ATTACHMENT 5
Procedures for Affected Local Agency-Initiated Dissolutions and Establishment of Subsidiary Districts under the Cortese-Knox-Hertzberg Local Government Reorganization Act The Local Agency Formation Commissions(“LAFCo”) are authorized to review and approve reorganizations of special districts, include consolidations, mergers, the creation of subsidiary districts, and dissolutions. Proceedings to dissolve a special district and establish a new subsidiary district may be initiated by the LAFCO, the special district, an “affected local agency” or by voter-petition. An “affected local agency” means any “local agency that contains, or would contain, or whose sphere of influence contains or would contain, any territory for which a change of organization is proposed or ordered, either singularly or as part of a reorganization or for which a study is to be reviewed by the [LAFCO].”1 California courts have confirmed that cities qualify as “affected local agencies.” 2 The following chart provides an overview of the procedural steps an affected local agency must take to initiate proceedings to dissolve a special district and establish a new subsidiary district before the LAFCO.
Step Description Timing Requirements San Mateo
LAFCO
Examples
1 Notice of
Resolution of
Application
The legislative body of the affected local agency may – but is not required – give mailed notice of its intention to adopt Resolution of Application to the LAFCO, the subject special district, and other interested agencies. (Gov. Code § 56654(c).)
21 days before
Resolution of
Application
approved.
The notice must generally describe
the proposal and the affected
territory.
2 Resolution of
Application
The legislative bodymust adopt a Resolution of Application to establish a subsidiary district, which must be submitted to LAFCO. (§ 56375).
Prior to taking this step, the legislative body could direct agency staff to prepare staff reports, conduct study sessions and/or take other measuresto explore the feasibility of establishing a subsidiary district. Agency staff couldalso be directed to prepare a draft Resolution of Application (based on the examples to the right-most column) for the legislative body’s consideration and adoption. The Passed prior to
preparing
Application, and
filed with
Application. (#3
below)
A Resolution of Application must
include the following: (Gov’t Code §
56652.)
• State the proposal is made
[pursuant to Part 3 of Division 3
of the Act [(§ 56650 et~-)];
• nature of the proposal and list all
proposed changes of organization;
• Los Trancos
County Water
District Change
of Organization,
Plan of Service,
and Resolution
for Application to
Dissolution (May
7, 2015)
1 Gov. Code § 56014.
2 See, City of Patterson v. Turlock Irrigation Dist. (2014) 227 Cal.App.4th 484 (City was an “affected local agency” authorized to propose an annexation of part of the city into an irrigation district, where city's territory was within the area that was proposed for annexation to the district). 2 7/18/22
Step Description Timing Requirements San Mateo
LAFCO
Examples
legislative body could also consider establishing a committee to provide guidance and oversee agency staff’s progression withthese tasks.
NOTE: Establishment of a subsidiary district is exempt from CEQA because it is an organizational change in which the territory in which municipal services is not changing. (15320) • a description of the boundaries of
the affected territory accompanied
by a map showing the boundaries;
• any proposed terms and
conditions;
• the reason or reasons for the
proposal;
• designate three persons as chief
petitioners, setting forth their
names and mailing addresses.
• request that the proceedings be
taken for the proposal; and
• whether the proposal is consistent
with the sphere of influence of
any affected city or affected
district.
• Granada Sanitary
District,
Resolution of
Application for
Reorganization,
Application, and
Plan for
Providing
Services(Nov.
14, 2013)
• Skyline County
Water District,
Resolution for
Application,
Application and
Plan for
Providing
Services(May
13, 2009)
• * East Palo Alto
County
Waterworks
District,
Resolution from
City of East Palo
Alto and City of
Menlo Park,
Application,
Plan for
Providing
Services(Jan.
10, 2001)
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Step Description Timing Requirements San Mateo
LAFCO
Examples
3 Plan for
Providing
Services
The Resolution of Application must include a plan for providing services.(§ 56653(b).)
Submit together with
Application.
The plan for providing service must
include:
• An enumeration and description
of the services to be extended to
the affected territory;
• The level and range of those
services;
• An indication of when those
services can feasibly be
extended to the affected
territory;
• An indication of any
improvement or upgrading of
structures, roads, sewer or
water facility, or other
conditions the local agency
would impose or require within
the affected territory if the
change of organization or
reorganization is completed;
• Information with respect to how
those services would be
financed.
See above.
4 LAFCO
Completeness
Determination
The LAFCO Executive Officer must determine whether the
application is complete and acceptable for filing or whether the application is incomplete.(§ 56658(c).)
30 days of receiving
application.
Property Tax Resolution by the
Board of Supervisors (and the City
council as future governing board)
for transfer of the EPASD share of
1% property tax to the subsidiary
district
5 LAFCO
Certificate of
Filing and Set
Hearing Date
Once the application is deemed complete (Property tax resolution(s) adopted and Executive Officer has received all required materials), the LAFCO Executive Officer must immediately issue a certificate of filing to the applicant. A certificate mustspecify a future hearing date for the proposal.(§ 56658(f).)
Immediately
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Step Description Timing Requirements San Mateo
LAFCO
Examples
6 LAFCO
Notice of
Hearing and
Notice of
Proposal to
Establish
Subsidiary
District
The Executive Officer must give notice of any hearing by the commission by publication, posting on its website, and by mailed notice. (§§ 56660; 56661).
N/A
7 Alternative
Proposals for
Subsidiary
District
If the proposal involvesthe establishment of a subsidiary district, the subject special district may either (i) consent to the proposal or (ii) adopt a resolution of intent to file an alternative proposal for reorganizationwithin 35 days of receiving notice. Ifthe special district adopts a resolution of intention to file an alternative proposal, LAFCO cannot take further action on the original proposal for 70- days.If the special district fails to provide an alternative proposal within this 70-day period, it shall be deemed to have consented to original proposal (§§ 56861, 56862).
35 days after
receiving LAFCO
notice of proposal to
establish subsidiary
district.
8 LAFCO
Executive
Officer’s
Report
Not less than five (5) days prior to the hearing, the Executive Officer must prepare a report on the Application, including his or her recommendation, and must provide a copy of the report to every affected district, agency, and city. (§ 56665.)
If the special district files an alternative proposal, LAFCO must analyze and report on both the original and alternative proposal so both may be considered at the hearing. (§ 56862).
5 days prior to
LAFCO hearings.
9 LAFCO
Hearings
At the hearing, the LAFCO will hear and receive written and oral protests and evidence. (§ 56666(b).)
Hearing must occur
no later than 90 days
after issuance of the
certificate of filing.
10 LAFCO
Adoption,
Modification
or Rejection
of Dissolution
After hearing public testimony, the LAFCO may approve, modify, or deny the proposed dissolution. If approved, LAFCOmay adopt terms and conditions.(§ 56886.)
Terms and conditions may include effective date such as beginning of fiscal year or fiscal quarter. If terms and conditions don’t include N/A
5 7/18/22
Step Description Timing Requirements San Mateo
LAFCO
Examples
an effective date, the effective date is the date the Certificate of Completion is recorded.
12 Conducting
Authority
“Protest
Hearing”
If protests are filed, LAFCO must schedule, give notice and conduct a protest hearing. (§ 57077).Conduct of the protest hearing may be delegated to the Executive Officer. At the conclusion of the protest hearing, the LAFCO must do one of the following:
• if majority of voters protest (>50%),terminate proceedings and disapprove the proposal
• if at least 25% of voters submit protests AND the special district objects, approve the proposal subject to a
“confirmation election”
• if the special district does not object and 25% of voters do not submit protests, LAFCo shall order the establishment of a subsidiary district without election
The LAFCO must
set a date for protest
hearings within 35
days of the
resolution, which
must take place no
later than 60 days
after the notice (e.g.,
95 days from the
resolution approving
dissolution) (§
57002(a)).
13 Voter
“Confirmation
Election”
IF the LAFCO determines that a confirmation election is required, it must inform the city council and the elections official of the affected city and direct the elections official to conduct the necessary election.If the majority of the voters approve establishment of a subsidiary district, the LAFCO must execute a certificateof completion confirming the establishment of a subsidiary district. (§ 57176.)If the majority of voters vote against establishment of a subsidiary district, LAFCO must terminateproceedings and disapprove establishment of a subsidiary district.
Election shall be
called within 45
days of being
notified by LAFCO,
or next established
election date. (§
57000(e)(1)-(2).)
14 Effect of
Establishing a
Subsidiary
District
If approved, the legislative body of the affected local agency will be designated and empowered to act as the board of directors of the subsidiary district.
Effective upon
recordation of the
Executive Officer’s
certificate of
completion and/or
effective date
established by a
condition of
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Step Description Timing Requirements San Mateo
LAFCO
Examples
approval of the
commission