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2 Newport Beach merchants associations lose half their city grants

About 120 businesses on Balboa Island’s Marine Avenue are part of Balboa Island Marketing Inc., which will get a city grant $20,000 smaller than anticipated.
(Hillary Davis)

The city of Newport Beach is continuing its retreat from providing funding to groups that market local businesses.

The City Council voted Tuesday to cut in half the city’s $40,000-per-year allotments to the Balboa Village Merchant Assn. and Balboa Island Marketing Inc., taking large chunks out of the independent groups’ budgets.

The decision came at the suggestion of Mayor Pro Tem Will O’Neill, who led a move earlier this month to fully hold back the $40,000 subsidies to the business improvement districts for the Corona del Mar area and restaurants around town.

2 Newport Beach business improvement districts lose $40,000 infusions from city »


The Balboa groups are merchants associations, which are private nonprofits but have similar functions to the quasi-governmental business improvement districts, which raise money chiefly through special assessments and are largely self-governed with some city administrative support. Those functions include marketing, event planning and neighborhood beautification, with regular discretionary financial support from the city.

The Balboa Village Merchant Assn. and Balboa Island Marketing Inc. launched in 2013, borne out of BIDs. Upon the transition, the city offered each of the groups $40,000-per-year grants as seed money. The plan was to limit the grants to five years, but they were extended.

“We’re entering year seven and the $40,000 a year is still being given and it accounts for almost half the money that is in their budget,” O’Neill said. “So I was curious — why?”

City Manager Grace Leung couldn’t give a precise answer, since she joined the city a few weeks after the adoption of the fiscal 2018-19 budget.


Craig Batley, owner of Burr White Realty, said that without city assistance, the groups can’t do much because they have limited fundraising streams without the assessments that come through BIDs.

The $40,000 in city money “wasn’t guaranteed forever, but the thought was, ‘Hey, that’s something that’s going to continue,’ ” said Batley, a member of the Balboa Village association. “We have no way to raise any money down there. We don’t assess the business owners anymore. There’s just no funds. Without that funding, there won’t be much activity.”

The Balboa Village group, which represents about 80 businesses on Balboa Boulevard between A and Coronado streets, drew up a $91,500 budget for fiscal 2019-20, projecting $57,500 in new revenue (including the $40,000 grant) along with $34,000 in carryover from the current fiscal year.

The Balboa Island association, which represents 120 businesses in the Marine Avenue corridor, budgeted about $120,000, with $45,000 in new funds (all but $5,000 of it from the city grant) and $75,000 in carryover.

The two groups now will get $20,000 each for the new fiscal year. O’Neill said the funding should be completely discontinued the following year.

The council voted unanimously to reduce the funding for the Balboa Village association and 6-0 on the Balboa Island grant, with Councilman Jeff Herdman recusing himself because he owns property in the area.

General plan update outreach contract

The council Tuesday awarded a $452,000 contract to public affairs firm Kearns & West to lead community outreach as the city updates its general plan.

The firm will be expected to become familiar with the current version of the city’s long-term planning and development guideline, “capture community desires” through forums, other events and online channels, and summarize them as part of a general plan update process that is expected to take about three years. The outreach portion could take about a year of that.


Kearns & West, which has offices around California and elsewhere in the country, earned the nod from the resident-led General Plan Steering Committee after an interview in May. City staff also gave the firm top marks.

Board and commission appointments

The council made the following board and commission appointments Tuesday:

  • Planning Commission: Sara Klaustermeier and Mark Rosene
  • Parks, Beaches & Recreation Commission: Laird Hayes (incumbent) and Kate Malouf
  • Arts Commission: Arlene Greer (incumbent)
  • Harbor Commission: Marie Marston and Steve Scully
  • Board of Library Trustees: Janet Ray (incumbent) and Barbara Glabman, who will move from the Arts Commission
  • Building and Fire Board of Appeals: Robert Ahlke (incumbent)
  • Civil Service Board: Mike Talbot

All terms run through June 2023, except for Scully of the Harbor Commission, whose term will run through June 2021.
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