City Agency to Consider Theater Plan

The dream of a downtown movie theater could cost the city nearly $5.4 million to demolish eight businesses and help finance the 10-screen multiplex and retail complex, under a proposal released Friday.

The deal, which also calls for the city to pay for a $2-million downtown parking structure, will be considered by the City Council on Monday when it convenes as the Redevelopment Agency.

Opening a movie theater in downtown Ventura has been a major goal of city leaders, who have already invested millions of dollars on improvements to lure visitors to the historic business district.

But the proposal on the table shows for the first time in cold, hard numbers what the city’s dream project would actually cost. And council members must now decide how--and whether--to pay for it.

“I think we have known all along that it is going to take some city help,” said Councilman Gary Tuttle, chairman of the Redevelopment Agency. “We have put a lot of money into downtown, and I think this is the final piece that will make us or break us.”

But the idea that the deal could break the city has some council members concerned.

“We are going to have to talk about this,” Mayor Jack Tingstrom said. “As bad as I want this, we are going to have to talk about it.”

The last big deal the council made with a retail developer--a tax-sharing plan for renovating the Buenaventura Mall--provoked a public outcry of a city giveaway and an unsuccessful ballot measure in March.

As proposed, Burbank-based developer Victor K. Georgino would build a 31,000-square-foot movie theater complex with an additional 14,000 square feet of retail stores in the 500 block of Main Street.

The 1,800-seat theater complex would open within two years and be operated by Century Theatres. The city would contribute $1.7 million toward the $5.4-million construction cost.

The deal requires the city to pay for a 500-car parking garage on a city-owned lot on Santa Clara Street between California and Chestnut streets. Georgino would supervise its construction.

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But before the theater could break ground, the city would have to pay roughly $3.7 million to acquire the property, raze the existing buildings and relocate eight businesses.

“The biggest chunk of money is the acquisition of the property and those are real rough estimates,” said Pat Richardson, the city project manager.

Although the city intends to negotiate with the four property owners, the agency has the ability to seize their lots and pay them fair market value.

After clearing the 1.6-acre lot, the city would transfer about 52,000 square feet to Georgino. The deal is structured in such a way that if the developer sells the complex within 10 years, he would be forced to pay back the city’s $1.7-million investment.

“We have gone through a tremendous amount of economic analysis in this,” Richardson said. “We look at it more as an investment.”

The city has the money to go forward with the deal, drawing on $12 million set aside in General Fund reserves in addition to other unrestricted funds.

“There is certainly always that $9 million in that tourist-related fund,” Tuttle said of money earmarked for a convention center 10 years ago. “I am going to be looking at that, no doubt about it.”

If the city were to go forward with the proposal, its funding scheme would work like this:

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Instead of issuing a bond, like most cities do for big projects, the Redevelopment Agency would extend its line of cash credit with the city and borrow the $5.4 million over a span of several years.

The money would be paid back to the city through increased property taxes gleaned by the agency over a 20-year period or possibly sooner, said Everett Millais, the city’s community services director. With the theater downtown, the reasoning goes, property values would rise and so would tax revenue.

Unlike the city as a whole, taxes from properties within the redevelopment area go directly to the redevelopment agency and cannot be used for any projects outside the area. The area stretches from Poli Street to the beach and from Ash Street west to the Ventura River.

Although the agency only makes a modest $64,875 in property taxes right now, officials estimate that the agency will take in $25 million over the next 20 years as the downtown area is improved.

The theater project is one such improvement, officials say.

“It is an expense to the city, there is no way around it,” Millais said. “But it is an expense that the city will get back with interest. . . .”

In addition to property taxes, officials say the theater will be a catalyst for development downtown, attracting upscale retailers and prompting property owners to invest in their own buildings.

“We hear from retailers, [who say] ‘We’d be interested in coming to Ventura but you don’t really have an anchor downtown,’ ” Richardson said. Like department stores in malls, he said, movie theaters are considered anchors for fledgling redevelopment projects.

“It really will bring downtown Ventura into its own,” said Georgino, who has been working with the city for more than a year to secure a theater deal.

“I think it is a good investment for the city, I believe it is a good investment for me,” he said.

But council members are approaching the deal with caution.

“I am concerned about the statements about getting money back and the tax increases,” Tingstrom said. “There are a lot of questions in my mind. I think those are going to play out Monday.”

Councilman Jim Friedman said city officials need to look at the proposal as a long-term investment in downtown.

“We cannot look at this as a short-term proposition,” he said. “I believe over the life of the project it will provide tremendous dividends to the city.”