AN ORDINANCE related to funding for the Equitable Development Initiative and affordable housing; creating a fund for short-term rental tax revenue.
The bill passed in show Senate. Please read the report of the Finance and Neighborhoods Committee. The Report of the Finance and Neighborhoods coverage and Item one Council Vote 119402 relating to funding for the Equitable Development Initiative and Affordable Housing. Creating a fund for short term rental tax revenue. The committee recommends the bill. Passed as amended. Councilman Bagshaw. Good. I'm going to pass this quickly over to Councilmember O'Brien, but just to let all know that this passed out of our committee unanimously last week, actually ten days ago, we had many meetings to discuss this opportunities for public comment. I want to say thank you to all of you who have been so steadfast and working with us and letting us know what your priorities are. Councilmember O'Brien has led this charge, and I would like to pass this over to you. If you would like to speak to it, just know that I appreciate so much the work that you're doing. It's incredibly critical to our community that we are funding all of these things, both the ones that the sweetened beverage tax is funding now and what we intended to fund and what we will fund going forward. So. Councilmember Brian. Councilmember Brian. Thank you. And Councilwoman, based on think for working with me on this. Colleagues, we've talked about this a lot, so I'll try to be brief. The short term rental tax, as originally intended, was dedicated to support at least the first $5 million a year Equitable Development Initiative during last year's budget cycle. About a million of that was in the proposed budget by the mayor, was diverted to fund staff resources for the EDA as opposed to grants reducing the grant amount to 4 million. We found a way to increase that to 5 million in the budget by using CDBG money. But I understand that that money is really challenging for these organizations to actually use. And so it was a noble effort in really tight circumstances last year, but it's not something that can be repeated and it's not clear that that money will be able to be used as intended. What this legislation would do would dedicate in this order the revenues of this the short term rental taxes. The first $5 million would go to grants for EDA projects. We know that there are dozens of applicants, qualified applicants each year for these programs and only a small handful get funded. There is no shortage of really good programs that could be funded if there were money available. The second tier would be 2200 of the proceeds, or 2.2 million of the proceeds would be directed to pay off debt for affordable housing projects. Bonds that were issued a few years ago. The next $3.3 million would be directed to support permanent supportive housing. The next $1,069,000 would be directed to support staffing and consultants for EDA program and then any money on top of that cumulative amount, which is about $11 million a little over that would go back to additional grant funds for the I. Thank you. Councilman Bryan, any other comments or questions? Councilman Beckstrom Just one comment. I want to appreciate the fact that you were willing to amend the document as you went forward. Councilmember O'Brien I think we've reached a good compromise, and I'm certainly going to continue to support this. You know the comments before we take the road, Councilwoman Pacheco. I have an amendment. I didn't realize it. I do apologize for that. I think that's for the sweetened beverage tax amendment. Do we have a bottom? Okay. Councilmember Checker, you have an amendment and and I have a hard copy of it. And I believe it was timely to have to suspend any rules. It was timely. Councilmember Pacheco, give the floor. Sure. So I move to amend Council Bill 11940 to ask for an Amendment one. I'll second it. Okay. Catherine Pacheco, it's been it's it's been moved in second. Can you explain what we have here? Sure. The amendment establishes that the surplus funds in 2020 would be directed towards EDA grants in 2021 and beyond. The financial policies would prioritize paying the debt service on bonds issued for affordable housing projects by directing the first 2.2 million for this purpose. The next 6 million in revenues to the Eli would go to Eli, including 5 million for 88 grants and 1 million for staffing and consultant services, and then direct the next 3.3 million to permanent supportive housing and direct any excess short term revenue taxes, revenues to ELI Grants. The proposal is consistent with the 2020 endorsed budget and would not result in any budget shortfalls unless revenues come in below what is projected for 2020. Just to provide additional thoughts. First, I'm supportive of the programs that this grant funds and the mission of this underlying legislation. This amendment just clearly states that any surplus funds in 2020 would be directed to support EDA grants in 2021. The full 5 million would go to the grants, which is what the desire of the communities that the community desire and any surplus funds would also increase that dollar amount. My intent on introducing this amendment is to follow through with the plans made last year to fund the support required to carry out these grants. Given that this is my first budget session in my approach to the budget is to give us the flexibility we need to the important services we all care about and know that our community needs. I have inherited an endorsed budget and a series of decisions that have resulted in the complicated situation we're in. This amendment is about making communities whole in a manner that balances our fiduciary responsibility, our endorsed budget, and puts us on a path councilmember compliant intent in the underlying legislation. This amendment is about giving us the time to make sure that the program is whole for 2020, while still supporting the underlying financial policies beginning in 2021. Thank you, Councilmember Pacheco. I'm going to ask the speaker of the Bass legislation to speak on it. Councilmember O'Brien. Thank you, Councilmember Pacheco and Council President Harrell. I oppose this amendment. What this would do would be to defer the restoration of the full $5 million for an additional year, and I don't think that's acceptable. The demand for actual development investments right now is significant and will almost certainly continue to grow. Again, as I mentioned earlier, we found a what we hoped would be a workaround in last year's budget. But I know that the community organizations have struggled to take advantage of that. And I think the most appropriate thing to do is to be responsive to the I grant applicants who have been here today and in past meetings who want to see us stand up to the original commitment of $5 million a year, granted. So I'll be opposing this amendment. Okay. So we have. Councilmember Becerra. I want to say thank you. Councilmember Pacheco, as your budget chair, I am delighted to have the support of keeping things going in the direction that we endorsed last year. That said, I'm not going to be supporting this amendment in large part because of what we talked about at my committee ten days ago. Councilmember O'Brien, I really respect the fact that you were willing to work with me on a compromise, and I'm going to follow through with that agreement. Very good. Now, this is just for the amendment. Any other discussion on the amendment, and I'll just share in closing that I'm not supporting the amendment. Thank you for bringing it and having a transparent conversation. In my mind, this equitable development initiative and the investments we're making are absolutely critical for preserving cultures and communities that are vital to our city, many of whom are are priced out through historical practices of racism and discrimination, are finding challenges even more increasing with a president we have in this country. And these investments are urgent and we should treat them as such. And so I'm ready to support both this and a sweetened beverage tax as we move forward. In simple terms. So I won't be supporting the amendment, so we're just going to vote in the amendment. So having said that, all those in favor of the amendment, please say I and raise your hand. I Oh, I'm sorry. I'm sorry. That was one and a half. No. Okay. I believe it's one vote. All those opposed. Say no and raise your hand. No. Okay. So the amendment fails. So now we have the base legislation with the it'II in place. Councilmember O'Brien, did you need to see any more words or are we ready for a vote? I'm ready. Did anyone else need to close on this or. I'm going to call for a vote. CHEERING No hands. Please call the roll on the passage of the bill. Must get up. Now. I'll say I. O'Brien. All right, let's go now. So what? I think John Gonzalez, purple. President Harrell, I. Seven in favor. One opposed, the bill passes and the chair will sign it. Please read the next edition item into the record. Agenda item to cancel 119551 relating to creating a fund for sweetened beverages tax revenues. Adding a new section 5.50 3.0 55 to the settlement of code and providing additional guidelines for expanding proceedings. Proceeds excuse me. Committee recommends the bill passes amended.