Tuesday, November 7, 2023
Meeting Agenda
Closed Session - 5:00 PM
HESPERIA CITY COUNCIL
SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY
HOUSING AUTHORITY
COMMUNITY DEVELOPMENT COMMISSION
WATER DISTRICT
City Council Chambers
9700 Seventh Ave., Hesperia CA, 92345
City Clerk's Office: (760) 947-1007
City Council Members
Brigit Bennington, Mayor
Larry Bird, Mayor Pro Tem
Allison Lee, Council Member
Cameron Gregg, Council Member
Rebekah Swanson, Council Member
Rachel Molina, City Manager
Pam K. Lee, City Attorney
See page (3) for details on public meeting guidelines during the COVID-19 (Coronavirus) Pandemic
NOTE: In compliance with the Americans with Disability Act, if you need special assistance to participate in this meeting, please contact the City Clerk’s Office at (760) 947-1007 or (760) 947-1026. Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility.
Brigit Bennington, Mayor 9700 Seventh Avenue Larry Bird, Mayor Pro Tem Hesperia, CA 92345 Cameron Gregg, Council Member
Allison Lee, Council Member 760-947-1000 Rebekah Swanson, Council Member TD 760-947-1119
Rachel Molina, City Manager www.cityofhesperia.us Gateway to the High Desert
City of Hesperia
Public Access to City Council Meetings:
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November 7, 2023City Council Meeting Agenda
REGULAR MEETING AGENDA
HESPERIA CITY COUNCIL
SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY
HESPERIA HOUSING AUTHORITY
HESPERIA COMMUNITY DEVELOPMENT COMMISSION
HESPERIA WATER DISTRICT
9700 7th Avenue, Council Chambers, Hesperia, CA 92345
As a courtesy, please silence your cell phones and other electronic devices while the meeting is in session. Thank you.
Prior to action of the Council, any member of the audience will have the opportunity to address the legislative body on any item listed on the agenda, including those on the Consent Calendar.
Individuals wishing to speak during General Public Comments or on a particular numbered item must submit a speaker slip to the City Clerk with the agenda item noted. Speaker slips should be turned in prior to the public comment portion of the agenda or before an agenda item is discussed. Comments will be limited to three minutes for General Public Comments, Consent Calendar items and New Business items. Comments are limited to five minutes for Public Hearing items.
In compliance with the Brown Act, the City Council may not discuss or take action on non-agenda items or engage in question and answer sessions with the public. The City Council may ask brief questions for clarification; provide a reference to staff or other resources for factual information and direct staff to add an item to a subsequent meeting.
CLOSED SESSION - 5:00 PM
Roll Call
Mayor Brigit Bennington
Mayor Pro Tem Larry Bird
Council Member Allison Lee
Council Member Cameron Gregg
Council Member Rebekah Swanson
Conference with Legal Counsel - Potential Litigation:
Government Code Section 54956.9(d)2
1. Two (2) Cases
Conference with Legal Counsel – Existing Litigation
Government Code Section 54956.9(d)1
1. Apex HM, LLC et al. v. City of Hesperia, et al. (San Bernardino County Superior Court Case No. CIVBS 2208845)
CALL TO ORDER - 6:30 PM
A. Invocation
November 7, 2023City Council Meeting Agenda
B. Pledge of Allegiance to the Flag
C. Roll Call
Mayor Brigit Bennington
Mayor Pro Tem Larry Bird
Council Member Allison Lee
Council Member Cameron Gregg
Council Member Rebekah Swanson
D. Agenda Revisions and Announcements by City Clerk
E. Closed Session Reports by City Attorney
GENERAL PUBLIC COMMENTS (For items and matters not listed on the agenda) Individuals wishing to speak during General Public Comments or on a particular numbered item are requested to submit a speaker slip to the City Clerk with the agenda item noted. Speaker slips should be turned in prior to the public comment portion of the joint agenda or before an agenda item is discussed. Comments will be limited to three minutes for General Public Comments, Consent Calendar items and New Business items. Comments are limited to five minutes for Public Hearing items.
In compliance with the Brown Act, the City Council may not discuss or take action on non-agenda items or engage in question and answer sessions with the public. The City Council may ask brief questions for clarification; provide a reference to staff or other resources for factual information and direct staff to add an item to a subsequent meeting.
JOINT CONSENT CALENDAR
1. Consideration of the Draft Minutes from the Regular Meeting held Tuesday, October 17, 2023.
Recommended Action:
It
is recommended that the City Council approve the Draft Minutes from the Regular Meeting held Tuesday, October 17, 2023.
Staff Person: Assistant City Clerk Erin Baum
Draft CC Min 2023-10-17Attachments:
2. Warrant Run Report (City - Successor Agency - Housing Authority - Community Development Commission - Water)
Recommended Action:
It is recommended that the Council/Board ratify the warrant run and payroll report for the City, Successor Agency to the Hesperia Community Redevelopment Agency, Hesperia Housing Authority, Community Development Commission, and Water District.
Staff Person: Assistant City Manager Casey Brooksher
November 7, 2023City Council Meeting Agenda
SR Warrant Run 11-7-2023
Attachment 1 - Warrant Run
Attachments:
3. Treasurer’s Cash Report for the unaudited period ended August 31, 2023 Recommended Action:
It
is recommended that the Council/Board accept the Treasurer’s Cash Report for the City, Successor Agency to the Hesperia Community Redevelopment Agency, Hesperia Housing Authority, Community Development Commission, and Water District.
Staff Person: Assistant City Manager Casey Brooksher
SR Treasurer's Report 11-7-2023
Attachment 1 - Treasurer's Report
Attachments:
4. Amend Agreement with Routeware DBA Recyclist
Recommended Action:
It
is recommended that the City Council authorize the City Manager to approve a two-year extension for the software services agreement with Routeware DBA Recyclist, in the amount of $56,780, for a not-to-exceed contract amount of $90,680.
Staff Person: Assistant City Manager Casey Brooksher and Assistant to the City Manager Tammy Pelayes
SR Agreement with Routeware DBA Recyclist 11-7-2023Attachments:
5. Fiscal Year 2022-23 Final Budget Amendments and Update to Accounting Policy
Recommended Action:
It is recommended that the following resolutions be adopted, amending the respective Fiscal Year (FY) 2022-23 Budgets for the City of Hesperia, Hesperia Housing Authority, and the Hesperia Water District, along with an update to the Accounting Policy related to revenue recognition:
1) City of Hesperia No. 2023-64
2) Hesperia Housing Authority HHA 2023-12
3) Hesperia Water District Resolution HWD
2023-22
Staff Person: Assistant City Manager Casey Brooksher
SR FY 22-23 Final Budget Amendments & Update 11-7-2023
Resolution 2023-64
Resolution HHA 2023-12
Resolution HWD 2023-22
Attachments:
NEW BUSINESS
6. Discussion on Alternative Funding Sources
November 7, 2023City Council Meeting Agenda
Recommended Action:
It
is recommended that the City Council receive and file this staff report, which provides information about potential funding sources to address the needs of the community, and provide direction to staff.
Staff Person: Assistant City Manager Casey Brooksher
SR Discussion on Alternative Funding Sources 11-7-2023Attachments:
COUNCIL COMMITTEE REPORTS AND COMMENTS
The Council may report on their activities as appointed representatives of the City on various Boards and Committees and/or may make comments of general interest or report on their activities as a representative of the City.
CITY MANAGER/CITY ATTORNEY/STAFF REPORTS
The City Manager, City Attorney or staff may make announcements or reports concerning items of interest to the Council and the public.
ADJOURNMENT
I, Erin Baum, Assistant City Clerk of the City of Hesperia, California do hereby certify that I caused to be posted the foregoing agenda on Thursday, November 2, 2023 at 5:30 p.m. pursuant to California Government Code §54954.2.
_____________________________
Erin Baum,
Assistant City Clerk
Documents produced by the City and distributed less than 72 hours prior to the meeting regarding items on the agenda will be made available in the City Clerk's Office during normal business hours.
City of Hesperia
City of Hesperia
Meeting Minutes - Draft
City Council
Tuesday, October 17, 2023 6:30 PM
REGULAR MEETING AGENDA
HESPERIA CITY COUNCIL
SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY
HESPERIA HOUSING AUTHORITY
HESPERIA COMMUNITY DEVELOPMENT COMMISSION
HESPERIA WATER DISTRICT
CLOSED SESSION - 5:00 PM
Roll Call
Present: 4 - Mayor Pro Tem Bird, Council Member Gregg, Mayor Bennington, and Council
Member Lee
Absent: 1 - Council Member Swanson
Conference with Legal Cou
nsel - Potential Litigation: Government Code Section 54956.9(d)2
1. One (1) Case
CALL TO ORDER - 6:30 PM
A. Invocation
B. Pledge of Allegiance to the Flag
C. Roll Call
Present: 4 - Mayor Pro Tem Bird, Council Member Gregg, Mayor Bennington, and Counc
il Member Lee
Absent: 1 - Council Member Swanson
D. A genda Revisions and Announcements by City Clerk
E.
Closed Session Reports by City Attorney
City Council Chambers
9700 Seventh Ave.
Hesperia CA, 92345
City of Hesperia
GENERAL PUBLIC COMMENTS (For items and matters not listed on the agenda) Dr. Cisneros spoke via phone message on community issues.
John Bartels spoke on speaking limits.
Gena Whelan spoke on animal issues.
Stephanie James spoke on animal issues.
Robert Davie spoke on animal issues.
JOINT CONSENT CALENDAR
A motion was made by Lee, seconded by Bird, that the Joint Consent Calendar be approved. The motion carried by the following vote:
Aye: 4 - Bird, Gregg, Bennington, and Lee
Nay: 0
Absent: 1 - Swanson
1. Consideration of the Draft Minutes from the Regular Meeting held Tuesday, October 3, 2023.
Recommended Action:
It is recommended that the City Council approve the Draft Minutes from the Regular Meeting held Tuesday, October 3, 2023.
Sponsors: Assistant City Clerk Erin Baum
2. Warrant Run Report (City - Successor Agency - Housing Authority - Community Development Commission -
Water)
Recommended Action:
It is recommended that the Council/Board ratify the warrant run and payroll report for the City, Successor Agency to the Hesperia Communit
y Redevelopment Agency, Hesperia Housing Authority, Community Development Commission, and Water District.
Sponsors: Assistant City Manager Casey Brooksher
3. Treasurer’s Cash Report for the unaudited period ended July 31, 2023.
Recommended Action:
It is recommended that the Council/Board accept the Treasurer’s Cash Report for the City, Successor Agency to the Hesperia Communit
y Redevelopment Agency, Hesperia Housing Authority, Community Development Commission, and Water District.
Sponsors: Assistant City Manager Casey Brooksher
NEW BUSINESS
4. Authorize Letter of Opposition to the Draft San Bernardino County Regional Conservation Investment Strategy
Recommended
Action:
It is recommended that the City Council authorize the City Manager, and/or designee, to issue a letter of
City of Hesperia
opposition to the County of San Bernardino and the San Bernardino County Transportation Authority (SBCTA) regarding the draft Regional Conservation Investment Strategy.
Sponsors: Director of Development Services Nathan Freeman Based on events that occurred after the printing of the agenda staff retracted their original recommendation and introduced the item as “receive and file”.
Dr. Cisneros spoke via phone message on this item.
A motion was made by Gregg, seconded by Lee, that this item be received and filed. The motion carried by the follow
ing vote:
Aye: 4 - Bird, Gregg, Bennington, and Lee
Nay: 0
Absent: 1 - Swanson
COUNCIL COMMITTEE REPORTS AND COMMENTS
The Mayor, Mayor Pro Tem, and Council Members reported from various events and Committees.
Council Member Gregg requested information regarding comments on a wolf incident and that staff add an item for discussion on possible ballot initiatives to a future agenda.
CITY MANAGER/CITY ATTORNEY/STAFF REPORTS
None.
ADJOURNMENT
The meeting was adjourned at 7:21 p.m.
_____________________________
Erin Baum,
Assistant City Clerk
THIS PAGE LEFT INTENTIONALLY BLANK
City of Hesperia
STAFF REPORT
DATE: November 7, 2023
TO: Mayor and Council Members
City Council, as Successor Agency to the Hesperia Community Redevelopment Agency
Chair and Commissioners, Hesperia Housing Authority
Chair and Commissioners, Community Development Commission Chair and Board Members, Hesperia Water District
FROM: Rachel Molina, City Manager
BY: Casey Brooksher, Assistant City Manager
Anne Duke, Deputy Finance Director
Shirley Domacio Calderon, Accountant
SUBJECT: Warrant Run Report (City – Successor Agency – Housing Authority – Community Development Commission – Water)
RECOMMENDED ACTION
It is recommended that the Council/Board ratify the warrant run and payroll report for the City, Successor Agency to the Hesperia Community Redevelopment Agency, Hesperia Housing Authority, Community Development Commission, and Water District.
BACKGROUND
The Warrant Run totals represented below are for th e period September 23, 2023 through October 6, 2023.
ATTACHMENT(S)
1. Warrant Runs
Agency/District Accounts Payable Payroll Wires Totals
City of Hesperia $5,027,751.33 $289,619.53 $0.00 $5,317,370.86 Successor Agency 248,531.50 0.00 0.00 248,531.50
Housing Authority 0.00 191.21 0.00 191.21
Community Development Commission 0.00 0.00 0.00 0.00
Water 553,807.76 118,489.55 0.00 672,297.31
Totals $5,830,090.59 $408,300.29 $0.00 $6,238,390.88
* Includes debt service payments made via Automated Clearing House (ACH) electronic deposit of funds.
YEAR-TO PRIOR FY YTD
W/E W/E WARRANT DATE DATE
FUND # FUND NAME 9/29/2023 10/6/2023 TOTALS Wires TOTALS * TOTALS Accounts Payable
100 GENERAL 1,877,214.10 $ 276,311.90 $ 2,153,526.00$ - $ 11,479,632.59$ 9,944,745.88$ 105 PENSION OBLIGATION TRUST -$ -$ -$ -$ -$ -$
106 OPEB TRUST -$ -$ -$ -$ -$ -$
200 HESPERIA FIRE DISTRICT -$ -$ -$ -$ -$ -$
204 MEASURE I - RENEWAL 97.11$ -$ 97.11$ - $ 405,842.73$ 173,443.94$ 207 LOCAL TRANSPORT-SB 325 -$ -$ -$ -$ 922,727.40$ 1,146.68$ 209 GAS TAX-RMRA -$ -$ -$ -$ -$ -$
210 HFPD (PERS) -$ -$ -$ -$ 907,316.00$ 1,093,204.87$ 251 CDBG -$ 24,249.56$ 24,249.56$ - $ 211,229.29$ 40,178.81$ 254 AB2766 - TRANSIT -$ -$ -$ -$ -$ -$
255 AB3229 SUPPLEMENTAL LAW -$ -$ -$ -$ -$ -$
256 ENVIRONMENTAL PROGRAMS GRANT -$ 1.50$ 1.50$ -$ 5,019.25$ 11,883.37$ 257 NEIGHBORHOOD STABILIZATION PROG -$ -$ -$ -$ -$ -$ 262
SB 1383 LOCAL ASSISTANCE GRANT -$ -$ -$ -$ -$ 5,000.00$ 263 STREETS MAINTENANCE 48,236.05$ 17,338.73$ 65,574.78$ - $ 802,134.36$ 758,857.51$ 300 DEV. IMPACT FEES - STREET -$ -$ -$ -$ 3,600.00$ 2,721.18$ 301 DEV. IMPACT FEES - STORM DRAIN -$ -$ -$ -$ -$ 17,460.50$ 302 DEV. IMPACT FEES - FIRE -$ -$ -$ -$ -$ -$
303 DEV. IMPACT FEES - POLICE -$ -$ -$ - $ -$ -$
304 DEV. IMPACT FEES - PUBLIC WKS. -$ -$ -$ -$ -$ -$ 306 DEV. IMPACT FEES - 2018-STREETS 297,585.82$ -$ 297,585.82$ - $ 1,050,601.98$ 1,812,868.67$ 312 DIF 2018-POLICE FACILITIES -$ -$ -$ -$ -$ -$
313 DIF A-04 DRAINAGE -$ -$ -$ -$ 317,748.35$ -$ 402 WATER RIGHTS ACQUISITION 1,105,238.08$ -$ 1,105,238.08$ - $ 1,105,238.08$ 1,090,323.17$ 403 2013 REFUNDING LEASE REV BONDS -$ -$ -$ -$ 568,901.39$ 655,055.62$ 504 CITY WIDE STREETS - CIP 938,157.37$ -$ 938,157.37$ - $ 3,230,902.12$ 3,566,844.49$ 509 CITY FACILITIES CIP -$ -$ -$ -$ -$ -$
800 EMPLOYEE BENEFITS 30,476.18$ 411,284.78$ 441,760.96$ - $ 2,714,334.30$ 2,839,785.97$ 801 TRUST/AGENCY -$ 1,560.15$ 1,560.15$ - $ 311,673.20$ 316,783.86$ 802 AD 91-1 AGENCY -$ -$ -$ -$ -$ -$
804 TRUST-INTEREST BEARING -$ -$ -$ -$ 97,818.90$ 26,625.00$ 806 SUMMIT VALLEY -$ -$ -$ -$ -$ -$
807 CFD 2005-1 -$ -$ -$ -$ 982,734.24$ 962,956.49$ 808 HFPD (TRANSITION) -$ -$ -$ - $ 347,796.19$ 317,384.59$ CITY 4,297,004.71$ 730,746.62$ 5,027,751.33$ - $ 25,465,250.37$ 23,637,270.60$ 163 REDEVELOP OBLIG RETIREMENT-2018 248,531.50$ -$ 248,531.50$ - $ 8,076,933.89$ 7,740,169.98$ 173 SUCCESSOR AGENCY ADMINISTRATION -$ -$ -$ -$ -$ -$ SUCCESSOR AGENCY 248,531.50$ -$ 248,531.50$ - $ 8,076,933.89$ 7,740,169.98$ 370 HOUSING AUTHORITY -$ -$ -$ -$ 4,122.44$ 4,419.77$ HOUSING AUTHORITY -$ -$ -$ - $ 4,122.44$ 4,419.77$ 170 COMMUNITY DEVELOPMENT COMMISSION -$ -$ -$ -$ -$ -$ COMMUNITY DEVELOPMENT COMMISSION -$ -$ -$ - $ -$ -$ 700 WATER OPERATING 119,525.03$ 414,288.10$ 533,813.13$ 3,818,965.78$ 2,458,042.22$ 701 WATER CAPITAL -$ -$ -$ -$ 298,109.99$ 8,087.00$ 710 SEWER OPERATING 6,277.18$ 13,589.63$ 19,866.81$ - $ 1,665,235.77$ 1,248,972.19$ 711 SEWER CAPITAL -$ -$ -$ -$ 525,100.10$ 148,179.21$ 713 SEWER CAPITAL REHAB AND REPLACE -$ -$ -$ -$ -$ -$ 720 RECLAIMED WATER OPERATIONS -$ 127.82$ 127.82$ - $ 10,777.38$ 5,141.65$ WATER 125,802.21$ 428,005.55$ 553,807.76$ - $ 6,318,189.02$ 3,868,422.27$ ACCOUNTS PAYABLE TOTAL 4,671,338.42$ 1,158,752.17$ 5,830,090.59$ - $ 39,864,495.72$ 35,250,282.62$ REG. PAYROLL
City 289,619.53$ -$ 289,619.53$ - $ 2,103,243.57$ 1,912,551.11$ Housing Authority 191.21$ -$ 191.21$ - $ 1,387.82$ 1,284.16$ Water 118,489.55$ -$ 118,489.55$ - $ 910,510.70$ 785,706.24$ PAYROLL TOTAL 408,300.29$ -$ 408,300.29$ - $ 3,015,142.09$ 2,699,541.51$ *No payments were issued on July 1, 2023.
City of Hesperia
WARRANT RUNS
9/23/2023-10/06/2023
Attachment 1
City of Hesperia
STAFF REPORT
DATE: November 7, 2023
TO: Mayor and Council Members
City Council, Serving as Successor Agency to the Hesperia Community Redevelopment Agency
Chair and Commissioners, Hesperia Housing Authority
Chair and Commissioners, Community Development Commission Chair and Board Members, Hesperia Water District
FROM: Rachel Molina, City Manager
BY: Casey Brooksher, Assistant City Manager
Anne Duke, Deputy Finance Director
Jacob Weatherbie, Accountant
SUBJECT: Treasurer’s Cash Report for the unaudited period ended August 31, 2023.
RECOMMENDED ACTION
It is recommended that the Council/Board accept the Treasurer’s Cash Report for the City, Successor Agency to the Hesperia Community Redevelopment Agency, Hesperia Housing Authority, Community Development Commission, and Water District.
BACKGROUND
This report is presented to the City Council pursuant to Government Code Section 53646 (b) setting forth the City’s investment portfolio.
ISSUES/ANALYSIS
The Treasurer’s Cash Reports are presented on the following pages for each agency.
FISCAL IMPACT
These reports reflect unaudited cash balances as of August 31, 2023.
ALTERNATIVE(S)
Provide alternative direction to staff.
ATTACHMENT(S)
1. City of Hesperia Investment Report
2. Successor Agency to the Hesperia Community Redevelopment Agency Investment Report
3. Hesperia Housing Authority Investment Report
4. Community Development Commission Investment Report
5. Hesperia Water District Investment Report
Staff Report to the Mayor and City Council/Board Members Treasurer’s Cash Report
November 7, 2023
Staff Report to the Mayor and City Council/Board Members Treasurer’s Cash Report
November 7, 2023
Staff Report to the Mayor and City Council/Board Members Treasurer’s Cash Report
November 7, 2023
Tvpe of Investment
Investments under the direction of the Cit
Institution/
Fiscal Agent
Interest
Rate
Local Agency Investment Funds State of Calif. 3.434%
Local Bank Checking Accounts U.S. Bank n/a
Total Unaudited Investments under the direction of the City Investments under the direction of fiscal agents·
2012 Lease Revenue Bonds US Bank 0.428%
2012 Lease Revenue Bonds US Bank 0.428%
2012 Lease Revenue Bonds US Bank 0.427%
2012 Lease Revenue Bonds US Bank 0.000%
2013 Refunding Lease Revenue Bonds US Bank 0.014%
2013 Refunding Lease Revenue Bonds US Bank 0.138%
2013 Refunding Lease Revenue Bonds US Bank 0.000%
2013 Refunding Lease Revenue Bonds Escrow US Bank 0.000% 2014 CFO 2005-1 Refundinci US Bank 0.429%
2014 CFO 2005-1 Refunding US Bank 0.427%
2014 CFO 2005-1 Refunding US Bank 0.427%
2014 CFO 2005-1 Refunding US Bank 0.427%
Deposits - Workers' Comp PERMA n/a
Sully Miller Retention - Ranchero US Bank 0.000%
City of Hesperia Stabalized Trust Chartes Schwab n/a
City of Hesperia OPEB Trust Chartes Schwab n/a
Hesperia Fire Protection PST Chartes Schwab nla
City of Hesperia Settlement Escrow Account US Bank 0.000% City of Hesperia
Investment Report
Unaudited
August 31, 2023
Date of Date of Par Value
Purchase Maturity at Maturity
31-Aug-23 Demand $ 93,844,336.19
31 -Aug-23 Demand 1,253,473.66
$ 95,097,809.85
31-Auci-23 Demand 473.73
31 -Auci-23 Demand 25.71
31-Aug-23 Demand 1,507,511 .06
31-Aug-23 Demand 0.31
31 -Aug-23 Demand 647.36
31-Aug-23 Demand 6,486.68
31 -Aug-23 Demand 0.31
31 -Aug-23 n/a 0.52
31-Auci-23 Demand 34,197.36
31-Aug-23 Demand 1,002,493.75
31-Aug-23 Demand 1,428,212.50
31 -Aug-23 Demand 24,916.54
31 -Aug-23 n/a 542,901.06
31 -Aug-23 n/a 1.08
31-Aug-23 n/a 3,446,898.97
31-Aug-23 n/a 608,308.02
31-Aug-23 n/a 1,216,206.28
31 -Aug-23 n/a 300,007.91
Book
Value
93,844,336.19
1,253,473.66
$ 95,097,809.85 $
473.73
25.71 1,507,511.06
0.31 647.36
6,486.68
0.31 0.52
34,197.36
1,002,493.75
1,428,212.50
24,916.54
542,901.06
1.08 3,446,898.97
608,308.02
1,216,206.28
300,007.91
Market
Value
93,844,336.19
1,253,473.66
95,097,809.85
473.73
25.71 1,507,511.06
0.31 647.36
6,486.68
0.31 0.52
34. 197.36
1,002,493.75
1,428,212.50
24,916.54
542,901.06
1.08 3,446,898.97
608,308.02
1,216,206.28
300,007.91
Account
Description
ATTACHMENT 1
2012 - Water Rights Revenue Fund
2012 - Water Rights Interest Fund
2012 - Water Rights Reserve Fund
2012 - Water Rights Surplus Revenue Fund
2005 Civic Plaza - Revenue Fund
2005 Civic Plaza - Reserve Fund
2005 Civic Plaza - Surplus Rev Fund
2013 Refunding Lease Revenue Bonds Escrow
2014 CFO 05-1 - Special Tax Fund
2014 CFO 05-1 - Bond Fund
2014 CFO 05-1 - Reserve Fund
2014 CFO 05-1 Administrative Expense Bonds
GL 1352
Ranchero Road - Escrow Account
City Pension
CityOPEB
Fire Pension
Settlement Escrow Account
Total Unaudited Investments under the direction of fiscal agents $ 10,119,289.1 5 $ 10,119,289.15 $ 10,1 19,289.15 Please Note: All market value data is provided courtesy of the City's fiscal agent, US Bank.
I certify that this investment portfolio is in compliance with the statement of investment policy of the City of Hesperia and the investment program provides sufficient liquidity to meet expenditure requirements for the next six months, as required by the California Government Code sections 53646(b)(2) and (3), respectively. • Note: 2005 Certificates of Participation began in May 2005 for the finacing of the Civic Plaza.
Y?trlle~ NichoJeSheppd,Senk)rA
Investment - City
Issuer/
Type of Investment Institution
Investments under the direction of the Cit :
Local Agency Investment Funds State of Calif.
Local Bank Checking Accounts U.S. Bank
Successor Agency to the Redevelopment Agency
Investment Report
Unaudited
August 31, 2023
Interest Date of Date of Par Value Book
Rate Purchase Maturity at Maturity Value
3.434% 31 -Aug-23 Demand $ 560,241 .06 $ 560,241 .06
n/a 31-Aug-23 Demand 7,483.11 7,483.11
Total Unaudited Investments under the direction of the City $ 567,724.17 $ 567,724.17 Investments under the direction of fiscal agents:
2018 Refunding Bonds US Bank 0.413% 31-Aug-23 Demand 12.63 12.63 2018 Refunding Bonds US Bank 0.427% 31-Aug-23 Demand 1,966,362.51 1,966,362.51 2018 Refunding Bonds US Bank 0.000% 31-Aug-23 Demand 5,865,000.00 5,865,000.00 2018 Refunding Bonds US Bank 0.000% 31-Aug-23 Demand 1.00 1.00 Market
Value
560,241 .06
7,483.11
$ 567,724.17
12.63 1,966,362.51
5,865,000.00
1.00 Total Unaudited Investments under the d1rect1on of fiscal agents $ 7,831,376.14 $ 7,831,376.14 $ 7,831,376.14 Please Note: All market value data is provided courtesy of the City's fiscal agent US Bank. The 2018 Refunding Bonds are supported by a $9,799,443.76 bond insurance policy.
ATTACHMENT 2
Account
Description
2018A & 2018B - Debt Service Account
2018A & 2018B - Interest Account
2018A & 2018B - Principal Account
2018A & 2018B - Reserve Account
I certify that this investment portfolio is in compliance with the statement of investment policy of the City of Hesperia and the investment program provides sufficient liquidity to meet expenditure requirements for the next six months, as required by the California Government Code sections 53646/b)/2) and /3), respectively. '12lelzo-te ~ J • • Note: The 2005 and 2007 Series Bonds were refinanced to 2018 Series Bonds in November 2018. Nichole~ Accountant Investment - SA
Type of Investment
Issuer/
Institution
Investments under the direction of the City:
Hesperia Housing Authority
Investment Report
Unaudited
August 31, 2023
Interest Date of Date of
Rate Purchase Maturity
Local A enc Investment Funds State of California 3.434% 31-Aug-23 Demand Local Bank Checking Accounts U.S. Bank n/a 31-Aug-23 Demand Total Unaudited Investments under the direction of the City $
$
Par Value
at Maturity
Book
Value
ATTACHMENT 3
Market
Value
5,834,258.60 5,834,258.60 5,834,258.60
77,927.87 77,927.87 77,927.87
5,912,186.47 $ 5,912,186.47 $ 5,912,186.47
I certify that this investment portfolio is in compliance with the statement of investment policy of the City of Hesperia and the investment program provides sufficient liquidity to meet expenditure requirements for the next six months, as required by the California Government Code secti9f!S 53646(b)(2) and (3), respectively.
Investment - HHA
Hesperia Community Development Comission
Investment Report
Unaudited
August 31, 2023
Issuer/
Institution
Interest
Rate
Date of Date of
Type of Investment Purchase Maturity
Investments under the direction of the City:
Local Agency Investment Funds State of California 3.434% 31 -Aug-23 Demand Local Bank Checking Accounts U.S. Bank n/a 31-Aug-23 Demand Total Unaudited Investments under the direction of the City Par Value
at Maturity
$ (592,755.10)
7,917.40
$ (600,672.50) $
I certify that this investment portfolio is in compliance with the statement of investment policy of the City of Hesperia and the investment program provides sufficient liquidity to meet expenditure requirements for the next six months, as required by the California Government Code sections 53646(b)(2) and (3), respectively.
ATTACHMENT 4
Book
Value
(592,755.10)
7,917.40
(600,672.50) $
Market
Value
592,755.10
7,917.40
(600,672.50)
Nichole Sheppard,eiorAccoun
Investment - CDC
Type of Investment
Investments under the direction of the Cit
Local Agenc Investment Funds
Local Bank Checkin Accounts
Issuer/
Institution
State of California
U.S. Bank
Hesperia Water District
Investment Report
Unaudited
August 31, 2023
Interest Date of Date of
Rate Purchase Maturity
3.434% 31-Au -23 Demand
n/a 31-Aug-23 Demand
Total Unaudited Investments under the direction of the City Investments under the direction of fiscal agents:
De osits - Workers' Com PERMA n/a 31-Oct-22 n/a
$
$
Total Unaudited Investments under the direction of fiscal agents $ Par Value
at Maturity
36,775,963.20
491,214.53
37,267,177.73
877,475.29
877,475.29
$
$
Please Note: All market value data is provided courtesy of the City's fiscal agent, US Bank.
I certify that this investment portfolio is in compliance with the statement of investment policy of the City of Hesperia and the investment program provides sufficient liquidity to meet expenditure requirements for the next six months, as required by the California Government Code sections 53646(b)(2) and (3), respectively.
Investment - ENT
Book
Value
36,775,963.20
491,214.53
37,267,177.73
877,475.29
877,475.29
$
$
ATTACHMENT 5
Market
Value
36,775,963.20
491,214.53
37,267,177.73
Account
Description
877,475.29 GL 1352
877,475.29
THIS PAGE LEFT INTENTIONALLY BLANK
City of Hesperia
STAFF REPORT
DATE: November 7, 2023
TO: Mayor and Council Members
FROM: Rachel Molina, City Manager
BY: Casey Brooksher, Assistant City Manager
Tammy Pelayes, Assistant to the City Manager
SUBJECT: Amend Agreement with Routeware DBA Recyclist
RECOMMENDED ACTION
It is recommended that the City Council authorize the City Manager to approve a two-year extension for the software services agreement with Routeware DBA Recyclist, in the amount of $56,780, for a not to exceed contract amount of $90,680.
BACKGROUND
On July 19, 2022, the City Council granted approval for the acceptance of $136,396 in grant funding from the California Department of Resources Recycling and Recovery (CalRecycle). This funding was designated for expenses associated with the enforcement of SB 1383 Organic Waste Reduction within the City, including software to assist the City in complying with re gulations related to recordkeeping and reporting.
City staff utilized the Recyclist software as a vital tool for monitoring and managing the SB 1383 mandates required by the state. Recyclist effectively tracks compliance among both Tier One and Tier Two generators situated across the City. Beyond mere tracking, Recyclist also keeps comprehensive records that align with Cal Recycle's stipulations, while also facilitating the generation of reports necessary for the City's annual Electronic Annual Report (EAR).
ISSUES/ANALYSIS
The Recyclist software is the cornerstone of the City’s SB 1383 record-keeping efforts, serving as the primary program that ensures the City remains in compliance with these critical regulations.
In addition, funds have since been reallocated by CalRecycle for the continued compliance monitoring through the conclusion of the initial grant cycle in March 2024. Because the City will remain obligated for SB 1383 compliance monitoring after the grant has ended, staff will continue to monitor for additional grant opportunities. As such, an amendment is requested for an additional two years for the continued compliance of SB 1383.
FISCAL IMPACT
This expense has been included in the Fiscal Year (FY) 2023-24 Operating Budget for the current year software, which was funded by the grant payment received from Cal Recycle. Additional funding will be requested in the FY 2024-25 Operating Budget.
Staff Report to the Mayor and Council Members
Amend Agreement with Routeware DBA Recyclist
November 7, 2023
ALTERNATIVE(S)
1. Provide alternative direction to staff
ATTACHMENT(S)
None
City of Hesperia
STAFF REPORT
DATE: November 7, 2023
TO: Mayor and Council Members
Chair and Board Members, Hesperia Housing Authority
Chair and Board Members, Hesperia Water District
FROM: Rachel Molina, City Manager
BY: Casey Brooksher, Assistant City Manager
Lorraine Carmona, Budget/Finance Specialist
SUBJECT: Fiscal Year 2022-23 Final Budget Amendments and Update to Accounting Policy
RECOMMENDED ACTION
It is recommended that the following resolutions be adopted, amending the respective Fiscal Year (FY) 2022-23 Budgets for the City of Hesperia , Hesperia Housing Authority, and the Hesperia Water District, along with an update to the Accounting Policy related to revenue recognition:
1) City of Hesperia No. 2023-64
2) Hesperia Housing Authority HHA 2023-12
3) Hesperia Water District Resolution HWD 2023-22
BACKGROUND
In compliance with the City Council’s policy direction, staff has reviewed expenditures through the end of FY 2022-23, and has determined that the City of Hesperia, Hesperia Housing Authority, and Hesperia Water District will require year-end budget adjustments.
ISSUES/ANALYSIS
The analysis of expenditures through the end of FY 2022-23 indicates that the following budget amendment requests should be considered:
Pension Obligation Trust (105)
Operating Transfer Out for Pension Obligation Trust – $600,000 At the May 16, 2023 Council meeting, the City Council approved allocating $4.0 million Section 115 Program between a City Pension Section 115 Trust ($3.4 million) and an Other Post Employment Benefits (OPEB) Trust ($0.6 million), in order to address both the City’s pension and Other Post Employment Benefit (OPEB) obligations. As such, $600,000 was transferred from Fund 105 – Pension Obligation Trust to establish new Fund 106 – OPEB Trust, so that the financial activity of the trust funds can be accounted for separately. This budget amendment provides the budget authority to move the funds needed to establish the new Fund 106.
Local Transport-SB 325 (207)
2023 Emergency Storm Repairs – $721,945
On February 25 and 26, 2023 a large storm passed through Hesperia with heavy rain and snow fall causing significant flooding throughout the City. From the significant flooding on
Staff Report to the Mayor and Boards of the Hesperia Housing Authority and Hesperia Water District Final Budget Amendments for Fiscal Year (FY) 2022-23
November 7, 2023
the roadways, the roads incurred major damage, which included an undermined road, excessive potholes in low flow areas , flowline damage, and asphalt ber m damage. On February 28, 2023, the City Manager declared a local emergency caused by the winter storm event. The local emergency was confirmed and ratified by the City Council at the March 7, 2023 City Council meeting, and the contract for needed repairs was affirmed at the June 6, 2023 City Council meeting. Staff identified thirteen (13) areas where emergency road repairs were needed and those repairs have been completed. Recently, City staff submitted a request for reimbursement to the Federal Emergency Management Agency (FEMA) and is currently under review by FEMA.
Development Impact Fee (DIF)–Streets (300)
Land Held for Resale – $2,644,000
During FY 2022-23, two parcels of DIF land were sold for a combination of $4,500,000 cash and a $2,644,000 promissory note that is to be paid upon completion of a sewer capital improvement project which is an ticipated to be operational by December 2024. Because collection on the promissory note is scheduled to occur in a subsequent year, a loss will be incurred for FY 2022-23, with subsequent revenue to be recorded upon completion of the project and collection on the promissory note. The FY 2022-23 loss has caused the fund to exceed the appropriation authority.
Development Impact Fee–Public Services (304)
DIF Public Services 304 to DIF City Hall Facilities 309 Transition – $16,716 In May 2018, the City Council approved a D evelopment Impact Fee (DIF) Study and rate structure for new development, which took effect in July 2018. As such, DIF 2018 City Hall Facilities Fund 309 was created to account for the new development under the 2018 rates.
Existing projects that were in various stages of construction were able to continue under the previous DIF 304. Therefore, the income from operations under DIF 304 need s to be transitioned to the new DIF 309.
DIF 2018 – City Hall Facilities (309)
Interest Expense – $12,135
The DIF-Public Services/City Hall Facilities Loan from the General Fund accrues interest at the Local Agency Investment Fund (LAIF) rate. The interest expense incurred in FY 2022-23 exceeded the budgeted amount by $ 12,135 due to several rate increases by the Federal Reserve which, in turn, resulted in increased quarterly LAIF rates. A budget amendment of $12,135 is requested to cover the additional interest expense.
Hesperia Housing Authority (HHA) (370)
Land Held for Resale – $77,928
During FY 2022-23 one HHA property was in the process of being sold less than the original cost to purchase the property, which resulted in the need to reduce the carrying value of the property to the lower of cost or market value. This recognized loss then caused the fund to exceed the appropriation authority.
Reclaimed Water Operations (720)
Recycled Water – $15,581
The City purchases recycled water from Victor Valley Wastewater Reclamation Authority (VVWRA), where it is stored within a reservoir , and purveyed to customers for irrigation, soils compaction, and dust control . An estimate was made in the FY 2022 -23 Budget for
Staff Report to the Mayor and Boards of the Hesperia Housing Authority and Hesperia Water District Final Budget Amendments for Fiscal Year (FY) 2022-23
November 7, 2023
the purchase of recycled water. Approval is requested for the actual cost of recycled water in excess of the budget estimate.
City Engineering Services
Consistent with Joint Resolution 2018 -06, budgeted funding for the City’s engineering services contract with TKE Engineering was identified in the FY 2022-23 Operating Budget in the amount of $602,000, and FY 202 2-23 engineering expenditures for operating purposes were within the operating budget, at $283,072. While the overall FY 2022-23 Capital Improvement Program (CIP) Budget was sufficient to fund capital project expenditures, contract engineering costs were not specifically identified in the CIP Budget. As such, notification is provided that TKE Engineering services in the amount of $803,818 were incurred during FY 2022-23 related to CIP projects and for services provided through trust fu nding. As sufficient bu dget exists within the respective funding sources for the City’s CIP projects during FY 202 2-23, a budget amendment related to engineering services is not needed.
Accounting Policy – Recommended Adjustment to Revenue Availability Period for Intergovernmental Revenue
Revenues of the City are recognized as soon as they are both measureable and available.
Revenues are considered to be available when they are collectable within the current period or soon enough thereafter to pay liabilities of t he current period. The City currently considers revenues to be available if they are collected within 60 days of the end of the current fiscal period, such as June 30th.
However, because it takes time for certain intergovernmental agencies, such as San Bernardino County Transportation Authority (SBCTA), to process the final revenue allocation for fiscal year end, the City has received the revenue just outside of the 60 day period referenced in the policy.
As this allocation reflects June activity, and i t is received and available to pay for obligations in the new period, an adjustment to the policy is recommended for revenues that are received from intergovernmental entities in order to accommodate for this slight delay. The recommended change is identified below in red:
Revenues are recognized as soon as they are both measureable and available.
Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. The City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period, or 90 days for intergovernmental revenues.
Making this change will accommodate for processing delays from other governmental entit ies in remitting revenue to the City.
FISCAL IMPACT
The proposed Final Fiscal Year 2022-23 Budget Amendments will be funded from a combination of revenues received, operating transfers, and the use of reserves.
ALTERNATIVES
Provide alternative direction to staff.
ATTACHMENTS
1. Resolution No. 2023-64
2. Resolution HHA 2023-12
3. Resolution HWD 2023-22
RESOLUTION NO. 2023-64
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HESPERIA, CALIFORNIA, AMENDING THE FISCAL YEAR 2022-23 CITY OF HESPERIA
BUDGET TO FUND CERTAIN RELATED EXPENDITURES
WHEREAS, the City Council of the City of Hesperia adopted the Fiscal Year (FY) 2022-23 Budget on June 7, 2022; and
WHEREAS, the City Council of the City of Hesperia has authorized various amendments to the FY 2022-23 Budget throughout the year; and
WHEREAS, the City Council of the City of Hesperia has reviewed the pr oposed FY 2022-23 final budget amendments information and analysis and has found it acceptable.
NOW THEREFORE, BE IT RESOLVED BY THE CITY OF HESPERIA CITY COUNCIL AS FOLLOWS:
Section 1. That the recitals above are true and correct and adopted as findings.
Section 2. That the City Council of the City of Hesperia approves the FY 2022-23 final budget amendments.
Section 3. That the City Council of the City of Hesperia approves the budget amendments with the following expenditure appropriations from the funds noted below:
Section 4. That the City Council of the City of Hesperia approves an adjustment to the Accounting Policy on Revenue Availability below:
The City considers revenues to be available if they are collected within 60 days of the end of the current period, or 90 days for intergovernmental revenues.
Section 5. The City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original resolutions.
Pension Obligation Trust (105) – Operating Transfer Out to Fund 106 OPEB Trust
$ 600,000
Local Transport -SB 325 (207) – 2023 Emergency Storm
Repairs
721,945
Development Impact Fee (DIF) -Streets (300) – Land Held for Resale
2,644,000
Development Impact Fee (DIF)-Public Services (304) – Fund 304 to Fund 309 Transition
16,716
DIF 2018-City Hall Facilities (309) – Interest Expense 12,135 Total $3,994,796
Resolution No. 2023-64
ADOPTED AND APPROVED this 7th day of November 2023.
___________________________________
Brigit Bennington, Mayor
ATTEST:
___________________________________
Erin Baum, Assistant City Clerk
RESOLUTION HHA 2023-12
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE HESPERIA
HOUSING AUTHORITY, CITY OF HESPERIA, CALIFORNIA, AMENDING THE FISCAL YEAR 2022-23 BUDGET TO FUND CERTAIN RELATED
EXPENDITURES
WHEREAS, the Board of Directors of the Hesperia Housing Authority (HHA) adopted the Fiscal Year (FY) 2022-23 Budget on June 7, 2022; and
WHEREAS, the Hesperia Housing Authority Board has authorized various amendments to the FY 2022-23 Budget throughout the year; and
WHEREAS, the Hesperia Housing Authority Board has reviewed the proposed FY 2022-23 final budget amendment information and analysis and have found it acceptable.
NOW THEREFORE, BE IT RESOLVED BY THE HESPERIA HOUSING AUTHORITY OF THE CITY OF HESPERIA AS FOLLOWS:
Section 1. That the recitals above are true and correct and adopted as findings.
Section 2. That the Board of Directors of the Hesperia Housing Authority approve the FY 2022-23 final budget amendments.
Section 3. That the Board of Directors approve the budget amendment with the following expenditure appropriations from the fund noted below:
Hesperia Housing Authority (370) – Land Held for Resale $77,928
Section 4. That the Secretary of the Housing Authority shall certify to the passage and adoption of this Resolution and enter it into the book of original resolutions.
ADOPTED AND APPROVED this 7th day of November 2023.
_________________________________________
Brigit Bennington, Chair
ATTEST:
_______________________________
Erin Baum, Secretary to the Board
RESOLUTION NO. HWD 2023-22
A RESOLUTION OF THE HESPERIA WATER DISTRICT OF THE CITY OF HESPERIA, CALIFORNIA, AMENDING THE FISCAL YEAR 2022-23
HESPERIA WATER DISTRICT BUDGET TO FUND CERTAIN RELATED
EXPENDITURES
WHEREAS, the Board of Directors of the Hesper ia Water District adopted the Fiscal Year (FY) 2022-23 Budget on June 7, 2022; and
WHEREAS, the Board of Directors of the Hesperia Water District has authorized various amendments to the FY 2022-23 Budget throughout the year; and
WHEREAS, the Board of D irectors of the Hesperia Water District has reviewed the proposed FY 2022-23 final budget amendment information and analysis and have found it acceptable.
NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS O F THE HESPERIA WATER DISTRICT AS FOLLOWS:
Section 1. That the recitals above are true and correct and adopted as findings.
Section 2. That the Board of Directors of the Hesperia Water District approve the FY 2022-23 final budget amendments.
Section 3. That the Board of Directors approve the budget amendment with the following expenditure appropriations from the fund noted below:
Reclaimed Water Operations (720) – Recycled Water $15,581
Section 4. That the Board Secretary shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.
ADOPTED AND APPROVED this 7th day of November 2023.
_________________________________________
Brigit Bennington, Chair
ATTEST:
_______________________________
Erin Baum, Secretary to the Board
THIS PAGE LEFT INTENTIONALLY BLANK
City of Hesperia
STAFF REPORT
DATE: November 7, 2023
TO: Mayor and Council Members
FROM: Rachel Molina, City Manager
BY: Casey Brooksher, Assistant City Manager
SUBJECT: Discussion on Alternative Funding Sources
RECOMMENDED ACTION
It is recommended that the City Council r eceive and file this staff report, which provides information about potential funding sources to address the needs of the community, and provide direction to staff.
BACKGROUND
During the October 17, 2023, City Council Meeting, Council Member Gregg requested for staff to bring forth a report to discuss revenue enhancements that would require a vote of the residents during the November 2024 elections ; such revenue enhancements are tax measures . The following is the staff report originally presented to the City Council at the September 19, 2023 City Council Meeting for the purpose of discussing potential revenue measu res to improve public infrastructure and public safety, per the request of Mayor Pro Tem Bird . This report discusses several different tax measures and their respective potential revenue impacts. As shown, the most impactful revenue enhancement, should it be approved by the voters, is an increase to sales tax; whereas, the least impactful is an increase to the transient occupancy tax rate, from a revenue generation standpoint.
In general, the City primarily receives General Fund revenue from two main sources: Charges for Services and Taxes. Charges for Services, such as building permits, are assessed to cover the City’s costs for providing a service. In the case of building permits, the City assess a fee to cover the cost of reviewing project design submittals to ensure compliance with building codes and for providing inspections.
General Fund tax revenue is primarily comprised of four sources:
Sales Tax is the largest General Fund revenue. The sales tax rate in the City is 7.75% on all taxable goods sold within City limits. The following is a breakdown of the sales tax rate: 6%-State of California, 1% -Local (Hesperia), 0.25% -Local Transportation (State assessed), and 0.50% - Countywide Measure I (transportation/road).
Property Taxes are governed by the 1978 voter approved Proposition 13. This dictates that the maximum amount of any ad valorem tax on real property shall not exceed one percent (1%) of the assessed value. The City of Hesperia receives approximately 1.59% of the 1% ad valorem.
For this tax type to grow, continued development must occur in the City. For every $100 million
Staff Report to the Mayor and Council Members
Discussion on Alternative Funding Sources
November 7, 2023
growth of assessed valuation, the City would see a net annual property tax revenue growth of $15,900 ($100 million assessed valuation x 1% ad valorem tax x 1.59% Hesperia share).
Vehicle License Fee revenue is based on the growth of the City’s assessed valuation. This annual amount is determined and remitted by the State.
Transient Occupancy Tax is a 10% room tax assessed by the local hotel/motel establishments for stays under 30 days (short-term rentals).
In total, taxes of all types comprise 65% of the General Fund revenue budget, which is detailed in the following table and chart:
ISSUES/ANALYSIS
Should the City Council consider potential tax increases as an option to increase funding for government services, such as roadway enhancements and law enforcement, there are several options that may be considered.
Taxing Options
1. Sales Tax
Sales tax is assessed when tangible goods are sold within the City limits. The tax is collected from any person making a purchase, regardless of whether or not the person is a resident of the City.
By a vote of the residents, the one p ercent (1%) local share can be increased. A determination would need to be made as to whether the sales tax increase would be a general or special tax. A general tax generates revenues that can be used for any purpose determined by the City Council and requires a simple majority vote (50% + 1). A special tax must be spent on uses specified in the ballot measure and requires a 2/3 (66.6%) vote.
Additionally, should a sales tax increase be explored, a decision could be made to have a citywide increased tax rate or a targeted tax rate. For example, a targeted tax rate that could be applied to certain areas in corridors such as the freeway and Bear Valley Road.
Data from the California Department of Tax and Fee Administration indicates that there are 1,788 different jurisdictions, which includes cities, towns, and unincorporated areas that receive sales taxes. The following details the statistics of sales tax rates:
22% or 384 jurisdictions have the state minimum rate of 7.25% Total Tax
Related
65%
All Other
General Fund
35%
General Fund Revenue
FY 2023-24
Budget Percent
Sales Taxes 14,439,963$ 29%
Vehicle License Fee 11,565,002 24%
Combined Property Taxes 2,403,498 5%
Transient Occupancy Tax 1,700,000 4%
Other Taxes 729,185 2%
Total Tax Related 30,837,648 65%
All Other General Fund 16,629,143 35%
Total General Fund Revenue 47,466,791$ 100%
Staff Report to the Mayor and Council Members
Discussion on Alternative Funding Sources
November 7, 2023
35% or 641 jurisdictions have a rate exceeding the minimum rate , but less than 8%
43% or 763 jurisdictions have rates exceeding 8%
Locally within San Bernardino County, 15 cities and towns have the County minimum rate of 7.75%. The following cities* have a sales tax rate of 8.75%, which increased the local share from 1% to 2%: Barstow, Colton, Ontario, Re dlands, San Bernardino, Victorville, and Yucca Valley. The City of Montclair has a sales tax rate of 9.00%. *Source: California Department of Tax and Fee Administration (CDTFA)
The following tables show the potential revenue increase that could be achieved, should the voters approve a sales tax increase. The first table details the impacts of a citywide sales tax increase of 1% and 0.5%, which would bring the total sales tax rate to 8.75% (equal to the City of Victorville ) and 8.25%, respectively. The second table reflects the projected outcome from a targeted sales tax of the same rates, at the freeway and Bear Valley Road corridors.
2. Utility User Tax
The voters could elect to raise revenue through a Utility User Tax ballot initiative which is placed on water/sewer bills. The voting requirements are the same as a sales tax; with a general tax requiring a simple majority vote (50% + 1) and a special tax (spent on uses specified purpose) requiring a 2/3 (66.6%) vote.
For every one percent (1%) of utility user tax, the G eneral Fund could potentially yield approximately $300,000. The following table demonstrates the potential increase should a utility user tax be levied.
1% Increase 0.5% Increase
Total Rate 8.75% Total Rate 8.25%
Annual Point of Sale Tax 12,900,000$ 12,900,000$
Increase of Sales Taxes 12,900,000 6,450,000
Total Sales Tax 25,800,000$ 19,350,000$
1% Increase 0.5% Increase
Total Rate 8.75% Total Rate 8.25%
Annual Point of Sale Tax 12,900,000$ 12,900,000$
Increase of Targeted Sales Taxes 6,100,000 3,050,000 Total Sales Tax 19,000,000$ 15,950,000$
Citywide Sales Tax Increase
Targeted Sales Tax Increase. - Freeway and Bear Valley Corridor 1% 5% 10%
Water Sales Revenue 24,759,387$ 24,759,387$ 24,759,387$ Potential Utility Tax 248,000 1,238,000 2,476,000 Sewer Sales 5,595,626$ 5,595,626$ 5,595,626$
Potential Utility Tax 56,000 280,000 560,000 Total Potential Utility Tax
(General Fund Increase)
304,000$ 1,518,000$ 3,036,000$
Potential Tax Increase
Staff Report to the Mayor and Council Members
Discussion on Alternative Funding Sources
November 7, 2023
As mentioned, a utility user tax is assessed to the rate payers, whereas a sale s tax is assessed to anyone making a purchase of tangible goods. This means that such a tax would be spread amongst the 28,000 accounts within the Water District. The following demonstrates the potential impact to the average rate payer bill for water only, along with water and sewer combined:
3. Transient Occupancy Tax (TOT)
TOT is only paid by individuals staying in the various motels and hotels within the City. As with sales and utility user tax, a voter approved ballot measure would need to be approved to increase the transient occupancy tax (TOT). In California, the average TOT rate ranges from 10% to 12%. Currently, the Hesperia rate is 10%, which yields approximately $1. 7 million annually of General Fund revenue. Should the voters approve an increase, the General Fund would gain approximate $170,000 for each additional percentage increase.
For example, should the rate be increased to 11%, the General Fund revenue could potentially increase from $1. 7 million to approximately $1.9 million; furthermore, a 12% TOT tax rate would increase General Fund revenue by $340,000 to $2.04 million.
Should consideration be given to increasing taxes, it is recommended that the City engage an outreach consultant. A consultant can assist with engaging the community on the potential increases ahead of the November 2024 election. This engagement will inform the community on the City’s existing budget and revenue as well as it will gather community input on priorities of the residents and help to gauge whether there is community support for a revenue measure. Through the community outreach, a determination can be made on the following key issues:
Type of Tax
If a tax will be considered, a decision will need to be made on the type of tax (sales tax, utility user tax, or transient occupancy tax). Additionally, a determination will need to be made regarding the ballot measure’s indication of a general or special tax. o General tax can be used for any purpose determined by the Council and requires a majority (50% + 1) vote.
o Special tax must be spent on uses specified in the ballot measure and requires a 2/3 (66.6%) vote.
Amount of Increase
As demonstrated, there are potential options to the amount of tax. Through the outreach / community engagement process, the City is able receive information on citizen support of the amount (percentage) of taxes to be potentially levied. The following is a recap of identified potential tax increases:
1% 5% 10%
Average Bi-MonthlyWater Bill 110.00 $ 110.00 $ 110.00 $ Potential Utility Tax 1.10 5.50 11.00
Total Average Bi-monthly Water Bill 111.10 115.50 121.00 1% 5% 10%
Average Bi-MonthlyWater & Sewer Bill 173.00 $ 173.00 $ 173.00 $ Potential Utility Tax 1.73 8.65 17.30
Total Average Bi-monthly Water & Sewer Bill 174.73 181.65 190.30 Potential Tax Increase
Potential Tax Increase
Staff Report to the Mayor and Council Members
Discussion on Alternative Funding Sources
November 7, 2023
o Sales Taxes – Annual Increased Revenue
1% Citywide - $12,900,000
0.5% Citywide - $6,450,000
1% Freeway & Bear Valley Corridor - $6,100,000
0.5% Freeway & Bear Valley Corridor - $3,050,000
o Utility User Tax – Approximately $300,000 in revenue for every 1% levied o Transient Occupancy Tax - Approximately $170,000 revenue for every 1% levied Note – Hesperia current rate is 10% and state average is in between 10% and 12%.
Based upon the information presented above, t o help meet important community needs, staff is seeking directi on from the City Council on whether to move forward with a public outreach consultant to proceed with community engagement on potential tax increases. Staff would then report back to the City Council the results of the public engagement. At that time, the City Council may elect to place an initiative on the November 2024 ballot.
FISCAL IMPACT
Should the City Council choose to proceed with a public engagement consultant, the City will seek qualified/experienced consultants. It is estima ted that such a consultant could cost between $50,000 to $100,000 depending on the number of outreach meetings, as wells as the detail of the public outreach.
Following the City’s purchasing ordinance, if costs exceed $50,000, a staff report will be presented to the City Council for approval. Furthermore, as this was not included in the F iscal Year 2023-24 Operating Budget, a budget amendment would be presented to the City Council during the quarterly budget review.
ALTERNATIVE(S)
1. Provide alternative direction to staff.
ATTACHMENT(S)
None