Arlington Economic Development COUNTY MANAGERS PROPOSED FY 2021 - PowerPoint PPT Presentation

Arlington Economic Development COUNTY MANAGER’S PROPOSED FY 2021 BUDGET General Fund and Tourism Promotion Fund County Board Work Session Tuesday, March 17, 2020, 3:00 p.m.

Ensure that Arlington is an economically vital, competitive and sustainable community

Office Vacancy Rate: 2Q 2012 – QTD 2020 Positive momentum 25% on office vacancy, challenges remain NSF 20.8% Departure 20% 18.7% 17.5% 16.0% 15% to 16% 16.8% 15% 14.8% 12.9% 10% Source: CoStar Arlington Economic Development 2

Headwinds Continued Loss of GSA Leases • Nearly 1 million square feet of major GSA leases leaving the County in the next 24 months Real Estate Competition • High tenant expectations for office space (e.g. amenities, sustainability, design, technology) • Delivery of more affordable Class A product along Silver line • Less price advantage in a weaker D.C. office market Legacy Space • Small businesses in legacy spaces face challenges as properties are redeveloped Talent • Historically low unemployment • Global demand for tech talent COVID-19 • Global outbreak is having significant negative impacts on Arlington’s hotels, hospitality industry, small businesses and artists 3 Arlington Economic Development

Department Overview Business Investment Real Estate BizLaunch FY 2020 FY 2019 FY 2020 Concluded Columbia Pike Market Study One-on-one Consultations: 1,030 Jobs: 3,100 Support for transformative development Workshops: 129 Square Feet: 771,000 projects (Rosslyn Holiday Inn site, Met Workshop Participants: 4,060 Business Engagements: 320 Park, etc.) Over 58,000 clients served since 2002 4 Arlington Economic Development

Department Overview Convention and Cultural Affairs Communications Visitors Service CY 2018 FY 2019 FY 2020 Tax Revenue: $93.7 M Create: 335 artists presented Web Traffic: 201,400 pageviews CY 2019 Support: 347 performances and events Earned Media: 131.6 M impressions Website Sessions: 302,000 Promote: 483,187 social media reach Social Media: 475,100 impressions Advertising Impressions: 114 M 5 Arlington Economic Development

Realizing A rlington’s Commitment to Equity BizLaunch’s S mall W omen a nd M inority-Owned ( SWaM ) Equity Outreach Who Benefits? Who is Missing? SWaM businesses and entrepreneurs Micro-enterprises and small businesses, whose characteristics fall into one of the especially those located in legacy commercial following categories: small, micro- space and/or who are hard to reach through enterprise, woman-owned, minority-owned traditional marketing channels. or service disabled veteran-owned. Who is Burdened? How Do We Know? Arlington’s small businesses and micro - Team with existing on the ground partners to enterprises who are unaware of, or have analyze gaps in service and identify limited access to resources, because of opportunities for SWaM businesses. schedule limitations, lack of technology or language barriers. 6 Arlington Economic Development

Realizing A rlington’s Commitment to Equity BizLaunch’s S mall W omen a nd M inority-Owned ( SWaM ) Equity Outreach • Create new tools and programming for SWaM businesses • Translate business resources into multiple languages • Increase outreach through collaborative partnerships • Launch inaugural SWaMmy Awards with the Commonwealth of Virginia • Present Arlington’s “ BizPossibilities ” powered by Amazon Web Services (AWS) • Increase access to Arlington’s purchasing processes via AED -DMF collaboration 7 Arlington Economic Development

Summary of Proposed Budget Changes General Fund % FY 2020 FY 2021 Change Change Adopted Proposed +$228,656 $8,735,645 $8,964,301 +2.62% Expenses $186,000 $177,034 -$8,966 -4.82% Revenue 46.40 FTEs 45.40 FTEs -1.0 FTEs - Staff • The proposed budget includes the restoration of ongoing funding for the Cultural Affairs Scenic Studio Manager and Facilities Manager positions (2.0 FTEs), and increased investments in community arts, neighborhood partnerships and provision of support to small businesses in the County. • Elimination of the vacant Facility Technical Services Director position (1.0 FTE).* *This position was eliminated as part of the FY 2020 Adopted Budget and was covered with one-time funds in FY 2020 until the incumbent retired. 8 Arlington Economic Development

Summary of Proposed Budget Changes Tourism Promotion Fund % FY 2020 FY 2021 Change Change Adopted Proposed $1,546,700 $1,546,700 - - Expenses $1,546,700 $1,546,700 - - Revenue 7.0 FTEs 7.0 FTEs - - Staff • Proposed budget reflects anticipated $1,300,000 revenue from Transient Occupancy Tax Surcharge • Revenue includes $246,700 ongoing General Fund Transfer • Governor Northam signed SB 107 and HB 62 removing the July 1, 2021 sunset date for Arlington County’s authority to impose the Transient Occupancy Tax Surcharge 9 Arlington Economic Development

Community Arts Transition Plan Process County Board approves interim community arts transition plan and charges the County April 2019 Manager with providing a long-term, strategic transition plan for the FY 2021 Budget. County Manager appoints the 15-member Community Arts Advisory Committee (CAAC) to develop alternative business models for Scenic Studio, CostumeLab and Mobile Stage and to recommend an improved scheduling process for joint-use theater space. CAAC presents final recommendations: July – Nov. 2019 • Grounded in the efficient, effective and equitable delivery of services; • Aligned with the County’s adopted Enriching Lives: Arlington Arts and Culture Strategy (2017) ; and • Provide greater opportunities for the community at large to make use of Arlington’s unique cultural resources. FY 2021 Majority of CAAC recommendations included in the FY 2021 Proposed Budget and the County continues to explore additional CAAC recommendations. Proposed Budget 10 Arlington Economic Development

Detail: Proposed Investments in Community Arts Proposal Type Budget Impact SCENIC STUDIO Restore ongoing funding for Scenic Studio Manager Restore ongoing funds $110,692 More flexible scenic studio operating hours Increased efficiency - Revised Scenic Studio use fees New revenue $12,900 COSTUMELAB New one-time funding Pilot – Signature Theatre to manage the CostumeLab inventory $70,000 Alternative service delivery JOINT-USE SCHEDULING Restore ongoing funding for Facilities Manager position Restore ongoing funds $101,350 Develop new scheduling process Increased efficiency - MOBILE STAGE Continue use for 2020 season; obtain vendor for future Alternative service delivery - ARTS GRANTS Funding for Arts Grants program New one-time funding $30,000 (total proposed funding for FY 2021: $245,810) 11 Arlington Economic Development

Detail: Proposed Budget Changes Small Business Investment through the BizLaunch Program Service Impacts Budget Impact FY 2021 Change: $55,000 • Ongoing funding added to the BizLaunch program ($35,000) to meet the rising demand for multilingual programming, technical assistance and events for small businesses in the County. • One-time funding to create and deliver programming for small businesses along Columbia Pike ($20,000). Staff Impact None 12 Arlington Economic Development

Investments in Neighborhood Partnerships FY 2020 Adopted FY 2021 Proposed Base One-time Total Base Ongoing One-time Total Budget Budget Above Base $80,000 $10,000 $80,000 $15,000 $10,000 CA $90,000 $105,000 LHA $60,500 $20,000 $80,500 $60,500 25,500 - $86,000 CPRO $350,000 $20,000 $370,000 $350,000 - $60,000 $410,000 Total $490,500 $50,000 $540,500 $490,500 $40,500 $70,000 $601,000 *Base budget includes ongoing funding only. • Clarendon Alliance (CA) – $15,000 in new ongoing funding for staff benefits; $10,000 in new one-time funding for marketing and operations, reflecting a 19% increase in base budget funding. • Lee Highway Alliance(LHA) – $25,500 in new ongoing funding for Director salary and LHA’s office lease, reflecting a 42% increase in base budget funding. • Columbia Pike Revitalization Organization (CPRO) – $60,000 in new one-time funding to hire a business engagement specialist. CPRO will collaborate with AED’s BizLaunch on the scope, hiring and work plan of the new position. 13 Arlington Economic Development

Key Budget Considerations The FY 2021 Proposed Budget: • Provides greater opportunities for the community at large to make use of Arlington’s unique cultural resources; • Builds on FY 2020 small business investments by providing additional programming funds to support increased demands; • Maintains support for business investment program to sustain momentum; and • Makes strategic investments in the Neighborhood Partnerships. Looking ahead to future budget years… • The removal of the TOT sunset clause provides new opportunity for long-term convention and visitors service planning and strategy; • Increased demand for small-business services and new initiatives for SWaM businesses could strain BizLaunch staffing resources; • Workforce will continue to be a challenge in working to attract, retain and expand companies; and • Competitive real estate market necessitates continued investments for economic diversification and reducing commercial vacancy. 14 Arlington Economic Development

Arlington Economic Development COUNTY MANAGER’S PROPOSED FY 2021 BUDGET General Fund and Tourism Promotion Fund County Board Work Session Tuesday, March 17, 2020, 3:00 p.m.