City Council Memorandum
TO: HONORABLE MAYOR AND CITY COUNCIL DATE: APRIL 26, 2022 FROM: FINANCE DEPARTMENT WARD: 4
SUBJECT: PUBLIC HEARING - CONDUCT FORMATION PROCEEDINGS FOR PROPOSED COMMUNITY FACILITIES DISTRICT NO. 2021-3 (BRIDLE RIDGE); RESOLUTIONS OF FORMATION ESTABLISHING COMMUNITY FACILITIES DISTRICT 2021-3 (BRIDLE RIDGE), AUTHORIZING LEVY OF SPECIAL TAXES, INCURRING BONDED INDEBTEDNESS IN AN AMOUNT NOT TO EXCEED $7,000,000 WITHIN THE PROPOSED COMMUNITY FACILITIES DISTRICT, CALLING AN ELECTION OF FORMATION, AND CERTIFYING RESULTS OF APRIL 26, 2022 SPECIAL TAX AND BOND ELECTION; ORDINANCE AUTHORIZING THE ANNUAL LEVY OF SPECIAL TAXES WITHIN CFD 2021-3 (BRIDLE RIDGE); ACQUISITION AGREEMENT BETWEEN THE CITY OF RIVERSIDE AND RIVERSIDE 103, LP; JOINT COMMUNITY FACILITIES AGREEMENT WITH CITY OF RIVERSIDE, WESTERN MUNICIPAL WATER DISTRICT AND RIVERSIDE 103, LP ISSUES:
Conduct a Public Hearing of formation proceedings for proposed Community Facilities District No. 2021-3 (Bridle Ridge); adopt a Resolution establishing Community Facilities District 2021-3 (Bridle Ridge), authorizing the levy of special taxes, and calling an election therein; adopt a Resolution of necessity to incur bonded indebtedness in an amount not to exceed $7,000,000 within the proposed Community Facilities District 2021-3 (Bridle Ridge) and calling an election therein; adopt a Resolution certifying the results of the April 26, 2022, special tax and bond election; adopt an Ordinance authorizing the levy of Special Taxes within CFD 2021-3 (Bridle Ridge); approve the form of Acquisition Agreement between the City of Riverside, and Riverside 103, LP; approve the Joint Community Facilities Agreement with City of Riverside, Western Municipal Water District, and Riverside 103, LP.
RECOMMENDATIONS:
That the City Council:
Conduct a Public Hearing of formation proceedings for proposed Community Facilities District 2021-3 (Bridle Ridge); Adopt a Resolution establishing Community Facilities District 2021-3 (Bridle Ridge), authorizing the levy of special taxes, and calling an election therein; Adopt a Resolution of necessity to incur bonded indebtedness in an amount not to exceed $7,000,000 within the proposed Community Facilities District 2021-3 (Bridle Ridge); Adopt a Resolution certifying the results of the April 26, 2022, special tax and bond election; Adopt an Ordinance authorizing the levy of Special Taxes within CFD 2021-3 (Bridle Ridge); Approve the form of Acquisition Agreement between the City of Riverside, and Riverside 103, LP Approve the Joint Community Facilities Agreement with the City of Riverside, Western Municipal Water District, and Riverside 103, LP.
BACKGROUND:
The City’s Financing team has been working with landowner Riverside 103, LP to establish a Community Facilities District (CFD) to reimburse the Developer for Development Impact Fees in lieu of facility improvements and to finance facilities that include street improvements, water improvements, sewer improvements, storm drain improvements, landscaping and street lighting. The City has received a petition from landowner Riverside 103, LP, requesting formation of CFD No. 2021-3 (Bridle Ridge). Riverside 103, LP represents 100 percent of the area subject to the Special Tax. The project consists of 103 lots located in Ward 4, east of Riverside Avenue, between Lurin and Mariposa Avenue. On March 22, 2022, the City Council adopted Resolution Nos. 23835 and 23836, stating their intention to establish CFD No. 2021-3 (Bridle Ridge) and to incur bonded indebtedness in an amount not to exceed $7,000,000.
DISCUSSION:
At the request of City Council, the attached CFD Report (Attachment 5) has been prepared by Special Tax Consultant, Webb Municipal Finance. The report provides a brief description of the public facilities by type proposed to be financed by CFD No. 2021-3 (Bridle Ridge), the services to be funded with the proceeds of the Special Tax, a cost estimate for all eligible facilities and fees, and the Rate and Method of Apportionment (RMA) of the Special Tax. The report also includes the recorded boundary map to provide reference to the location of this CFD and its boundaries.
The Form of Acquisition Agreement (Attachment 6) between the City of Riverside, and Riverside 103, LP provides for the levy of Special Taxes, and the issuance and sale of the Bonds of the District secured by those Special Taxes. The bonds will be used to finance the acquisition and construction of public improvements and facilities. The agreement outlines the representations, covenants, and warranties of the owners, including the requirement to disclose the special tax to all prospective purchasers within CFD 2021-3 (Bridle Ridge), and outlines the eligible uses of the Special Tax.
The Form of Joint Community Facilities Agreement between the City of Riverside, Western Municipal Water District, and Riverside 103, LP (Attachment 7) provides for the funding of eligible Water District improvements which include those water and sewer facilities included in WMWD’s water and sewer capacity and connection fee programs used to finance expansion projects, exclusive of in-tract facilities contributed by Property Owner. The Water District is responsible for verifying the validity of the requested reimbursements from bond proceeds from the property owners, at which time they will send a request to the City for release of bond proceeds, payable to the Water District.
To move forward with the completion of this project, during the Public Hearing the City Council may allow the testimony of all interested persons for or against the proposed formation of the CFD. Once this hearing is closed, the City Council, at their discretion, may adopt the Resolution Establishing CFD No 2021-3 (Bridle Ridge) (Attachment 1), which approves the Rate and Method of Apportionment. The Resolution Determining Necessity to Incur Bonded Indebtedness (Attachment 2) will call for an election of the landowners of the property within CFD No. 2021-3 (Bridle Ridge). The City Clerk will open the ballots of the landowner(s) casting votes for or against authorizing bonded indebtedness in an amount not to exceed $7,000,000. The City Clerk will count the votes and certify the results of the votes. The City Council, at their discretion, may adopt the Resolution Certifying the Results of the Election (Attachment 3) and vote for approval of the Ordinance Authorizing the Levy of a Special Tax (Attachment 4). The ordinance will be adopted and take effect on the date of adoption per City Charter sections 413 and 416(c).
STRATEGIC PLAN ALIGNMENT:
This item contributes to Strategic Priority No. 5 High Performing Government and Goal No. 5.3 – Enhance communication and collaboration with community members, to improve transparency, build public trust, and encourage shared decision-making.
This item aligns with EACH of the five Cross-Cutting Threads as follows:
Community Trust – The formation of a Community Facilities District provides a transparent and equitable way to manage, administer, and report on specific infrastructure and services related to new development.
Equity – CFD 2021-3 (Bridle Ridge) shares the cost of infrastructure and maintenance services among each property owner and spreads the cost long-term across the generations of property owners that benefit from it.
Fiscal Responsibility – Formation and administration of the Community Facilities District is offset by Developer deposits and Special Tax, ensuring the cost of the service is borne by those that benefit directly from it.
Innovation – Utilizing Community Facilities Districts is an innovative way to plan and direct revenue to directly support each new development.
Sustainability & Resiliency – Adding a Services Special Tax B offsets the cost to maintain new development well into the future.
FISCAL IMPACT:
All costs associated with formation are paid from a deposit posted by the Landowner with the City. Annually thereafter, costs incurred for staff time to administer the district are reimbursed from the annual levy of special taxes on district property owners. Bonds to be issued by CFD 2021-3 (Bridle Ridge) will be the sole responsibility of the District, to be paid through a levy of special taxes on all properties within the District. Revenue from the Services Special Tax B are estimated at $40,526 per year and will be used to offset the incremental cost of providing services not covered by general property tax.
Prepared by: Heidi Schrader, Debt and Treasury Manager
Certified as to
availability of funds: Edward Enriquez, Chief Financial Officer/Treasurer Approved by: Kris Martinez, Assistant City Manager
Approved as to form: Phaedra A. Norton, City Attorney
Attachments:
Resolution Establishing CFD 2021-3 (Bridle Ridge)
Resolution of Necessity to Incur Bonded Indebtedness in an Amount Not to Exceed $7,000,000 Resolution Certifying the Results of the Election Within the District Ordinance Authorizing the Levy of Special Taxes Within the District Community Facilities District 2021-3 Report
Form of Acquisition Agreement
Form of Joint Community Facilities Agreement with Western Municipal Water District Resolution of Formation to Form CFD 2021-3 (Bridle Ridge)