The Carmel Restaurant Improvement District (CRID) is a benefit assessment district proposed to continue to help fund marketing and sales promotion efforts for Carmel restaurant businesses. This approach has been used successfully in other destination areas throughout the state to increase sales at assessed restaurant businesses. The renewed CRID includes all full service restaurant businesses, existing and in the future, located within the City boundaries of Carmel-by-the-Sea.
The CRID was initially formed on January 1, 2019 for a five (5) year term. Restaurant business owners decided to pursue renewal of the CRID in order to continue a revenue source devoted to providing sales and marketing services to increase restaurant food and drink sales at assessed restaurant businesses. If renewed, the CRID would generate approximately $240,000 on an annual basis for promotion of Carmel restaurant businesses. The initial “year” of operations will be a partial year consisting of six (6) months, with an anticipated assessment budget of $96,000.
Restaurant Improvement Districts
Restaurant Improvement Districts (RIDs) utilize the efficiencies of private sector operation in the market-based promotion of restaurants. These special assessment districts allow restaurant business owners to organize their efforts to increase restaurant sales. Restaurant business owners within the RID fund the RID, and those funds are used to provide services that the businesses desire and that benefit the restaurant businesses within the RID.
RID benefits:
- Funds cannot be diverted for other government programs
- They are customized to fit the needs of each destination
- They allow for a wide range of services; including: marketing of the destination and assessed businesses, promotion activities and sales lead generation
- They are designed, created and governed by those who will pay the assessment
- They provide a stable funding source for restaurant promotion
In California, Restaurant Improvement Districts are renewed pursuant to the Property and Business Improvement District Law of 1994. This law allows for the creation of a special benefit assessment district to raise funds within a specific geographic area. The key difference between RIDs and other special benefit assessment districts is that funds raised are returned to the private non-profit corporation governing the RID.
MANAGEMENT DISTRICT PLAN
The Management District Plan (Attachment 2) includes the proposed boundary of the CRID, a service plan and budget and a proposed means of governance. The CRID will include all full service restaurant businesses, existing and in the future, within the City boundaries of Carmel-by-the-Sea.
The proposed CRID will have a nine (9) year and six (6) months year life, beginning January 1, 2024 or as soon as possible thereafter, and ending on June 30, 2033. The assessment will be implemented beginning January 1, 2024. Once per year beginning on the anniversary of CRID renewal, there shall be a thirty (30) day period in which business owners paying fifty percent (50%) or more of the assessment may protest and begin proceedings to terminate the CRID.
The City will be responsible for collecting the assessment on a quarterly basis from each assessed restaurant business located in the CRID boundaries. The City shall forward the assessments to Visit Carmel, which will have the responsibility of managing CRID programs as provided in this Management District Plan. The City shall retain a fee equal to two percent (2%) of the amount of assessment collected to cover its costs of collection and administration.
CRID RENEWAL PROCESS
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May 2, 2023
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RESOLUTION OF INTENTION MEETING
Upon the submission of a written petition, signed by the restaurant business owners in the renewed CRID who will pay more than fifty percent (50%) of the assessments proposed to be levied, the City Council may initiate proceedings to renew the CRID by the adoption of a resolution expressing its intention to renew the CRID.
Petition Status: Petitions in favor of CRID renewal were submitted which represent over 50% of the total CRID assessment. This majority petition allows the Council to initiate proceedings for CRID renewal at the May 2, 2023 meeting.
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May 3, 2023
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NOTICE
The Property and Business Improvement District Law of 1994 requires the City mail written notice to the owners of all businesses proposed to be within the CRID. Mailing the notice begins a mandatory forty-five (45) day period in which owners may protest CRID renewal.
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June 6, 2023
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INTRODUCTION/FIRST READING OF ORDINANCE
Allow public testimony on the renewal of the CRID and levy of assessments. No City Council action required.
At the public meeting, the City Council shall introduce and conduct the first reading of the ordinance renewing the CRID and levying the assessment.
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July 11, 2023
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FINAL PUBLIC HEARING AND SECOND READING/ADOPTION OF THE ORDINANCE
If written protests are received from the owners of restaurant businesses in the proposed renewed CRID which will pay more than fifty percent (50%) of the assessments proposed to be levied and protests are not withdrawn so as to reduce the protests to less than fifty percent (50%), no further proceedings to levy the proposed assessment against such businesses shall be taken for a period of one (1) year from the date of the finding of a majority protest by the City Council.
If the City Council, following the public hearing, decides to renew the proposed CRID, the City Council shall adopt a resolution of formation.
Following a successful public hearing and first reading of the ordinance, the City Council shall convene to hold a second reading of the ordinance renewing the CRID and levying the assessment. Upon successful passage of the ordinance, the CRID shall be renewed, and the ordinance shall go into effect thirty (30) days after successful passage of the ordinance.
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ALTERNATIVES
The Council could choose not to adopt the Resolution of Intention. Staff does not recommend this option.