TO: CITY COUNCIL
VIA: CITY ADMINISTRATOR
Placentia City Council
I AGENDA REPORT
FROM: DEPUTY CITY ADMINISTRATOR / PUBLIC SERVICES AND INFRASTRUCTURE DATE: MARCH 15, 2022
SUBJECT: PRE -ANNEXATION AND PROPERTY TAX EXCHANGE AGREEMENT WITH THE COUNTY OF ORANGE FOR THE ANNEXATION OF COUNTY "HAMER ISLAND" FISCAL
IMPACT: Upon recordation of an approved annexation the City will receive half of the County's General Fund share of property tax revenue and all the Structural Fire Fund revenues collected from within "Hamer Island" amounting to approximately $131,873 per year as well as a one-time compensation from the County of Orange of $1,500,000 to be used for public improvements and maintenance projects.
SUMMARY:
On February 15, 2022, the City Council considered and approved a resolution to annex County unincorporated Hamer Island into the City of Placentia. As part of the annexation application process the City must submit a formal application to the Orange County Local Agency Formation Commission (OC LAFCO) under the small island provisions, along with an approved resolution to OC LAFCO initiating the proceedings for the annexation of the Island. In addition, the City Council must consider and approve the adoption of a property tax agreement and resolution with the County. All these items must be provided to OC LAFCO before it may consider and approve the annexation. Once approved by OC LAFCO, the annexation of the small island is not subject to protests by the community or an election.
RECOMMENDATION:
It is recommended that the City Council take the following actions:
Adopt Resolution No. R-2022-13, a Resolution of the City Council of the City of Placentia, California, approving annexation and property tax exchange agreement for County unincorporated Hamer Island; and
2. Authorize the City Administrator and/or his designee to execute all necessary documents, in a form approved by the City Attorney.
1. f.
Mar. 15, 2022
City Council Agenda
March 15, 2022
DISCUSSION:
On February 15, 2022, the City Council considered and approved a resolution to annex County unincorporated Hamer Island into the City of Placentia. As part of the annexation application process the City must submit a formal application to OC LAFCO under the small island provisions, along with an approved resolution to OC LAFCO initiating the proceedings for the annexation of the Island. In addition, the City Council must consider and approve the adoption of a property tax agreement and resolution with the County. All these items must be provided to OC LAFCO before it may consider and approve the annexation. Once approved by OC LAFCO, the annexation of the small island is not subject to protests by the community or an election.
Pursuant to the terms of the proposed agreement, the City will receive upon final annexation
52.6624 percent of the property tax and the County shall receive 47.3376 percent of the County's share of the 1 % basic levy of property tax generated within the area to be annexed, pursuant to Master Property Tax Agreement 80-1975 between the County of Orange and the City of Placentia.
In addition, the City will receive all Structural Fire Fund revenues collected from within Hamer Island to offset proportional Fire and EMS costs, which amounts to approximately $131,873 per year. Additionally, a one-time compensation of $1,500,000 from the County of Orange for public improvements and maintenance projects. Staff is in the process of completing the formal annexation application for submission to OC LAFCO and has recorded the adopted Categorical Exemption pursuant to Section 15319 of the California Environmental Quality Act.
FISCAL IMPACT:
Upon recordation of an approved annexation the City will receive half of the County's General Fund share of property tax revenue and all the Structural Fire Fund revenues collected from within "Hamer Island" amounting to approximately $131,873 per year as well as a one-time compensation from the County of Orange of $1,500,000 to be used for public improvements and maintenance projects.
Prepared by:
Luis Estevez V
Deputy City Administrator
Reviewed and approved:
Damien . Arrula
City Administrator
Attachments:
1. Pre -Annexation Property Tax Agreement
2. Resolution No. R-2022-13 — Annexation and Property Tax Agreement