Placentia City Council
TO: CITY COUNCIL
VIA: CITY ADMINISTRATOR
FROM: ACTING DIRECTOR OF PUBLIC WORKS
DATE: JUNE 4, 2024
AGENDA REPORT
SUBJECT: SETTING OF THE ANNUAL SPECIAL TAX RATE FOR FISCAL YEAR 2024-25 FOR COMMUNITY FACILITIES DISTRICT NO. 2014-01 (PUBLIC SERVICES CFD)
FISCAL
IMPACT: REVENUE: $204,206.98 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) 2024-25 (Attachment 1) and approval of new annexations to the CFD (Attachment 2).
RECOMMENDATION:
It is recommended that the City Council take the following actions:
1. Adopt Resolution No. R-2024-34, 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. Adopt the Resolution No. R-2024-35, A Resolution of the City Council of the City of Placentia, California, Ordering the Annexation of Territory; and
3. Authorize inclusion of the Annual Special Tax for Community Facilities District No. 2014-01 (Public Services) for Fiscal Year 2024-25 on the Orange County Secured Property Tax Roll.
ofo
June 4, 2024
City Council Agenda
June 4, 2024
STRATEGIC PLAN STATEMENT:
There is no specific Strategic Plan Goal or Objective associated with this Council action.
DISCUSSION:
In 1978, California voters enacted Proposition 13, which limited the ability of local public agencies to increase property taxes based on a property's assessed value. In 1982, the Mello -Roos Community Facilities Act of 1982 ("Act") was created to provide an alternate method of financing public infrastructure and services. Under the Act, a Community Facilities District ("CFD") may fund public improvements with a useful life of five (5) years or more, such as park and recreational facilities, streets, sewer systems, schools, libraries, childcare facilities, and other public infrastructure. CFDs may also fund the maintenance and servicing of public landscape areas, parks, streetlights, storm drain systems, and public safety services.
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. All new residential development projects are required to annex their properties into the Public Services CFD as a condition of approval for receiving their entitlements. 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 initial 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. 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.
FY 2024-25 Annexations to CFD
City Council Resolution No. R-2014-04 designated the entire territory of the City as future annexation area for the District. This resolutuion also allows for voluntarily annexation into the District. Annexations can occur without additional public hearing as long as the annexing landowner provides unanimous consent. To date a total of 219 parcels have been annexed into the CFD. Since August 2023, the City has received a total of 15 new landowner petitions for annexations into the CFD as a result of new development. Staff is recommending adoption of Resolution No. R-2024-35 (Attachment 2) to approve the annexation of the following parcels into the CFD:
APN
339-021-11
339-294-08
336-355-08
Address
420 Orchid Drive
139 Ruby Drive
731 Longfellow
Drive
Development
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Number of Units
1 1
1 City Council Agenda
June 4, 2024
336-174-11
340-252-22
344-143-09
336-452-17
336-355-24
339-352-06
340-202-13
344-123-02
336-162-13
2102 Carleton
Circle
5142 Hamer Lane
940 Cypress Ave
919 Gehrig, Unit B
736 Cooper Drive
402 Olive St
642 Sunflower
Avenue
639 Missouri
Avenue
213 Koch Avenue
336-361-48 605 Alcott Avenue
346-172-01
339-283-17
Total
These new annexations will bring the total properties annexed in the CFD to 234. 604 S. Van Buren
Ave
913 Bradford
Avenue
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
Single Family Residential - ADU
Addition
-
Single Family Residential - ADU
Addition
Single Family Residential - New
Home
Single Family Residential - ADU
Addition
1 1
15 FY 2024-25 Special Tax Rates
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 3.5%. Therefore, the special tax rates are being increased by 5% as allowed. The adjusted special tax rates for FY 2024-25 are summarized below:
Land Use Type FY 2024-25 Special Tax Rate
Single -Family Residential Property
Multi -Family Residential Property
$372.08 per residential unit
$281.13 per residential unit
City Council Agenda
June 4, 2024
FISCAL IMPACT:
There is no General Fund impact as a result of this special tax levy for public safety services. If the recommended actions are approved, a total of 234 parcels will be assessed at the adjusted special tax rates for as summarized below:
Land Use Number of Parcels Number of Units Rate Total
Type
Single -Family
Residential
Property
233
233
372.08
86,694.64
Multi -Family
Residential
Property
418 281.13 117,512.34
L
Total 234
$204,206.98
The total anticipated revenue from these assessments in FY 2024-25 is $204,206.98.
Prepared by: Reviewed and approved:
Elsa Y. `Robinson Chris Tanio, PE
Senior Management Analyst Acting Director of Public Works Reviewed and approved: Reviewed and approved:
Jen nifer.'l'ampman
Director of Finance
Damien R. Arrula
City Administrator
Attachments:
1. Resolution No. R-2024-34 — Annual Levy for CFD 2014-01
2. Resolution No. R-2024-35 — Ordering of Annexation
3. Rate and Method of Apportionment of Special Tax