measure 91 is on the November ballot and if passed, will allow adults 21 or older to recreationally use or grow marijuana (and make products in small amounts for noncommercial purposes). The discussion tonight is to see if Council wants to do something ahead of time that would put the City in a better position if the ballot measure passes. The conversation is not around the pros and cons of Ballot Measure 91, or the effects of possible passage on the Development Code. Tonight they are looking at it from a financial standpoint and whether or not the City wants to do prior to the measure taking affect that will put the City in a better position to respond to the measure if it passes. Because the state of the law is unknown, cities throughout the state are grappling with the decision as to whether or not to pass a local tax. Currently, Ashland, Medford, King City, Milwaukie, and Tigard have passed a local tax. Tonight's discussion was whether or not the City wants to move forward with an option to tax. City of Springfield Council Work Session Minutes September 22, 2014 Page 5 Ms. King said medical marijuana is legal and there is nothing in the law saying the City can't tax medical marijuana or require a business license fee. If passed, Measure 91 would allow recreational use of marijuana in adults over the age of 21. The measure outlines how the state would tax that marijuana. The percentages are listed in the Council Briefing Memorandum. It is unclear whether or not the City would be able to tax recreational marijuana if it passes. There is a provision in the measure that says the State has exclusive right to tax, but it is not clear what affect that will have on a tax enacted by a city before the measure passes. It's also not clear how that will affect medical versus recreational marijuana. As Mr. Duey noted, several cities such as Hillsboro, Tualatin, Rogue River and Gold Hill have passed an ordinance to tax. Mr. Duey said they have been looking at what a tax attached to marijuana might look like. There are good examples from other cities. He was looking at what could be doable administratively for a city our size, with revenue worthwhile of such a tax. The one that has the most attraction was the gross receipts tax. He is not sure at this time whether it would be for sale of medical marijuana, recreational marijuana or both. A gross receipts tax would require adoption of an ordinance by the Council. Some of the issues such an ordinance would need to address include how the information would be transmitted between the seller and the City. The most common way is with self -reporting by the sellers. The City would come up with a form or basis, and the sellers would self-report their sales monthly or quarterly. From that, they would determine how much they would owe the City. He would recommend having a business license attached to it to identify who should be reporting. The ordinance could also include a penalty for non-payment, a collection process, an appeal process, a refund process and confidentiality as they would for any other business. Different cities have calculated the tax differently, and some are exempting medical marijuana. Home use and home grown would not likely be included as there are no sales involved. Mr. Duey said to adopt an ordinance at this point, Council would need to move fairly quickly in the process because they are not sure what will happen if the measure passes and if ordinances previously enacted will be grandfathered in or there will be court challenges. To be in the best position, Council will want to have something enacted and in force by the November 4 election. That doesn't allow time for discussion, and a first and second reading. Council could review it on either October 6 or October 20, and adopt with an emergency clause. If they enacted an ordinance before the election, they could make changes after the election. As far as the fee, the ordinance would not set the actual fee. A resolution would need to be passed setting the percentage or fee. Council may wait to decide some of the tougher questions until after the legislature is through the session. If the Council used the state guidelines, and 10% came to the cities, Springfield would probably get about $90,000 to $200,000 from the State. Councilor Moore asked if we had a City tax on alcohol. Ms. King said the City didn't have the authority to have a tax on alcohol. The City did license alcohol. Councilor Moore asked about a cigarette tax. Mr. Duey said there was no local tax, just the State tax. There is a tobacco license. Councilor Moore asked if the State would also use self -reporting to collect their tax. Mr. Duey said the State would be doing it entirely different and would be based on type of product (flowers, buds, etc.). The State is giving the Oregon Liquor License Commission (OLCC) until January 1, 2016 to put together rules. City of Springfield Council Work Session Minutes September 22, 2014 Page 6 Councilor Moore said because we have a Municipal Jail, we may incur quite a bit of additional costs related to driving while under the influence (DUI). Mr. Duey said that issue is currently in the community and our officers are trained to recognize impaired drivers. Councilor Moore said if recreational marijuana becomes legal, we might see more of that occurring. Councilor Ralston said since legalization is out of their hands, the City needed to position itself to be ready. We will likely incur additional need for law enforcement in a variety of ways. The City would be foolish not to do something ahead of time. He feels they should enact it now, and fine tune it at a later date. If they didn't take action now, it could be pre-empted. He has some reluctance in taxing the medical marijuana, but he had no problem taxing recreational marijuana at 10% to offset our costs. He asked what `non-commercial' referred to in the materials. Ms. King said that had to do with adults making their own products at home for personal use only. She is not clear on the regulation for edibles. The State tax was focused on the parts of the plant. Councilor Ralston said he didn't want to double tax on edibles. Mr. Duey said some other communities do show taxing edibles. The grower would be taxed. Councilor VanGordon asked if the ballot measure could ban business licenses as well. Ms. King said it could mean the City is pre-empted from business licenses. Councilor VanGordon said he is interested in looking at a business license for recreational marijuana at a fee higher than the business license for medical marijuana. He feels an exclusion on a tax for medicinal marijuana is appropriate. He prefers to choose an ordinance that sets the rate administratively so it could be set later through some other process. Acting now put the City in the best position. Councilor Woodrow said she agrees. She didn't feel the business license on the dispensaries was too high. It would not be out of line to have a gross receipts tax on the dispensaries, or a higher business license — one or the other to cover the staff time. She didn't have a problem with a gross receipts tax for recreational marijuana and creating an ordinance with a range up to a certain amount. They could then administratively decide the amount at a later date. That will preserve the opportunity to establish a tax in the future. Councilor Wylie said they need to be cognizant of how the state has guarded tobacco and alcohol. It looks like they want to do the same for marijuana. Meanwhile the State and Federal governments take away funds from cities to perform all of the services we perform. This is a new era and the City needs to move carefully and thoughtfully. There will be a cost for regulation for both dispensaries as well as recreational marijuana. At this juncture, they should look at an ordinance to preserve the right to tax in the future. She feels they need to include the products in the ordinance to provide that range of options. Mr. Duey said the last regular meeting prior to the November election is October 20. He asked if they would like to see something before October 20 so they can review and make comments. City of Springfield Council Work Session Minutes September 22, 2014 Page 7 Council agreed they would like to see something before October 20. Mr. Duey said staff will try to schedule something in time to provide that review. ADJOURNMENT The meeting was adjourned at 6:27 p.m. Minutes Recorder — Amy Sowa 4 Z�X� G Christine L. Lundberg Mayor Attest: Q� , Amy So a City Recorder