Agenda Item: 3
CITY OF SANTA CLARITA
AGENDA REPORT
PUBLIC HEARINGS
CITY MANAGER APPROVAL:
DATE: June 25, 2024
SUBJECT: FISCAL YEAR 2024-25 ANNUAL LEVY FOR OPEN SPACE
PRESERVATION DISTRICT
DEPARTMENT: Administrative Services
PRESENTER: Andrew Adams
RECOMMENDED ACTION
City Council conduct a public hearing and adopt a resolution approving the Engineer’s Report for the Fiscal Year 2024-25 annual levy of assessments for the Open Space Preservation District.
BACKGROUND
Property owners in the City of Santa Clarita (City) overwhelmingly approved the creation of the Open Space Preservation District (OSPD) in July 2007 to facilitate the purchase and preservation of undeveloped land in and around the City, within the boundaries of the OSPD.
The City partners with a number of public entities to meet the goals of the OSPD, including 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.
During the creation of and in approving the OSPD, property owners authorized a $1.00 increase in the maximum assessment rate each subsequent fiscal year to maximize the ability to purchase and preserve undeveloped land in and within proximity to the City to create a surrounding green belt.
In Fiscal Year (FY) 2023-24, the City Council authorized levy of the maximum OSPD assessment rate of $41.00 per Equivalent Dwelling Unit (EDU). It is important to note that 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 Santa Clarita.
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 2037. 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. The attached Engineer's Report in the Reading File describes the OSPD, including the improvements, budgets, parcels, and proposed assessments for FY 2024-25.
ALTERNATIVE ACTION
Other direction as determined by the City Council.
FISCAL IMPACT
Upon adoption of the Open Space Preservation District annual levy for Fiscal Year 2024-25, $42.00 per Equivalent Dwelling Unit will be placed on the Los Angeles County tax roll. For Fiscal Year 2024-25, annual OSPD special assessment revenues are estimated to be approximately $4 million. The funds will be deposited into the OSPD Special Assessment Revenue Account 358-402301 and will be utilized for open space, park, and parkland program purposes.
ATTACHMENTS
Public Hearing Notice
Resolution
FY 2024-25 OSPD Engineer's Report (available in the City Clerk's Reading File)