S.F.’s J-Town to vote for benefits district by July 25

As San Francisco’s Japantown Community Benefit District goes to a ballot, the Japantown Task Force held an informational meeting June 27 to help answer property owners’ questions about the proposed assessment on their properties. The official city ballot initiative will be among the final deciding factors on whether the commercial benefit district will be formed or not.

If formed, the proposed district — covering the Japan Center Malls, the Kinokuniya Building, the ethnic enclaves’ two hotels, the commercial buildings along Buchanan Street up to Bush Street and the properties along the north side of Post Street from Laguna Street to the New People building — would pay an additional assessment on properties to the city to fund a new nonprofit community benefit district corporation charged with providing additional services to the district’s properties.

The Japantown CBD Steering Committee — set up by the Japantown Task Force to form the CBD with city funding — has previously stated that the district could provide services such as additional power washing of sidewalks, the installation of security cameras and the creation of promotional materials to attract more visitors to shop in the ethnic enclave.

Chris Corgas, senior program manager at the Office of Economic and Workforce Development, attended the meeting to answer property owners’ questions about the proposed district. He assured the meeting attendees that all funds assessed can only be spent within the district’s boundaries, and that the city is set to vote to establish the CBD and pay into it. According to Corgas, the special ballot measure will close Tuesday, July 25 at 3 p.m. and have its results tabulated that day. If more than 50 percent of the responding ballots want to form the CBD, the San Francisco Board of Supervisors are expected to ratify the plan and send the measure off to the mayor’s office.

According to the Management Plan Executive Summary for the CBD, the proposed district would annually allocate $125,000 for environmental enhancements (street cleaning and beautifications), $195,000 for economic enhancements (business development assistance and marketing for the neighborhood), $70,000 for advocacy and administration and $10,000 as a reserve for 10 years starting Jan. 1, 2018. The assessment itself would bring in $393,750 annually, while the CBD organization will also have to raise an additional $6,250 annually in “general benefit dollars” from outside the assessment to cover expenses.

The additional assessment to each property owner’s tax bill is weighted proportionally to the parcel’s stake within the district, Corgas said. According to the plan, the assessment is calculated out as $0.1477 per square foot of the lot and building and $38.0166 per linear foot of street frontage to raise the needed $393,750. The only nonprofit in the mix, Kimochi, Inc., will be assessed at half the rate of commercial entities and annually pay in $1029.70 to the fund.

Once a CBD is formed, Corgas said it cannot be disestablished for two years, and property owners cannot “opt out.” If more than 50 percent of the property owners within the district petition the city to disestablish after 2019, the city will issue another special election. If not, the district will stay in operation for 10 years from its original inception, at which point it could be renewed through another special ballot. The CBD could also undergo “substantial changes,” but Corgas warned property owners that the process is costly and would also require another special ballot.

Sheron Chiu, representing the Japan Center Malls, said the cost could be burdensome to the malls. According to the city’s engineering report, the malls would owe more than $60,000 each year. “If we are not passing the amount (to renters), that means ownership has to bear all this additional cost,” she said.

While, the property owners must pay for the additional assessment, Beau Simon, at-large Japantown CBD Steering Committee member, noted landlords could potentially pass the costs down to renters or reassess what they are currently paying for their own maintenance and security services to reduce redundancy. Simon also noted that the city has a substantial stake in the district and would be paying into the CBD.

According to the Japantown Community Benefit District Engineer’s Report, the city will pay $68,816.77 of the total bill, 17.4 percent of the total assessment. San Francisco owns the Peace Plaza and the Japan Center Garage within the proposed district. Simon said this would mean private owners will get about a dollar of value for every $0.80 they pay into the CBD.

“I feel that my assessment is still high, five thousand-something dollars. And I was told it was because I have Sutter Street,” said Ricky Okamura, co-owner of Benkyodo Company. Okamura’s cafe and confectionary is located on the corner of Buchanan and Sutter Streets, assessing a tax bill far greater than most other properties on the Buchanan Mall due to about 100 feet of street frontage on the Sutter Street side of the building. “All I use is the store front on Buchanan, so I feel I should pay the same amount as all the other stores on Buchanan.”

Comparatively, properties with less street frontage, such as the Mihara family’s Paper Tree building would owe $2,186.11 or $4,252.38 for the New People Building on Post Street, according to the engineer’s report.

Other major property owners within the enclave would also pay tens-of-thousands into the community benefit district. Hotel Kabuki would owe $36,041.13, the Kinokuniya Building’s assessment would be $43,282.00 and the AMC Kabuki Cinema’s owners will owe $37,177.43.

Proponents, however, pushed the importance of the district. “I think collective self determination would be huge,” Glynis Nakahara, the Japantown Task Force’s liaison to the CBD steering committee, said. “I feel like the community has always been in survival mode, subject to developers or whatever. For once, to have a vision and be able to participate in what Japantown is commercially — that’s huge.”

The community benefit district could also provide Japantown with political muscle. “When a CBD walks into city hall, politically, there’s a lot more power there than me as an individual property owner,” Steve Nakajima, a local resident, said.

A second information meeting for property owners is planned for Wednesday, July 12 at 5:30 p.m. at the Japanese American Citizens League National Headquarters, 1765 Sutter St. in San Francisco’s Japantown.

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