Livermore will ask property owners and residents in the newly redeveloped downtown to approve a special assessment district to pay for maintaining the downtown improved landscaping.

On Monday night, the City Council moved to form a maintenance assessment district, to include both commercial and residential properties. It would encompass the area bounded by Inman Street to the east, S Street to the west, Chestnut Street to the north and sections of Third, Fourth and Fifth streets to the south.

Under the proposal, assessments on owner-occupied residential properties would accrue at the time the district forms. However, at the owner’s request, the assessment would be collected only after the property is sold.

The council expects to ask property owners in the proposed maintenance district to vote on the assessments early next year.

Councilwoman Lorraine Dietrich was the sole dissenting vote, saying she would rather see the assessments accrue once the owner-occupied residential properties were sold or redeveloped.

Responding to concerns raised by downtown merchants at an April meeting, the city engineer returned with a proposal that reduces initial landscape maintenance costs to business owners impacted by First Street construction last year.

City engineer Cheri Sheets said that during 2005, sales tax revenue went down 2 to 4 percent due to that construction.

With those revenue losses taken into account, commercial assessment for existing owners would be phased in over three years, with nothing assessed the first year, 50 percent assessed the second year and 100 percent assessed the third year.

The council also agreed to phase in assessments for new businesses under construction before Nov. 17, 2005.

If the district is formed, property owners will vote on whether to cover $300,000 of the initial $510,000 annual cost of maintaining the new landscaping, plaza and park areas. Total maintenance costs are expected to climb to $1.3 million a year after trail, mini-park and remaining streetscape work is complete.

“The city and redevelopment agency have invested $30 million into the downtown,” Sheets said. “With the success we have had increased activity, which has led to increased maintenance.”

She said utility costs have gone up with the new lighting, and more litter control is needed.

The city contributes $450,000 annually to maintain downtown landscaping and the parking garage, as well as for garbage pickup and special events.

The proposal also included maintenance of pocket parks constructed within new residential developments. The developers would pay 85 percent of maintenance costs, with the maintenance district covering 5 percent and the rest of the community paying 10 percent.

Sheets said city staff would meet with property owners to review the maintenance quality and assessment levels.

There will also be a provision to defer assessments due to economic hardship.

A few business owners complained that the city foisted the maintenance costs on the property owners, after the initial $12 million streetscape project was near completion.

Some urged the City Council to ask all of the city’s residents to pay for the new downtown, since it serves everyone.

“The revitalization process has yielded benefits to all of the city’s residents,” said First Street business owner Art Thompson. “The costs to maintain it should be borne by all city residents.”

Other business owners said they were more than willing to pay their fair share to maintain the newly redeveloped downtown.

“We have realized significant value in our property,” said First Street business owner Dennis Swanson. “This is a significant amount of traffic because of the streetscape.”

Councilman John Marchand raised the idea of general parcel tax.

“If you don’t ask the question, no one has the chance to answer it,” Marchand said. “A lot of people are enjoying the area, trampling the area — those are people coming from all over the city.”

The council decided not to ask voters to approve a parcel tax because of the two-thirds majority needed to pass such a measure and the added cost of a special election.