Agenda Item: 12
CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR
CITY MANAGER APPROVAL:
DATE: June 11, 2024
SUBJECT: FISCAL YEAR 2024-25 ANNUAL LEVY FOR OPEN SPACE
PRESERVATION DISTRICT
DEPARTMENT: Administrative Services
PRESENTER: Andrew Adams
RECOMMENDED ACTION
City Council adopt a resolution declaring the City's intention to levy assessments, preliminarily approve an Engineer's Report in connection with the Open Space Preservation District for Fiscal Year 2024-25, and set a public hearing for June 25, 2024.
BACKGROUND
In July 2007, the property owners in the City of Santa Clarita (City) overwhelmingly approved the creation of the Open Space Preservation District (OSPD) to facilitate the purchase and preservation of undeveloped land within the boundaries of the OSPD.
To meet the goals of the OSPD, the City partners with a number of public entities, including the Santa Monica Mountains Conservancy, Riverside Land Conservancy, The Trust for Public Land, County of Los Angeles, and Mountains Recreation and Conservation Authority. Through these partnerships, the City is able to utilize and leverage OSPD funds for the purchase and maintenance of properties with grant funds, land bank mitigation funds, or other special funds.
The initial maximum assessment rate, as approved by the property owners of Santa Clarita, was established at $25.00 per equivalent dwelling unit (EDU). In approving the OSPD, property owners authorized the City Council to annually increase the maximum assessment rate each subsequent fiscal year by $1.00.
In Fiscal Year (FY) 2023-24, the City Council authorized the levy of the maximum OSPD assessment rate of $41.00 per EDU. The actual assessment rate in any fiscal year must be approved by the City Council prior to the levy, and may not exceed the authorized maximum assessment rate without receiving property owner approval for the increase.
For FY 2024-25, staff is recommending the City Council approve a $1.00 adjustment from the current levied assessment rate of $41.00 per EDU to the proposed levied assessment rate of $42.00 per EDU, effective July 1, 2024. If approved, this adjustment conforms to the requirements of Proposition 218, as it is equal to the maximum assessment rate for FY 2024-25 allowable by state law.
The ability to annually adjust the maximum assessment rate by $1.00 supports the bond financing utilized by the City to purchase undeveloped land for the specific purpose of expanding the greenbelt surrounding our community.
The annual debt servicing for OSPD bonds was structured in a manner that incorporates ascending debt service payments. By issuing ascending debt, the City was able to borrow against future assessment rate increases in order to maximize the size of the borrowing. In FY 2023-24, the OSPD debt service totaled $825,006, while the proposed debt service for FY 2024-25 totals $844,806.
Annual debt service costs continue to increase every year through the 30-year repayment period and will total $1,127,850 in the final year of FY 2036-37. To offset rising debt service costs, it is necessary to adjust the annual OSPD rate by the voter-approved amount each year in order to retire bond indebtedness.
The process of ordering, approving, and setting the public hearing on the annual levy of the OSPD is required by the Landscaping and Lighting Act of 1972, and allows the City to continue levying assessments in FY 2024-25 for the purpose of acquiring open space properties. Upon adoption of the attached resolutions, a public hearing on ordering the FY 2024-25 OSPD levy will be scheduled for the June 25, 2024, City Council meeting.
ALTERNATIVE ACTION
Other direction as determined by the City Council.
FISCAL IMPACT
Open Space Preservation District assessments are budgeted, assessed, and collected annually for the preservation of undeveloped land within District boundaries.
ATTACHMENTS
FY 2025 OSPD Intent Resolution
FY 24-25 OSPD Engineer's Report (available in the City Clerk's Reading File)