City of Corona
Staff Report
400 S. Vicentia Ave.
Corona, CA 92882
File #: 22-0462
REQUEST FOR CITY COUNCIL ACTION
DATE: 06/01/2022
TO: Honorable Mayor and City Council Members
FROM: Finance Department
SUBJECT:
Resolution declaring intention to levy and collect assessments within Zone 6 of the Landscape Maintenance District No. 84-2 for Fiscal Year 2023, approving the preliminary Engineer's Report, and providing notice of public hearing on the proposed assessments.
EXECUTIVE SUMMARY:
Landscape Maintenance District No. 84-2 provides landscape maintenance and operating services for the public landscaping and related appurtenances within the District's boundaries. Adoption of the recommended resolution will declare the City's intent to levy and collect Fiscal Year 2023 assessments, approve the preliminary Engineer’s Report, and set a public hearing for July 6, 2022, at which time, the City Council may approve the annual assessments and order the levy of assessments within the District.
RECOMMENDED ACTION:
That the City Council adopt Resolution No. 2022-050, declaring intention to levy and collect assessments within Zone 6 of the Landscape Maintenance District No. 84-2 for Fiscal Year 2023, approving preliminary Engineer's Report, and providing notice of public hearing on proposed assessments.
BACKGROUND & HISTORY:
Zone 6 of the Landscape Maintenance District No. 84-2 (“LMD 84-2” or “District”) was established in 1986 in accordance with the provisions of the Landscaping and Lighting Act of 1972 (the "1972 Act").
The purpose of the District is to provide landscape maintenance and operating services for the public landscaping, and related appurtenances within the District's boundaries.
The annual assessments proposed to be levied within the District will pay for the maintenance services during Fiscal Year 2023. The services provided include all necessary operations, administration, capital replacements, and maintenance required to keep the above-mentioned City of Corona Page 1 of 3 Printed on 5/25/2022
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File #: 22-0462
administration, capital replacements, and maintenance required to keep the above-mentioned improvements in a healthy and satisfactory working condition.
ANALYSIS:
The State of California Street and Highways Code Section 22500 requires an annual review of the assessments levied by the assessment districts formed under the 1972 Act. In order to levy and collect special assessments within the districts, an Engineer's Report must be prepared, which provides details on the improvements that are maintained and the estimated budgets for each district.
On April 6, 2022, the City Council adopted Resolutions No. 2022-029, to initiate the proceedings to levy and collect assessments for the District for Fiscal Year 2023, appointed Spicer Consulting Group, LLC as the engineer of record, and ordered the preparation of an Engineer's Report for the District.
Attached to this report is the preliminary Engineer's Report (the “Report”) as it pertains to the District, which includes a detailed description of the existing improvements within the District, the estimated maintenance costs, the methods of assessment apportionment, and diagram showing the boundaries of the District. The report also provides analyses of the District's financial status.
FINANCIAL IMPACT:
The cost of operation, servicing, and maintenance of the District will be funded by the assessments levied and collected within the District. For Fiscal Year 2023, it is projected that the current year assessment revenues will be insufficient to cover the operating costs for the District during the same fiscal period, resulting in an estimated operating deficit of $31,549. The District does not have a built -in escalator for the annual levy. The estimated deficit is due to rising costs over the years and the levy not keeping up with the expenditures.
A one-time contribution from the District’s capital reserves will be used to cover the estimated deficit in the operating budget for the Fiscal Year 2023. The current estimated reserve balance is $471,506 as of June 30, 2022. Based on the Fiscal Year 2023 expenditure budget, the reserve balance will be exhausted in approximately 14 years.
Staff is currently assessing options to ensure the financial sustainability of zones within the District that have funding shortages and will return to the City Council at the 2022 Fall Workshop with updated information.
Below is an overview of the District’s estimated assessment revenues and proposed expenditures for Fiscal Year 2023. Detailed information can be found in the attached Report.
Estimated
Costs
Estimated
Assessment
Revenue
Estimated
Excess/(Deficit)
Actual
Assessment
YOY % Change
346,583 315,035 (31,549) 0.00%
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File #: 22-0462
Estimated
Costs
Estimated
Assessment
Revenue
Estimated
Excess/(Deficit)
Actual
Assessment
YOY % Change
346,583 315,035 (31,549) 0.00%
ENVIRONMENTAL ANALYSIS:
This action is exempt pursuant to Section 15061(b)(3) of the Guidelines for the California Environmental Quality Act (CEQA), which states that a project is exempt from CEQA if the activity is covered by the common sense exemption that CEQA applies only to projects that have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. This action merely declares the City's intent to levy and collect assessments within the District for Fiscal Year 2023, and there is no possibility that adopting the resolution will have a significant effect on the environment. Therefore, no environmental analysis is required.
PREPARED BY: LIEN-CHI CANTUBA, ACCOUNTING SUPERVISOR
REVIEWED BY: KIM SITTON, FINANCE DIRECTOR
Attachments:
1. Exhibit 1 - FY 2023 LMD 84-2 Preliminary Engineer’s Report, as it pertains to the District
2. Exhibit 2 - Resolution No. 2022-050
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