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STANDALONE TAX SHARING AGREEMENT
BETWEEN THE CITY OF FRESNO AND THE COUNTY OF FRESNO
REGARDING CALIFORNIA-WILLOW NO. 4 REORGANIZATION
THIS STANDALONE TAX SHARING AGREEMENT BETWEEN THE CITY OF FRESNO AND THE COUNTY OF FRESNO REGARDING CALIFORNIA -WILLOW NO. 4 REORGANIZATION (AGREEMENT) is made and entered into on this______ day of _________ ______, 2023, by and between the CITY OF FRESNO, a municipal corporation of the State of California (CITY) and the COUNTY OF FRESNO, a political subdivision of the State of California (COUNTY).
RECITALS
A. Revenue and Taxation Code Section 99 requires that CITY and COUNTY enter into a property tax sharing agreement prior to annexation approval of unincorporated COUNTY territory into CITY’s jurisdictional limits by the Fresno Local Area Formation Commission (LAFCo).
B. CITY and COUNTY were previously parties to that certain Amended and Restated Memorandum of Understanding, dated January 6, 2003 (the 2003 MOU), a master tax sharing agreement sanctioned by Revenue and Taxation Code Section 99(d).
C. The 2003 MOU expired on August 29, 2020.
D. On November 9, 2022, by Resolution No. 2022-244, CITY authorized submission of an annexation application to LAFCo for the area covered by CITY Annexation Application No. P 22-00411, which area is mor e particularly set forth in Exhibit A hereto and incorporated herein by this reference (the ANNEXATION) , “[s]ubject to approval of a Revenue and Taxation Code Section 99 tax sharing agreement between the City of Fresno and County of Fresno evidencing reve nue neutrality to the City of Fresno a s required by Fresno Municipal Code Section 15-6104(C).”
E. In the absence of a master tax sharing agreement, t he City and County now desire to enter into a standalone tax sharing agreement , using the real property tax apportionment formula provided by the 2 003 MOU, but only for real property in the ANNEXATION, pursuant to Revenue and Taxation Code Section 99( a)(6), under the mutually agreed upon terms set forth herein.
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F. The development of the real property identified in t he ANNEXATION would best be served by being annexed to CITY. CITY and COUNTY further share a mutual interest in the acquisition by CITY of the rights -of-way identified in Exhibit B, attached hereto and incorporated herein by this reference, as this acquisition of the rights -of-way by CITY would serve the public interest by mini mizing creation of peninsulas, corridors, and other distortions of boundaries. At COUNTY’s request, CITY has agreed to include a plan to accomplish the aforementioned as part of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the covenants, conditions, and promises hereinafter con tained to be kept and performed by the respective parties, it is mutually agreed as follows:
1. Definitions.
a. Base Property Tax Revenue means Property Tax Revenue allocated by tax rate equivalents to all taxing jurisdictions as to the geographic area comprising a given tax rate area annexed in the fiscal year immediately preceding the tax year in which property tax revenues are apportioned pursuant to this Agreement, including the amount of State reimbursement for the homeowners' exemption. b. Property Ta x Increment means revenue from the annual tax increment, as "annual tax increment" is defined in Section 98 of the Revenue and Taxation Code, attributable to the tax rate area for the respective fiscal year. c. Substantially Developed means real property which, prior to annexation, has an improvement value to land value ratio equal to or g reater than 1.25:1, as determined by the Fresno County Assessor's records, as of the property tax lien date in the fiscal y ear in which the annexation becomes effective under the Cortese-Knox Local Government Reorganization Act, and on and after January 1, 2001, the Cortese -Knox-Hertzberg Local Government Reorganization Act of 2000.
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d. Property Tax Revenue means Base Property Tax Revenue, plus the Property Tax Increment for a given tax rate area in a given fiscal year.
2. Property Tax Revenues.
a. General. The Property Tax Revenue collected in rela tion to the annexation of the real property in the geographical area covered by the ANNEXATION shall be apportioned between CITY and COUNTY as set forth in sections 2.b. and 2.c. below. The parties acknowledge that, pursua nt to Sections 54902, 54902.1, and 54903 of the Government Code and Sections 97 and 99 of the Revenue and Taxation Code, the distribution of such Property Tax Revenues will not be effective until the revenues are collected in the fiscal year following the calendar year in which the related statement of boundary changes and the related map or plat is filed with the County Assessor and the State Board of Equalization. b. Property Not Substantially Developed. Regarding real property in the ANNEXATION, which is n ot conside red Substantially Develo ped at the time of annexation, COUNTY will retain all of its Base Property Tax Revenue upon the annexation of such geographical area to the CITY . The amount of the Property Tax Increment allocated to special districts whose services are assumed by CITY shall be combined with the Property Tax Increment allocated to COUNTY, the sum of which shall be allocated between CITY and COUNTY pursuant to the following ratio:
COUNTY: 62%
CITY: 38%
c. Substantially Develope d Property. Regarding the real property in the ANNEXATION, which is considered Substantially Developed at the time of annexation, Property Tax Revenue (base plus increment) will be reallocated as follows: a detaching or dissolving di strict's Property Tax Revenue (base pl us increment) shall be combined wi th COUNTY's and the sum shall be allocated between CITY and COUNTY pursuant to the ratio set forth in section 2.b. above.
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3. Effective Date. The Agreement shall not become effective until both (1) execution by both parties hereto and (2) fulfillment of the condition precedent set forth herein. a. Condition Precedent. It shall be a condition precedent of this Agreement that the Developer of the initial ANNEXATION amends the conditions of approval of Vesting Tentative Tract Map N o. 6345 (part of Annexation Application No. P 22- 00411) to require Developer to make up for revenue shortfalls addressed in City of Fresno Resolution No. 2022-244, through an appropriate mechanism.
4. Additional Covenants. Not as conditions to the validity or enforceability of other provisions of this Agreement, CITY and COUNTY agree as follows:
a. Acquisition of Rights-of-Way. Within a reasonable time prior to the recordation of the ANNEXATION, CITY shall accept conveyances from COUNTY for, or otherwise acquire, all road rights -of-way along S. Wi llow Avenue as identified in Exhibit C . In regard to any portion(s) of road rights -of-way along S. Willow Avenue shown in Exhibit C, for which the COUNT Y does not have marketable record title as of the Effective Date, CITY shall be responsible to acquire ( by purchase, eminent domain, or otherwise) said portion(s) of road rights -of-way.
Upon the acceptance or acquisition by CITY of the road rights-of-way identified in Exhibit C, pursuant to this section 4.a., those rights -of-way shall become CITY streets and the sole responsibility of CITY. As an alternative to the acceptance by CITY of conveyances from COUNTY for or other acquisition of all road rights -of- way shown i n Exhibit C under this section 4.a., City may annex the territory comprising all road rights -of-way shown in Exhibit C. CITY will not object to and shall support the imposition by LAFCo of a condition of the ANNEXATION requiring, prior to the re cordation of the ANNEXATION, the acceptance by CITY of conveyances from COUNTY for or other acquisition of all road rights -of-way shown in Exhibit C.
b. Enforcement. COUNTY may enforce the covenants in section 4, inclusive of section 4.a., by any legal means, provided ho wever that, once LAFCo issues a
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certificate of completion pursuant to Section 572 03 of the Government Code with respect to the ANNEXATION, this section 4 does not authorize COUNTY to seek LAFCo’s invalidation of, or to withdraw support for, the proceedings for the ANNEXATION.
[Signatures follow on next page.]
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IN WITNESS WHEREOF, the parties have executed this Agreement at Fresno, California, the day and year first above written.
CITY OF FRESNO,
a California municipal corporation
By: ____________________________
Georgeanne A. White
City Manager
APPROVED AS TO FORM:
ANDREW JANZ
City Attorney
By: ____________________________
Jennifer M. Quintanilla Date
Senior Deputy City Attorney
ATTEST:
TODD STERMER, CMC
City Clerk
By: ____________________________
Deputy Date
COUNTY OF FRESNO, a Political
Subdivision of the State of California
By: ____________________________
Sal Quintero, Chairman of the
Board of Supervisors of the County
of Fresno
ATTEST:
Bernice E. Seidel
Clerk to the Board of Supervisors
County of Fresno, State of California
By: ____________________________
Deputy
Attachments:
Exhibit A – Proposed Annexation Boundaries
Exhibit B – Rights-of-way to be accepted or acquired by the City of Fresno
Exhibit A
PEACH
WILLOW
PITT
ASH
GEARY
KAREN
HAMILTON
MATUS
ADLER
HELM
FLORENCE
SYLMAR
DWIGHT
BAILEY
WINERY
TIMMY
ATCHISON
GARDEN
BRALY
LAUREEN
ORLEANS
WOODWARD
CASTELLAR
HELM
FLORENCE
PITT
KAREN
HAMILTON
KAREN
WINERY
µ
0 230 460 690 920115
Feet
Map Prepared by: GS
G:\4360Devs&Pln\GIS\
Maps\Specific\
RIGHT-OF-WAY TO BE ACCEPTED
OR ACQUIRED BY CITY OF FRESNO
Legend
Right-of-Way to be Accepted or Acquired by City of Fresno California - Willow No. 4 Reorg.
City of Fresno Sphere of Influence
EXHIBIT B
CITY
OF
FRESNO
Right-of-Way to be
Accepted or Acquired
by City of Fresno