Charges that Assessment Money Wasted at Downtown Santa Monica Inc

April 5, 2024 - As 54 downtown businesses are in the process of legally withdrawing from the private non-profit organization, Downtown Santa Monica Inc, charges have been leveled that the city-controlled operation wastes the money they collect from assessments on business and property owners.

Downtown Santa Monica Inc is not a Business Improvement District, in which the businesses themselves run and decide on improvements, additional security, and other matters. Instead, DTSM is controlled by the city, with 6 of its 13 members appointed by the city and the tie-breaking member the city manager. The rest of the members are elected by the dues-paying property owners in the downtown district, which stretches from Second Street to Lincoln Boulevard and the 10 Freeway. Effectively, the actual stakeholders do not have controlling interest in what is done to maintain and secure the area or in instituting policies to promote economic prosperity - all the stated goals of DTSM.

It has recently been revealed that Andrew Thomas, who earns a 6-figure salary as CEO of DTSM, turned down the offer of free office space from stakeholders in the organization. "Instead, he renewed at above market rates (higher than what some ground floor space is leased) and used our assessment money to remodel and redecorate his office," wrote one property owner in an email to The Observer. The property owner, John Alle, estimates that Thomas's decision cost stakeholders approximately $700,000 in rent alone.

DTSM spends about $8.5 million per year, according to the Santa Monica Coalition, a group of Santa Monicans who want to restore safety and cleanliness to the city. About $2 million of that goes to salaries for its paid staff. Another, even larger chunk, goes to pay for Downtown Ambassadors, who are unable to and not required to deal with the largest problem in downtown: the anti-social behavior of the homeless, crime (theft, assault, shoplifting), mental illness, and drug addiction. "That leaves barely $1.5 million for actual maintenance of the Promenade and Downtown," Alle wrote in an email last year.

Over the last year, REI has left the Third Street Promenade, T-Mobile, The Champs, Wetzel's Pretzels, and other stores have closed and given up on downtown Santa Monica. Starbucks removed all the seating at its Promenade location. A DTSM board member had to close his own restaurant on the Promenade due to "safety concerns," according to the Santa Monica Coalition.

Meanwhile, Alle notes that the number one item on DTSM's latest meeting agenda was "Santa Monica's Urban Forest." A cursory look at the SM Coalition's log of videos on Instagram and YouTube indicate the most pressing matter in downtown Santa Monica is the presence of the homeless and the crime, trash, and used drug paraphernalia associated with those who are mentally ill and/or addicted to drugs. Until very recently, the Los Angeles County Department of Public Health was passing out free needles to drug addicts on the Promenade. They continue to do so in nearby Reed, Palisades, and Tongva Parks.

A resident of the San Fernando Valley noted that Burbank's BID is a fraction the size of Santa Monica's DTSM (which is not a BID, as noted), and yet they are able to keep their downtown "clean and safe."