The Santa Monica City Council Tuesday will consider the next steps in an already three-year-long process aimed at revitalizing the city-owned, Expo-adjacent Bergamot Arts Center, rents from which subsidize the operation of the Big Blue Bus because the city purchased the land three decades ago with transit dollars.
According to the staff report, the Council will provide “conceptual direction regarding a preliminary plan for revitalization of the [c]ity-owned Bergamot Station Arts Center,” which is a cluster of about two dozen art galleries and a small handful of performance and nonprofit arts-related spaces housed in refurbished industrial buildings located in a part of the city that has been designated a “disadvantaged community” by the state.
Purchased with transit funds in the late 1980s in anticipation of a future transit line, ground rents from the property subsidize Big Blue Bus operations, which has one of the lowest fares of any transit system in the region. However, some of the for-profit gallery owners who have enjoyed relatively low rents on the city-owned site for decades have vocally opposed any changes there for fear that they may lose business.
Tuesday’s meeting is the next step in a process begun in 2014 that is designed to bring the decades-old arts center into the 21st century and open up the five-acre property — located in one of the city’s historically underserved neighborhoods, among the 25 percent of census tracts in California designated a disadvantaged community by the state — with more community-oriented arts, programming, and open space.
“The future of Bergamot [Arts Center] is not only envisioned as a place for art-selling businesses. It’s also envisioned as a safe harbor for nonprofit cultural uses,” Andy Agle, Santa Monica’s director of Housing and Economic Development, told Santa Monica Next in an interview Wednesday morning. “This is one of our only opportunities where they can survive and thrive.”
The plan is to preserve the existing gallery spaces while adding space for nonprofit arts and cultural uses as well as revenue-generating uses, like creative office space and a small hotel. Agle pointed out that art galleries are an essential part of the “cultural infrastructure” because, he noted, selling art sustains artists.
The location of Bergamot Arts Center isn’t insignificant, either. Since it is in a part of Santa Monica that has been designated a disadvantaged community under California Assembly Bill 535 — largely due to the environmental issues caused by the area’s proximity to the freeway and municipal landfill — the city could easily qualify for cap-and-trade money through the state’s Active Transportation Program (ATP) or the Affordable Housing and Sustainable Communities program (AHSC) to improve multimodal access to the site from the surrounding neighborhood, including the historically underserved Pico neighborhood directly to the south across the freeway.
In 2014, the City Council choose the Worthe Real Estate Group out of three teams competing to work on the project. The current iteration of the proposal by the Worthe Group includes 65,700 square feet of gallery and nonprofit arts space, a 21,000 square foot museum space, an additional 9,000 square feet of space dedicated to arts-related uses, 4,000 square feet of community space, a 600 square-foot bike center, and 133,750 square feet of programmable open space.
In order to generate sufficient revenue to continue subsidizing both nonprofit arts uses and BBB operations, the plan also calls for a small hotel (100 to 120 rooms) and 30,000 square feet of commercial office space above some of the gallery spaces.
As part of the deal, the ground rent would go from $552,553 annually to an estimated $700,000, increasing the subsidy to the Big Blue Bus by about $150,000 a year. That ground lease is an initial estimate, officials said, and would increase over time. For transit riders who cannot afford regular fare increases, that’s good news, since the money helps the transit agency keep fares stable.
The ground rents aren’t the only revenue stream, though. With property taxes and taxes levied on hotel rooms, the city could see an additional $2,195,000 (on top of the ground lease) annually to fund city services. All the revenue goes into the city’s General Fund and then is allocated by the City Council.
The most vocal opponents to proposed changes to the city’s property are a handful of gallery owners there. A number of them have claimed that even though Council direction has been to assure that revitalization plans make the preservation of gallery spaces a top priority, any changes would disrupt their business and drive them out.
Their low rents come at a cost, however. Without an increase in revenue on the site, Big Blue Bus would be forced to make hard decisions about fare increases sooner than might otherwise be necessary, a reality that impacts the transit agency’s low-income riders the hardest.
The Worthe team has made it clear that preserving arts uses at the site is a top priority.
“Worthe proposes to form a nonprofit organization to implement the Arts Center Management Plan. The organization would be funded by the Worthe Group annually by $270,000 with additional annual fundraising efforts,” according to the staff report.
“The non-profit organization would have a board comprised of representatives of the Arts Commission, the Worthe Group, and community members to advise the organization’s staff who would be responsible for community programming, oversee an artist residency program and other programs, coordination of gallery openings and Arts Center events, and assisting with tenant selection,” the report reads.
Still, the question of a hotel on the site could be a contentious one. An advisory committee was formed in 2015 to make recommendations about how to move forward with the project, in part to allay concerns of the gallery owners. The group was made up of 11 people, including gallery owners and other community members. Initially, the group voted to recommend a hotel on the site, then narrowly rescinded the recommendation at its next meeting.
“A minority of Advisory Committee members (five of the  members) supported the hotel, noting the additional services and economic benefits the hotel would bring to the project, including unionized jobs for local residents, transient occupancy tax revenue to support [c]ity and BBB operations, additional dining and nightlife amenities for nearby residents and workers, synergies with Art Center uses including additional gallery and event space, and proximity to the Expo station to serve transit users,” according to the staff report.
The committee’s recommendation is, as its name suggests, advisory, which means the Council is under no obligation to abide by it. City staff has made it very clear that while it would be possible to move forward under the constraints recommended by the committee, that would mean severe trade-offs in lost revenue for city and transit operations. The option without a hotel would generate $1,340,000, compared to $2,895,000, annually.
If the Council decides to move forward Tuesday, it will still likely be several years before any major changes come to Bergamot Station Arts Center, officials said.
After Tuesday’s meeting, depending on the Council’s decision, the Worthe Group could move forward with negotiating a development agreement, which means that plans would get refined with input from the community and various commissions before the Council votes on a final project.