Report on downtown again facing claims of faulty figuring
HBPD officers stand guard on pier plaza. File photo
Signalling ongoing uncertainty over the role played by late-night uses in the city’s downtown, Hermosa Beach City Council members on Tuesday quizzed a consultant hired to produce a report on the economic impact of the neighborhood, highlighting what they saw as inaccuracies and fallacies.
The report, from consultant Kosmont Companies, was intended to serve as a Cost-Benefit Analysis for downtown Hermosa — specifically, whether the city derived more in economic benefits from the area, such as revenue from taxes, than it spent in associated costs, like police and fire response. It concluded that, on balance, the area likely produces “revenues equal to or greater than the expenses it incurs.” The council ultimately voted to have staff return with information on the report’s implications for meetings in advance of annual budget deliberations.
Responses to the report’s conclusions roughly paralleled those to a draft version of the report, originally released last February. Then, as now, most councilmembers were particularly skeptical of the conclusion that late-night establishments generate revenues equivalent to their costs.
Councilmember Stacey Armato drew attention to the claim that the existing blend of uses constituted a “synergistic mix that at some level supports the success of each,” noting the lack of hard data to support it. Wil Soholt, senior vice president at Kosmont, said that it was less amenable to strict statistical support, but followed from examination of many urban areas.
“The mix of uses provides benefits overall to various users. That mix of users is typically what helps drive a downtown,” Soholt said.
Mayor Hany Fangary drew attention to the supposition that only four percent of all fire department calls originate after 10 p.m. in the city’s downtown area. Fangary, who lives near downtown, said that anecdotally it seemed far higher.
“I think that a lot of the problems that happen in downtown come after 10 p.m., usually after people have been drinking,” he said.
Fangary’s comments were representative, with four of the five councilmembers arguing that the report did not adequately account for the costs imposed by late-night operations in the downtown. This led to discussion about potentially increasing fees, including business license costs.
But Councilmember Carolyn Petty cautioned that increasing the burden on businesses already facing high rents could have the unintended effect of further intensifying use. She argued that increased foot traffic, as could be provided by planned hotels, would be more effective in diversifying the mix of uses in the area, and said the reason many businesses are dependent on late-night activity is because of the high cost of rent makes it the only way to survive.
“I honestly think that if they could make their rent, they would close at midnight and just avoid the aggravation. But they can’t. The only way to pay their rent is to stay open till 2 a.m. selling alcohol,” Petty said.