Special EDIR Committee Meeting - January 10, 2024
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Special Economic Development and Intergovernmental Relations Committee Meeting - January 10, 2024
The committee met to discuss transient occupancy tax allocation for arts funding, review annual grants report, hear from the Small Business Advisory Board, receive reports on the creative economy and nonprofit arts impact, and get an update on the Bridge to Home affordable housing program. The committee also sought input on 2024 priorities. Public testimony covered a range of topics including support for arts funding, criticisms of government overreach, concerns about marijuana edibles safety, and youth employment.
Consent Calendar
- The committee unanimously approved the committee actions from December 6, 2023, after receiving one public comment expressing concern about government interference in business.
Discussion Items
Item 1: Annual Recommendation on Council Discretionary Portion of Transient Occupancy Tax (TOT)
- Staff presented a recommendation to allocate 6.5% of total TOT (projected $21.5 million) to arts, culture, and community festivals, with the remaining 1% of TOT (projected $10 million) to balance the general fund. This is the first step toward the "Penny for the Arts" goal (9.52% of TOT). The recommendation is advisory and subject to the Mayor's budget authority.
- Public speakers: Christine Martinez (Arts and Culture San Diego) expressed strong support, highlighting job creation and community vibrancy; Fernando Ramirez (Japanese Friendship Garden) noted visitor growth and need for sustained funding; Kim Phillips (local artist) supported the initiative. Eight additional individuals submitted written support without speaking. One speaker (original) criticized the process as burdensome, and another (Blair B.) urged accountability and openness.
- Chair Campio moved to approve the recommendation; seconded by Councilmember Campbell. The motion passed unanimously (3-0).
Item 2: Fiscal Year 2023 Citywide Annual Grants Report (Information)
- The Grants Division reported record results: 132 applications totaling $494 million (29% increase in volume), and 97 awards worth $306.4 million (54% increase in award volume). Awards included $30 million for Oak Park Library, $4 million for Ocean Beach Library, $4 million for San Ysidro Community Activity Center, $4.3 million for City Heights Library and Performance Annex, $55 million for homelessness and housing, and $13.6 million for Urban Area Security Initiative. Funding sources: 65% state, 19% federal, 16% local/private. 57% of awards were competitive.
- Public comments: The original speaker criticized spending priorities; Blair B. encouraged open democratic practices. Councilmember Lee praised the team and asked about competitive grant success rates; staff committed to follow up.
Item 3: Small Business Advisory Board Report (Information)
- The SBAB presented its duties and accomplishments, including advising on the Economic Development Strategic Plan, developing a safety resource guide, and advocating for equitable access to business resources (e.g., multilingual business tax certificate application). The board has a full 11 members. Future priorities include promoting local business preferences in city contracts and addressing the disparity study.
- Public comments: The original speaker criticized government hurdles for small businesses; Blair B. supported equity efforts. Councilmember Lee commended the board's work.
Item 4: 2023 Creative Economy in the San Diego Region Study (Information)
- The study found that San Diego's creative industries generated $10.8 billion in economic activity (3.7% of county GRP), supported 84,000 jobs (comparable to a city the size of Encinitas), and are predominantly small businesses (98% for-profit). The sector is recovering from pandemic losses. Recommendations include strategic integration, workforce diversity, affordable creative space, and global awareness. The report was commissioned by the city and produced with the San Diego Regional Policy and Innovation Center.
- Public comments: The original speaker blamed the city's pandemic lockdowns for the decline; Blair B. linked creativity to democratic processes and tech accountability.
Item 5: Arts and Economic Prosperity 6 Study – Nonprofit Arts Impact (Information)
- The study found that San Diego's nonprofit arts and culture sector generated $1.1 billion in economic activity in 2022, supporting 16,900 jobs and generating $276 million in tax revenue. Attendance exceeded 16 million. Countywide, the sector is a $1.3 billion industry. The study included improved diversity data collection and established a new benchmark.
- Public comments: Similar themes to previous items; the original speaker criticized COVID policies; Blair B. discussed democracy as creativity.
Item 6: Bridge to Home Notice of Funding Availability, Round 3 (Information)
- Staff presented five recommended projects: Hillcrest Hall (98 units, $53 million), Humble Heart (73 units, $69 million), Palm City Transit Village Phase 1 (79 units, $49 million), Rose Creek Village (60 units, $36 million), and Terracini (95 senior units). Total city loan request approximately $20 million.
- The Independent Budget Analyst raised concerns: Humble Heart's $947,000 per unit cost (highest seen) and Palm City Transit Village's combined city subsidy ($129,000/unit) potentially exceeding the $100,000/unit cap set by the Housing Commission. Staff explained cost drivers (historic preservation, commercial space, parking, prevailing wages, interest rates) and noted that the Housing Commission loan has not been awarded yet.
- Public comments: Heidi Mathers (Chelsea Investment Corp.) thanked the committee for Terracini funding; Blair B. questioned high costs; the original speaker criticized slow progress; John Seymour (National CORE) explained infrastructure costs for Palm City.
Item 7: Discussion of EDIR Committee Priorities for 2024
- Chair Campio announced a call for priorities memos from committee members. Councilmember Lee proposed priorities: supporting small business, non-profits, arts and culture, working families, child care, life sciences, and incorporating an Asian American Pacific Islander economic impact study.
- Public comment: Several speakers urged focus on protecting children from marijuana edibles (Kathleen Leppett, Becky Rapp, Kelly McCormick) and youth employment development (Judy Strang). Others called for less government intervention.
Key Outcomes
- Approved Item 1 (TOT recommendation) unanimously (3-0). The recommendation will be forwarded to the Budget and Government Efficiency Committee for consideration on February 7, 2024.
- Acknowledged information items on grants, small business advisory board, creative economy, nonprofit arts impact, and Bridge to Home.
- Set the next meeting for Wednesday, February 7, 2024, at 2 p.m.
Non-Agenda Public Comment
- Additional public comment addressed concerns about marijuana edibles poisoning children, youth employment programs, and government overreach. Speakers included Becky Rapp, Judy Strang, Kelly McCormick, and others.
Meeting Transcript
Good afternoon, can you hear me? Yes, we can hear you, Chair. Thank you. Okay. Let me know when we have quorum. We do have quorum. So whenever you'd like to start. Okay. Whenever you're ready, Chair. Very good. Good afternoon, and welcome to the special economic development and intergovernmental relations committee meeting of January 10th, 2024. Our committee liaison, Sarah Jordan will provide information and instruction for the public to participate in today's meeting. At this point, I am notifying the committee I need to attend today's meeting remotely due to just cause related to child care needs for my son. Thank you, Chair Campio. While members of the public are able to attend the meetings in person, this meeting is being televised and live streamed on the city's website, and the council administration will continue to make arrangements for the public to comment using the web Zoom Zoom platform. Members of the public who wish to provide virtual testimony must send to the virtual queue by raising their hand before the virtual queue closes. This queue will close when the last virtual speaker finishes speaking, or five minutes after in-person testimony ends, whichever occurs first. This will allow for better meeting management between the two platforms and ensure the committee is able to manage and conduct city business. We appreciate the public's cooperation. Chair Kempio. If you raise your hand during a non-comment period, your hand will be lowered. Chair. Thank you, Sarah, for reviewing these instructions for the benefit of the public. A quorum is now present, and we will dispense with the approval of the committee action for December 6, 2023. Sarah, do we have any public comment on the past committee committee uh committee actions? Thank you, Chair. We do not have anybody here in chambers, but we do have a hand raised in the virtual queue, so I will begin the five-minute timer in case there are any others who want to indicate if they wish to speak. Our first speaker on the past committee actions is the original. Please unmute yourself and provide your comment. You will have one minute. Yeah, so um what we're doing with the um 901 and 912 um program seems to be something that is getting well more so the um the the development for what the businesses have to or required to do if they want to um do business. And um that you know what we're doing with that is um just really dangerous because I find I feel that it is going to be um you know actually working in the opposite direction of what you'd like because whenever we put up all of these um different, you know, constraints and and hurdles to jump through, it actually deters people from you know what you are trying to do. And if you guys have trouble retaining employees in the city, you know, um, I don't know if you're doing something like you're trying to with other people's businesses, but you just I find we meddle too much in people's um ability to succeed. Thank you for your comments. That does conclude your time. Our next speaker is Blair B. Please unmute yourself and provide your testimony. You will have one minute on the past committee actions. Hi, uh, thank you for that clarification. This is past committee actions. Uh I was waiting for public comment on the items uh wait for that item. Thank you. Thank you. And chair with no other hands raised, that does conclude public comment on the past committee actions. Thank you, Sarah. Thank you to the members of the public for calling in. We'll now move to uh motion for approval of the committee actions from December 6th, 2023. I will make the motion myself. And do I have a second? I see a second from Council Member Campbell.
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