City of Gonzales
PUBLIC WORKS / CITY ENGINEER DEPARTMENT
STAFF REPORT
TO: Honorable Mayor Rios and City Council
DATE: June 3, 2024
FROM: Patrick Dobbins, Public Works Director/City Engineer THROUGH: Carmen Gil, City Manager
SUBJECT: Resolution 2024-26
RECOMMENDATION
It is recommended that the City Council take the following actions:
• Adopt Resolution 2024-30, A Resolution of the City Council of the City of Gonzales, Approving the Engineer’s Report and Declaring its Intention to Propose an Increase of Assessments and an Annual Escalation Factor for the California Breeze Benefit Assessment District for Fiscal Year 2024/25.
• Adopt Resolution 2024-31, A Resolution of the City Council of the City of Gonzales, Approving the Engineer’s Report and Declaring its Intention to Propose an Increase of Assessments and an Annual Escalation Factor for the California Breeze Parks and Open Space District for Fiscal Year 2024/25.
BACKGROUND
The City has eight assessment districts, formed in accordance with the provisions of the Lighting and Landscaping Act of 1972 or the Benefit Assessment Act of 1982. These districts provide funds for maintenance of specified improvements. The districts are:
1. California Breeze Subdivision Benefit Assessment District
2. California Breeze Subdivision Parks and Open Spaces Assessment District
3. Canyon Creek Subdivision Benefit Assessment District
4. Canyon Creek Subdivision Parks and Open Spaces Assessment District AGENDA
ITEM
25 5. Industrial Business Park Benefit Assessment District
6. Industrial Business Park Parks and Open Spaces Assessment District
7. Cipriani Subdivision Benefit Assessment District
8. Cipriani Subdivision Parks and Open Spaces Assessment District
The California Breeze Benefit Assessment District provides funding for the maintenance of the roadways, streetlights, storm drains, retention basins in the subdivision. The California Breeze Parks and Open Space Assessment District provides funding for public landscaping and irrigation systems along Herold Parkway and in Meyer Park.
The California Breeze assessment districts were the first assessment districts established by the city. The formation documents for these districts did not include an annual Consumer Price Index adjustment to the Maximum Annual Assessment amount (the other six districts have an annual Consumer Price Index adjustment). Therefore, the assessments for the California Breeze Districts have not kept up with inflation and the city General Fund has been subsidizing district expenses for the last several years.
This effort to increase these California Breeze Assessments is being done in parallel with the annual assessments efforts for this subdivision based on the current maximum assessment, should the Proposition 218 process to increase the maximum assessment fail.
REVIEW & ANALYSIS
A consulting agreement with Harris & Associates to undertake the Proposition 218 process and prepare the Engineer Reports for the two California Breeze Assessment Districts services was approved at the February 20, 2024 Council meeting. The Engineer Reports are attached and they identify the special benefits received by the parcels with the Assessment Districts and include the estimated expenditures for the next fiscal year.
Regarding a Consumer Price Index adjustment for the Maximum Annual Assessment amount for the two districts, staff recommends using the same benchmark as the other six assessment district which is the twelve-month average of the Bureau of Labor Statistics Consumer Price Index for the San Francisco Bay Area as the annual Consumer Price Index adjustment for Fiscal Year 2024/25 and all subsequent years.
California Breeze Benefit Assessment District
Staff recommends that the new maximum assessment amount for the California Breeze Benefit Assessment District be phased in over a three-year period. The below tables show the proposed annual assessment amounts over the three-year phase-in period:
Subdivision
Phase
Current
Maximum
Assessment
FY 2023/24
Proposed
Maximum
Assessment
FY 2024/25
Proposed
Maximum
Assessment
FY 2025/26
Proposed
Maximum
Assessment
FY 2026/267
Phase 1 $187.00 $287.34 $366.33 $392.67
Phase 2 $185.34 $287.34 $366.33 $392.67
Phase 3 $234.38 $287.34 $366.33 $392.67
California Breeze Parks and Open Space Assessment District Staff recommends that the new maximum assessment amount be phased in over a four-year period for the Parks and Open Space Assessment District. The below tables show the proposed annual assessment amounts over the four-year phase-in period:
Subdivision
Phase
Current
Maximum
Assessment
FY 2023/24
Proposed
Maximum
Assessment
FY 2024/25
Proposed
Maximum
Assessment
FY 2025/26
Proposed
Maximum
Assessment
FY 2026/27
Proposed
Maximum
Assessment
FY 2027/28
Phase 1 $227.00 $325.00 $406.26 $507.82 $574.94
Phase 2 $227.00 $325.00 $406.26 $507.82 $574.94
Phase 3 $271.76 $325.00 $406.26 $507.82 $574.94
PROPOSITION 218 PROCESS
Proposition 218 was approved by California voters in 1996 and are Articles XIII C and XIII D in the State Constitution. To increase the California Breeze assessments, the following steps must take place upon Council direction to proceed with the Proposition 218 process:
1. Ballots will be mailed to all property owners in the California Breeze subdivision. The ballots will list the current and proposed maximum assessment amounts. A minimum 45-day period shall be provided for property owners to return of their ballots.
2. Ballots are counted based on the current assessment amount for each parcel. That means one vote for every dollar of the annual assessment amount for a specific parcel for each assessment district.
3. Following the 45-day ballot period, the Council will hold a public hearing at the City Council meeting on July 22, 2024 to take public comment and tabulate the submitted ballots.
4. If the ballots submitted in opposition to the proposed assessment increase do not exceed 50% of the total number of ballots (ie, Majority Protest), the Council may approve the increased assessment amounts.
5. If so confirmed and approved, the Assessments would be submitted to the County of Monterey Assessor for inclusion on the property tax rolls for fiscal year 2024/25.
PROPERTY OWNER ENGAGEMENT
In the last four months, staff met with interested property owners on two occasions, with the most recent taking place the evening of May 8. On May 3 Staff mailed the attached notice and survey to all property owners in the California Breeze subdivision. Additional meetings will be held with property owners should the Council direct staff to proceed with the Proposition 218 process.
In conclusion, Staff recommend that the City Council Adopt the attached Resolutions authorizing initiation of a Proposition 218 process to increase the annual assessments collected by the California Breeze Benefit Assessment District and the California Breeze Parks and Open Spaces Assessment District with the addition of an annual CPI adjustment escalator.
Explain Recommendation and How it Supports the Vision
Gonzales will continue to be a safe, clean, family-friendly community, diverse in its heritage, and committed to working collaboratively to preserve and retain its small town charm.
Explain: Going through a successful Prop 218 process to increase the assessments over a three or four-year phased-in approach for the two California Breeze Assessment Districts will fully fund the costs for the specified maintenance efforts.
Explain how the Recommendation Directly Implements the Mission The City Council and Staff of the City of Gonzales will realize our Vision by providing the leadership, commitment and resources necessary to provide excellent services that enhance the quality of life of our diverse community. X Yes ___ No
Explain: Collection of the assessments provides funds for the maintenance of a variety of improvements that enhance the quality of life in the subdivision.
City services will be delivered in a cost-effective, respectful and friendly manner to ensure the safety and well being of the residents and the promotion of business, recreational, housing and employment opportunities in an environmentally sustainable manner. X Yes No Explain: See above Vision.
Strong fiscal policies allow us to provide appropriate infrastructure for:
• Public Safety X Yes _ No NA
• Housing _ Yes No NA
• Recreation X Yes No NA
• Environment X Yes No NA
• Education Yes No X NA
Explain: Collection of the annual assessments enables the city to maintain the certain improvements in the California Breeze subdivision.
ALTERNATIVES
The Council could decide not to undertake the Prop 218 process to increase the maximum assessment amount and add an annual CPI adjustment. This isn’t recommended as the annual assessments are not covering the district’s expenses, so the city General Fund is used to close the funding gap.
BUDGET IMPACT
Moving through a Proposition 218 process to increase the maximum assessment amount for the two assessment districts and include an annual Consumer Price Increase would fully fund the operations and maintenance of these districts.
CONCLUSION
It is recommended that the City Council take the following actions:
• Adopt Resolution 2024-30, A Resolution of the City Council of the City of Gonzales, Approving the Engineer’s Report and Declaring its Intention to Propose an Increase of Assessments and an Annual Escalation Factor for the California Breeze Benefit Assessment District for Fiscal Year 2024/25.
• Adopt Resolution 2024-31, A Resolution of the City Council of the City of Gonzales, Approving the Engineer’s Report and Declaring its Intention to Propose an Increase of Assessments and an Annual Escalation Factor for the California Breeze Parks and Open Space District for Fiscal Year 2024/25.
Attachments:
1. Resolution 2024-30
2. Resolution 2024-31
3. Draft Ballot for the California Breeze Benefit Assessment District
4. Draft Ballot for the California Breeze Parks and Open Spaces Assessment Districts
5. May 3, 2024 Survey mailed to California Breeze Property Owners
6. Eng. Report Ca Breeze Benefit
7. Eng. Report Ca Breeze POS