Modesto council approves downtown incentives, beautification

kvaline@modbee.comMay 6, 2014 

The Modesto City Council signed off Tuesday night on two programs designed to boost downtown and took a big step toward hiring a city attorney and an interim city manager.

One program would provide cash, tax breaks and other incentives to keep and attract certain types of businesses. It also would waive some fees to encourage downtown residential development. The other would beautify 10th Street between J and I streets by installing public art, planting shade trees in planters and other improvements.

The council voted 7-0 to approve both programs.

Modesto officials say the programs are part of a larger effort involving the city, downtown interests and others to make the city center more economically vital and attractive.

“This downtown is a great asset and it’s the right timing because the economy is improving,” said David White, chief executive officer of the Stanislaus Economic Development and Workforce Alliance, about the incentive program. “... There is nothing more important to the economy of this county than a vibrant downtown Modesto.”

The programs could cost the city’s financially stressed general fund as much as $160,000, according to city reports. That was a concern for Mayor Garrad Marsh and Councilman John Gunderson, who both asked whether the city could find alternatives to using the general fund.

Community and Economic Development Director Brent Sinclair said the staff was asking the council only for approval to develop the details of the programs, not to allocate money for them. Sinclair said he expected staff members to come back to the council within a couple of months on how they would implement the programs. He added that will give the city time to figure out how to fund the programs.

The incentives program includes $50,000 annually toward cash payments to new businesses or businesses relocating to downtown. For instance, a business that creates five to 10 jobs would receive a $2,000 payment. Businesses could get breaks on their sales tax and other taxes by meeting certain requirements. The proposal includes $50,000 annually for matching grants of as much as $10,000 to businesses that improve their facades.

The incentives would be for restaurants and certain types of retailers, such as booksellers, music stores and clothing shops, as well as professional offices, such as legal services.

The program to beautify 10th Street is expected to cost as much as $120,000, with the city providing half of the funding. The rest of the funding would come from the groups the city is working with on the project.

The two programs received mixed reviews from several speakers. Some extolled Modesto’s initiatives, but others said the programs don’t address downtown’s core problems: too many vacant buildings, aggressive panhandlers and homeless people who create public nuisances.

Hiring top managers

Marsh announced that council members had voted 7-0 in closed session before the meeting to authorize staff members to negotiate contracts for a city attorney and an interim city manager and bring them back for the council’s consideration at next week’s meeting.

Modesto is considering hiring the law firm of Meyers, Nave, Riback, Silver & Wilson as its permanent attorney. The firm has been providing interim legal services for several months after City Attorney Susana Alcala Wood resigned in November for another job.

Modesto also is considering hiring Jim Holgersson as interim city manager for six to eight months while it searches for a permanent manager. City Manager Greg Nyhoff is leaving this month after nearly six years in Modesto to become city manager of Oxnard in Southern California.

Holgersson has more than 35 years of experience in the private and public sectors, including five years as a deputy city manager in San Jose and six years as city manager of Arlington, Texas. He is a partner with San Jose-based consulting firm Management Partners.

Bee staff writer Kevin Valine can be reached at kvaline@modbee.com or (209) 578-2316.

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