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August 19, 2009 > Economic Development Commission

Economic Development Commission

City of Milpitas
August 10, 2009

Commissioners Steve Tao and Michelle Yu prepared and presented memorandums about industrial district names, the business license application process, and business attraction. Milpitas Unified School District

Board President Michael Mendizabal presented subcommittee findings and recommendations regarding the employability of Milpitas residents.


Industrial district names

There are 10 industrial parks, Districts, as that have been identified. District 1 is Town Center Business Park. District 2 has no name. District 3 is Oak Creek Business Park. On South Abbott Avenue District 4 has no name. District 5 is McCarthy Ranch. California Circle is District 6. District 7 has no name. District 8 is Los Coches Avenue. District 9 is Railroad Yards. District 10 is Minnis Circle/Hanson Court.

Tao provided the commission with a list of alternative names and plan to organize the business districts. The names still have to be decided. Upon a full EDC agreement on the district names, and council approval, EDC recommends RDA funds be utilized to identify the districts with the light post banners (details to be worked out), incorporating the current Milpitas logo and graphics.

Tao explained that the goal is to set up business districts in a manageable fashion. His proposed alternatives feature a convention of using certain words to give an idea of what the space is used for, such as "park" for light industrial, and "center" to indicate research and development (R&D) and office space.

The thought here is identify these districts. Use the banners, existing color palette, different color schemes for different districts. So this way there is an identifiable signage that is bright and colorful and draws interests to districts.

Tao wants to work with staff to create a letter signed by the mayor to send to the stakeholders, and affected property owners about the district names.

Diana Barnhardt, the Economic Development Manager, said to let them know what's going on, not so much about being concerned that they will complain about being a district called by a particular name.

Mayor Livengood wondered if there were any legal restrictions imposed on naming districts.

The names recommended in the memo are more geography based.

The goal is to stay away from names like "Town Center" that evoke a specific shopping center associated with companies like Shappell.

Want to keep the names as short as possible. Be more visible as you're driving by, and fit on the banner.

Livengood suggested making Abbott avenue and auto dealerships one whole district and referring to it as an auto center. It will be physically connected eventually.

Livengood: From a marketing point of view if you rename that whole area something auto mall related, and things change, and the economy comes back, who knows what could happen.

Mendizabal agreed that the Abbott-Thompsen area should have auto an mall. To draw attention to that.


Business license application

For more information on how to apply for a business license in Milpitas, visit www.ci.milpitas.ca.gov and click on "Business License."

The task that Yu had was to look into the business application process and see if the City could simplify this. Yu believes that the recommendations discussed in the memo will be geared more towards what Barnhardt calls "micro businesses," small businesses, because the larger businesses get a lot of support from the City to acquire the necessary approval.

Yu believes that the current process is how it is now for some reason.

The first thing that she noticed, from her own experience trying to open a business in the city, was a lot of information.

Part of the potential problem is that for a smaller business, the information that is currently provided on the website is applicable to businesses of all sizes. And so a good chunk of the forms do not apply to small businesses.

When I saw how other cities have dealt with the issue, a lot of them dealt with it by having the business application form very straightforward and short 2 page form.

In that form a huge disclaimer in bold and black saying that the business owner knows that this business license doesn't mean that it's a clearance to operate a business. There are various other approvals that need to be obtained. It simplifies the process for the person who is trying to go step by step to at least get the business license first.

And then based on whoever is at City Hall reviewing that application to decide what other considerations would be applicable.

Yu made a recommendation to stick with business license application, build in a disclaimer, and then have all of the relevant approvals come afterward.

First recommendation to at least make clear that to operate a business in this city one has to fall within 4 categories.

The first category is the forms required for a commercial business, second home business, third a state licensed contractor located outside Milpitas, the fourth one is for businesses located outside of Milpitas at no fixed location.

The first category seems to apply to most businesses that will operate in the city. The first few items are straightforward: pay the application fee, go through the various channels such as fire department. Confusion about the occupancy permit, when is it required, whether it is required each time a person moves into a building.

The information is not clear on the website, so it requires the person to make a phone call. If every potential business owner makes a phone call that would flood the system.

The phone call information made it clear that there was only a one-time fee that would apply, $413 and change. This only applies to the first occupant in the building.

Other people that move into that building can rely on the first permit that was obtained, even if it is a different business.

The only time a permit is required again, is when the first person who got the permit moves out. That permit goes with them.

Livengood said it needs to be clear the difference in business license and occupancy permit. The business license doesn't have any life safety, or anything attached to it. Occupancy is something that we pay close attention to for a variety of reasons. He said that Yu described the rules, the problem is how do you let people know that those are the rules.

There should be no reason for someone to pay $500 to move into a previously occupied space that was used to do the same kind of business.

Livengood said that the city needs to be clear about what triggers the need for an occupancy permit. Need to clarify who needs an occupancy permit.

Category 3 and 4 are for people who are doing business in the city, who are not going to have a physical location.

The only difference between 3 and 4 is that 3 is for state licensed contractors, and 4 is for people who are not state licensed contractors. This should be clarified on the website because it would confuse anyone trying to start a business and make sense of unclear information.

It needs to be clear that a person who applies for a business license only needs to apply under one of the four categories. The current approach, where all four categories are presented, could cause some businesses to think that they fall into more than one category. The list of categories is currently not enumerated, 1 - 4.

Compliance and enforcement. The website does not indicate what happens when a person operates a business without completing the business license application. There is no punitive or prohibitive fee that is imposed on someone who gets caught. It seems that it would be difficult for staff to identify, and enforce.

The cost to get caught is nearly the same as the cost to apply in the first place, so there is no incentive to get it right from the beginning.

Some cities provide the option of completing the business license application online. This way incomplete information can be sent to the city, who could offer support in the process.

Yu also recommends putting information about the necessary fees on the website. The issue of fees could get very complicated because it could depend on the square footage of the business. In this case there could be information that fees would be based on a formula. Can always say for further assistance to call the city. Need at least some description on the fees.

Identify whether noncompliance is a problem. Fines could lead to revenue, but would costs much staff time trying to track down businesses who don't have a business license. Since the license fee is not that much there could be a negligible cost benefit analysis.


Business attraction

Tao and Yu prepared a memo that begins: As the economy goes through its turns and cycles, the City is faced with challenges to increase its tax base, generate revenue, support a healthy business environment and continue to make the City attractive to businesses which demand retail, office/R&D, industrial/warehouse and other type of commercial buildings.

To get businesses into Milpitas is a matter of reaching out, and reaching out to whom. Tao said that the city should concentrate its efforts to reach out to the brokerage community, who have a particular fear factor when coming into a city and starting a business. There should be a person to have a face and be a city hall point of contact with brokers.

City employees should introduce themselves to the brokers, make them aware of the City's desire to help them and their clients.

City needs to understand how to better serve the brokerage community.

Yu said to focus on the larger retailers that the City would like to attract. Find out what it is they look for when selecting a city. Yu recommends contacting and looking at Costco, and perhaps having a smaller one in Milpitas, without the gasoline station, Fry's Electronics, Bed, Bath and Beyond, Toys R Us, Macys, REI. At least engage them in conversation.

Yu also recommends free advertising for retailers when they are first starting out. Advertising does cost a lot of money, and it is essential to continue during this economic downturn. Could advertise businesses on the city website, or the Milpitas Post, at the Milpitas Sports Center, at the Milpitas Public Library. This could incentivize people to operate a business in Milpitas.

There should also be "coming soon" signs for businesses coming in, to build anticipation in the public of new merchants, according to Yu.

Being "green" is the big thing these days. Depending on feasibility, the city could develop green branding to establish a green identity, and in theory provide some kind of incentive for businesses that have environmentally friendly practices.

Facilitate open communication with the Milpitas Chamber of Commerce and the Milpitas Telecommunications Commission to utilize technology to expand communication possibilities.


Employability of Milpitas residents

Mendizabal reported about the kind of Milpitas residents that the subcommittee researched the employability of: Previous employed residents looking for employment. Underemployed residents, people who had their working hours cut, or were demoted. Newly employed residents, recently high school and college graduates. The youth, work experience education, summer jobs, part time jobs.

What the subcommittee decided was that we needed to concentrate on especially, in this time, was on previously employed residents and underemployed residents.

The subcommittee thought it would be great if the City website had links to job finding and career finding websites like monster.com, careerbuilder.com. and try to connect through city human resources to large company job listings so people looking for a job need only visit the city website.

What kind of skills are employers looking for, and how would we find that out? Concluded that that was ever changing too costly to find out.

In their interviews with educators within the Milpitas Unified School District, Silicon Valley Small Business Development Center, and North Valley Job Training Consortium (NOVA), the subcommittee found that these agencies are geared towards educating about employable skills.

The curriculum of these educational agencies is based on what is out there in the marketplace right now, so there is no need for the City to conduct such research.

The subcommittee thought another section of the City website could contain information pertaining to looking for a job and acquiring new skills, and who to contact.

Milpitas pays into NOVA, out of Sunnyvale, and is part of it.

There is also work2future and the Metropolitan Education District. Most of these programs are fee based, but they can be reasonable fees Mendizabal reported.

The Milpitas Chamber of Commerce has a bi-annual job faire, and offer free job counseling through SCORE (Service Corp of Retired Executives).

How can the city operate on its website information from other organizations that people can use to help them get jobs, change employability status, give them new careers, new abilities to do different things?

At its next meeting the commission will work on getting the items discussed on the Milpitas City Council agenda. The items are industrial district names, business license process, new business procurement.

The memos prepared by subcommittees will act as background information, and the recommended changes will be discussed and decided by city council.


Signs

The EDC is looking to construct signs to welcome people into Milpitas at Fremont, Warms Springs Blvd. to N Milpitas Blvd., McCarthy Blvd. at Montague, South Main Street at Montague.

Barnhardt said actually have money in the capital budget for this.

A decision was made to do the freeway signs first to see how they would be designed before the "minor" signs.

The goal is to not have 5 different sign designs welcoming you to Milpitas, Barnhardt said. Looking to achieve continuity.

The council has to approve, and the commission would come back to council with design ideas.

Mendizabal: You're looking to put in permanent signs that would blend in with the freeway monument signs.

There will be changes to projects depending on state on city budget.


Mayor report

Mayor Livengood reported that he and Diana Barnhardt, Economic Development Manager, hosted a meeting with hoteliers, inviting the Great Mall.

They had a conversation about cross marketing, looking at ways to get people to go from the hotels to the Great Mall and vice versa.

Livengood said that he will continue working with the Great Mall and the auto dealerships to create a synergy of traffic between them.

Next meeting
Monday, September 14
6 p.m.
City Hall
455 E. Calaveras Blvd., Milpitas
(408) 586-3000

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