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DATE:
Placentia City Council
AGENDA REPORT
CITY COUNCIL
CITY ADMINISTRATOR
DEPUTY CITY ADMINISTRATOR/ PUBLIC SERVICES & INFRASTRUCTURE MAY 16, 2023
SUBJECT: SETTING OF THE ANNUAL SPECIAL TAX RATE FOR FISCAL YEAR 2023-24 FOR COMMUNITY FACILITIES DISTRICT NO. 2014-01 (PUBLIC SERVICES
CFD) AND DECLARING THE INTENTION TO ALLOW FOR THE ANNEXATION OF PROPERTY TO COMMUNITY FACILITIES DISTRICT NO. 2014-01 FISCAL
IMPACT: REVENUE: $64,139.16 RECOUPED THROUGH ASSESSMENTS (550000-4505) SUMMARY:
On February 18, 2014, the City Council adopted Resolution No. R-2014-10, establishing Community Facilities District No. ("CFD") 2014-01 ("Public Services CFD") to provide an ongoing sustainable funding source paid for by new developments to help fund the cost of public safety services. On March 4, 2014, the City Council adopted Ordinance No. 2014-03, authorizing the City Council to determine, by resolution, on or before August 1 of each year, the specific special tax to be levied on each parcel of land within the CFD. At that time, the City Council also, in the adoption of the territory map, approved the area designated as future annexation to the CFD.
Staff recommends that the City Council adopt a resolution to levy a special tax to pay for public safety services for Fiscal Year (FY) 2023-24 (Attachment 1), adopt a resolution declaring its intention to annex territory to the CFD and set a public hearing on June 20, 2023 (Attachment 2).
RECOMMENDATION:
It is recommended that the City Council take the following actions:
Adopt Resolution No. R-2023-32, a Resolution of the City Council of the City of Placentia, California, setting the levy of an Annual Special Tax for Community Facilities District No. 2014-01 (Public Services); and
2. Authorize inclusion of the Annual Special Tax for Community Facilities District No. 2014-01 (Public Services) for Fiscal Year 2023-24 on the Orange County Secured Property Tax Roll; and
3. Adopt Resolution No. R-2023-33, a Resolution of the City Council of the City of Placentia, California, declaring its intention to annex certain territory to Community Facilities District No. 2014-01 (Public Services).
1.c.
May 16, 2023
City Council Agenda
May 16, 2023
STRATEGIC PLAN STATEMENT:
There is no specific Strategic Plan Goal or Objective associated with this Council action.
DISCUSSION:
In 2014, the City Council created CFD 2014-01 to provide a new revenue stream paid for by new residential developments to be used to help fund the cost of public safety services. This type of financing program, which is authorized under the Mello -Roos Community Facilities Act of 1982, envisioned the participation of all future additional new development projects, either by formation of new districts or annexation into the existing CFD.
The special tax that is currently being assessed on properties within the CFD is based upon a Fiscal Impact Analysis ("FIA") that was prepared for the intital formation of the CFD in 2014. Based on the FIA, the tax rate needed to support public safety services for new residential developments was established at $225.00 for each single-family residential unit per year. Therefore, the special tax rates for 2014-15 were $225.00 per residential unit for single-family residential property and $170.00 per residential unit for multi -family residential property.
The CFD is subject to an Annual Escalation Factor beginning on July 1, 2015, which shall be the greater of five percent (5%) or the annual percentage increase, if any, of the Consumer Price index for the twelve (12) months ending the preceding December 31. The index identified in the Rate and Method of Apportionment from 2014 was the All -Urban Consumers (CPI_U) for Los Angeles -Riverside -Orange County area. However, in January 2018, the Bureau of Labor and Statistics split the index geographically into a Los Angeles -Long Beach -Anaheim area and a Riverside -San Bernardino -Ontario area. The City has determined that the Los Angeles -Long Beach -Anaheim index is the most appropriate index as it includes both Los Angeles and Orange Counties. The CPI for the 12 months ending the preceding December 31 was 4.9%. Therefore, the special tax rates are being increased by 5% as allowed. The adjusted special tax rates for FY 2023-24 are $354.36 per residential unit for single-family residential property and $267.74 per residential unit for multi -family residential property.
As a condition of approval, the JPI transit -oriented development at 505 W. Crowther Avenue, was required to annex itself to the CFD. This project is currently under the final phase of construction and will need to be annexed to the CFD prior to receiving a Certificate of Occupancy. To commence the annexation process, the City Council must adopt a Resolution of Intention (Attachment 2). This Resolution sets forth terms and conditions for annexing territory into the CFD and includes the rate and apportionment for the special tax to be levied. The Resolution of Intention also establishes a date for a public hearing on the annexation action, and for an election among the authorized electors. The hearing date, which by statute must be within 30-60 days following the adoption of the Resolution of Intention, is scheduled for June 20, 2023. Since there are less than twelve (12) registered voters in the territory proposed to be annexed, the election will be a landowner vote which is a vote of JPI annexing its property to the CFD.
City Council Agenda
May 16, 2023
FISCAL IMPACT:
For the tax to be applied to a parcel, either construction must be completed or a building permit for the home needs to be issued by the City by June 1 of the preceding fiscal year. Currently, a total of 181 single-family properties have been annexed into CFD 2014-01 since its creation. For FY 2023-24, 181 parcels will be assessed at the adjusted special tax rate of $354.36. The 54 detached single-family homes by Shea Homes located on the southeast corner of Alta Vista Street and Rose Drive were annexed into CFD 2014-01 and will be levied for the first time in FY 2023-
24. The anticipated revenue from these assessments in FY 2023-24 is $64,139.16. The addition of the new annexation into the special tax district will generate future new revenue as summarized in the following.
Development Number of Units Annual Unit Rate
JPI Luxury
Apartments
Prepared by:
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Elsa Y. Robinson
Senior Management Analyst
Reviewed and approved:
(p.is fsft )
Luis Estevez
Deputy City Administrator
418 $267.74
Reviewed and approved:
1. Jennifer Lampman
Director of Finance
Reviewed and approved:
Damien R. Arrula
City Administrator
Total Annual
Revenue
$111,915.32
Attachments:
1. Resolution No. R-2023-32 — Annual Levy for CFD 2014-01
2. Resolution No. R-2023-33 — Intention to Annex Territory to CFD 2014-01
3. Rate and Method of Apportionment of Special Tax