Update: Redding OK's finding new way to pay for Market Street Promenade services

Update: 7:53 p.m. Tuesday, Sept. 15

The Redding City Council approved dismantling the current agreement that governs how businesses at the former Midtown Mall site cover the cost of a variety of services in their area, including maintenance, landscaping, lighting and security.

It will take about a year to nail down a replacement plan funding maintenance and services for what is now the Market Street Promenade, an area being transformed into retail and residences.

The measure passed 5-0.

There are 18 properties with 12 different owners within the Midtown Mall boundaries. While the downtown location of Shasta College location is within the boundaries, it is not subject to the assessment.

The current district is funded by a 3-cent-per-month benefit assessment for an annual total of $74,866, funds the city of Redding collects and distributes quarterly to the Midtown Mall Benefit Corporation, which operates and maintains the area, said Community Development Manager Steve Bade. The staff report released last week incorrectly listed the amount at $101,600 because it included two parcels that are no longer part of the assessment district, said Bade.

On Tuesday night, the council authorized disestablishing the Redding Midtown Mall Project Benefit Assessment District of 1993 and also allowing the City Manager to terminate the city's agreement with the Midtown Mall Benefit Corporation.

Under the council's action, city staff will work with property owners to form an alternate funding arrangement to cover maintenance costs for the district. Only the businesses within the district's boundaries receive its services and pay the tax.

In other action on Tuesday, the council also got an update about the $750,000 City of Redding CARES Act Business Relief Grant Program that the council approved last month.

Awards of between $2,000 to $10,000 went to 121 businesses before the money ran out, a member of the business selection committee told council members. That left 124 businesses that applied not getting any money from Redding's program.

City Manager Barry Tippin told the council that Redding companies that weren’t funded can reapply to Shasta County, which on Tuesday approved $3 million in business support out of their CARES Act money. Redding companies are eligible to apply for those funds, Tippin said.

While businesses located in unincorporated areas of the county will receive preference for the county's CARES Act disaster relief funds, Tippin said, "Hopefully, (Shasta County) will use a very similar, if not the same, application that we had."

Original story, published Monday, Sept. 14

Now that downtown Redding is awash in new investment and development, property owners are considering a different way to pay for maintenance and services at the Market Street Promenade.

The Redding City Council will hold a public hearing on the issue Tuesday night.

City staff has recommended dismantling the current agreement that governs how businesses at the former Midtown Mall site cover costs of a variety of services, including maintenance, landscaping, lighting and security. 

“We recognize the importance of an assessment district to address (those) issues,” said Shannon Phillips, COO of the McConnell Foundation, one of the property owners in the Market Street Promenade. “We are just in favor of a clean slate, a new start,” she said.

The current district is funded by a 3-cent-per-month benefit assessment for an annual total of $101,600. The city of Redding collects the funds and distributes them quarterly to the Midtown Mall Benefit Corporation.

While there is no impact to the City’s general fund, costs associated with city staff who now administer the current assessment system will end if the “disestablishment” is approved, said the staff report to the council.

At its meeting on Tuesday, the council could decide to dissolve the current Benefit Assessment District covering the Redding Midtown Mall. Then, they could ask City Manager Barry Tippin to also terminate an agreement with the Midtown Mall Benefit Corporation, which currently handles the operation and maintenance of the Market Street Promenade.

Council members will also consider whether to work with property owners to form a new district that pays for landscape maintenance needs. Only the businesses within the district's boundaries receive its services and pay the tax.

Many improvements are happening within the Market Street Promenade area, including the addition of new commercial and retail spaces, the development of residential units, reconstruction of an underground parking facility, revitalization of existing facades and new sidewalks, streetlights and utility services.

McConnell and Redding builder K2 Development Co., Inc. are equal partners in "Block 7," a $67 million affordable housing and retail complex in downtown Redding that's replacing a bank of outdated parking garages on California Street. 

K2 is also developing the 82-unit Market Center apartments, expected to be ready for tenants this fall.

New streets are also in the works for the neighborhood. That includes reconstruction of the Yuba Street and Butte Street connections to California Street and southbound Market Street's connection from Tehama Street to Yuba Street.

Also on Tuesday, the council will get updates on two assistance programs for small companies that were hard hit financially by the coronavirus pandemic.

The council will be informed about the City of Redding CARES Act Business Relief Grant Program.

As part of the agenda's Consent Calendar, the council will also receive an update on the city’s COVID-19 Local Economic Stimulus Package projects.

The council meeting is scheduled for 6 p.m., Tuesday at Redding City Hall, 777 Cypress Ave.

More: The Buzz: Bay Area group buys entire block in downtown Redding

More: UPDATE: Downtown housing-retail project gets the A-OK. Take a look at what's ahead

Michele Chandler covers city government and housing issues for the Redding Record Searchlight/USA Today Network. Follow her on Twitter at @MChandler_RS, call her at 530-225-8344 or email her at michele.chandler@redding.com. Please support our entire newsroom's commitment to public service journalism by subscribing today.