Montrose Merchants Propose Tax Increase to Aid Promotion Drives

Merchants in Montrose Shopping Park are proposing an increase in their own tax assessments to increase revenues for promotional campaigns in the hope of turning around sagging sales.

Frank Roberts, former president of the Montrose Shopping Park Assn. and the group’s liaison to the City of Glendale, said the increases would be the first since 1968.

The shopping area’s assessment district, the only one of its kind in Glendale, was formed to promote the village and make street improvements. Taxes derived from a portion of retail sales are collected by the city and returned to the merchant group.

The merchants’ plan would levy the biggest increases against financial institutions and service-oriented businesses, which have paid only $15 a year since the tax district was formed 18 years ago.

Those businesses, including banks, barbers, beauticians and sign painters, will be charged a new fee based on the number of employees. The new tax would range from a minimum of $100 for a business with five or fewer employees to $2,000 for a business with 13 or more workers, according to the ordinance submitted to the City Council this week.

Would Affect 20 Businesses

Roberts said the steep increase would affect about 20 of the 137 businesses in the district, including four banks and savings and loan branches that have at least 13 employees. Managers at the branches said they were unaware of the proposed tax increase.

Janet Van Stralen, a spokeswoman for the Security Pacific National Bank branch, said she had not been told of the increase, but commented, “Whatever the merchant association does, we support very strongly.”

Corey Hill, manager of the Bank of America branch, said, “Our bank wants to cooperate, but we need to study the proposal to determine if it is fair.”

The tax increase also would double the annual fee levied against the only movie theater in the village--the Montrose Theatre--from 25 cents a seat to 50 cents. The theater owner could not be reached for comment.

Roberts said tax assessments against most retail merchants would rise about 35%.

A city-funded study released this spring recommended that merchants spend more money to attract shoppers to the three-block, drive-through mall along Honolulu Avenue west of Verdugo Road. The study found that most people who do not shop in Montrose perceive it to be smaller and more limited than it actually is.

Among the stores in the village are several sports and clothing stores, jewelry shops, restaurants and bakeries.

Glendale paid for the $22,000 study because, it said, sales tax revenues generated by village merchants have been stagnant for four years, whereas sales in other shopping areas of the city have soared.

The proposed increases could increase the village’s annual promotional budget from $16,000 to about $35,000, Roberts said. A public hearing on the changes will be held at 2 p.m. July 1.

The association sponsors more than a dozen major promotional events each year, including several sidewalk sales and art and crafts shows, a Cinco de Mayo celebration, Oktoberfest and St. Patrick’s Day and Christmas parades.

Roberts said three general meetings have been held with members of the association to explain the proposed increases. Another meeting is scheduled at 8 a.m. June 12 at Joselito’s Mexican Restaurant, 2345 Honolulu Ave.