BACKGROUND:
City Council is considering annexing into the Desert Recreation District (“DRD”) to provide park maintenance services and recreation programs to Cathedral City residents.
In April 2018, the DRD and City staff submitted a preliminary feasibility analysis that included the cost to maintain Ocotillo, Century and Panorama parks. At this meeting, the City Council requested the DRD incorporate the future dog park and Dream Homes Park into the feasibility analysis.
On April 25, 2018, the City hosted a meeting that included district staff as well as one (1) District Board member and two (2) Council members, Council members Aguilar and Carnevale, to review the revised feasibility analysis that included the cost to maintain Ocotillo, Century, Panorama and the future dog park and Dream Homes Park.
On May 9, 2018, the DRD provided a detailed presentation to the City Council about the District, its programs, and associated estimated fiscal analysis. On June 13, 2018, the DRD Board approved the recommendation to move forward with Phase I of the Community Facilities District (CFD) formation process subject to City Council's agreement on July 11, 2018. On July 11, 2018, City Council agreed to support the DRD conducting a citywide poll, otherwise known as Phase I of a CFD formation process, to determine the residents’ level of interest in becoming part of the DRD.
On January 23, 2019, Council received a presentation on the outcome of public opinion polling related to the DRD and the level of support for annexation and the necessary CFD assessment. At that time, it appeared there was slightly better support for the proposals among likely voters in a November 2020 election as opposed to other options and general direction from Council was to work toward that election date. On May 22, 2019, Council confirmed their direction to proceed toward a November 2020 election.
On February 26, 2019, then Mayor Pro Tem Aguilar, met with staff and DRD officials to map out a plan to move toward an election on annexing into the DRD and forming the necessary CFD to support the assessment. On March 18, 2019, Council members toured DRD facilities to get an understanding of the type of facilities and programs which could be brought to Cathedral City as part of the annexation into the DRD.
On October 26, 2019 Council received a presentation from Kevin Kalman, Director of the DRD that covered the services Cathedral City residents would receive from the DRD and a tentative timeline on when services would begin. The Parks and Community Events Commission received a similar presentation on October 28, 2019.
On March 4, 2020, Governor Gavin Newsom declared a state of emergency to help Californians prepare for the broader spread of the novel coronavirus (COVID-19) pandemic. This act was followed by a stay-at-home order and a cancellation of all social gatherings. Subsequently, Council decided not to pursue the DRD annexation election in 2020 as originally planned. At the City Council Goal Setting Session in early 2021 Council developed a goal statement to re-engage with the DRD to work towards a 2022 annexation vote.
DISCUSSION:
In October 2021, the City began reengaging the DRD with a new election target of November 2022.
Staff has worked diligently with DRD officials and their consultants to map out the steps necessary to educate the community and begin the formation of the CFD and annexation into the DRD. Remaining required steps include:
TENTATIVE DRD PROJECT TIMELINE
MONTH YEAR DELIVERABLE
FEB/MAR 2022 Public Awareness Mailer prepared and disseminated Public Opinion Poll to be prepared and disseminated
Approval of MOU between DRD and the City
Development of community outreach and educational campaign materials to inform the community of the annexation proposal and solicit community participation
MAY 2022 Launch public information & stakeholder outreach JUNE 2022 Preparation of the application to LAFCO to implement the annexation Adoption of necessary resolutions to call for the election question JUL 2022 Submit LAFCO Application (DRD Applicant)
SEPT 2022 LAFCO Public Hearing
OCT 2022 LAFCO Annexation Protest Hearing
NOV 2022 Election/Annexation
JAN 2024 First tax proceeds disbursed to DRD
Given the decision to work toward a November 2022 election, concerted effort on the above items will need to start in early 2022. Additionally, the City is also looking to partner this summer with the Palm Springs Unified School District (PSUSD) and the DRD on summer pool programming at the Cathedral City High School. The City and the DRD plan to use this facility as a community engagement springboard effort demonstrating the value the DRD brings to Cathedral City residents. This item will be brought before Council as a separate agenda item.
FISCAL IMPACT:
The proposed DRD Memorandum of Understanding (MOU) includes a not-to-exceed (NTE) contract amount of $286,749. The approved budgets for FY21-22 and 22-23 include $200,000 in each year for a total of $400,000. In addition to the MOU NTE contract amount of $286,749, the City is also responsible for “Other Costs” totaling $107,000. Therefore, the total fiscal impact to the City for this endeavor is $393,749. If the CFD is ultimately approved by the voters in November, any costs the City has not yet paid can be reimbursed through the CFD. The cost breakdown of the services to be provided under the MOU are as follows:
Desert Recreation District
Cathedral City CFD Formation
CFD Formation & Outreach
Total FY21/22 FY 22/23
NBS Project Management $13,500 $9,000 $4,500
NBS Special Tax Consulting 31,000 27,000 4,000
TBWBH Outreach* 80,749 50,125 30,625
FM3 Polling 67,750 35,750 32,000
NHA Advisors Municipal Advising 17,500 15,000 2,500
Total $210,499 $136,875 $73,625
CFD Bond Issuance
Total FY21/22 FY 22/23
NBS Bond Issuance Disclosure $17,000 $0 $17,000
NHA Advisors Municipal Advising 59,250 0 59,250
Total $76,250 $0 $76,250
Subtotal $286,749 $136,875 $149,875
Other Costs
Total FY21/22 FY 22/23
Registrar $32,000 $0 $32,000
LAFCO 20,000 20,000 0
Jones Hall Legal 55,000 20,000 35,000
$107,000 $40,000 $67,000
Grand Total $393,749 $176,875 $216,875
Please note, the CFD Bond Issuance and the Jones Hall Legal costs are paid out of bond proceeds and only incurred if election is successful.