City Council Agenda Report
September 16, 2025
TO: Honorable City Council
FROM: Jesus M. Gomez, City Manager
BY: Alex Hamilton, Interim Director of Community Development SUBJECT: RESOLUTION NO. 25-44 - APPROVING THE INFRASTRUCTURE FINANCING
PLAN FOR THE NORWALK ENHANCED INFRASTRUCTURE FINANCING
DISTRICT AND THE ALLOCATION OF PROPERTY TAX INCREMENT WITHIN
THE NORWALK ENHANCED INFRASTRUCTURE FINANCING DISTRICT
Background:
As a result of the elimination of redevelopment agencies in California, the City lost a tax increment financing (TIF) tool to invest in public facilities supporting the development of communities. In 2014, Senate Bill 628 created a new tax increment financing tool called the Enhanced Infrastructure Financing District (EIFD). The original legislation has been amended to modify the EIFD formation procedural requirements and requirements to issue bonds to finance infrastructure.
Statement of Facts
EIFDs aid cities in funding public facilities and other public investments to foster future development and increase property values. By capturing tax increment revenue generated within the district as new development occurs and property values increase over time, like a redevelopment project area, a portion of tax increment revenue is redirected from the taxing entity to the EIFD. Importantly, the establishment of EIFDs does not increase property taxes or any other taxes for landowners within or outside the EIFD boundaries.
The following chart illustrates how tax TIF captures that new revenue from new development into the EIFD (note these dollars are for illustrative purposes only):
City Council September 16, 2025
EIFD Resolution No. 25-44 Approving the IFP Page No. 2
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On September 2, 2025, the PFA received a presentation of the Infrastructure Financing Plan (IFP), taking no action at that time. Following that public meeting, the PFA must hold two public hearings before considering the approval of the IFP. The public hearings are tentatively scheduled for October 7, 2025, and November 18, 2025, for which there will be additional required newspaper, mail, and website notices.
Analysis
The current IFP is included in the Resolution as Exhibit A. It contains all items required by California Government Code Section 53398.63. A summary of the key requirements contained in the IFP is provided below.
1.EIFD Map and Legal Description. The proposed EIFD boundaries are focused on specific economic development opportunity sites, such as the Transit Village, Entertainment Village, and other properties with potential for new development or rehabilitation. The land included in these boundaries totals approximately 201 acres (approx. 2.7% of the City).
2.Public Facilities and Development Proposed within the EIFD. The public capital facilities proposed to be financed through the EIFD include:
Affordable housing is high priority near-term (e.g., CYA Property) Roadway and utility capacity enhancements (e.g., Front Street Utility and Streetscape Improvements)
Parks and open space (e.g., Tank Farm Park)
Transit connectivity
3.Use of Incremental Tax Revenue. The EIFD will use incremental property tax revenue to finance public facilities and maintenance of those public facilities, and administration of the EIFD. The City would allocate a maximum of 50% of its future share of future property
City Council September 16, 2025
EIFD Resolution No. 25-44 Approving the IFP Page No. 3
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City Council September 16, 2025
EIFD Resolution No. 25-44 Approving the IFP Page No. 3
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tax increment within the EIFD, and the County would match the City’s allocation dollar- for-dollar. Based on projected growth of assessed value, total EIFD funding capacity is estimated at approximately $70 million on a present-value basis.
4.Necessity and Goals of the EIFD: The formation of the EIFD is necessary to assist in the financing of the construction of the targeted public facilities that serve the EIFD boundary and surrounding community while providing significant communitywide benefits. These public facilities will catalyze private sector investment and development to support the City's General Plan and provide the infrastructure foundation for the development of critically needed housing in the community and greater region.
5.Economic and Fiscal Impacts: Establishing the EIFD is a necessary step towards the successful development of the public facilities and other projects of communitywide significance, which will generate significant economic benefits to the City, County, and other taxing entities. Fiscal impact analysis prepared by Kosmont Companies as Appendix D to the IFP estimates that EIFD activity would generate approximately $26 million in net positive general fund revenues on present value basis for the City.
Additionally, the Analysis highlights the job opportunities generated by the EIFD, including approximately 12,700 direct, indirect, and induced temporary constructed-related jobs and over 480 permanent ongoing jobs in the City and County.
Next Steps
The County Board of Supervisors must approve the IFP, and the PFA must hold two public hearings before final approval of the IFP. These public meetings and hearings are scheduled to occur in October and November. If the IFP is modified after City Council action this evening, the modified IFP would be required to return to the City Council for approval prior to EIFD formation.
The PFA may adopt the IFP at the second public hearing to form the EIFD. A summary of the key actions for establishing the EIFD, as well as estimated dates of completion, is as follows:
Task Target Date Notes
PFA holds Public Hearing
#1
October 7, 2025 Additional comments taken; PFA takes
action to approve, modify, or reject IFP
PFA holds Public Hearing
#2 and Protest Proceeding
November 18, 2025 If majority protest exists – takes action to terminate EIFD. If no majority protest,
PFA can propose adoption of the IFP
and formation of the EIFD
Staff files EIFD with State
Board of Equalization
(BOE)
November 2025
City Council September 16, 2025
EIFD Resolution No. 25-44 Approving the IFP Page No. 4
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City Council September 16, 2025
EIFD Resolution No. 25-44 Approving the IFP Page No. 4
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In the event of a majority protest by property owners or residents within the boundaries, the formation proceedings would be discontinued.
California Environmental Quality Act Review
The City Council’s adoption of the Resolution approving the EIFD IFP is exempt from the California Environmental Quality Act (CEQA) as they are actions solely related to the creation of a government funding mechanism and the administrative or organizational activities of the City. Therefore, this action does not constitute a “project” pursuant to CEQA Guidelines Sections 15378(b)(4) and 15378(b)(5). This action could not result in a physical change in the environment because the City has not committed itself to any specific project(s) that could be funded by the EIFD. As a separate and independent ground, this action is exempt from the requirements of CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines, because it can be seen with certainty that there is no possibility that they will have a significant effect on the environment. However, future actions (such as the approval of infrastructure improvements using funding from the EIFD) will be subject to environmental review in accordance with CEQA.
Fiscal Impact:
There is no immediate fiscal impact for establishing the Norwalk EIFD. If ultimately established, the EIFD would create the opportunity to use tax increment financing to fund targeted infrastructure investments in the City. If the EIFD is formed, future budget actions will be required to budget the allocation of incremental tax revenues to the EIFD.
Citizens Advised:
N/A
Strategic Plan 2023 Implementation:
The EIFD is a tool to invest in public facilities supporting the development of communities, which would contribute to Objective 4 – maintain the City’s financial resiliency.
Recommended Action:
Staff recommend City Council adopt Resolution No. 25-44, A RESOLUTION OF THE CITY
COUNCIL APPROVING THE INFRASTRUCTURE FINANCING PLAN FOR THE NORWALK
ENHANCED INFRASTRUCTURE FINANCING DISTRICT AND THE ALLOCATION OF THE CITY’S INCREMENTAL PROPERTY TAX REVENUE WITHIN THE NORWALK ENHANCED
INFRASTRUCTURE FINANCING DISTRICT PURSUANT TO GOVERNMENT CODE SECTIONS 53398.68 and 53398.75.
Attachments:
Resolution No. 25-44