Novato business association presents balanced budget

The Novato City Council has approved the revised budget of the Downtown Novato Business Association.

The association is a nonprofit organization that works with the city to support commerce through the business improvement district. In October, the association presented a proposed 2026 budget with a slight deficit of $3,000.

At the time, the executive director, Stephanie Koehler, said the group’s most problematic expenses were holiday tree lights along Grant Avenue and maintaining 52 planter boxes on the street. The organization said the work cost about $93,000.

At the direction of the council, city staff worked with the organization to take over the two projects. Katie Skjerping, the economic development manager for the city, said it assumed the management of the projects in January. The cost estimate to the city is about $72,600 annually.

The Downtown Novato Business Association is primarily funded by business improvement district assessments that are matched by the city. The annual assessments range from $100 for small operations to $550 to financial institutions. Additional revenue comes from community events organized by the group and often sponsored by the city.

In the revised 2026 budget, which was presented to the council at its Feb. 24 meeting, the association budgeted $70,000 in assessments and a $70,000 match from the city. Its total projected revenue for 2026 is $280,100. The association now has a surplus of $44,587.

“The revised budget is the first in recent years to show a significant surplus as a result of the removal of those capital expenses for the Grant Avenue planters and tree white lights,” Skjerping said.

The surplus will be used to fill the organization’s reserves.

With the cost of the Grant Avenue lights and planter boxes, the city now spends about $531,000 annually on downtown investments outside the annual assessment match. The funds go toward endeavors like the tourism committee, the “Shop Local” campaign and the Tenant Improvement Grant Program, which offers funds to spruce up business exteriors.

Councilmember Sandeep Karkal asked how much funding the downtown area gets from the city and the business association.

“Would it be fair to say then that if you use the term ‘investment’ loosely, actually the summation of the $530,000 plus the $280,000 or so, that would be the sort of benefit or investment?” he said.

“The $280,000 doesn’t all come from city funds, of course, but yes absolutely, that is all being invested downtown,” Skjerping said.

The Downtown Novato Business Association has more than 400 members, according to its website.