Newport council hesitant to keep funding business improvement district in Corona del Mar

The Corona del Mar Business Improvement District, which aims to enhance the visitor and proprietor experience in that neighborhood of Newport Beach, could be working with $40,000 less next year after the Newport Beach City Council telegraphed its interest in cutting the group’s subsidy.

The council was hesitant to offer full support for the improvement district, which represents businesses along East Coast Highway between Avocado Avenue and Hazel Drive, when the BID came up for its annual renewal Tuesday.

Council members said they like the concept, in which, through special assessments and the city’s administrative help, business owners can fund street beautification, marketing campaigns, special events and initiatives such as parking improvements to help promote visits to their shops.

Mayor Diane Dixon called such districts business owners’ “own mini form of democracy.”

But the council balked on helping to fund the CdM district directly, as it long has.

This year, the Corona del Mar BID has kept up landscaping and street furniture such as benches, trash cans and bike racks, run a “shop local” campaign with the Corona del Mar Chamber of Commerce and continued its work on parking distribution, time limits and space minimums. It also regularly chips in for neighborhood traditions such as the annual Christmas Walk block party and the seasonal decor around the topiary dolphins on the medians at Marguerite Avenue.

It does that on an annual budget of about $220,000 — $100,000 of which comes from assessments on area businesses and $40,000 comes from the city’s contribution. The rest typically is money carried over from the previous year.

The City Council established the district in 1997 and has been chipping in direct discretionary funds for much of the time since.

Mayor Pro Tem Will O’Neill said last year that he wouldn’t vote to renew the district again if he didn’t see a turnaround in merchant support for the BID. After hearing Tuesday from BID Chairman Bernie Svalstad that only the incumbents on the group’s nine-member advisory board applied for the board in May, O’Neill said he was concerned by the apparent apathy.

Councilman Brad Avery said the BID has champions, “but it’s just been limping along for a long time.”

“Bernie’s just done an incredible job over the years, so I think it makes it difficult for us to come to terms with it because a number of people have put a lot of time and effort into this,” Avery said.

The Corona del Mar district operates under a 1989 state law in which city councils establish BIDs but district members can dissolve them if a majority wants to. A 1994 law on BID structures, which does not supersede the earlier law, establishes BIDs by member initiative.

“I have this philosophical concern about government compulsion on an issue like this, where we don’t know and we haven’t known for quite some time that there is a majority … support for it,” O’Neill said.

No one on the council moved to renew the district Tuesday, which Dixon said was because council members weren’t comfortable with the structure.

She said the alternative structure gives member merchants more independence and ownership. She said she wants to keep the district and allow it to continue collecting assessments, but reduce the city’s role and pull its funding. She said that isn’t intended as punitive and that it could help the BID grow.

“We strongly support business improvement districts,” Dixon said.

Councilwoman Joy Brenner, who represents Corona del Mar, said the BID has done good work but that business owners should be able to opt in.

“I’d hate to not be supportive of them, but I’d like to see them transition over to the 1994 system,” she said.

The council agreed to continue the matter to its next meeting in June. It did the same for the Newport Beach Restaurant Assn. BID, which operates under the same structure and also gets a $40,000 annual infusion from the city.

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