Item Coversheet

Agenda Item - 4.a.


City of Garden Grove


INTER-DEPARTMENT MEMORANDUM

To:Scott C. Stiles

From:Lisa L. Kim
Dept.:City Manager 

Dept.: Community and Economic Development 
Subject:

Approval to re-brand the Shop Local Initiative BiGG and consider approval of  a New Vehicle Rebate Program for Garden Grove residents. (Action Item)

Date:5/14/2019

OBJECTIVE

The purpose of this report is to obtain City Council approval to re-brand the City's Shop Local Initiative known as Buy in Garden Grove (“BiGG”); and to conduct a Public Hearing to consider the proposed New Vehicle Rebate Program for Garden Grove residents, to incorporate into the Shop Local Initiative. 
BACKGROUND

Established in 2009, the BiGG program was designed to promote local business growth, and to encourage job creation and retention. Through BiGG, local Garden Grove residents are offered local incentives, such as discounts by participating businesses and retailers. Shoppers only need to mention BiGG at the place of business to receive the local incentive or discount. All Garden Grove businesses are eligible to receive a free listing on the City’s website, as well as seasonal publicity, such as the Black Friday Goes BiGG and OC Restaurant Week.  To date, approximately 100 businesses participate in the BiGG program.

DISCUSSION

To mark BiGG’s 10th anniversary, an enhancement and re-branding of the program was undertaken with new interactive features to provide user-friendly tools while adding more benefits to participating businesses and shoppers.  The 2019 BiGG program will unveil the following features:

 

  1. New Look - A new Buy in Garden Grove logo and tagline, “Think BiGG.”
  2. Enhanced Interactive Website - A redesigned webpage offering an interactive GIS map that geo-locates businesses and provides driving directions using Google Maps and enhanced search filters.
  3. Business Highlights - There are opportunities for individual businesses to create a detailed business page featuring large-sized logos, and the addition of social medium platforms and Yelp with contact information.
  4. Streamline Participation - To streamline efforts, a business portal has been established for new business sign-ups.
  5. Staycation Package - Shopper portals for individual business incentives and combined business packages, such as “dinner and show” or hotel/restaurant staycation discounts.
  6. New Vehicle Rebate -  A new incentive has been added to BiGG to offer Garden Grove residents a $500 rebate for new vehicle purchases from a local Garden Grove new vehicle dealership.

To facilitate the New Vehicle Rebate Program, a Public Hearing is required for this type of Shop Local incentive to Garden Grove residents and businesses. There are a total of six (6) franchised new vehicle dealerships that would participate in the New Vehicle Rebate Program through a Participation Agreement with the City.

 The general terms and conditions of the Participation Agreement under the New Vehicle Rebate Program are as follows:

  • The New Vehicle Rebate Program term would be five (5) years effective July 1, 2019.
  • A $500 rebate would be offered to Garden Grove residents or businesses for the purchase of a new vehicle at any of the six (6) franchised new vehicle dealerships including: Garden Grove Kia, Garden Grove Nissan, Russell Westbrook Hyundai, Simpson Chevrolet of Garden Grove, Toyota Place and Volkswagen of Garden Grove.
  • Qualifying new vehicles include all purchases of new cars or trucks. Motorcycles, off-road vehicles or watercraft and fleet vehicles are not eligible purchases under this program. Fleet vehicle sales are also excluded from the program.
  •  Participating franchised new vehicle dealerships would be required to submit documentation using an online New Vehicle Rebate form to include: a buyers driver’s license, proof of a Garden Grove address via a utility bill, and a copy of the purchase agreement.
  • Requests made by participating franchised new vehicle dealerships would be processed  monthly, and City reimbursement would be processed 30 days thereafter; e.g., rebates requested in July would be processed in August.

 

 The Office of Economic Development Division will evaluate the effectiveness of the New Vehicle Rebate Program annually to determine whether the Shop Local initiative has increased or has kept the number of new car sales and leases stable for Garden Grove residents and businesses. Staff will also consider factors including any changes in the economy and new dealerships opening outside of the City borders. The New Vehicle Rebate Program is compliant with provisions of Government Code §§ 52200 et seq. and Government Code § 53083 et seq. The economic development benefits achieved would result in the generation of significant additional sales tax revenues to the City, the creation of additional employment opportunities for residents of the City as outlined in the attached AB 562 report.  In addition, the New Vehicle Rebate Program has been developed to minimize sales tax leakage of local vehicle purchases to other cities and will provide that future revenue generated will be available for vital City services.

FINANCIAL IMPACT

It is anticipated the program cost for the six (6) participating franchised new vehicle dealerships would be approximately five hundred sixty-seven thousand dollars ($567,000) annually.  Program funding will be requested through the upcoming Fiscal Years 2019-20 and 2020-21 budget process, and additional funding for the program would be appropriated on an annual basis.

RECOMMENDATION

It is recommended that the City Council:

 

  • Conduct a Public Hearing for the New Vehicle Rebate Program;

 

  •  Approve the re-branding of the Shop Local Initiative known as BiGG;

 

  • Approve implementing Participation Agreements by and between the City of Garden Grove, a California Municipal Corporation, and participating dealers; and

 

  • Authorize the City Manager to execute New Vehicle Rebate Agreements, including any minor modifications as appropriate, and any other pertinent documents necessary.

 

 

By:  Greg Blodgett, Sr. Project Manager




ATTACHMENTS:
DescriptionUpload DateTypeFile Name
AB 562 Report 5/7/2019Backup MaterialAB_562_Report_Final_for_GG-3.pdf
Participation Agreement5/9/2019Agreement5-14-19_BIGG_New_Vehicle_Rebate_Program_Agreement.pdf