Citywide Street Lighting Assessment District Resolutions June 4, 2024
DATE: June 4, 2024
TO: Honorable Mayor and City Council
FROM: Paul Cranmer, Public Works Services Director
By: Jennifer Lopez, Management Analyst
SUBJECT: RESOLUTIONS INITIATING PROCEEDINGS FOR THE ANNUAL LEVY
AND COLLECTION OF ASSESSMENTS, APPROVING THE
PRELIMINARY ENGINEER’S REPORT , DECLARING INTENTION TO
LEVY AND COLLECT ASSESSMENTS FOR FISCAL YEAR 2024-25, AND
APPOINTING A TIME AND PLACE FOR A PUBLIC HEARING FOR THE ARCADIA CITYWIDE LIGHTING DISTRICT NO. 1
RESOLUTION NO. 7569 INITIATING PROCEEDINGS FOR THE ANNUAL
LEVY AND COLLECTION OF ASSESSMENTS FOR THE ARCADIA
CITYWIDE LIGHTING DISTRICT NO. 1 PURSUANT TO THE
PROVISIONS OF PART 2 OF DIVISION 15 OF THE CALIFORNIA
STREETS AND HIGHWAYS CODE AND ORDERING THE
PREPARATION OF THE ENGINEER’S REPORT
CEQA: Not a Project
Recommendation: Adopt
RESOLUTION NO. 7570 APPROVING THE PRELIMINARY ENGINEER’S
REPORT OF WILLDAN FINANCIAL SERVICES FOR THE ARCADIA
CITYWIDE LIGHTING DISTRICT NO. 1
CEQA: Not a Project
Recommendation: Adopt
RESOLUTION NO. 7571 DECLARING ITS INTENTION TO LEVY AND
COLLECT ASSESSMENTS WITHIN THE ARCADIA CITYWIDE LIGHTING DISTRICT NO. 1 FOR FISCAL YEAR 2024-25 AND APPOINTING A TIME
AND PLACE FOR A PUBLIC HEARING
CEQA: Not a Project
Recommendation: Adopt
SUMMARY
The Citywide Lighting District No. 1 (“Citywide Lighting District” or “District”) was formed in the City of Arcadia pursuant to state law for the purpose of partially funding the ongoing
Citywide Street Lighting Assessment District Resolutions June 4, 2024
operation, maintenance, and servicing of the Ci ty’s street lighting system. As proposed, the District budget for Fiscal Year 202 4-25 is decreasing by 1.01%, or $ 14,600. The decrease is primarily due to a decrease in contract services. Since the budget decreased, there is no pr oposed assessment rate increase for Fiscal Year 202 4-25. The annual assessment rate for a single- family property owner in Zone 1 will remain at $23.00; and will remain at $39.16 in Zone 2.
It is recommended that the City Council a dopt the Resolutions initiating proceedings for the annual levy and collection of assessments , approving the preliminary engineer’s report, declaring its intention to levy and collect assessments for Fiscal Year 2024-25, and appointing a time and place for a public hearing for the Arcadia Citywide Lighting District No. 1.
BACKGROUND
The City’s original Street Lighting District was established in the early 1950s through the Street Lighting Act of 1919, and was set to expire on June 30, 2010 . Expiration of the District would have resulted in a loss of approximately $420,000 in annual revenue to the City beginning in Fiscal Year 2010-11, and would have impeded the ability to properly maintain the City’s streetlights. Renewal of the Lighting District could no longer be done through the Street Lighting Act of 1919 because the assessment s were based on the value of real property, which Proposition 13 prohibits. Additionally, not all properties within the City were included in the original assessment district, which resulted in an inequity of assessments.
To address this issue, in 2009, the City Council directed the formation of a Citywide Lighting District via the Landscaping and Lighting Act of 1972. U nder this Act, assessments are based on the special benefit that street lighting provides to properties within the Citywide Lighting District area. Proposition 218 noticing and balloting requirements were met, and on August 3, 2010, the City Council adopted the Engineer’s Report for the formation of the Citywide Lighting District, and approved the levy and collection of assessments beginning in Fiscal Year 2010-11.
To ensure appropriate allocation and annual levy of assessments based on proportional benefits, the Citywide Lighting District established two benefit zones to separate general benefit and special benefit.
• Zone 1 includes properties along major thoroughfares and parcels that receive the general benefit of street lighting along arterial streets.
• Zone 2 includes properties in residential neighborhoods that specifically benefit from maintenance of street lighting on local streets.
In addition to the use of zones, the assessment rate utilizes a weighted methodology of apportionment referred to as an equivalent benefit unit (“EBU”). The proportional special Citywide Street Lighting Assessment District Resolutions June 4, 2024
benefit calculation for each parcel is determined by land use, number of units , and acreage. Furthermore, a benefit multiplier is also employed to account for varying density levels of street lighting within the City, which ranges from a standard level of street lighting to no street lighting. S ome areas in the City were developed with less lighting on their streets. These sparsely lit neighborhoods still receive special benefits from their local lights even though their overall lighting density is less than those streets with full lighting; these properties receive 20% of the standard lighting density and pay 20% of the annual assessment rate. Properties in areas of the City that do not have street lighting do not pay a street lighting assessment fee. This methodology has been in place since Fiscal Year 2010-11.
DISCUSSION
The City’s Fiscal Year 2024-25 proposed Budget for the Lighting District is $1,432,000, of which $1,208,497, has been determined to be of special benefit to properties within the Citywide Lighting District based on the assessment methodology. However, the District was established to fund only a portion of this amount . As a result, the City will be contributing approximately 60%, or $847,482, of the total street lighting budget, while the property owners (the “District”) will pay about 40%, or $584,518, of street lighting costs.
The Citywide Lighting Dis trict budget for Fiscal Year 2024 -25, as proposed, decreased by 1.01%, or $14,600, due to a decrease in contract costs. Since the budget is decreasing slightly, the Fiscal Year 20 24-25 annual assessment rate for a single- family property owner in Zone 1 will remain at $23.00; and at $39.16 for a single-family property owner in Zone 2.
As part of the District formation, an assessment range formula was developed to provide reasonable increases and inflationary adjustments that are associated with providing improvements for the Citywide Lighting District. The maximum rates for the Citywide Lighting District are annually adjusted by an amount not to exceed 3% each Fiscal Year.
The adjusted Maximum Assessment Rate is calculated independently of the Citywide Lighting District’s annual budget. Although the assessment range formula allows the City to increase the assessment rate to the M aximum Assessment Rate, Arcadia has never raised assessment rates to the maximum allowed. For instance, while the Maximum Assessment Rate formula would allow the rates for a single-family property owner to be raised to 25.30 in Zone 1 and 43.01 in Zone 2, the assessment rates will remain at $23.00 in Zone 1 and $39.16 in Zone 2, since the budget is decreasing.
Using the single- family property as the baseline for the assessment, the table below shows the annual assessment rate levied in Fiscal Year 2023-24 and the proposed Fiscal Year 2024-25 annual assessment rates for Zones 1 and 2:
Citywide Street Lighting Assessment District Resolutions June 4, 2024
1FY 2024-25 Maximum Assessment Rate for Zone 1 is $25.30; Zone 2 is $ 43.01
At the June 1 8, 2024, City Council Meeting, a public hearing will be conducted to allow the public an opportunity to provide comment regarding the levy and collection of assessments for the District. Fees can only be adopted after the conclusion of the public hearing.
ENVIRONMENTAL ANALYSIS
The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”) under Section 15061(b)(3) of the CEQA Guidelines , as it can be seen with certainty that it will have no impact on the environment.
FISCAL IMPACT
Fees collected under the Citywide Lighting District will help defray the total maintenance costs of lighting in the subject areas. Upon conclusion of the public hearing and adoption of the engineer’s report, a total of $584,518 will be levied and collected under the Citywide Lighting District. The levy will not exceed the cost of providing the subject services to the areas nor will the levy exceed the M aximum Assessment Rates allowed. The levy has been set to ensure that the cost to the property owner does not exceed the special benefit to that property. Based on the recommended assessments, the City of Arcadia will contribute $847,482 to the street lighting system in Fiscal Year 2024-25.
RECOMMENDATION
It is recommended that the City Council find the following resolutions are categorically exempt pursuant to the California Environmental Quality Act (“CEQA”); and adopt:
a. Resolution No. 7569 initiating proceedings for the annual levy and collection of assessments for the Arcadia Citywide Lighting District No. 1 pursuant to the provisions of Part 2 of Division 15 of the California Streets and Highways Code and ordering the preparation of the Engineer’s Report.
FY 23-24
Assessment Rate
FY 24-25
Assessment Rate1
Lighting District Total Budget $1,446,600 $1,432,000
Zone 1 (Arterial Lights)
Sparse Lighting
$23.00
($4.60)
$23.00
($4.60)
Zone 2 (Local Lights)
Sparse Lighting
$39.16
($7.83)
$39.16
($7.83)
Citywide Street Lighting Assessment District Resolutions June 4, 2024
b. Resolution No. 7570 approving the preliminary Engineer’s Report of Willdan Financial Services for the Arcadia Citywide Lighting District No. 1.
c. Resolution No. 7571 declaring its intention to levy and collect assessments within the Arcadia Citywide Lighting District No. 1 for Fiscal Year 2024-25 and appointing a time and place for a public hearing.
Attachments: Resolution No. 7569
Resolution No. 7570
Resolution No. 7571