HomeMy WebLinkAboutHuntington Beach Auto Dealers Association - 2022-03-15 2000 Main street.
Huntington Beach, CA
„ City of Huntington Beach AW 92648
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File #: 22- 183 MEETING DATE: 3/15/2022
REQUEST FOR CITY COUNCIL ACTION
SUBMITTED TO: Honorable Mayor and City Council Members
SUBMITTED BY: Sean Joyce, Interim City Manager
VIA: Ursula Luna-Reynosa, Director of Community Development
PREPARED BY: Kriss Casanova, Economic Development Manager
Subject:
Approve and authorize execution of a Memorandum of Understanding (MOU) between the City
and the Huntington Beach Auto Dealers Association extending the Auto Incentive Beach
Parking Program for an additional five (5) years
Statement of Issue:
In 2011, the City Council authorized a one-year Memorandum of Understanding (MOU) with the
Huntington Beach Auto Dealers Association (Association) for an Auto Incentive Beach Parking
Program (program) that provided car purchasers with a voucher to redeem an annual free beach
parking pass from the City. The program has proven to be successful (or associated with) increasing
sales and was renewed on an annual basis until 2015, when it was extended for a five year term. The
Association considers the City's incentive valuable for attracting vehicle buyers and has requested
another five year extension of the MOU. Per Government Code Section 53083, a public hearing is
required prior to approving the economic development subsidy.
Financial Impact:
Annual sales tax revenue to the City from car sales and leases is estimated to be between $8-9
million. An average of 2,750 passes are redeemed each year at a cost of $150 each, resulting in an
annual subsidy of approximately $412,500 with approximately 250 hours of staff time. The annual
cost of printing parking passes is approximately $1,900 and is included in the Community and Library
Services Department budget.
Recommended Action:
A) Open the public hearing and receive written and oral testimony; and,
B) Approve and authorize the Mayor and City Clerk to execute a new "Memorandum of
Understanding Between the City of Huntington Beach and the Huntington Beach Auto Dealers
Association."
City of Huntington Beach Page 1 of 3 Printed on 3/912022
File #: 22-183 MEETING DATE: 3/15/2022
Alternative Action(s):
Do not approve the recommended motion and direct staff accordingly.
Analysis:
In 2011 , the City Council authorized a one-year Memorandum of Understanding (MOU) with the
Huntington Beach Auto Dealers Association (Association) to pilot an Auto Incentive Beach Parking
Program (program). The program was designed to encourage car sales and downtown eating and
shopping during the off-season by providing qualified vehicle buyers with a voucher to obtain a free
beach parking pass. The program provides an extra incentive over other dealerships in adjacent
communities, allowing the City to receive sales tax revenue that might otherwise be received by
neighboring cities. The Association, made up of 12 dealerships, markets the incentive to prospective
car buyers. Eligible buyers initially include buyers of new vehicle, and in 2015, the program was
extended to buyers of used automobiles selling for at least $20,000. Leased sales have historically
also been eligible.
The pilot program was successful and renewed annually and then for an additional 5-year term in
2015. The Association considers the City's incentive to be valuable and has requested to continue
the program for five more years until 2027 (Attachment 1). The MOU (Attachment 2) memorializes
the City and the Association's collective objectives and responsibilities regarding the continued
implementation of the program. Updates to the MOU include memorializing leased vehicles as part
of the program and the inclusion of program procedures for all participating auto dealerships.
Staff recommends that the program be extended given its perceived success enhancing the local
economy. Car dealerships are the largest sales tax generators in the City with annual sales tax
revenue estimated to be between $8-9 million. The program is an indirect marketing tool provided by
the City at a low cost that may entice customers not only to purchase their automobile in Huntington
Beach, but also encourages vehicle owners/lessees to visit the beach, shops and restaurants in the
Downtown area for the year that the beach parking pass is valid, with the hopes of renewing the
pass.
The City is able to analyze the number of parking passes that have been redeemed for the past
several years, including what city each program participant resides. Since 2018, 11,016 parking
vouchers have been redeemed, and of those, 5,539 purchasers were from Huntington Beach
(50.3%). While the majority of the vouchers redeemed are buyers from Huntington Beach and
adjacent cities, the program has also been successful attracting regional buyers and lessees. The
average number of parking passes issued in association with the program between 2018 through
2021 was approximately 2,750 annually. Overall numbers for 2020 were down due to COVID-19,
with a slight increase for 2021. The number of parking passes redeemed for the past several years
are as follows:
Parking Passes Redeemed--Per City
Residence of 2018 2019 2020 2021 TOTAL IV,
Huntin_ton Bt I1878 1,593 1,043 1,025 5,539 50.3%
Fountain Vall 63 241 13S 148 790 7.2%
Westminster 177 171 913 Ill 552 -%
City of Huntington Beach Page 2 of 3 Printed on 3/9/2022
oowere7.87 Legistar—
File #: 22-183 MEETING DATE: 3/15/2022
Costa Mesa 165 148 103 84 -500 4.5%
Garden Grovc 160 11 I 76 76 423 '.S%
Irvine 87 55 i0 52 24 %
Santa Ana 97 87 62 52 298 2.7%
Lon, Beach 109 66 40 55 270 2.5%
Anaheim 78 /9 -o )5 P92 F.7%
Oran_e 55 6 20 r2 1153 11.4%
Others 595 577 83 20 1,975 117.9%
TOTAL 3,684 3,174 2.038 PJ20 111,016 1100.00%
Government Code Section 53083 requires that the City Council hold a noticed public hearing and,
prior to the public hearing, provide information to the public through the City's website regarding the
proposed economic development subsidy in a report. An "economic development subsidy" is any
expenditure of public funds or loss of revenue of $100,000 or more, for the purpose of stimulating
economic development. Since the aggregate expenditure of public funds by the City for the program
is anticipated to be approximately S412,500 annually, an economic development subsidy report
(Attachment 3) has been prepared. Highlights of the report are as follows:
• Agreement term for five years through March 14, 2027.
• Approximately 24,600 vehicles sold on average for the past 3 years (new/used/leased) with
annual sales tax revenue of $8-9 million.
• The City will retain approximately $1,000,000 in annual sales tax revenue from vehicle
purchases or leases in association with continuing the program.
• The City will provide beach passes at a value of approximately $2,000,000 throughout the five
yearterm.
• Continuation of the program will assist in retaining approximately 1,100 auto dealer jobs.
Environmental Status:
Pursuant to CEQA Guidelines Section 15378(b)(4), government fiscal activities that do not result in a
physical change in the environment and do not commit the lead agency to any specific project, do not
constitute a project. Therefore, these activities are exempt in accordance with CEQA Guidelines
Section 15060(c)(3).
Strategic Plan Goal:
Economic Development & Housing
Attachment(s):
1. Huntington Beach Auto Dealers Association - Letter of Support
2. Memorandum of Understanding
3. Economic Development Subsidy Report
City of Huntington Beach Page 3 of 3 Printed on 3/912022
ooxere7.54 Legistar-
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' 405 • Beach Blvd. South
HBADA Foundation e
Huntington Beach Auto Dealers Association
Pebnuuy 25.201-1
Kriss,Casanova
Economic Development r\lanager
City oft luillin"lon Beach
2060 Again street
I lunlineton Reach. Ca 92648
[)car Ms.Casanova:
Our Executive Director Dave GaroGdo is responsible fivaIt of our Government Relations,I.mItlCHICutalid Public 1'olicy
issues liv the FIB Auto Dealers Assoc.
Items being discussed:
1. 'There are 12 New Cur Dealer Membeo:s in the 1113 Auto Dealers Association.A copy of the dealers and their contact
information is enclosed. I arm involved in dice ofthose, I III Chrrs]cr Dodge Ram.I .Iccp and I-II1 Hyundai.Chrvslcr
Corp mandated a separate building to qualify our dealership frnchise area.'[lie size of our invesumcnt resulted in the
city asking for a bLiSilIC5S license for that address...yet we operate the business at a corporate level as one entity. N'c are
tl lid] Iledged voting mender at all three stores as pan of the FIR Auto Dealers Assoc.
2. Parking Pennits.lbe lilt DcalcrAs;ocialion strongly supports the continued ability to use this owl as a sales incenlive.
lhere au'c 12 ofus,all different managenmcnl styles.Dave actively works With all ofus continually providing instruction
and inform pion on the Parking Pass program and other items. Mule we cannot lone every dealer to make available
the Parking Pass on even-yualifyumg sales or lease transaction on either New or Previously Owned vehicles.the majority
ofus count on this owl to attract,retain and develop new consmner opportunities.
We respectively request that the "shell'lil "of the parking Pass application once given to die customer be valid Ibr a
mininuun for 45 days. Manv of our stores do most of their business on weekends and not every store has their stall
people who process this Parking Pass voucher work on die weekend -resulting in the certificate being mailed several
days aller the purchase/lease.etc. And,of course.many people arc busy with other priorities and getting to their voucher
for the Parking Pass once they receive it...nmight not be lbeu'highest priorily. Pony-five day period would be reasonable.
3. Reader Board Sign ads and,compliance reporting has been going on Ihr it period of lime especially since the latest
request. Dave ha,copied us on all city requests and our ellorts to respond back with the requested information.
We are here to develop not only successful kcal businesses,but to be the best partner possible with the local government.
And,to that cod,particularly with Davis length of tinge in the community,his rNlasces Degree in Public Administration
and his long nnumunily experience as an advocate of sound private/public sector partnerships-we are sure he represents
its at the highest possible degree of prolcssionalism anti civic pride.
Dave reports that the city's new administration has seriously re-ingested in Economic Development leadership and dial
is a good thing I�br all ofus.
Sincercl>I, {//
Pete Shaverr,7,
17/Ill'1 Auto Dealers Assoc.
cc: Dave Garofalo
I'.xcc. Dir. IgR Auto DcalcrsAssoc.
PS: We employ over 1000 men and women and they also buy;md lease yualifyfng vehicles. Recently an employee
with proper paper work was denied it Pass.'llmat exemption should be removed in our opinion.
630 Main Street -Huntington Beach, Ca - 92643 789
714.914.9797 - Hbnewsl a tiol.com - beach blvdofca l-S-Con,
MEMORANDUM OF UNDERSTANDING
BETWEEN THE CITY OF HUNTINGTON BEACH AND
THE HUNTINGTON BEACH AUTO DEALERS ASSOCIATION
This MEMO�RjkNDUM OF UNDERSTANDING (MOU) is made and entered into this
lS"A- day of 2022 ("Effective Date")by and between the HUNTINGTON BEACH
AUTO DEALERS A SOCIATION, ("Auto Dealers"), a California 501 (c) 3 nonprofit corporation
and the City OF HUNTINGTON BEACH, a California municipal corporation("City"). Auto
Dealers and City may hereafter collectively be referred to as "the Parties."
RECITALS
WHEREAS, the Huntington Beach City Council authorized a pilot program in 2011 with the
Huntington Beach Auto Dealers to provide an Annual Beach Parking Pass ("Beach Parking Pass")
to buyers of new automobiles in Huntington Beach; and
The "Program" continues to be successful in enhancing local economy by incentivizing
prospective purchasers of new automobiles to shop in Huntington Beach with the reward of a free
Beach Parking Pass; and
In 2015, the Parties extended the"Program" to buyers of qualifying used automobiles which
sold for$20.000.00 or more in Huntington Beach; and
The Parties now desire to extend the"Program" to automobile leases;and
The Parties desire to enter into this MOU to memorialize their collective objectives and
responsibilities regarding continued implementation of the Program.
Pursuant to this MOU, Parties agree as follows:
l. The above Recitals are true and correct to the best of each party's knowledge, and
such Recitals are incorporated by this reference to be part of this MOU.
2. This MOU will end 5 years from the effective date as set forth below. Termination
shall not affect any continuing obligations that may arise from this MOU.
This MOU may be terminated by the City or Auto Dealers for any reason with or
without cause upon thirty (30)days written notice.
3. The obligations and duties of each Party are as follows:
A. The City will issue fill-in-the-blank vouchers to Auto Dealers to be exchanged by
the owner of any qualified new, used or leased automobile for a Beach Parking
Pass("Voucher"). The City reserves the right to deny vouchers that are
incomplete or missing information. The following minimum information must
be provided:
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21-10382267451
• The name of the owner of the new or used automobile
• The new or used automobile make and model
• The. specific Auto Dealership
• The Vehicle Identification Number
• An authorized signature from the Auto Dealership that sold the
automobile
• Date of-purchase of the new or used automobile
13. Each Auto Dealership that issues a Voucher will provide instructions to the
owner of the new. used or leased automobile that he or she will be required to (I)
complete the Voucher with the Auto Dealership, (2) Bring the Voucher. Sale
Contract/Lease Agreement and a photo identification to Ivtoorehouse L.ilcguard
Headquarters, 103 Pacific Coast Highway, 1-luntington Beach, within 45 days of
automobile purchase to redeem the Voucher.
1. The vouchers may be redeemed as provided herein, with a limit ofone
per new, used or leased automobile sold.
IL Vouchers may not be duplicated by Auto Dealers or customers.
111. New, used or leased automobile buyers need not be Huntington Beach
residents to participate_
IV. In order to redeem a voucher. the Citv will verifv that the voucher is
matched with the owner of a new, used or leased automobile using the
auto sale transaction paperwork (Sale Contract/Lease Agreement).
V. Each auto dealer will designate a person as the authorized signature for
the voucher for City verification.
VI. Each auto dealership that has issued a Voucher will submit a quarterly
report of the number of new, used or leased vehicles sold and number of
Vouchers issued during the term of this N1OU. The Auto Dealers will
designate Peter Shaver to act as representative with regard to this NIOU.
In the event said representative changes. the Auto Dealers agree to meet
with the City before designating a new representative. The City shall
have input in choosing a representative but will not have discretion in
the ultimate choice of a representative.
VIL Each participating Auto Dealership will need to abide by the Auto
Dealership Procedures for the Auto Incentive Beach Parking Program,
included as Appendix 13.
C. In addition. each buyer of a new, used or leased car will be required to agree to
the following as condition precedent to receiving a Beach Parking Pass:
1. The Beach Parking Pass must be permanently affixed to the inside. lower
left corner of the front windshield (drivers side) on the vehicle for which
it was issued.
31-10387P_6745I
IL If the vehicle owner replaces the car windshield during the year, the
Beach Parking Pass may be replaced for S 10.00.
111. Beach Parking Passes are valid until the stated expiration date of the pass.
IV. The City is not responsible for lost. stolen, or misplaced passes.
V. Possession ofthe pass does not guarantee a parking space.
VI. Beach Parking Passes may be limited to certain areas at various times
during the year at the sole discretion of the City.
VI1. The Beach Parking Pass is valid at City Beach parking lots located north
and south of the Pier and at the Main Promenade Parking Structure (200
Main Street). Main Promenade Parking Structure has entrances on Walnut
and Olive Streets. Also valid at City beach parking lots from Beach
Boulevard to 61h Street. parking meters along Pacific Coast flighway and
Beach Boulevard, metered parking lots between Goldenwest Street and
Seapoint "Dog Beach" area parking lot adjacent to the Warner Avenue
Dire Station and boat launch.
VII I. Exceptions: The Beach Parking Pass does not allow parking on Main
Street. The Strand parking structure, at residential or business meters, nor
in Duke's Valet designated areas.
The above terms are included as part of Appendix A to the Voucher and must be signed by
the new automobile purchaser.
q. The Auto Dealers agree that any discrepancies regarding Vouchers or eligibility to
receive a Voucher and/or Beach Parking Pass will be resolved by the City Manager
or his designee at his or her sole and absolute discretion. The receipt of a Voucher or
Beach Parking Pass is not any type of entitlement or property interest and may be
withdrawn or not issued at the sole discretion of the City with no right to appeal.
5. The Community & Library Services Department will retain a record of all Vouchers
redeemed during the incentive period in the software system. Additionally, the City
will collect quarterly sales reports from the Auto Dealers to indicate the expected
number of qualified participants.
6. Upon the prior written approval of City, which approval shall be at the sole
discretion of City's City Manager or his designee. Auto Dealers shall have the right
to use the official Huntington Beach City logo and City's "Surf City Huntington
Beach" trademark.
7. Auto Dealers shall protect. defend, indemnify and hold harmless City, its officers,
officials, employees, and agents from and against any and all liability, loss, damage.
expenses, costs (including without limitation. costs and fees of litigation of every
nature) arising out of or in connection with performance of this MOU or its failure to
comply with any of its obligations contained in this MOU except such loss or
damage which was caused by the sole negligence or willful misconduct of City. In
addition to the workers' compensation insurance required by state law. and Auto
Dealers' covenant to indemnify City. Auto Dealers shall obtain and furnish to City, a
policy of general public liability insurance, including motor vehicle coverage. Said
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policy shall indemnify Auto Dealers, its officers. agents and employees. while acting
within the scope of their duties, against any and all claims arising out of or in
connection with this Agreement. and shall provide coverage in not less than the
following amount: combined single limit bodily injury and property damage,
including products/completed operations liability and blanket contractual liability. of
51,000,000 per occurrence. If coverage is provided under a form which includes a
designated general aggregate limit, the aggregate limit must be no less than
51.000,000. Said policy shall name City, its agents, its officers. employees and
volunteers as Additional Insureds, and shall specifically provide that any other
insurance coverage which may be applicable shall be deemed excess coverage and
that Auto Dealers' insurance shall be primary.
Under no circumstances shall the above-mentioned insurance contain a self-insured
retention, or a "deductible" or any other similar form of limitation on the required
coverage.
8. Neither party shall encumber. assign, or otherwise transfer this MOU. or any right or
interest in this NIOU, without the express written consent of the other party. Consent
by one party to an assignment or transfer shall not be deemed to be consent to any
subsequent assignment or transfer. Any encumbrance, assignment or transfer,
Without the prior written consent of the other party. whether it be voluntary or
involuntary, by operation of law or otherwise, is void and shall, at the option of the
other party. terminate this MOU.
9. All the terms. covenants and conditions of this NIOU shall inure to the benefit ofand
be binding upon the parties and their successors and assigns. The provisions of this
Section shall not be deemed as a waiver of any of the conditions against assignment
hereinbefore set forth.
10. Auto Dealers shall employ no City official nor any regular City employee in the
work performed pursuant to this MOU. No officer or employee of City shall have
any financial interest in this MOU in violation of the applicable provisions of the
California Government Code. Failure to abide by the Auto Dealership Procedures
included in this MOU as Appendix B. in addition to producing any forged or
fraudulent vouchers, will result in expulsion from the program.
11. Auto Dealers shall consult with City prior to issuing any press releases or otherwise
making any public statements with respect to this MOU, the transactions
contemplated herein, or matters arising herefrom.
12. The remedies given to the parties in this MOU shall not be exclusive but shall be
cumulative and in addition to all remedies now or hereafter allowed by law or
elsewhere provided in this MOU.
13. The waiver by City of any breach by Auto Dealers of any ol'the provisions of this
NIOU, irrespective of the length of time for which such failure continues, shall not
constitute a waiver of'such breach or a waiver of any subsequent breach by Auto
Dealers either of the same or another provision of this NIOU.
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21-10382267451
14. Should the performance of any act required by this MOU to be performed by either
City or Auto Dealers be prevented or delayed by reason of an act of God, strike,
lockout, labor troubles, inability to secure materials. restrictive governmental laws or
regulations. or any other cause (except financial inability) not the fault of the party
required to perform the act, the time for performance of the act will be extended for a
period equivalent to the period of delay and performance of the act during the period
of delay will be excused.
15. Any written notice, given under the terms of this MOU. shall be either delivered
personally or mailed, certified mail. postage prepaid, addressed to the party
concerned. as follows:
City: Auto Dealers:
Community Development Department Peter Shaver
City of Huntington Beach Huntington Beach Auto Dealers Association
2000 Main Street 630 Main Street
P.O. Box 190 Huntington Beach CA 92648
Huntington Beach. CA 92648
If a party desires to change the address for notices set forth herein. said party will
provide 30 days advance written notice to the other party of any such change.
16. In the event of any litigation to enforce the terms and provisions of this MOU. each
party shall bear its own costs and attorney's fees. The prevailing party shall not be
entitled to recover its attorneys' fees from the non-prevailing party.
17. The rights and liabilities of the parties, and the interpretation and construction of this
MOU. shall be determined in accordance with the laws of the State of California.
Any controversy arising out of or under this MOU. if litigated, shall be adjudicated
in a court of competent jurisdiction in Orange County. California.
18. Termination of this MOU shall not affect the right of City to enforce any and all
indemnities given or made by Auto Dealers under this MOU. nor shall it affect any
provision of this MOU that expressly states that the provision shall survive
termination thereof.
19. No elective or appointed City or City affiliated board. commission or member
thereof'. or officer. official, employee or agent of City shall be personally liable to
Auto Dealers, its successors and assigns, of any default or breach by City under this
MOU or for any amount which may become due to Auto Dealers. its successors and
assigns. under this MOU or for am' obligation of City under this MOU.
20. This MOU contains and embraces the entire agreement between the parties hereto
and neither it. nor any part of it, may be changed, altered. modified. limited or
extended orally or by any other agreement between the parties unless such agreement
be expressed in writing. signed and acknowledged by City and Auto Dealers. or their
successors in interest.
5
21-103821267451
21. Should any provision of this MOU be held by a court of competent jurisdiction to be
either invalid, void,or unenforceable,the remaining provisions of this MOU shall
remain in full force and effect unimpaired by the holding, so long as the reasonable
expectations of the parties hereto are not materially impaired.
22. This MOU may be executed in counterparts,each of which shall be deemed an
original, but all of which taken together shall constitute one and the same document. "
23. No title interest of any kind is hereby given and Auto Dealers shall never assert any
claim or title to the Voucher or Annual Pass or any other public property.
24. This MOU shall be interpreted and applied in accordance with California law. Any
litigation concerning this MOU shall be brought in Orange County Superior Count.
In the event suit is brought by either party to construe, interpret and/or enforce the
terms and/or provisions of this Agreement or to secure the performance hereof, each
party shall bear its own attorney's fees, such that the prevailing party shall not be
entitled to recover its attorney's fees from the non-prevailing party.
IN WITNESS WHEREOF, the parties hereto have caused this MOU to be executed by and
through their authorized officers on ✓{FYI R t—e_� /t$ftl 2022.
HUNTINGTON BEACH AUTO DEALERS CITY OF HUNTINGTON BEACH, a
ASSOCIATION AY municipal corporation of the State of
By: // California
print name
ITS: (circle one)Chairma President May
AND q4
By: �ieQ City Clerk ?/.u/22
FJ
.a Gr St
print name INITIATEDA A OVFD:
ITS: (circle one)secretary/Chief ' ' I 1 , n
Officer/Asst. secretary-T r`O �l(�(<
Directo-of Community Development
APPROVED
00,
it torney
6
21-ID392/267451
APPENDIX A
SAMPLE VOUCHER
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21.1039M67451
APPENDIX B
Auto Dealership Procedures for Auto Incentive Beach Parking Program
The Huntington Beach City Council and the Huntington Beach Auto Dealer Association developed
an Auto Incentive Beach Parking Program which provides a voucher for a free annual beach
parking pass to buyers of all new cars. used cars over$20.000 (Car Value Pre-Tax). or lessees. This
program seeks to enhance the local economy by creating an incentive fur local, prospective car
purchasers and lessees to shop for automobiles in Huntington Beach because they will be
incentiyized with this unique perk. This program keeps revenue circulating back into the City of
Huntington Beach with additional sales tax revenue from non-residents as well.
Auto Dealers should remember the following regulations and procedures for the Auto Incentive
Beach Parking Program.
• Limit of one voucher per qualifying new, used ($20.000 or more), or leased vehicle.
• Auto Dealer shall complete the voucher in its entirely by editing the "Annual Beach Parking
Pass Voucher" document to match the owner/lessee's information and eiye the voucher to
the car buyer/lessee as a free incentive the day of purchase.
• lach Auto Dealer will ensure that an authorized dealer representative will sign each Voucher
for City verification and that each dealership's authorized representative is responsible for
overseeing program procedures. including data reporting.
• Customers and Auto Dealers may not duplicate the voucher.
• Autonnobile buyers/lessees do not need to be I luntineton Beach residents in order to
participate.
• In order to redeem a voucher. the City will verify that the voucher is matched with the
owner/lessee of the new. used or leased vehicle by using the auto sale contract/lease
agreement paperwork to complete the registration of the parking pass.
• A quarterly report ofthe total number of"new/used vehicles sold/leased and number of
vouchers issued must be sent to the City by each auto dealership in order to retain a record
of issued vouchers.
• Vouchers must be otTered to all customers that meet the above guidelines and may not be
held to require additional customer duties such as filling out an evaluation or survey.
• Auto Dealers should actively market and promote the program.
Voucher Instructions
Hach voucher will contain all the necessary information for new/used car purchasers or lessees to
obtain their annual Beach Parking Pass. "hhe Voucher will contain the following information to be
tilled in by the dealership at the time of sale".
• Name of Owner/Lessee
• Vehicle Make K Model
• Auto Dealership
• Vehicle Identification Number
• Signature of Authorized Representative (designated by Dealership)
• Printed Name of Authorized Signature
21-10382n67451
• Date of Purchase
**Illegible or altered vouchers will not be accepted**
**Failure to abide by the policies and procedures in addition to producing any forged
or fraudulent vouchers will result in expulsion from the program."*
Remind the buyer to bring the following materials within 4- days to Lifeguard Headquarters, 103
Pacific Coast Highway, Huntington Beach:
• Annual Beach Parking Pass Voucher completed by the Auto Dealership
• Sale Contract/Lease Agreement
• Photo Identification
Quarterly Retorts
The City will collect quarterly sales reports from the auto dealers to indicate the expected number of'
qualified program participants and the redemption rate The quarterly reports will be due as follows:
Jan I - NIar 31 = Quarter 1 Report due April 15°i
Apr I - Jun 30 = Quarter 2 Report due July 15`h
Jul I - Sept 30 = Quarter 3 Report due October 15`h
Oct 1 - Dec 31 =Quarter 4 Report due January I5`"
Please fill out the quarterly report form provided by the City at the end of each quarter and submit
by email to:
Community Enhancement Division - City off-Iuntington Beach
opcnhb@surfcitv-hb.org
surfcity-hb.org
(714) 536-5582
Questions and Concerns
Please direct any questions and concerns regarding the Auto Incentive Beach Parking Program to
the City of Huntington Beach at (714) 536-5582.
?I-10332267J>I
ECONOMIC DEVELOPMENT SUBSIDY REPORT
PURSUANT TO GOVERNMENT CODE SECTION 53083
FOR AUTO INCENTIVE BEACH PARKING PASS PROGRAM
BY AND BETWEEN
THE CITY OF HUNTINGTON BEACH
AND THE
HUNTINGTON BEACH AUTO DEALERS ASSOCIATION
Pursuant to Government Code Section 53083, the City Council of Huntington Beach must hold a noticed
public hearing and, prior to the public hearing, provide all of the following information in written form
and available to the public through the City's website regarding a proposed economic development
subsidy provided by the City pursuant to a Memorandum of Understanding between the City of
Huntington Beach and the Huntington Beach Auto Dealers Association, in connection with the Auto
Incentive Beach Parking Program. Notice was published on the City's website for a public hearing to be
held on March 15, 2022.
The purpose of this report is to provide the information required pursuant to Government Code Section
53083 in regards to the City's Auto Incentive Beach Parking Pass Program. This report shall remain
available to the public and posted on the City's website until the end of date of the economic
development subsidy, as further described in number two below.
1. The name and address of all corporations or any other business entities, except for sole
proprietorships, that are the beneficiary of the economic development subsidy.
Norm Reeves Honda Superstore Toyota of Huntington Beach
19131 Beach Blvd. 18881 Beach Blvd.
Huntington Beach, CA 92648 Huntington Beach, CA 92648
Car Pros KIA Huntington Beach McKenna Subaru
18835 Beach Blvd. 18801 Beach Blvd.
Huntington Beach, CA 92648 Huntington Beach, CA 92648
Huntington Beach Ford DeLillo Chevrolet
18255 Beach Blvd. 18211 Beach Blvd.
Huntington Beach, CA 92648 Huntington Beach, CA 92648
Surf City Nissan Huntington Beach Mazda
17331 Beach Blvd. 16800 Beach Blvd.
Huntington Beach, CA 92647 Huntington Beach, CA 92647
Huntington Beach Hyundai Huntington Beach Chrysler, Dodge, Ram
16751 Beach Blvd. 16701 Beach Blvd.
Huntington Beach, CA 92647 Huntington Beach, CA 92647
799
McKenna Volkswagen Huntington Beach Jeep
18711 Beach Blvd. 16701 Beach Blvd.
Huntington Beach, CA 92648 Huntington Beach, CA 92647
2. The start and end dates and schedule, if applicable, for the economic development subsidy.
Upon City Council approval, the proposed agreement is expected to commence on March 15,
2022 and end on March 14, 2027.
3. A description of the economic development subsidy, including the estimated total amount of
the expenditures of public funds by, or of revenue lost to, the local agency as a result of the
economic development subsidy.
The economic development subsidy will provide an incentive to car buyers, lessees, and
participating members of the Huntington Beach Auto Dealers Association by providing a voucher
to obtain a free annual beach parking pass ($150 per vehicle) with the purchase of new, used
($20,000 or more), or leased vehicles. Data from the on-going program suggests that the City
redeems about 2,750 vouchers each year. Therefore, the City estimates that a subsidy of
approximately$412,500 will be provided annually which equates to the cost of the beach
parking passes provided, with a total expenditure of approximately $2,062,500 throughout the
5-year duration of the program. Additionally, 250 hours of City staff will be devoted to oversee
the program.
4. A statement of the public purposes for the economic development subsidy.
Car dealerships are the largest sales tax generators in Huntington Beach with annual sales tax
revenue estimated to be between $8-9 million. Maintaining sales tax revenue from the City's
auto dealerships is needed to fund vital City services.The program helps to spur sales tax
revenue growth, encourages local residents and regional visitors to purchase and lease vehicles
in the City of Huntington Beach, and prevents leakage of automotive purchases and leases to
outside jurisdictions.
5. Projected tax revenue to the local agency as a result of the economic subsidy.
The average number of vehicles sold (new and used) and leased by the Huntington Beach Auto
Dealers Association between 2018 and 2020 was roughly 24,600 annually. Approximately, 2,750
vouchers were redeemed each year between 2018 and 2021, which equates to an 11% voucher
redemption rate. The projected total gross sales for vehicles within the City is roughly$800-900
million of which the City will retain 1% in sales tax totaling $8-9 million. Using the 11%voucher
redemption rate as a way to determine the impact of extending the subsidy and keeping the
program active, the City will retain almost $1 million in sales tax annually and $5 million
throughout the 5-year duration of the program. Increased marketing of the economic subsidy
will allow the City to receive additional sales tax from purchases or leases made under the
program, which also provide increased sales tax generation on parts and service.
800
Promotion of this program will allow the City's auto dealers to stay competitive with other
dealerships throughout the region. The program also encourages car buyers and lessees to
frequent the City's beach, downtown shops, and restaurants when utilizing the beach parking
pass, expanding support to other local businesses and increasing overall sales tax to the City.
6. Estimated number of jobs created by the economic development subsidy, broken down by
full-time, part-time, and temporary positions.
The proposed subsidy will assist in retaining approximately 1,100 auto dealer jobs.
801
Estanislau, Robin
From: Casanova, Kriss
Sent: Tuesday, March 8, 2022 9:54 AM
To: Estanislau, Robin
Subject: FW: URGENT: Public Hearing Noticing requirement AB 562
Hi Robin,
We are good to proceed.
Thanks!
Kriss
From:Vigliotta, Mike <MVigliotta@surfcity-hb.org>
Sent:Tuesday, March 8, 2022 9:40 AM
To: Casanova, Kriss<Kriss.Casa nova @surfcity-h b.org>
Subject: RE: URGENT: Public Hearing Noticing requirement AB 562
No need for newspaper
From: Casanova, Kriss
Sent: Monday, March 7, 2022 4:38 PM
To:Vigliotta, Mike<MVieliotta@surfcity-hb.orR>
Subject: URGENT: Public Hearing Noticing requirement AB 562
Hi Mike,
We have a public hearing item going on March 151" regarding the economic subsidy for the beach parking passes that we
provide to the car dealerships. We noticed 10 days prior on the City's website and downstairs based on what had been
done in the past and AB 562. Can you confirm this is sufficient and a newspaper noticing isn't needed?
On March 1", we posted this notice to the City's website here and we also posted it downstairs at City Hall.
AB 562
(a) On and after January 1, 2014, each local agency shall, before approving any economic development subsidy
within its jurisdiction, provide all of the following information in written form available to the public, and
through its Internet Web site, if applicable.
(b) Before granting an economic development subsidy, each local agency shall provide public notice and a
hearing regarding the economic development subsidy. A public hearing and notice under this subdivision is
not required if a hearing and notice regarding the economic development subsidy is otherwise required by
law.
(c) The information required to be provided in subdivision (a) shall remain available to the public under existing
state and federal law and be posted on the local agency's Internet Web site, if applicable, for the entire
term of the economic development subsidy.
(d) The local agency, within the term of the economic development subsidy but not later than five years after
the action granting an economic development subsidy, as defined in paragraph (1) of subdivision (g), shall
1
issue a report for each economic development subsidy. The report shall contain the information described
in subdivision (a). The local agency shall make the report available to the public and through its Internet
Web site, if applicable.
Thanks!
Kriss
From: Estanislau, Robin <Robin.Estanislau(dsurfcity-hb.orR>
Sent: Monday, March 7, 2022 3:05 PM
To: Casanova, Kriss<Kriss.Casanova(@surfcity-hb.orR>
Cc: Estanislau, Robin <Robin.Estanislau(dsurfcity-hb.org>
Subject: RE: Item to be moved to Public Hearing
Thanks for the information. Our office does not provide an interpretation of law ... that legal decision is to be made by
the City Attorney and/or his staff. Are you certain that this item does not require newspaper notification?
Let us know ... thanks!
Robin Estanislau, CMC, City Clerk
City of Huntington Beach
714-536-5405
r
1:
i
Please consider the HB City Clerk's office for your possport needs!
From: Casanova, Kriss <Kriss.Casa nova(olsurfcity-hb.org>
Sent: Monday, March 7, 2022 1:10 PM
To: Estanislau, Robin <Robin.Estanislau(@surfcity-hb.ora>
Cc: Esparza, Patty<PEsparza(c@surfcity-hb.org>, Luna-Reynosa, Ursula <ursula.luna-reynosa cDsurfcity-hb.org>
Subject: RE: Item to be moved to Public Hearing
Hi Robin,
On March 1", we posted this notice to the City's website here and we also posted it downstairs at City Hall.
Here are the noticing requirements for AB 562.
AB 562
(a) On and after January 1, 2014, each local agency shall, before approving any economic development subsidy
within its jurisdiction, provide all of the following information in written form available to the public, and
through its Internet Web site, if applicable.
(b) Before granting an economic development subsidy, each local agency shall provide public notice and a
hearing regarding the economic development subsidy. A public hearing and notice under this subdivision is
not required if a hearing and notice regarding the economic development subsidy is otherwise required by
law.
2
(c) The information required to be provided in subdivision (a) shall remain available to the public under existing
state and federal law and be posted on the local agency's Internet Web site, if applicable, for the entire
term of the economic development subsidy.
(d) The local agency, within the term of the economic development subsidy but not later than five years after
the action granting an economic development subsidy, as defined in paragraph (1) of subdivision (g), shall
issue a report for each economic development subsidy. The report shall contain the information described
in subdivision (a). The local agency shall make the report available to the public and through its Internet
Web site, if applicable.
Please let me know if you have any questions.
Thanks,
Kriss
Kriss Casanova
Economic Development Manager
City of Huntington Beach
714.536.5547
www.hbbiz.com
From: Luna-Reynosa, Ursula <ursula.luna-revnosa@surfcity-hb.ora>
Sent: Monday, March 7, 2022 12:46 PM
To: Estanislau, Robin <Robin.Estanislau@surfcity-hb.orR>
Cc: Esparza, Patty<PEsparza@surfcity-hb.orR>; Casanova, Kriss <Kriss.Casanova@surfcity-hb.orQ>
Subject: RE: Item to be moved to Public Hearing
Robin,
It's file 22-183. It's not a planning item so it doesn't have our typical notice requirements.
Kriss—Can you please outline what noticing requirements, if any, are needed?
Thanks,
Ursula
From: Estanislau, Robin
Sent: Monday, March 7, 2022 12:33 PM
To: Luna-Reynosa, Ursula <ursula.tuna-reynosa@surfcity-hb.ore>
Cc: Esparza, Patty<PEsparza@surfcity-hb.orR>
Subject: Item to be moved to Public Hearing
At today's ET you indicated an item currently scheduled on consent should be moved to public hearing. Please confirm
the Legistar# so we can verify that the public notification process was followed.
Thanks!
Robin Estanislau, CMC, City Clerk
City of Huntington Beach
714-535-5405
3
j, W CITY OF HUNTINGTON BEACH
INTERDEPARTMENTAL COMMUNICATION
TO: Honorable Mayor and City Council Members
SUBMITTED BY: Sean Joyce, Interim City Manager
PREPARED FROM: Ursula Luna-Reynosa, Director of Community Development k
DATE: March 15, 2022
SUBJECT: SUPPLEMENTAL COMMUNICATION FOR ITEM 19 (22-183) -
Approve and authorize execution of a Memorandum of
Understanding (MOU) between the City and the Huntington
Beach Auto Dealers Association extending the Auto Incentive
Beach Parking Program for an additional five (5) years
This communication is being provided to correct language in the MOU regarding eligibility of auto
dealership employees in the Auto Incentive Beach Parking Program The revised language is
consistent with the agreement between staff and the Auto Dealers and was not intentionally
omitted The revised language can be found on Page 4 of the MOU. item Number 10. and
included below for reference
10 Auto Dealers shall employ no City official not any regular City employee in the work
performed pursuant to this MOU No officer or employee of City shall have any financial
interest in this MOU in violation of the applicable provisions of the California Government
Code. Not valid feir ally Auto DeaIeF employee OF thedF family. Failure to abide by the Auto
Dealership Procedures included to this MOU as Appendix B, in addition to producing any
forged or fraudulent vouchers, will result in expulsion from the program
xc Michael Gates. City Attorney
Robin Estanislau. City Clerk
Executive Team
SUPPLEMENT AL
COMMUNICATION
MW*V Date. `�//yr�•Za2
Agenaa learn No.: /9 .2.2-/ 83
policy shall indemnify Auto Dealers. its officers, agents and employees, while acting
within the scope of their duties; against any and all claims arising out of or in
connection with this .Agreement, and shall provide coverage in not less than the
following amount: combined single limit bodily injury and property damage,
including products/completed operations liability and blanket contractual liability, of
51,000,000 per occurrence. If coverage is provided under a form which includes a
designated general aggregate limit, the aggregate limit must be no less than
$1.000.000. Said policy shall name City, its agents, its officers, employees and
volunteers as Additional Insureds, and shall specifically provide that any other
insurance coverage which may be applicable shall be deemed excess coverage and
that Auto Dealers' insurance shall be primary.
Under no circumstances shall the above-mentioned insurance contain a self-insured
retention. or a "deductible' or any other similar form of limitation on the required
coverage.
8. Neither party shall encumber, assign, or otherwise transfer this MOU, or any right or
interest in this MOU, without the express written consent of the other party. Consent
by one party to an assignment or transfer shall not be deemed to be consent to any
subsequent assignment or transfer. Any encumbrance, assignment or transfer,
without the prior written consent of the other party, whether it be voluntary or
involuntary, by operation of law or otherwise, is void and shall, at the option of the
other party, terminate this MOU.
9. All the terms, covenants and conditions of this MOU shall inure to the benefit of and
be binding upon the parties and their successors and assigns. The provisions of this
Section shall not be deemed as a waiver of any of the conditions against assignment
hereinbefore set forth.
10. Auto Dealers shall employ no City official nor any regular City employee in the
work performed pursuant to this MOU. No officer or employee of City shall have
any financial interest in this MOU in violation of the applicable provisions of the
California Government Code. Failure to abide by the Auto Dealership Procedures
included in this MOU as Appendix B, in addition to producing any forged or
fraudulent vouchers, will result in expulsion from the program.
11. Auto Dealers shall consult with City prior to issuing any press releases or otherwise
making any public statements with respect to this MOU, the transactions
contemplated herein, or matters arising herefrom.
12. The remedies given to the parties in this MOU shall not be exclusive but shall be
cumulative and in addition to all remedies now or hereafter allowed by law or
elsewhere provided in this MOU.
13. The waiver by City of any breach by Auto Dealers of any of the provisions of this
MOU, irrespective of the length of time for which such failure continues, shall not
constitute a waiver of such breach or a waiver of any subsequent breach by Auto
Dealers either of the same or another provision of this IOU.
a
21-103S2R67451
policy shall indemnify Auto Dealers, its officers, agents and employees, while acting
within the scope of their duties, against any and all claims arising out of or in
connection with this Agreement, and shall provide coverage in not less than the
following amount: combined single limit bodily injury and property damage,
including products/completed operations liability and blanket contractual liability, of
$1,000,000 per occurrence. If coverage is provided under a form which includes a
designated general aggregate limit, the aggregate limit must be no less than
$1,000,000. Said policy shall name City, its agents, its officers, employees and
volunteers as Additional Insureds, and shall specifically provide that any other
insurance coverage which may be applicable shall be deemed excess coverage and
that Auto Dealers' insurance shall be primary.
Under no circumstances shall the above-mentioned insurance contain a self-insured
retention, or a"deductible"or any other similar form of limitation on the required
coverage.
8. Neither party shall encumber, assign,or otherwise transfer this MOU, or any right or
interest in this MOU, without the express written consent of the other party. Consent
by one party to an assignment or transfer shall not be deemed to be consent to any
subsequent assignment or transfer. Any encumbrance, assignment or transfer,
without the prior written consent of the other party, whether it be voluntary or
involuntary, by operation of law or otherwise, is void and shall, at the option of the
other party, terminate this MOU.
9. All the terms,covenants and conditions of this MOU shall inure to the benefit of and
be binding upon the parties and their successors and assigns. The provisions of this
Section shall not be deemed as a waiver of any of the conditions against assignment
hereinbefore set forth.
10. Auto Dealers shall employ no City official nor any regular City employee in the
work performed pursuant to this MOU. No officer or employee of City shall have
any financial int est in this MOU in violation of the applicable provisions of the
California Govi ment Code. Not valid for any Auto Dealer employee or their
family.
11. Auto De rs shall consult with City prior to issuing any press releases or otherwise
makin y public statements with respect to this MOU, the transactions
Conte plated herein, or matters arising herefrom.
12. remedies given to the parties in this MOU shall not be exclusive but shall be
ulative and in addition to all remedies now or hereafter allowed by law or
elsewhere provided in this MOU.
13 The waiver by City of any breach by Auto Dealers of any of the provisions of this
MOU, irrespective of the length of time for which such failure continues, shall not
constitute a waiver of such breach or a waiver of any subsequent breach by Auto
Dealers either of the same or another provision of this MOU.
4
21-103821267451
' City of Huntington Beach
2000 Main Street ♦ Huntington Beach, CA 92648
(714) 536-5227 ♦ w�ti�v.huntingtonbeachca.gov
Office of the City Clerk
Robin Estanislau, City Clerk
March 21, 2022
Huntington Beach Auto Dealers Association
Attn: Peter Shaver
630 Main Street
Huntington Beach, CA 92648
Dear Mr. Shaver:
Enclosed is a fully executed copy of the Memorandum of Understanding between the
City of Huntington Beach and the Huntington Beach Auto Dealers Association approved
by City Council on March 15, 2022.
Sincerely,
Robin Estanislau, CMC
City Clerk
RE:ds
Enclosure
Sister Cities: Anjo, Japan Waitakere, New Zealand