PART A
DESCRIPTION OF IMPROVEMENTS
The facilities, which have been constructed within the boundaries of the City of Gardena District, and those which may be subsequently constructed, will be operated, maintained and serviced as generally described as follows:
DESCRIPTION OF IMPROVEMENTS
FISCAL YEAR 2025-2026
CITY OF GARDENA
CONSOLIDATED STREET LIGHTING ASSESSMENT DISTRICT
The facilities to be maintained and serviced include an annexed area called the West Gardena area in 1995. The costs for the street lighting were paid through the County of Los Angeles by an ad valorem tax and assessment. The lighting costs were transferred to the City of Gardena in 1997 after the removal of the County Lighting District and Assessment District. The ad valorem tax charge of the County for lighting was also transferred to the City of Gardena to fund the lighting costs in this area in 1997. The plans for lighting reflect the addition of the new lighting.
The plans and specifications for the improvemen ts, showing and describing the general nature, location and the extent of the improvements, are on file in the office of Public Works, and are incorporated herein by reference.
CITY OF GARDENA
PART B
ESTIMATE OF COST
The 1972 Act provides that the total cost of installation, construction, operation, maintenance and servicing of the improvements described in Part A can be recovered by the District. Maintenance can include the repair and replacement of existing facilities. Servicing can include electrical and associated costs from a public utility. Incidental expenses, including administration of the District, engineering fees, legal fees, printing, posting and mailing of notices, and all other costs associated with the annual assessment process can also be included.
The estimated costs of the operation, servicing and maintenance of the improvements for Fiscal Year 2025-2026, as described in Part A, are summarized herein, and described in the Proposed Budgets on the subsequent pages.
The significant increases in energy costs experienced in early 2001 are expected to continue through 2025-2026. The City had anticipated increases in energy costs for several years and had set aside reserves to pay for the increases. However, the depletion of this reserve has warranted an increase in assessments.
The City of Gardena, in 2009-2010 fiscal year increased the assessment by conducting an assessment ballot (Proposition 218) proceeding by mailed ballots for approval of the increase, in accordance with Section 53753 of the Government Code and Section 4000 of the Election's Code.
The increase in assessments in the FY2009-2010 did not allow the District to wipe out its negative reserve in the 2010-2011 and 2011-2012 fiscal years; however, for 2012-2013 fiscal year, with
2.09% increase, the reserve started a modest gain; and for 2021-2022 fiscal year, with projected
0.9% increase the District is also projected to build up reserves in the positive. The fiscal year 2022- 2023 7.5% increase for the District helped further build up resources. The increase for fiscal year 2023-2024 was 5.8%. The increase for fiscal year 2024-2025 was 2.5%. For fiscal year 2025-2026, the increase is projected to be 3.3%.
The 1972 Act requires that a special fund be set up for the revenues and expenditures of the District.
Funds raised by assessment shall be used only for the purpose as stated herein. Any balance or deficit remaining on July 1 must be carried over to the next fiscal year.
The LED Street Light Conversion was completed in year 2019. However, savings will be minimal, if any, until t
he recouping cost period of 20 years is completed.
City of Gardena
Consolidated Street Lighting Districts FY 2025-2026
CITY OF GARDENA
PART C
ASSE
SSMENT DISTRICT DIAGRAM
Diagrams showing the exterior boundaries of the City of Gardena Consolidated Street Lighting Assessment District and the lines and dimensions of each lot or parcel of land within the District are in the Public Works Director’s Office and referenced herein.
The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the Assessor of the County of Los Angeles, for the year in which this report was prepared. The Assessor’s maps and records are incorporated by reference herein and made part of this report.
CITY OF GARDENA
PART D
METHOD OF APPORTIONMENT OF ASSESSMENT
GENERAL
Part 2 of Division 15 of the Streets and Highways Code, the Landscaping and Lighting Act of 1972, permits the establishment of assessment district s by public agencies for the purpose of providing certain public improvements, which include operation, maintenance and servicing of street lights, traffic signals, and landscaping.
Section 22573 of the Landscape and Lighting Act of 1972 requires that maintenance assessments be levied according to benefit rather than according to assessed value. This Section States:
"The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements.
”
In addition, Article XIIID, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property.
The Act permits the designation of benefit zones within any individual assessment district if "by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement " (Sec. 22574). Thus, the 1972 Act
requires the levy of a true "benefit assessment" rather than a "special tax."
ASSESSMENT METHODOLOGY
The total operation, maintenance, and servicing costs for the assessment district improvements are apportioned in accordance with the benefit spread described below.
General versus Special Benefit
The assessment cost for each parcel is determined by the front linear footage of the property, multiplied by the applicable rate for that parcel. If the property faces more than one street or alley, the cost is determined by the linear footage of the longest side facing a street/alley plus 10 percent of the rest of the sides facing a street/alley, multiplied by the rate. Rate of assessment is determined by zone. The rates are determined by the quantity of street lighting in each zone, spacing frequency being most intense in commercial zone and least intense in residential zones and near public properties. This method of apportionment ensures that properties are not assessed in excess of the proportional special benefit conferred.
CITY OF GARDENA
PART E
PROPERTY OWNER LIST & ASSESSMENT ROLL
The total proposed assessment for Fiscal Year 2025-2026 and the amount of proposed assessment apportioned to each lot or parcel within the District, as shown on the latest roll at the County of Los Angeles Assessor's Office, are contained in the Assessment Rolls and the description of each lot or parcel is part of the records of the Assessor of the County of Los Angeles and these records are, by reference, made part of this Report.
The included tracts of land have been subdivided into four zones, with each of subject lots benefiting from the improvements being maintained. Therefore, the costs associated with the street lighting within and directly adjacent to each tract, as shown in Part B of this report will be apportioned to pay in accordance with the property frontage within each zone.
CITY OF GARDENA
FY 08/09 FY 09/10 FY 10/11 FY 11/12 FY 12/13 FY 13/14 FY 14/15 FY 15/16 CPI Rate Increase N/A Actual Actual Actual Actual Actual Actual Percentage Assessment
Rate Increase 28.00% 1.8554% 1.4056% 2.09% 1.96% 0.7737% 0.726% Approx ima te Asse ssme nt
(Annual) X 1,000 $485 $620 $627 $636 $649 $658 $661 $665 FY 16/17 FY 17/18 FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 FY 23/24 CPI Rate Increase Actual Actual Actual Actual Actual Actual Actual Actual Percentage Assessment
Rate Increase 3.1% 2.1% 3.5% 3.2% 3.4% 0.9% 7.5% 5.8%
Approx ima te Asse ssme nt
(Annual) X 1,000 $682 $696 $720 $746 $771 $778 $837 $886 FY 24/25 FY 25/26
CPI Rate Increase Actual Actual
Percentage Assessment
Rate Increase 2.5% 3.3%
Approx ima te Asse ssme nt
(Annual) X 1,000 $908 $937
LIGHTING ASSESSMENT DISTRICT
PART F
FINANCIAL STUDY
Staff has performed a financial study of the District for the 2025-2026 FY to ensure that the maintenance and improvement costs for the district were funded appropriately.
In FY 2009-2010, through Prop. 218, the City of Gardena approved increased assessments for the District as indicated in the summary below. Additionally, the study recommended adjustment of future annual assessments as needed, per the Consumer Price Index (CPI), All Urban Consumers, for the Los Angeles, Long Beach, and Anaheim Areas, not to exceed 50% of operating reserves. The actual assessments levied in any fiscal year will be approved by the City Council. Please see “Appendix A” for
a copy of the detailed Financial Study for the District.
Since the increase in the assessments was approved, benefit areas within the District will continue to be maintained at the highest service levels. The proposed increase includes language to adjust assessments per the CPI, future votes regarding this annual increase will not be needed; however, each year staff will present the annual Engineer’s Reports with the recommended assessment amount. For FY 2025-2026, an increase of 3.3% is recommended.
CITY OF GARDENA
OPERATING EXPENDITURES
The following information describes the types of costs associated with maintaining the District, as well as information regarding the proposed rate increase. The financial study projects the expenditures and revenues through Fiscal Year 2025-2026.
CPI – Annual Increase According to Need
In FY 2009-2010, the City approved a recommended scaled increase in assessments to occur over a two year period for the District. After the initial scaled increase, the assessments are increased annually per the CPI on an as needed basis (0.9% per year for the study). Should the district reach a reserve level not-to-exceed 50% of operating revenues, the assessment will not be increased per the CPI for the year. Ea ch year, the City will evaluate the reserves and the expenditures, and inform the residents whether or not an increase per the CPI will be necessary for the upcoming year.
Maintenance Upgrades/Projects
The line item in the proposed budget and financial study for “Maintenance Upgrades/Projects”
includes any new projects such as new conduits, wiring, lights, or poles, etc. that can be scheduled for the upcoming year. Often, City staff receives input from residents on any projects that a district may like to see completed. The proposed budget includes an estimate for these projects, and if the amount actually spent each year is less than the estimate, the remaining balance returns to the District’s reserve fund. Should the amount exceed the estimate, then the funds needed would be taken from the reserve fund.
Reserve Fund
Any remaining funds not used from the previous year are added to the District ’s reserve fund.
The reserve fund should have sufficient funds av ailable to lessen the fiscal impact of any unforeseen expenditures. Staff is recommending that the district maintain a healthy reserve balance of an amount not-to-exceed 50% of the total annual assessments.
CITY OF GARDENA
ESTIMATE OF COSTS*
2025-2026
APPENDIX A
APPENDIX A
FINANCIAL STUDY DETAIL
UTILITY-
OWNED SYSTEMS
(LS-1) Energy Cost $707,610
CITY-OWNED SYSTEM
(LS-2) Energy Cost $31,639
SUBT
OTAL $739,249
FUEL CONTINGENCY (5%) $36,962
SUBTOT
AL $776,212
OVERHEAD $42,040
OTHER PROGRAM EXPENSES $49,15
0 CAPITAL OUTLAY $128,000
CONTINGENCY
TOTAL ESTIMATED COS
T OF STREET LIGHTING DISTRICT $995,402
* Expenses are provided by the City of Gardena Finance Department
CITY OF GARDENA