DATE: June 27, 2023
TO: Mayor and City Council
FROM: Maintenance Services Director
SUBJECT: LLAD 96-1 Assessment Hearing: Adopt a Resolution to Approve the Final Engineer's Report, Reconfirm Maximum Base Assessment Amounts, Confirm the Assessment Diagrams and Fiscal Assessments, Order the Levy and Collection of Fiscal Assessments; and Adopt a Resolution to Approve Funding Recommendations and Appropriate Special Revenue Funds for Consolidated Landscaping and Lighting Assessment District (LLAD) No. 96-1, Zones 1 through 18, for Fiscal Year 2024
RECOMMENDATION
That the City Council adopts two resolutions (Attachments II and III):
Approving the Final Engineer’s Report,
Confirming the Maximum Base Assessment (MBA) amounts,
Confirming the Fiscal Assessments,
Confirming the Assessment Diagrams,
Ordering the Levy and Collection of Fiscal Assessments, Approving the Funding Recommendations, and
Appropriating Revenue and Expenditure budgets for Consolidated Landscape and Lighting Assessment District (LLAD) No. 96-1, Zones 1 through 18 for Fiscal Year 2024.
SUMMARY
The Landscaping and Lighting Act of 1972 requires an annual review and update of the engineer’s report to set the annual assessment rate for each benefit zone. Assessment rate recommendations are made based on annual expenses, required cash flow, and future capital repair and replacement requirements. Recommended annual assessment rates cannot exceed the Maximum Base Assessment (MBA) established when each zone was originally formed. The annual engineer’s report (Attachment IV) includes a detailed summary and budget for each of the eighteen benefit zones.
BACKGROUND
The Landscaping and Lighting Act of 1972 (Streets and Highways Code §22500) is a flexible tool used by local government agencies to form Landscaping and Lighting Assessment Districts (LLAD). These districts are formed to finance the cost of operating, maintaining, and servicing landscaping (including parks), and lighting improvements in public areas. In 1996, six separate LLAD benefit zones (1-6) were consolidated into one district by the adoption of Resolution No. 96-63. The new district was subsequently renamed, Consolidated Landscaping and Lighting Assessment District No. 96-1, and is known as the “District.” In subsequent years, zones 7-18 were individually created and annexed into the District.
This staff report and the attached engineer’s report provide assessment, benefit, and budget details for each of the established eighteen zones. The eighteen benefit zones are located throughout the City as shown on the following map.
The following table (Table 1) provides a summary of the LLAD benefit zones, including the year in which each zone was formed and the number of assessable parcels within each zone.
TABLE 1: DESCRIPTION OF BENEFIT ZONES
A
B
C
D
E
Zone
Name/Location
Year Formed
Type of
Development
Number of Assessed
Parcels/SFE
1 Huntwood Ave. and Panjon St.
1990
Residential
30 2
Harder Rd. and Mocine Ave.
1991
Residential
85 3
Prominence
1992
Residential
155
4 Stratford Village
1995
Residential
174
5 Soto Rd. and Plum Tree St.
1995
Residential
38 6
Pepper Tree Park
1982
Industrial
11 7
Twin Bridges
1998
Residential
348
8 Capitola St.
1999
Residential
24 9
Orchard Ave.
2000
Residential
74 10
Eden Shores
2003
Residential
534
11 Stonebrae
2006, 2018, 2020
Residential
644
12 Eden Shores East (Spindrift)
2007, 2016
Residential
379
13 Cannery Place
2008
Residential
599
14 La Vista
2016
Residential
179
15 Cadence
2017
Residential
206
16 Blackstone
2016
Residential
157
17 Parkside Heights
2019
Residential
97 18
SoHay
2019
Residential
433
Total Assessed Parcels:
4,167
Self-Maintained.
DISCUSSION
Recommended changes to a zone’s annual assessment rate are based on annual expenses, required cash flow, and capital replacement requirements. When determining the annual assessment rate, staff looks at two things:
Maximum Base Assessment (MBA) – The MBA is the maximum assessment rate that a parcel can be charged annually. This is established during the original formation of the zone. The annual MBA can only be increased if an inflation factor was included in the original formation document.
Assessment Revenue – The assessment revenue is the annual amount of revenue collected by charging each parcel an assessment rate. The assessment rate recommendation depends on review of the following three items:
Annual Expenses – Annual operating and maintenance expenses are estimated based on past years’ experience and future years’ estimates. Expenses include staff administration, noticing, and annual reporting.
Cash Flow – This is the amount of “cash” needed to pay monthly invoices when revenue is not received monthly (assessment rates are received through property tax revenues collected by Alameda County, which are transmitted to the City three times a year (January, May, and June).
Capital Replacement – This is the “savings account” where funds are collected and reserved each year to fund future capital replacement items. Future capital expenses are estimated based on an inventory of capital items, their useful life, and future replacement cost.
Table 2 on the following page summarizes assessment information by zone. The table provides assessment details for each zone by describing the number of parcels, if there is an annual inflation adjustment calculation included, lists the MBA rate, the FY 2024 assessment rate, and the change between last year’s adopted assessment and this year’s recommended assessment. For FY 2024, staff recommends no change to four Zones (6, 14, 15 and 18) fourteen increases (1, 2, 3, 4, 5, 7, 8, 9, 10, 11, 12, 13, 16, and 17), based on annual expenses, required cash flow, and future capital repair and replacement.
TABLE 2: ASSESSMENT AMOUNTS BY BENEFIT ZONE
A
B
C
D
E
F
G
H
I
J
Zone
Name/Location
# Parcels
CPI Adj
FY 2024 Max
Base Assessment
FY 2024
Rate
FY 2023
Assessment
Change from last year
1 Huntwood Ave. and Panjon St.
30 No
295.83
224.70
214.00
Incr
10.70 5%
2 Harder Rd. and Mocine Ave.
85 No
193.39
129.00
122.86
Incr
6.14 5%
3 Prominence
155
Yes
1,118.42
1,008.76
951.66
Incr
57.10 6%
4 Stratford Village
174
No
180.00
123.13
116.16
Incr
6.97 6%
5 Soto Rd. and Plum Tree St.
38 No
258.67
258.67
255.17
Incr
3.50 1%
6 Pepper Tree Park
11 No
2.61 2.61
2.61 None
-
0%
7 Twin Bridges
348
Yes
1,169.82
627.20
591.70
Incr
35.50 6%
8 Capitola St.
24 Yes
836.64
195.89
186.56
Incr
9.33 5%
9 Orchard Ave.
74 Yes
223.38
36.24 34.19
Incr
2.05 6%
10 Eden Shores
534
Yes
1,332.08
316.05
287.32
Incr
28.73 10%
11a
Stonebrae (Developed)
617
Yes
1,889.38
374.48
340.44
Incr
34.04 10%
11b
Stonebrae (Undeveloped)
27 Yes
566.81
198.47
180.43
Incr
18.04 10%
12a
Eden Shores - East
261
Yes
250.34
98.26 92.70
Incr
5.56 6%
12b
Eden Shores East (Spindrift)
118
Yes
239.80
98.26 92.70
Incr
5.56 6%
13 Cannery Place
599
Yes
1,420.74
394.13
371.82
Incr
22.31 6%
14 La Vista
179
Yes
725.28
683.65
683.65
None
-
0%
15 Cadence
206
Yes
703.34
N/A
N/A
N/A
N/A
N/A
16a
Blackstone (Zone A)
133
Yes
501.60
501.60
482.00
Incr
19.60 4%
16b
Blackstone (Zone B)
24 Yes
526.68
526.68
506.08
Incr
20.60 4%
17 Parkside Heights
97 Yes
594.78
555.12
528.69
Incr
26.43 5%
18a
SoHay Zone A (Developed)
192
Yes
453.66
300.00
300.00
None
-
0%
18b
SoHay Zone A (Undeveloped)
69 Yes
136.10
90.00 90.00
None
-
0%
18c
SoHay Zone B (Developed)
79 Yes
430.98
285.00
285.00
None
-
0%
18d
SoHay Zone B (Undeveloped)
93 Yes
129.29
85.50 85.50
None
-
0%
Proposition 218 Compliance
For FY 2024, all fiscal assessments are proposed to be levied in compliance with Proposition 218 and do not require the noticing and balloting of property owners to obtain their approval. Any future increases in fiscal assessment amounts that exceed the MBA would require the noticing and balloting of property owners.
FISCAL AND ECONOMIC IMPACT
There is no impact to the General Fund as monies related to these LLADs are reserved in dedicated special revenue funds. LLAD assessment revenue is collected, and expenditures are paid directly from their dedicated special revenue funds. All zones have adequate cash balances for annual expenses, cash flow, and capital replacement, as shown in Table 3.
STRATEGIC ROADMAP
This agenda item is not directly related to the Council’s Strategic Roadmap.
PUBLIC CONTACT
City staff: 1) mailed a postcard to all affected property owners to provide details of their recommended FY 2024 assessment rate and to alert them to two Council meetings where they could provide input (June 6 and June 27); 2) held a virtual meeting on May 31 via Zoom; and 3) published a printed legal notice in the East Bay Times on June 16, 2023.
NEXT STEPS
If the City Council adopts the two attached resolutions (Attachments II and III), the Final Engineer’s Report (Attachment IV) will be approved, the revenue and expenditure budgets will be appropriated, and the final Assessor’s tax roll will be prepared and filed with the County Auditor’s Office allowing the assessments to be included in the FY 2023 tax roll. The draft assessment rolls are included (Attachment V) but are under review and will be updated in July to allow up-to-date information to be included for developing zones (11, 18). Once updated in July, a copy will be provided to the City Clerk and County Assessor.
Prepared by: Manny Grewal, Management Analyst Recommended by: Todd Rullman, Maintenance Services Director Approved by:
Kelly McAdoo, City Manager