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HomeMy WebLinkAbout2012-02-14 City Council Item No. 08 CITY OF ice, LAKE OLSINOU D REAM EXTREME M REPORT TO CITY COUNCIL TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: ROBERT A. BRADY CITY MANAGER DATE: FEBRUARY 14, 2012 SUBJECT: RESOLUTION OF INTENTION TO ANNEX PROPERTY INTO COMMUNITY FACILITIES DISTRICT NO. 2006 -5 (PARKS, OPEN SPACE AND STORM DRAIN MAINTENANCE) AND TO AUTHORIZE THE LEVY OF A SPECIAL TAX WITHIN ANNEXATION AREA NO. 4 (LA LAGUNA) Background On May 9, 2006 the City Council approved Resolution 2006 -5 establishing Community Facilities District No. 2006 -5 (Parks, Open Space and Storm Drain Maintenance). The district levies a special tax for park, open space and storm drain maintenance costs. The City, as a condition of approval, is requiring all undeveloped property, which is proposed to be developed into four or more residential dwelling units, to also provide a funding mechanism to finance the development's financial impact to the City for park, open space and storm drain maintenance services. To meet that requirement, the City will allow a development to annex into the City's existing Community Facilities District No. 2006 -5. If the development is proposed to be located within a bonded Community Facilities District, which includes a funding mechanism for the development's financial impact to the City for park, open space and storm drain maintenance services, that annexation will have satisfied this condition and would not need to be annexed into CFD 2006 -5. The property owners of the La Laguna residential development (Tract No. 32337) have requested that the City annex their development into the Community Facilities District No. 2006 -5 to comply with their condition of development. Discussion A maximum special tax was authorized to be levied in the amount of $272.53 per developed single family unit, $136.27 per developed multi - family unit and $613.76 per AGENDA ITEM NO. 8 Page 1 of 11 Resolution of Intention to Annex Property into CFD 2006 -5 February 14, 2012 Page 2 acre of non - residential property for fiscal year 2011 -12. The maximum special tax increases two percent annually and may be ' levied in an amount of $277.98 per developed single family unit, $138.99 per developed multi- family unit and $626.03 per acre of non - residential property for fiscal year 2012 -13. The La Laguna development (Tract 32337) project will add 110 developed single family units to the existing district boundary and generate about $30,577.80 annually (in FY 2012 -13 dollars) once all the units are built. The map of the proposed boundary is attached. Fiscal Impact The cost to the City for park, open space and storm drain maintenance services is approximately $333 per single family dwelling unit for FY 2012 -13. For each new single family dwelling unit, approximately $55 will be generated from property tax and other revenues, not including this CFD, dedicated to park, open space and storm drain maintenance services. Property tax and other revenues generated from the residents are not sufficient to fund the entire cost of park, open space and storm drain maintenance services therefore the CFD 2006 -5 special tax levy will assist the funding the deficiencies of the cost of providing park, open space and storm drain maintenance services. Process The annexation into the district requires a specific process as outlined in the attached resolution. The City Council is required to hold a public hearing on the annexation into CFD 2006 -5 and the participating property owner will have the opportunity to vote for or against the annexation. The public hearing, by State law, is required to be held not less than 30 or more than 60 days after the adoption of the resolution of intention. The public hearing, as noted in the Resolution of Intention, is scheduled for March 27, 2012. Page 2 of 11 Resolution of Intention to Annex Property into CFD 2006 -5 February 14, 2012 Page 3 Recommendations 1. Adopt the resolution of intention to Annex Property from Annexation Area No. 4 Laguna) into the CFD 2006 -5. 2. Schedule the public hearing on Annexation Area No. 4 (La Laguna) for March 27, 2012. Prepared by: James R. Riley Director of Administrative Services Approved by: Robert A. Brady i ' I� City Manager � Attachment: 1. Resolution of Intention Page 3 of 11 Page 4of11 RESOLUTION NO. 2012 -004 RESOLUTION OF INTENTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE TO ANNEX PROPERTY INTO COMMUNITY FACILITIES DISTRICT NO. 2006 -5 (PARKS, OPEN SPACE AND STORM DRAIN MAINTENANCE) AND TO AUTHORIZE THE LEVY OF A SPECIAL TAX WITHIN SAID DISTRICT WHEREAS, the City Council (the "Council ") of the City of Lake Elsinore (the "City ") has established City of Lake Elsinore Community Facilities District No. 2006- 5 (Parks, Open Space and Storm Drain Maintenance) (the "District ") pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, commencing with Section 53311 of the Government Code of the State of California (the "Act "); and WHEREAS, the District will finance parks, open space and storm drain maintenance services that are in addition to those provided in the territory within the District prior to the formation of the District and do not supplant services already available within the territory proposed to be included in the District through the formation of the District subject to the levy of a special tax to pay for such services, being approved at an election to be held within the boundaries of the District; and WHEREAS, the Council has provided for the annexation in the future of territory (the "Future Annexation Area ") to the District pursuant to the terms and provisions of the Act; and WHEREAS, the City has received a Consent and Waiver from K. Hovnanian Companies of California, Inc., a California Corporation, requesting annexation of property owned by K. Hovnanian at La Laguna, LLC, a California Limited Liability Company and K. Hovnanian at Communities, Inc., a California Corporation, which constitutes a portion of the Future Annexation Area, into the District. NOW, THEREFORE, the City Council of the City of Lake Elsinore, California, does hereby resolve as follows: SECTION 1. The. Council hereby determines to institute proceedings for the annexation of Annexation Area No. 4 (La Laguna) ( "Annexation Area No. 4 ") into the District under the terms of the Act. The exterior boundaries of the area to be annexed (Annexation Area No. 4) are hereby specified and described to be as shown on that certain map now on file in the office of the City Clerk entitled "Annexation Map No. 4 of Community Facilities District No. 2006 -5 (Parks, Open Space and Storm Drain Maintenance) of the City of Lake Elsinore, County of Riverside, State of California, which map indicates by a boundary line the extent of the territory included in Annexation Area No. 4 and shall govern for all details as to the extent of Annexation Area No. 4. SECTION 2. The map showing Annexation Area No. 4, which area is to be subject to a special tax to be levied, is hereby approved and adopted. On the original Page 5 of 11 and one copy of the map of such Annexation Area No. 4 on file in the City Clerk's office, the City Clerk shall endorse the certificate evidencing the date and adoption of this Resolution. The City Clerk shall file the original of such map in his office and, within fifteen (15) days after the adoption of this Resolution, the City Clerk shall file a copy of such map so endorsed in the records of the County Recorder, County of Riverside, State of California. SECTION 3. The name of the proposed community facilities district shall be "City of Lake Elsinore Community Facilities District No. 2006 -5 (Parks, Open Space and Storm Drain Maintenance), Annexation Area No. 4 (La Laguna)." SECTION 4. Except where funds are otherwise available, it is the intention of the City Council to levy annually in accordance with procedures contained in the Act a special tax (the "Special Tax ") sufficient to finance a portion of the cost of providing parks, open space and storm drain maintenance services that are in addition to those provided in the territory within Annexation Area No. 4 prior to the annexation of Annexation Area No. 4 and do not supplant services already available within the territory proposed to be included in the District, the costs of administering the levy and collection of the Special Tax and all other costs of the levy of the Special Tax, including any foreclosure proceedings, legal, fiscal, and financial consultant fees, election costs, and all other administrative costs of the tax levy. The Special Tax will be secured by recordation of a continuing lien against all non- exempt real property in the proposed Annexation Area No. 4. The schedule of the rate and method of apportionment and manner of collection of the Special Tax is described in detail in Exhibit "A" attached hereto and by this reference incorporated herein. The annexation of Annexation Area No. 4 will not result in any change to the special tax rates levied in the District prior to such annexation. The Special Tax is apportioned to each parcel on the foregoing basis pursuant to Section 53325.3 of the Act and such Special Tax is not on or based upon the ownership of real property. The maximum Special Tax applicable to a parcel to be used for private residential purposes, as set forth in Exhibit A, is specified as a dollar amount which shall be calculated and established not later than the date on which the parcel is first subject to tax because of its use for private residential purposes, and such amount shall not be increased over time by an amount in excess of 2 percent per year. Under no circumstances will the Special Tax to be levied against any parcel used for private residential purposes be increased as a consequence of delinquency or default by the owner of any other parcel or parcels within the proposed Annexation Area No. 4 by more than 10 percent. As specified by the Act, for purposes of this paragraph, a parcel shall be considered "used for private residential purposes" not later than the date on which an occupancy permit for private residential use is issued. SECTION 5. A public hearing (the "Hearing ") on the annexation of Annexation Area No. 4 and the proposed rate and method of apportionment of the Special Tax shall be held on March 27, 2012, at 7:00 o'clock p.m., or as soon thereafter Page 6of11 1 as practicable, at the chambers of the City Council of the City of Lake Elsinore, 183 North Main Street, Lake Elsinore, California 92530. SECTION 6. At the time and place set forth above for the hearing, any interested person, including all persons owning lands or registered to vote within the proposed Annexation Area No. 4, may appear and be heard. SECTION 7. Each City officer who is or will be responsible for the District, if it is established, is hereby directed to study the proposed Annexation Area No. 4 and, at or before the time of the above - mentioned Hearing, file a report with the City Council, which is to be made a part of the record of the Hearing, containing a brief description of Annexation Area No. 4 and his or her estimate of the cost of providing additional parks, open space and storm drain maintenance services within the boundary of Annexation Area No. 4. The City Manager is directed to estimate the fair and reasonable cost of all incidental expenses, including all costs associated with the annexation of Annexation Area No. 4, determination of the amount of any special taxes, collection of any special taxes, or costs otherwise incurred in order to carry out the authorized purposes of the City with respect to the District. SECTION 8. The City may accept advances of funds from any sources, including private persons or private entities, and is authorized and directed to use such funds for any authorized purpose, including any cost incurred by the City in annexing the proposed Annexation Area No. 4. The City may enter into an agreement to repay all of such funds as are not expended or committed for any authorized purpose at the time of the election on the levy of the Special Tax, if the proposal Special tol Tax such tax be pproved and to repay all of such funds advanced if the levy of th e by the qualified electors of Annexation Area No. 4. SECTION 9. The City Clerk is hereby directed to publish a notice ( "Notice ") of the Hearing pursuant to Section 6061 of the Government Code in a newspaper of general circulation published in the area of the proposed Annexation Area No. 4. Such Notice shall contain the text of this Resolution, state the time and place of the Hearing, a statement that the testimony of all interested persons or taxpayers will be heard, a description of the protest rights of the registered voters and landowners in the proposed Annexation Area No. 4 as provided in Section 53339.5 of the Act and a description of the proposed voting procedure for the election required by the Act. Such publication shall be completed at least 7 days prior to the date of the Hearing. SECTION 10. The voting procedure with respect to the establishment of the District and the imposition of the special tax shall be by mailed ballot election. SECTION 11. This Resolution shall take effect from and after the date of its passage and adoption. PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the City of Lake Elsinore, California, this 14 day of February, 2012. Page 7 of 11 BRIAN TISDALE MAYOR ATTEST: VIRGINIA BLOOM CITY CLERK APPROVED AS TO FORM: BARBARA ZEID LEIBOLD CITY ATTORNEY CITY OF LAKE ELSINORE STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE )ss. CITY OF LAKE ELSINORE ) I, VIRGINIA BLLOM, City Clerk of the City of Lake Elsinore, California, hereby certify that Resolution No. 2012 -004 was adopted by the City Council of the City of Lake Elsinore, California, at a regular meeting held on the 14 day of February, 2012, and that the same was adopted by the following vote: AYES: NOES: ABSENT: ABSTAIN: VIRGINIA BLOOM CITY CLERK Page 8of11 EXHIBIT A RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX Approved by City Council May 9, 2006 By Resolution 2006 -56 1 1 Page 9 of 11 CITY OF LAKE ELSINORE COMMUNITY FACILITIES DISTRICT NO. 2006 -5 (PARKS, OPEN SPACE AND STORM DRAIN MAINTENANCE) RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX Introduction Special taxes shall be annually levied on all Developed Residential Property and Developed Multi - Family Property (as hereinafter defined) in City of Lake Elsinore Community Facilities District No. 2006 -5 (Parks, Open Space and Storm Drain Maintenance) (the "District "), in accordance with the rate and method of apportionment of special taxes hereinafter set forth. Definitions "Assessor's Parcel" means a parcel of land in the District designated and assigned a discrete identifying number on a map of the County Assessor of the County of Riverside. "City" means the City of Lake Elsinore, California. "Developed Multifamily Unit" means a residential dwelling unit within a building in which each of the individual dwelling units has or shall have at least one common wall with another dwelling unit and a building permit has been issued by the City for such dwelling unit on or prior to May 1 preceding the Fiscal Year in which the Special Tax is being levied. "Developed Non - Residential Property" means all Assessor's Parcels for which a building permit was issued by the City for any type of non - residential use on or prior to May 1 preceding the Fiscal Year in which the Special Tax is being levied. "Developed Single Family Unit" means a residential dwelling unit other than a Developed Multifamily Unit on an Assessor's Parcel for which a building permit has been issued by the City on or prior to May 1 preceding the Fiscal Year in which the Special Tax is being levied. "Fiscal Year" means the period beginning on July 1 and ending on the following June 30. "Maximum Special Tax" means the maximum Special Tax that can be levied by CFD No. 2006 -5 in any Fiscal Year on any Assessor's Parcel. "Operating Fund" means a fund that shall be maintained for CFD No. 2006 -5 for any Fiscal Year to pay for the actual costs of maintenance related to the Service Area, and the applicable Administrative Expenses. "Operating Fund Balance" means the amount of funds in the Operating Fund at the end of the preceding Fiscal Year. Page 10 of 11 "Service Area" means parks, open space, and storm drains. "Special Tax" means any of the special taxes authorized to be levied within CFD No. 2006 -5 pursuant to the Act to fund the Special Tax Requirement. "Special Tax Requirement" means the amount determined in any Fiscal Year for CFD No. 2006 -5 equal to (i) the budgeted costs directly related to the Service Area, including maintenance, repair and replacement of certain components of the Service Area which have been accepted and maintained or are reasonably expected to be accepted and maintained during the current Fiscal Year, (ii) Administrative Expenses, and (iii) anticipated delinquent Special Taxes based on the delinquency rate in CFD No. 2006 -5 for the previous Fiscal Year, less (iv) the Operating Fund Balance, as determined by the CFD Administrator. `Unit means each separate residential dwelling unit, which comprises an independent facility capable of conveyance or use separate from adjacent dwelling units. Rate and Method of Apportionment of the Special Tax Commencing Fiscal Year 2005 -2006 and for each subsequent Fiscal Year, the City Council shall levy Special Taxes on (i) all Assessor's Parcels containing a Developed Single Family Unit or Developed Multifamily Unit and (ii) all Assessor's Parcels of Non - Residential Property, up to the applicable Maximum Special Tax to fund the Special Tax Requirement. The Maximum Special Tax for Fiscal Year 2005 -2006 shall be $242 per Developed Single Family Unit, $121 per Developed Multifamily Unit, and $545 per Acre for each Assessor's Parcel of Non - Residential Property. On each July 1, commencing July 1, 2006, the Maximum Special Tax shall be increased by two percent (2.00 %) of the amount in effect in the prior Fiscal Year. Duration of the Special Tax The Special Tax shall be levied in perpetuity to fund the Special Tax Requirement, unless no longer required as determined at the sole discretion of the City Council. Collection of the Special Tax The Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes, provided, however, that CFD No. 2006 -5 may collect the Special Tax at a different time or in a different manner if necessary to meet its funding requirements. Page 11of11