San Marino's Lacy Park, Old Mill, and Taiwanese Sister City

San Marino is home to one of the world’s greatest cultural, research, and educational centers the Huntington Library. A private, nonprofit institution, The Huntington was founded in 1919 by Henry E. Huntington, an exceptional businessman who built a financial empire that included railroad companies, utilities, and real estate holdings in Southern California. Huntington was also a man of vision – with a special interest in books, art, and gardens.

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San Marcos, Inc. - Doing Business Like a Business Helps City Flourish

San Marcos has long been known as a city that does things differently, and the positive benefits of this approach have become more than apparent during the recent economic downturn. While cities up and down the state have had to cut service levels, shut down recreation facilities and layoff staff, the City of San Marcos has been able to maintain the high level of service that residents have come to expect. In fact, the city has even opened several new parks over the last few years.

“San Marcos has a long-held tradition of being entrepreneurial in spirit and operating more like a business,” explained City Manager Paul Malone.

The “San Marcos, Inc.” concept, as it is sometimes called, was developed shortly after the city chartered in 1994. Written into the city’s charter is a statement that says the city can engage in enterprise necessary to produce revenues to support the general fund.

“This language encourages the city to create non-tax revenue streams,” explained Malone. “It was and is a concerted effort to relieve the burden on the city’s taxpayers.”

One of the most prominent components of San Marcos, Inc. is the city’s role as a landlord. This stemmed from the idea that owning land and commercial space could create a recurring income stream for city operations, independent of tax revenues.

In 2005, rental income from city-owned property exceeded what the city collected in property tax. Property tax is usually a city’s second largest form of revenue behind sales tax.

Two of the best examples of the San Marcos, Inc. concept are the San Marcos Town Center development and the Creekside Marketplace development.

The San Marcos Town Center was developed by the city in 1994 with the goal of creating an economically self-sustaining focal point in the heart of San Marcos. The 60-acre site is now home to San Marcos City Hall, a County library branch, the San Marcos Community Center and Civic Center Plaza.

Of the Town Center’s 60 acres, 29 are revenue-generating commercial development. The city also leases out four floors in its City Hall building and ground leases all of the land in Civic Center Plaza, which is home to tenants like LA Fitness and The Old Spaghetti Factory. City Hall rents total $2 million annually, while Town Center ground lease rents total $1.3 million.

Another noteworthy example of the San Marcos, Inc. concept is the Creekside Marketplace development, located just off SR-78 at San Marcos Boulevard. This development has 293,000 square feet of anchored retail and is 50 percent ground leased. The city also owns 50 percent of the buildings in this development and receives revenue from floor leases.

The Creekside Marketplace alone generates a total recurring income stream of $4.65 million annually. “These two projects are ‘poster children’ for the San Marcos way,” said Malone. “The foresight to operate more like a business has paid healthy dividends and our residents are the ultimate beneficiary. Because we’ve been creative with revenue generation, our residents continue to receive top-notch programs, projects and services.”

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