Mayor’s/Council Summer Recess
August 20, 2024
AGENDA REPORT
TO: Jestin D. Johnson FROM: Erin Roseman
City Administrator Director of Finance
SUBJECT: Fiscal Year 2024-25 Tax Levy For
Voter Approved Indebtedness
DATE: August 1, 2024
City Administrator Approval Date:
RECOMMENDATION
Staff Recommends That The City Council Adopt A Resolution Fixing The Rate Of Property Tax And Levying A Tax On Real And Personal Property In The City Of Oakland For Fiscal Year 2024-25 For Voter-Approved Indebtedness.
EXECUTIVE SUMMARY
Adoption of the proposed resolution will permit the City of Oakland (the “City”) to collect the Fiscal Year 2024-25 (“FY24-25”) property tax revenues for the payment of the City’s voter approved outstanding general obligation (“GO”) bonds debt service and Police and Fire Retirement System (“PFRS”) obligations. The City must annually set property tax levy rates, based on the assessed valuation subject to taxation, and must inform the County of Alameda (the “County”) of these rates by August 31st for inclusion on the stated year’s property tax bill. If the estimated GO bond rates need to be adjusted to reflect the actual figures for the assessed valuation, the City Administrator or his designee will be authorized to make the necessary adjustments.
This resolution is submitted during the Summer Recess in order to calculate the property tax levy rates using FY24-25’s assessed valuation figures, which become available in early August, and meet the County’s August 31st deadline for submitting these rates for inclusion on this year’s property tax bill.
BACKGROUND / LEGISLATIVE HISTORY
The proposed resolution has been prepared pursuant to California Government Code and Article VIII, Section 802, of the Oakland City Charter, setting the FY24-25 property tax rate for voter- approved indebtedness. Article XIIIA of the California Constitution (Proposition 13) precludes the adoption of a City-wide property tax rate. A County-wide one percent (1%) property tax rate is assessed by Alameda County and apportioned to cities and special districts in accordance with State law.
Attachment B
Jestin D. Johnson, City AdministratorSubject: Fiscal Year 2024-25 Tax Levy For Voter Approved Indebtedness Date: August 1, 2024 Page 2 Mayor’s/Council Summer RecessAugust 20, 2024
ANALYSIS AND POLICY ALTERNATIVESThe Citywide priority advanced by this recommended policy action meets the goal of a responsive, trustworthy government. For the City’s outstanding GO bonds, the required property tax levy rates are calculated annually based on the year’s debt service obligations and assessed valuation figures. For FY2024-25, the property tax levy rate required to fund the City’s continuing indebtedness to PFRS is 0.0705%. For the City’s FY2024-25 voter-approved indebtedness, the rates in Table 1 are estimated to satisfy the debt service obligations of the indicated GO bond series and indebtedness to PFRS. Table 1: Property Tax Rates Bond Issue Property Tax Rates$128,895,000 General ObligationRefundingBonds, Series2015A0.0065%$26,500,000 General Obligation Bonds, Series 2017C (Measure DD) 0.0016%$62,735,000 General Obligation Bonds, Series 2017A-1 (Measure KK) 0.0023%$55,120,000 General Obligation Bonds, Series 2017A-2 (Measure KK) 0.0044%$140,010,000 General Obligation Bonds, Series 2020B-1 (Measure KK) 0.0041%$44,880,000 General Obligation Bonds, Series 2020B-2 (Measure KK) 0.0048%$64,260,000 General Obligation Refunding Bonds, Series 2020 0.0087%$198,645,000 General Obligation Bonds, Series 2022C-1 (Measure KK) 0.0097%$32,760,000 General Obligation Bonds, Series 2023A-1 (Measure U) 0.0000%$68,370,000 General Obligation Bonds, Series 2023A-2 (Measure U) 0.0019%$52,580,000 General Obligation Bonds, Series2023D (MeasureKK) 0.0000%Police andFireRetirementSystemobligations0.0705%Total LevyRate0.11450%In the event of any changes to the County’s assessed valuation data, the proposed resolution allows the City Administrator or his designee to approve any necessary adjustments in the property tax levy rates for the indicated general obligation bonds prior to the County’s preparation of the tax bills. The City Council will be notified of any significant changes to the rates estimated in this report. FISCAL IMPACT Adoption of this proposed resolution will allow the City to levy and collect the FY24-25 property tax revenues of approximately $37 million, which are included in the FY 2024-2025 Adopted Mid-Cycle Budget, for the payment of debt service on the City’s outstanding general obligation bonds and $59 million for the payment of Police and Fire Retirement System obligations. The property tax rate calculations can be found in Attachment A.
Jestin D. Johnson, City AdministratorSubject: Fiscal Year 2024-25 Tax Levy For Voter Approved Indebtedness Date: August 1, 2024 Page 3 Mayor’s/Council Summer RecessAugust 20, 2024
PUBLIC OUTREACH / INTERESTThis item did not require public outreach other than the required posting on the City’s website. COORDINATION This report was prepared by the Finance Department, and the legislation has been reviewed by the City Attorney’s Office.SUSTAINABLE OPPORTUNITIES Economic: Essential City services that serve the public greatly rely upon revenues generated from voter-approved special tax measures. Environmental: There are no direct environmental impacts associated with the City Council action requested in this report. Race & Equity: To the extent authorized by the individual measure, the funding provided from tax levies can be used to support Oakland’s equity goals and objectives, including programs and services to Oakland’s vulnerable population and communities of color. Some voter-approved measures, other than the general obligation bond measures, provide a mechanism for the exemptions from parcel tax to qualifying low-income households, senior households, affordable housing projects and certain religious organizations and schools.
Jestin D. Johnson, City AdministratorSubject: Fiscal Year 2024-25 Tax Levy For Voter ApprovedIndebtedness Date: August 1, 2024 Page 4 Mayor’s/Council Summer RecessAugust 20, 2024
Erin Roseman (Aug 2, 2024 12:00 PDT)ACTION REQUESTED OF THE CITY COUNCILStaff Recommends That The City Council Adopt A Resolution Fixing The Rate Of Property Tax And Levying A Tax On Real And Personal Property In The City Of Oakland For Fiscal Year 2024- 25 For Voter-Approved Indebtedness.For questions regarding this report, please contact Dawn Hort, Assistant Treasury Administrator, at (510) 238-2994.Respectfully submitted,ERIN ROSEMANDirector of Finance Finance DepartmentReviewed by:David Jones, Treasury Administrator Treasury BureauPrepared by:Greg Danielian, Financial Analyst Treasury BureauAttachments (1)(A): General Obligation Bonds Levy Calculations for Fiscal Year 2024-25
Attachment A
City of Oakland
General Obligation Bonds
Levy Calculations for Fiscal Year 2024-25
Bond Description
Fund Number
Series 2015A
(Refunding)
6064
Series 2017C
(Measure DD)
6322
Series 2017A-1
(Measure KK)
6330
Series 2017A-2
(Measure KK)
6331
Series 2020B-1
(Measure KK)
6332
Series 2020B-2
(Measure KK)
6333
Series 2020
(Refunding)
6334
Series 2022C-1
(Measure KK)
6335
Series 2023 A-1
(Measure U)
6340
Series 2023A-2
(Measure U)
6341
Series 2023D
(Measure KK)
6337
GOB
TOTAL
Cash available for debt service as of 6/30/2024
Cash held by Treasury 1,095,736 389,846 1,175,006 560,378 2,037,974 538,291 -938,363 7,889,491 802,483 11,203,936 1,183,846 25,938,624 Cash held by Trustee 2,753 7,570 652 2,057 1,440 3,412 3,858 2,573 1,831,021 698 3,108,553 4,964,589 Total cash as of 6/30/2024 1,098,489 397,416 1,175,658 562,436 2,039,414 541,704 -934,505 7,892,065 2,633,504 11,204,635 4,292,399 30,903,214 Debt service payments through 12/31/2025
DS payments for FY 2024-25 5,504,675 1,447,931 2,239,056 4,129,280 3,932,700 4,956,444 5,798,950 10,437,900 1,755,463 12,926,355 2,811,850 55,940,604 DS payment for 7/15/2025 1,245,588 387,966 1,119,528 501,615 1,966,350 189,006 414,622 7,144,200 877,731 1,722,419 1,405,925 16,974,949 DS payment for 12/31/2025 - - - - - - - - - - - -
Bank and Bond expenses for FY 2024-25 12,500 8,500 8,500 8,500 12,000 8,500 8,000 8,500 8,500 8,500 8,500 100,500 Total debt service through 12/31/2025 6,762,763 1,844,397 3,367,084 4,639,395 5,911,050 5,153,950 6,221,572 17,590,600 2,641,694 14,657,274 4,226,275 73,016,053 Total DS Shortfall
5,664,274 1,446,981 2,191,426 4,076,959 3,871,636 4,612,246 7,156,077 9,698,535 8,189 3,452,639 (66,124) 42,112,839 Add: Reserve of DS at 6.00% 330,281 86,876 134,343 247,757 235,962 297,387 347,937 626,274 105,328 775,581 168,711 3,356,436 Unsecured Roll (Prior Year's Rate) FY 2023-24 (162,158) (66,771) (109,695) (195,544) (190,775) (267,084) (85,849) (629,556) (81,556) (734,005) (109,695) (2,632,690) Add: Projected delinquencies, unsecured roll
at
6.48%
10,508
4,327
7,108
12,671
12,362
17,307
5,563
40,795
5,285
47,564
7,108
170,598
Less: Unitary Tax collected as of FY 2023-24 (428,701) (176,524) (290,004) (516,963) (504,354) (706,096) (226,959) (1,664,369) (37,246) (1,940,503) 0 (6,491,718) Balance to be levied on tax roll 5,414,203 1,294,889 1,933,179 3,624,880 3,424,832 3,953,760 7,196,769 8,071,679 0 1,601,276 0 36,515,466 Assessed Valuation (1) 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 83,041,997,549 Secured tax rate (2) 0.0065% 0.0016% 0.0023% 0.0044% 0.0041% 0.0048% 0.0087% 0.0097% 0.0000% 0.0019% 0.0000% 0.0440% Prior year's secured tax rate 0.0034% 0.0014% 0.0023% 0.0041% 0.0040% 0.0056% 0.0018% 0.0132% 0.0017% 0.0154% 0.0023% 0.0552% Variance 0.0031% 0.0002% 0.0000% 0.0003% 0.0001% -0.0008% 0.0069% -0.0035% -0.0017% -0.0135% -0.0023% -0.0112% Note: Totals may not add up due to
rounding.
(1) AV is net of 1.77% in secured roll delinquencies.
(2) Expected Unitary Tax Revenue for FY 2024-25 not factored into the secured tax rate given the uncertainty of the value of receipt; it will be taken into account for FY 2025-26 tax roll once the monies from the County are received.
Delinquency Calculation
Unsecured roll (Net AV plus Homeowner's 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 4,769,365,621 Prior year's tax rate 0.0034% 0.0014% 0.0023% 0.0041% 0.0040% 0.0056% 0.0018% 0.0132% 0.0017% 0.0154% 0.0023% 0.0552% 162,158 66,771 109,695 195,544 190,775 267,084 85,849 629,556 81,556 734,005 109,695 2,632,690 Prior year's delinquency rate, unsecured roll 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% Projected delinquencies, unsecured roll 10,508 4,327 7,108 12,671 12,362 17,307 5,563 40,795 5,285 47,564 7,108 170,598
APPROVED AS TO FORM AND LEGALITY
________________________
CITY ATTORNEY’S OFFICE
OAKLAND CITY COUNCIL
RESOLUTION NO. ______________ C.M.S.
RESOLUTION FIXING THE RATE OF PROPERTY TAX AND
LEVYING A TAX ON REAL AND PERSONAL PROPERTY IN THE
CITY OF OAKLAND FOR FISCAL YEAR 2024 -25 FOR VOTER-
APPROVED INDEBTEDNESS
WHEREAS, the City of Oakland (the “City”) must annually set property tax levy rates, based on the assessed valuation subject to taxation, and must inform the County of Alameda (the “County”) of these rates by August 31st for inclusion on that year’s property tax bill; and
WHEREAS, passage of this resolution will permit the City to collect the Fiscal Year 2024-25 tax revenues for the payment of ongoing obligations and indebtedness of the City to the Police and Fire Retirement System and debt service on outstanding and certain expected City general obligation bonds, as approved by the voters of the City; and
WHEREAS, this resolution cannot be deferred for Council approval following the Council recess because the City must set the rates and inform the County by August 31st for inclusion on the year’s property tax bill, and the City calculates the property tax levy rates using Fiscal Year 2024 -25’s assessed valuation figures which are published by the County annually in early August; now, therefore be it
RESOLVED: That a tax of 0.0705% is hereby fixed and levied for Fiscal Year 2024- 25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended to fund payment of ongoing indebtedness of the City to t he Police and Fire Retirement System as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0065% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended for debt service payments related to the City of Oakland, General Obligation Refunding Bonds, Series 2015A, as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax o f 0.0016% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby 2 identified and expended for debt service payments related to the City of Oakland, General Obligation Bonds, Series 2017C (Measure DD), as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0023% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended for debt service payments related to the City of Oakland, General Obligation Bonds, Series 2017A-1 (Measure KK), as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0044% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended for de bt service payments related to the City of Oakland, General Obligation Bonds, Series 2017A-2 (Measure KK), as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0041% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended for de bt service payments related to the City of Oakland, General Obligation Bonds, Series 2020B-1 (Measure KK), as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0048% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended for de bt service payments related to the City of Oakland, General Obligation Bonds, Series 2020B-2 (Measure KK), as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0087% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City of Oakland, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expe nded for debt service payments related to the City of Oakland, General Obligation Refunding Bonds, Series 2020, as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0097% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended for de bt service payments related to the City of Oakland, General Obligation Bonds, Series 2022C-1 (Measure KK), as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0000% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended for debt service payments related to the City of Oakland, General Obligation Bonds, Series 2023A-1 (Measure U), as approved by the voters of the City; and be it
FURTHER RESOLVED: That an estimated tax of 0.0019% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby 3 identified and expended for debt service payments related to the City of Oakland, General Obligation Bonds, Series 2023A-2 (Measure U), as approved by the voters of the City; and be it F
URTHER RESOLVED: That an estimated tax of 0.0000% is hereby fixed and levied for Fiscal Year 2024-25 on taxable property, real and personal, within the corporate limits of the City, and the tax so levied and the money arising therefrom, when collected, shall be and is hereby identified and expended for de bt service payments related to the City of Oakland, General Obligation Bonds, Series 2023D (Measure KK), as approved by the voters of the City; and be it F
URTHER RESOLVED: That if the estimated General Obligation Bond rates of
0.0065% for Series 2015A, 0.0016% for Series 2017C, 0.0023% for Series 2017A-1, 0.0044% for Series 2017A-2, 0.0041% for Series 2020B-1, 0.0048% for Series 2020B-2, 0.0087% for Series 2020, 0.0097% for Series 2022C -1, 0.0000% for Series 2023A -1, 0.0019% for Series 2023A -2, and 0.0000% for Series 2023D need to be adjusted to reflect the actual figures for the assessed valuations, the City Administrator is hereby authorized to make the necessary adjustments.
I
N COUNCIL, OAKLAND, CALIFORNIA,
P
ASSED BY THE FOLLOWING VOTE:
AYE
S - FIFE, GALLO, JENKINS, KALB, KAPLAN, RAMACHANDRAN, REID, AND
PRESIDENT FORTUNATO BAS
NOES –
ABSENT –
ABSTENTION –
ATTEST:
ASHA REED
City Clerk and Clerk of the Council of the
City of Oakland, California
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