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Council clears way to form Midtown Business Improvement District; businesses to vote on 2026 assessments
Summary
The City Council adopted a resolution of intent to form a Midtown Business Improvement District (BID) and levy assessments for calendar year 2026. The plan outlines a $250,000 first-year budget and starts a protest-hearing process that will conclude with a November public hearing; a 50% protest threshold by assessed value would stop formation.
The Santa Cruz City Council on Wednesday voted to move forward with the formation process for a Midtown Business Improvement District (BID), adopting a resolution of intent and initiating the statutorily required notice and protest process.
Rebecca Unit, the city’s economic development manager, told the council the Midtown BID effort grew from business-led organizing and consultant outreach. Unit said the proposed service area centers on Soquel Avenue between Morrissey and Pacheco and adjacent blocks near Seabright and Water Streets. “These are organizations that are formed for a specific commercial corridor,” Unit said, describing BIDs as business-funded, self-managed organizations that provide services “above and beyond what the city provides.”
Under the proposal the BID’s initial operating budget would be $250,000, funded by assessments on businesses. Unit presented the proposed breakdown: $125,000 for clean, safe and maintenance services; $100,000 for marketing, branding and events; and $25,000 for management and administration. The consultant team proposed an assessment formula based on business type and square footage, similar to the Downtown Association’s structure but calibrated for Midtown uses.
The council’s action adopts a resolution of intent and begins the required notice and protest timeline. Unit said the next steps include mailed notice to businesses, follow-up public meetings on Oct. 20 and Nov. 18, and a protest hearing; if businesses representing 50 percent of the assessed value protest, the district formation would not move forward. If the process is approved, Unit said the BID would begin operations on Jan. 1, 2026, with assessments collected by the city and remitted to the BID’s nonprofit manager.
Business owners who spoke during public comment urged council approval. Sonia McMoran, who owns multiple Midtown shops, said localized governance would give businesses a unified voice and long-term capacity for events and cleaning that ad hoc efforts have lacked. “This individualized activity is just not sustainable,” McMoran said.
Councilmember Brunner moved the resolution of intent; Councilmember Tragero seconded. The council approved the measure on a unanimous roll call.
What’s next: the city will mail notices to assessed businesses, hold outreach meetings in October and November and then a formal protest hearing on Nov. 18. If fewer than 50 percent (by assessed value) of owners file formal protests, the BID may be established and begin service delivery in 2026.
