Tracy Press

The Downtown Tracy Business Improvement Area is on the verge of changes that some members hope will revitalize the city's urban and business core. Glenn Moore/Tracy Press

Members of a downtown Tracy merchant organization languishing for lack of leadership, innovation and money, have their sights set on a few changes that they hope will liven up the city’s center.

"We’re stagnant right now," said Downtown Business Improvement Association Chairman Robert Cottrill. "So, yeah, some changes are in order."

But Cottrill sees the group’s low point — and the city’s plans to pull it up — as a chance for unprecedented improvement and, someday, a thriving downtown.

Practically, it’s a chance to bring up to date what many members and city officials consider an outdated tax system. Instead of tenants coughing up a few hundred dollars every year, it’d be on the landlord to pay for the trimmings that go into making the city center a cultural and commercial destination.

Special legislation in 1990 created what people in government call a business improvement area in Tracy, with invisible borders on Ninth and 11th streets and A and B streets.

Businesses within that zone pay a special tax that goes to the city-backed association led voluntarily by Central Street florist Cottrill and, until her contract expired last month, by paid director Diana Koron.

Retailers pay $475 a year, and service establishments such as banks, hairstylists or restaurants pay about $300 less.

Some small-time entrepreneurs outside the district volunteer to pay a $125 fee to reap the benefits of group membership — a say-so in putting together downtown events, security and landscaping, to name a few.

But change might be in order for the group’s decades-old tax-and-benefit status quo.

A planned series of talks by a city-hired consultant could bring about a slightly bigger district, a tax on property owners instead of tenants within those borders, and a chance that the organization could split from the city and become a bona-fide nonprofit.

For the group’s 139 members, that could mean more autonomy, more money and ultimately — they hope — a livelier downtown.

Should the group sever ties with the city, revenue generated through the potentially expanded tax base could pay for a full-time employee and a downtown office similar to a chamber of commerce. Only its sphere of membership would be limited to businesses within the downtown boundaries, unlike the chamber, which extends participation citywide.

"We need that," said Millie Comber, owner of an educational supplies store on Central Avenue. "We need a face in downtown — someone who’d walk around and ask you how things are going and really care about what’s going on down here."

Many business owners welcome the possibility of independence.

The current downtown organization’s relationship with the city has been at different times a source of contention and a blessing in members’ eyes, depending on the source.

Some feel that the city’s engineering department is too paternal and controlling, and that ideas from actual small-business owners get lost in a bureaucratic tangle somewhere behind "the hallowed doors of City Hall," said Kathy Kindred, who owns a B Street yarn shop and is one of the group’s handful of voluntary members.

"We come up with all these ideas, all these plans, and then the city has the final say," Kindred said. "And in the end, what we said means nothing."

Kathy Kindred of K2 Yarn Salon, a tenant in the downtown business area, is one of the merchants who hopes for changes in the downtown business association. Glenn Moore/Tracy Press

Business and property owners "would basically get to decide what to do with their money instead of the city," said Ursula Luna-Reynosa, who, as director of the city’s development and engineering department, pays the bills for and oversees the downtown association.

To help it along its way, the city will pay up to $30,000 to New City America Inc., a storied consulting group that helped reform city centers like Fisherman’s Wharf in San Francisco and San Diego’s Little Italy.

For several small business owners along 10th Street and Central Avenue, the price is a bargain compared to what could get done.

On Thursday, consultant Marco Li Mandri will begin the first of several meetings with midtown Tracy merchants to get a feel for what they want in the heart of the city.

Another bicycle cop, sidewalk landscaping or a few more parades and wine strolls every year might make the top of the list, according to several business owners.

Li Mandri said his job is to figure out what people want and how much it’ll cost.

"No pay, no benefit," he said. "That’s the concept."

But who’ll pay is a key item up for debate.

Consultants are floating the idea of getting the city to tax property owners instead of tenants for a period of five years, with another vote at the end of that time to continue taxing landlords. It would allow the city to assess with more discrimination how much each landlord should pay, instead of relegating businesses to a shallow hierarchy of service or retail.

Switching from a tenant tax base to one of landlords and property owners is more complicated to set up and normally takes up to 18 months to finalize, Li Mandri said.

And since many property owners are out of the city, state or country, it takes some conference-call networking on his part to sell them on the new fees. If enacted, some landlords might pass the buck on to merchants anyway via higher rent.

In then end, though, the city center would garner more revenue, because bigger businesses would be included in the redrawn boundaries and get taxed more based on, among other things, building size and location, Li Mandri explained.

Plus, the invisible border excluding parts of Central Avenue and 10th Street would be expanded. The under-construction transit center in the Bow Tie area would be included in the district, along with existing restaurants and any new businesses the under-construction transportation hub would bring, said Amie Parker of the city’s economic development department.

So an organization limited for decades by a tiny tax base, and thus a paltry operating budget — which this past year totaled just under $40,000 with an $11,000 deficit — would get an injection of new members and several thousand more dollars a year in tax-like membership fees.

That’s the plan, at least. It’s up to the business and property owners of the area in question to decide whether to make it a reality.

Andy Padilla, who leases space to a handful of businesses on B and 10th Streets, said he’s completely opposed to the idea of landlords paying in place of tenants.

Others said they’d probably share the cost with lessees.

Generally, though, downtown merchants are open to the idea of change and are eager to see what comes of the city-led forums, the first of which is set for Thursday.

"We’re at a crossroads," Cottrill said between helping customers Cottage Gardens, the florist shop on the corner of Central Avenue and Ninth Street. "The way things are now is a reflection of how downtown used to be."

Retailers pay more than service companies, he said, because years ago, downtown housed big department stores and was known locally as a retail destination.

Today, the milieu’s changed, said Cottrill.

"Now it’s retail that’s charged the most, but also struggles the most," he said. "And the (tax) never changed to reflect that."

• To reach Tracy Press reporter Jennifer Wadsworth, call 830-4225 or e-mail
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