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TAX AND REVENUE SHARING AGREEMENT AMONG
THE CITY OF MORENO VALLEY, THE CITY OF PERRIS,
THE CITY OF RIVERSIDE, AND THE COUNTY OF
RIVERSIDE REGARDING THE MARCH JOINT POWERS
AUTHORITY TERRITORY
This TAX AND REVENUE SHARING AGREEMENT (“Agreement”) among the CITY OF MORENO VALLEY (“Moreno Valley”), a municipal corporation, the CITY OF PERRIS (“Perris”), a municipal corporation, the CITY OF RIVERSIDE (“Riverside”), a charter city and municipal corporation, and the COUNTY OF RIVERSIDE, a political subdivision of the State of California (“County”) is made and entered into as of the ____ day of ___________, 2023 (“Effective Date”). Moreno Valley, Perris, and Riverside are sometimes collectively referred to hereafter as “Cities.” Moreno Valley, Perris, Riverside, and County are sometimes individually referred to as “Party” and collectively as “Parties.”
1. Recitals
1.1 WHEREAS, in 1993, the Base Realignment and Closure Commission recommended, and the President approved, the inclusion of March Air Force Base in the third round of base closures or realignments, resulting in the re-designation of the base as March Air Reserve Base and a significant reduction in its territory; and
1.2 WHEREAS, in response, in September 1993, the Parties adopted an agreement (the “Joint Powers Agreement”) establishing the March Joint Powers Authority (“Authority”) for the joint exercise of powers to dispose of and govern the former territory of the March Air Force Base in accordance with Article 1, Chapter 5, Division 7, Title 1 (commencing with Section 6500) of the Government Code of the State of California; and
1.3 WHEREAS, since 1993, the Parties collectively administered the Authority for the benefit of the territory served by the Authority (“Authority Territory”, which is further defined in Exhibit A, attached hereto and incorporated herein by this reference); and
1.4 WHEREAS, since that time, the Parties have amended the Agreement thirteen times, though the Seventh Amendment, establishing the March Joint Powers Utilities Authority, was only adopted by the Cities; and
1.5 1.4 WHEREAS, now, the Parties wish to amend the Joint Powers Agreement for a fourteenth time to generally remove the Authority’s land use and municipal obligations, leaving these obligations to the County because the Authority Territory is unincorporated; and
1.6 1.5 WHEREAS, in connection with this proposed amendment, to recognize the County’s increased duties in the Authority Territory, due to the desire by the Parties to keep the area unincorporated for the duration of the agreement term, the Parties’ collective efforts to redevelop the Authority Territory, and to prevent costly legal and land disputes among the Parties, the Parties have negotiated this Agreement to ensure an equitable distribution of revenues associated with the Authority and the Authority Territory.
NOW, THEREFORE, in consideration of the above recitals and the mutual covenants - 2 -
hereinafter contained and for good and valuable consideration, the receipt of which is hereby acknowledged, the Parties agree as follows:
2. Terms of Agreement
2.1 Incorporation of Recitals . The Parties hereby affirm the facts set forth in the Recitals above. Said Recitals are incorporated into this Agreement by this reference.
2.2 Distribution of Property Taxes.
(a) Definitions. For the purposes of this Section 2.2, the following definitions shall apply:
(i) Property Tax Revenues . Property Tax Revenues shall mean the moneys distributed to the County during the term of this Agreement from the Redevelopment Property Tax Trust Funds forrelated to the former March Joint Powers Authority SuccessorRedevelopment Agency (or “RPTTF”) for the properties identified in the map attached hereto and incorporated herein as Exhibit B and which are paid to the County as determined by the Riverside County Auditor Controller (“Auditor-Controller”) pursuant to Health and Safety Code Section 34183(a)(4) and as reported by the Auditor-Controller pursuant to Health and Safety Code Section 34182(d)(5)34183. Property Tax Revenues shall be exclusive of allowable charges of the Auditor-Controller for administering the RPTTF pursuant to Health and Safety Code Section 34182(e) and Revenue and Taxation Code Section 95.3. (b) Distribution. Property Tax Revenues shall be distributed as follows:
(i) County Services Payment. First, and prior to any distribution from Property Tax Revenues, beginning the effective date of this Agreement, the County shall subtract an amount equal to $2,450,975 for the fiscal year that this Agreement is executed, and thereafter shall subtract $2,450,975 plus the summation of any annual adjustments as described in this section, from the total Property Tax Revenues to cover its cost of providing services, including municipal services, within the Authority Territory. This amount, and successive amounts as adjusted each year thereafter, shall be adjusted annually based on the annual change in the Riverside-San Bernardino-Ontario, CA Consumer Price Index (CPI-U) for all items published by the U.S. Bureau of Labor Statistics (or equivalent successor index) with a baseline of the July 2023 index.
(ii) Property Tax Payment to Moreno Valley and Riverside. Second, if Property Tax Revenues remain after amounts deducted under subdivision (b)(i) herein, the County shall issue a reimbursement payment to Moreno Valley and Riverside in an amount equal to their proportionate share of RPTTF used to pay enforceable obligations of the March Joint Powers Authority Successor Agency from the assessed value of property within their respective jurisdictions (as shown in Exhibit B) , as reported by the Auditor-Controller. These payments shall be calculated as follows by jurisdiction as currently reported by the Auditor-Controller:
RPTTF gross growth generated within respective jurisdictional area, less pass-through payments, less both County administrative fees, and residual receipts. - 3 -
(iii) Remainder . Finally, if Property Tax Revenues still remain after amounts deducted in accordance with (b)(i) and (b)(ii) herein, the County shall retain seventy five percent (75%) of the remaining amount and shall distribute the remaining twenty five percent (25%) equally among the Cities.
2.3 Distribution of Sales Taxes, Transient Occupancy Taxes, and Franchise Fees. (a) Definitions. For the purposes of this Section 2.3, the following definitions shall apply:
(i) Sales Tax Revenues. Sales Tax Revenues shall include Bradley Burns Local 1% sales or use taxes paid by any businesses within the Authority Territory (see Exhibit A) upon taxable sales and uses attributable to the operations of businesses within the Authority Territory and allocated and actually paid to, and received by, County under the Uniform Local Sales and Use Tax Law (Part 1.5, Division 2 of the California Revenue and Taxation Code). Local Sales Tax Revenues shall not include (i) penalties, assessments, collection costs, and other costs, fees, or charges resulting from late or delinquent payments of sales or use tax and which are levied, assessed, or otherwise collected from business within the Authority Territory; (ii) any sales or use tax levied by, collected for, or allocated to the State of California, a district, or any entity (including an allocation to a statewide or countywide pool) other than County; (iii) any administrative fee charged by the California Department of Tax Fee Administration (or any successor agency); (iv) any sales or use tax subject to any sharing, rebate, offset, or other charge imposed pursuant to any applicable provision of federal, state, or local (except the County’s) law, rule, or regulation; or (v) any sales or use tax (or other funds measured by sales or use taxes) required by the State of California to be paid over to another public entity (including the State), or set aside and/or pledged to a specific use other than for deposit into or payment from the County’s general funds, including retroactively.. (ii) Transient Occupancy Tax Revenues shall include any tax charge on the rent paid by transient guests of hotels, motels, short-term rentals, or any other lodging facility within the Authority Territory (see Exhibit A) to the County under the County’s local laws.
(iii) Franchise Fee Revenues shall include any fees paid by a franchisee of the County for the use of governmental facilities within the Authority Territory (see Exhibit A). Franchise Fee Revenues shall be calculated as follows: Total Actual Franchise Fee Revenue generated within the county unincorporated area during the fiscal year, divided by unincorporated area Service Population for the year, then multiplied by Authority Territory Service Population for the year. Service Population shall be calculated as one half of the area employment, added to area population. Source data for this calculation shall be from a reputable source (e.g. Department of Finance, County of Riverside Budget Book, etc.) (b) Distribution. Sales Tax Revenues, Transient Occupancy Tax Revenues, and Franchise Fee Revenues shall be distributed evenly among the Parties such that the County shall pay to each of the Cities a total of twenty five percent (25%) of such revenues. - 4 -
(c) Data. County agrees to take any lawful actions necessary to permit Cities to receive sales tax , transient occupancy tax, and franchise fee revenue data for the Authority Territory.
2.4 Distribution of Land Sale Proceeds. The proceeds of any land sales by the Authority are distributed equally among the Parties in accordance with Section 5(j) of the Joint Powers Agreement.
2.5 Annexation of Property.
(a) City-Initiated Annexations. Cities shall not take any City-initiated steps toward the annexation of Authority Territory during the term of this Agreement. For example, Cities shall not initiate the following actions: any pre-zoning or pre-planning of Authority Territory, the preparation of any municipal service reviews for the Authority Territory, the preparation of any environmental document associated with considering annexation of any Authority Territory, or the submission of any applications to annex any Authority Territory.
Cities shall not provide funding for, solicit or encourage property owners, developers, or any third parties to seek annexation of any Authority Territory into a City’s jurisdiction. (i) Penalty for Violation. Should any Party violate this subsection of the Agreement, that Party shall reimburse to County any payments made under this Agreement to date and shall not receive any further payments under this Agreement. Reimbursed payments shall be redistributed by County equally among the non-violating Parties (i.e., one third each assuming only one Party is in violation).
(b) Property Owner-Initiated Annexations. If, in the absence of a violation of subdivision (a) of this Section 2.5, a third party initiates and successfully completes proceedings to annex property within the Authority Territory into one of the Cities’ jurisdictions, the Party annexing property shall make a payment to the County of all property, sales, and transient occupancy taxes received by that Party in connection with the annexed property within 30 days following receipt of said taxes. The payment shall be accompanied by a detailed statement setting forth the amount and type of taxes received from annexed properties within the Authority Territory. The County shall then distribute said payment to all Parties within 30 days following receipt in accordance with the applicable formula under this Agreement as if the County had received the taxes directly. If the legislative body of a City votes to approve an annexation initiated by a property owner, where the City has not encouraged, solicited, or incentivized the annexation, it shall not be considered a violation of subdivision (a) of this Section 2.5.
2.6 Term and Termination . This Agreement shall remain in effect until August 1, 2041. No Party may terminate this Agreement in advance of that date.
2.7 Payment Terms . On a twice-annual basis, on or before April 1 and October 1 each year, County shall make a payment to each of the Cities for their share of revenues received under Sections 2.2 and 2.3 during the periods July 1 through December 31 and January 1 through June 30 respectively (i.e., the first payment under this Agreement shall be made on or before April 1, 2024 for receipts during the period July 1 through December 31, 2023). - 5 -
Copy to: Copy to:
City of Moreno Valley
Attn: City Manager
P.O. Box 88005
[PARTY TO INSERT]Moreno Valley,
CA 92552
City of Moreno Valley
Attn: City Attorney
[PARTY TO INSERT]
P.O. Box 88005
Moreno Valley, CA 92552
City of Perris
Attn: City Manager
101 N “D” St.
[PARTY TO INSERT] Perris, CA
92570
City of Perris
Attn: City Attorney
101 N “D” St.
[PARTY TO INSERT] Perris, CA
92570
TO MORENO VALLEY:
TO RIVERSIDE: TO COUNTY:
TO PERRIS:
2.8 Insurance Requirements . The Parties shall each maintain adequate insurance coverage for the activities contemplated herein for the duration of this Agreement.
3. Miscellaneous Terms
3.1 Amendment. This Agreement may be amended at any time by the mutual consent of the Parties by an instrument in writing signed by all Parties.
3.2 Construction; References; Captions . Since the Parties or their agents have participated fully in the preparation of this Agreement, the language of this Agreement shall be construed simply, according to its fair meaning, and not strictly for or against any Party. Any term referencing time, days or period for performance shall be deemed calendar days and not work days. The captions of the various articles and paragraphs are for convenience and ease of reference only, and do not define, limit, augment, or describe the scope, content, or intent of this Agreement.
3.3 Entire Agreement . This Agreement constitutes the entire and integrated agreement with respect to the subject matter hereof and supersedes any and all prior and contemporaneous oral or written negotiations, representations or agreements.
3.4 Notices, Demands and Communications Between the Parties. (a) Formal notices, demands and communications between Parties shall be deemed sufficiently given if: (i) by commercial overnight delivery; (ii) by messenger service for immediate personal delivery; or (iii) by electronic transmittal, including electronic mail and/or fax transmissions, subject to written verification of receipt by the receiving party. Such written notices, demands and communications may be sent in the same manner to such other addresses as either Party may from time to time designate by written notice to the other Party.
All notices, demands and communications shall be sent, as follows:
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County of Riverside
Attn: County Executive Officer
County Administrative Center
4080 Lemon Street
[PARTY TO INSERT] Riverside, CA
92501
Copy to: Copy to:
City of Riverside
Attn: City Attorney
3900 Main Street, 7th Floor
[PARTY TO INSERT]Riverside, CA
92501
County of Riverside
Attn: County Counsel
County Administrative Center
4080 Lemon Street
[PARTY TO INSERT] Riverside, CA
92501
City of Riverside
Attn: City Manager
3900 Main Street, 7th Floor
[PARTY TO INSERT]Riverside, CA
92501
(b) Notices shall be deemed effective upon receipt or with respect to electronic transmission, upon receipt of written verification from the receiving party.
3.5 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original.
3.6 Laws and Regulations . Each Party shall keep itself fully informed of and in compliance with all local, state and federal laws, rules and regulations in any manner affecting the performance of this Agreement, and shall give all notices required by law. Each Party shall be liable for all violations of such laws and regulations in connection with this Agreement. If either Party performs any of its obligations hereunder knowing that its actions are contrary to such laws, rules and regulations and without giving written notice to the other, the violating Party shall be solely responsible for all costs arising therefrom.
3.7 Approvals. Approvals required by Parties, or any officers, agents or employees thereof, shall not be unreasonably withheld and approval or disapproval shall be given within a reasonable time.
3.8 Mutual Cooperation; Further Actions and Instruments. Each of the Parties shall cooperate with and provide reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Agreement and the satisfaction of the conditions of this Agreement.
3.9 Third Party Beneficiaries. This Agreement and the performance of the Parties obligations hereunder are for the sole and exclusive benefit of the Parties only. No person or entity who or which is not a signatory to this Agreement shall be deemed to be benefited or intended to be benefited by any provision hereof, and no such person or entity shall acquire any rights or causes of action against any Party hereunder as a result of any Party’s performance or non-performance of its obligations under this Agreement. - 7 -
3.10 Relationship of Parties. The Parties agree and intend that they are independent contracting entities and do not intend by this Agreement to create any partnership, joint venture, or similar business arrangement, relationship or association between them.
3.11 Governing Law. This Agreement shall be governed by the laws of the State of California without regard to conflicts of laws principles. This Agreement shall be deemed to have been made in the County of Riverside, California, regardless of the order of the signatures of the Parties affixed hereto. Any litigation or other legal proceedings which arise under or in connection with this Agreement shall be conducted in a federal or state court located within or for Riverside County, California. The Parties consent to the personal jurisdiction and venue in federal or state court located within the County of Riverside, California, and hereby waive any defenses or objections thereto including defenses based on the doctrine of forum non conveniens.
3.12 Waiver . No delay or omission in the exercise of any right or remedy of a non-defaulting Party on any default shall impair such right or remedy or be construed as a waiver. Either Parties’ consent or approval of any act by the other Party requiring its consent or approval shall not be deemed to waive or render unnecessary its consent to or approval of any subsequent act of the other Party. Any waiver by either Party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Agreement.
3.13 Rights and Remedies are Cumulative. Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the Parties are cumulative and the exercise by either Party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party.
3.14 Legal Counsel . Each Party acknowledges that: (i) it has read this Agreement; (ii) it has had the opportunity to have this Agreement explained to it by legal counsel of its choice; (iii) it is aware of the content and legal effect of this Agreement; and (iv) it is not relying on any representations made by the other Party or any of the employees, agents, representatives, or attorneys of the other Party, except as expressly set forth in this Agreement.
3.15 Severability . In the event that any one or more of the phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable by a valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or sections of this Agreement which are hereby declared as severable and shall be interpreted to carry out the intent of the parties hereunder.
3.16 Binding Effect. The terms of this Agreement shall inure to the benefit of, and shall be binding upon, each of the Parties and their respective successors and assigns.
3.17 Authorized Representatives. The person or persons executing this Agreement on behalf the each Party warrant and represent that they have the authority to execute this Agreement on behalf of that Party and that they have the authority to bind that Party to the performance of its obligations hereunder.
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3.18 Effective Date . This Agreement shall become effective on the date the later of the following events occur: (1) the execution of this Agreement by all Parties; and (2) the execution by all Parties of the Fourteenth Amendment to the Joint Powers Agreement ; and (3) the execution of an amendment to the Master Services Agreement between the County and the Authority to end County payments to the Authority.
SIGNATURES ON FOLLOWING PAGE
SIGNATURE PAGE
By:______________________________________
_______________, City Clerk
By: __________________________________
___________, City Manager
Date: ___________
CITY OF RIVERSIDE COUNTY OF RIVERSIDE
By:______________________________________
____________, City Attorney
By: __________________________________
____________, City Manager
Date: ___________
By: __________________________________
____________, City Manager
Date: ___________
By:______________________________________
______________, City Attorney
By: __________________________________
____________, County Executive Officer
Date: ___________
CITY OF MORENO VALLEY
APPROVED AS TO LEGAL FORM: APPROVED AS TO LEGAL FORM:
APPROVED AS TO LEGAL FORM:
By:______________________________________
______________, City Attorney
CITY OF PERRIS
By: __________________________________
_________________, County Counsel
ATTEST:
APPROVED AS TO LEGAL FORM:
ATTEST:
SIGNATURE PAGE TO
TAX AND REVENUE SHARING AGREEMENT AMONG THE CITY OF
MORENO VALLEY, THE CITY OF PERRIS, THE CITY OF
RIVERSIDE, AND THE COUNTY OF RIVERSIDE REGARDING THE
MARCH JOINT POWERS AUTHORITY TERRITORY
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be entered into as of the date set forth above.
ATTEST: ATTEST:
By:______________________________________
________________, City Clerk
By:______________________________________
____________, Clerk of the Board
By:______________________________________
_____________, City Clerk
EXHIBIT A – AUTHORITY TERRITORY
EXHIBIT A
AUTHORITY TERRITORY
[***INSERT LEGAL DESCRIPTION OF AUTHORITY TERRITORY AND MAP***] EXHIBIT B – AUTHORITY TERRITORY
EXHIBIT B
PROPERTY TAX REVENUE AREA
[***INSERT MAP***]
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