How can Santa Barbara save downtown, erase its structural deficit and build more housing?
A partnership with the Santa Barbara South Coast Chamber of Commerce might be the answer.
The city of Santa Barbara is considering a formal financial partnership with the Santa Barbara South Coast Chamber of Commerce to create an economic development plan.
“The chamber is uniquely positioned to provide programs that will improve the local economy and jobs, which in turn supports the city’s mission and goals,” said Kristen Miller, president and CEO of the Santa Barbara South Coast Chamber of Commerce. “The uncertain economy requires new, strategic thinking to grow the Santa Barbara economy across industries and the entire city.”
The three-member Finance Committee will discuss the matter at noon on Tuesday at 630 Garden St.
Staff’s recommendation is that the city spend $150,000 in general fund reserves, $50,000 from Airport Department reserves and $50,000 from Waterfront Department reserves to create a plan.
The partnership would develop new economic policies surrounding a State Street leasing strategy, hospitality, events, visitor services, the so-called “Blue Economy,” and supporting housing downtown, among other initiatives.
The council last approved an Economic Development Plan in June of 2021.
Last fiscal year the city approved a budget after moving money around to close a $7.1 million budget shortfall. It has a structural deficit and has placed a half-cent sales tax on the November ballot to help address the problem. Downtown has struggled in recent years, with vacant storefronts and businesses opening and then closing amid a closure of State Street to vehicles. Santa Barbara is also currently working on a State Street Master Plan.
“With limited staff and financial resources, the city has been stymied in progressing and
implementing many components of the plan,” according to the staff report.
The city’s downtown commercial vacancy rate is at 15%, according to the Chamber. About half the population has a household income below what is needed to afford rents in the city, according to the Chamber.
Businesses are suffering from a lack of certainty regarding city policies, the chamber’s proposal states.
“The Santa Barbara South Coast Chamber of Commerce is uniquely positioned to help the City of Santa Barbara with these very issues during this critical time,” the proposal states.
“This plan aims to position Santa Barbara as a dynamic city where businesses, residents and visitors thrive,” the proposal states. “A city that offers opportunities for exciting careers, housing for people at all levels, a sense of community for the residents and thriving businesses, as well as services and products required by both locals and visitors alike.”
The chamber wants to create an Economic Development Committee within the
city that includes city representation as well as the city’s various economic development stakeholders. The proposal also includes a communications proposal.
Although funding for the first year is proposed at $250,000, the Chamber’s proposal calls for a $500,000 investment in a public-private partnership starting with the 2025-
27 two-year fiscal budget. The proposal states that funding could result from a potential
sales tax increase. Santa Barbara has agreed to put a half-cent sales tax proposal on the ballot.
Parts of the proposal include creating eight business districts: Downtown, Coast Village Road, Mesa/Cliff Drive, Funk Zone, Waterfront, De la Vina, Milpas, and Upper State Street.
“Each have a variety of different types of businesses, all with their own unique sets of strengths and challenges,” according to the proposal.
Santa Barbara City Councilwoman Meagan Harmon supports the partnership. She said it is very clear that Santa Barbara is in need of ongoing economic development expertise.
Much potential exists, she said, both downtown and throughout the city. Over the years, Harmon said, the city has tried different routes to accessing economic development expertise—with different external partners or through different staff positions—to varying levels of success.
“An effective strategy is more critical now than ever,” Harmon said. “I’m hopeful that with the Chamber’s expertise, coupled with tangible programmatic milestones, effective oversight, and clear expectations around results, we will have an opportunity to move the ball forward for the benefit of local business and the whole community.”
