ESCONDIDO -- A new fee structure proposed by the Downtown Business Association would charge businesses based on how much benefit they receive from the association's marketing campaigns and other initiatives.

The proposal would also give the association extra revenue for better lighting in downtown alleys, more trash cans, better security and a shuttle to Grand Avenue from the Sprinter station near Quince Street and Valley Parkway, association officials said Thursday.

The new fee structure would increase the dues paid by most businesses on Grand and nearby streets, while giving large discounts to many businesses on the outskirts of downtown that benefit far less from association marketing efforts and cleaning of sidewalks.

The proposal, presented to about 50 downtown merchants at a Thursday morning meeting in the Escondido Library, would also increase the fees paid by restaurants and retail stores. Meanwhile, big discounts would go to banks, doctor's offices and other businesses that do not benefit much from marketing.

The association has collected annual fees ranging from $150 to $900 from its roughly 800 members since they agreed to form a business improvement district in 1989. The district covers 68 square blocks bordered by Washington Avenue, Centre City Parkway, Fifth Avenue and Palomar Medical Center.

Association officials said the current fee structure is unfair because it is based on the number of employees at a business and its estimated annual revenue rather than how much benefit the business receives from the association.

"We want it to be easier, we want it to be faster and we want it to be more equitable," said Jan Allen, a downtown attorney who led the presentation Thursday morning. Allen said she began reviewing the current fee system last summer at the request of the association.

Debra Rosen, chief executive of the association, said another flaw in the current system is that many business owners without their own storefronts, such as individual hairdressers and antique merchants, pay no fees at all.

The current system is also based on self-reported revenue from the businesses, said Rosen, explaining that there is some reason to doubt the accuracy of the revenue estimates.

Sales tax revenue generated by downtown businesses has tripled in the last six years, according to city data presented Thursday morning, but total fees collected by the association have remained at about $150,000 per year during that period, said Rosen.

"I think we're the only (business association) set up on the honor system," said Rosen, explaining to merchants that San Diego's Gaslamp District association sets its fees based on type of business and location.

Rosen said she strongly supports revamping the fee system.

She estimated the changes would increase annual fee revenue to about $200,000, allowing the association to tackle many projects that members have been requesting. The maximum fee would not climb above $900, but many merchants would see increases, she said.

At Thursday's meeting, merchants mostly praised the proposal.

"If my fees go up, it's still probably less than the cost of one ad in a magazine," said Liz Gulliver of Architectural Relics on Grand Avenue.

Olga Diaz, who owns a coffeehouse on Kalmia Street, said she was pleased that the association was seeking merchants' input.

"Some of us will pay more and some will pay less, but we'll come up with a good plan collectively," said Diaz.

Rosen said the association expects to unveil a detailed proposal in late February. If it is approved by the association's board of directors, the proposal would then be submitted to the Escondido City Council, Rosen said.

Contact staff writer David Garrick at (760) 740-5468 or dgarrick@nctimes.com.