Item Number: 17
City Council / Board of Directors
Written Communications
Meeting of: May 7, 2024
Submitted By:
Doug Mathews, Director of Public Works and Water
Subject:
Consideration of Resolution Nos. VWD 24-002 and VWD 24-003 - Resolutions of the Board of Directors of the Victorville Water District initiating proceedings to fix, levy, and collect standby charges for Water Improvement District Number One (WID1) and for Water Improvement District Number Two (WID2) for Fiscal Year 2024-2025.
Recommendation:
That the Honorable Victorville Water District Board of Directors:
(1) Approve Resolution No. VWD 24-002 authorizing the Victorville Water District to initiate proceedings to fix, levy, and collect standby Charges for Water Improvement District One for Fiscal Year 2024-2025;
(2) Approve Resolution No. VWD 24-003 authorizing the Victorville Water District to initiate proceedings to fix, levy, and collect standby Charges for Water Improvement District Two for Fiscal Year 2024-2025; and (3) Set May 21, 2024, as the date for the Public Hearing for the purpose of hearing arguments for and against determinations to fix, levy, and collect water standby charges as set forth in the aforementioned resolutions.
Fiscal Impact:
The proposed resolutions authorize the District to have Water Improvement District Number One and Water Improvement District Number Two standby charges for Fiscal Year 2024-2025 (tax roll year 2024) assessed by the County Assessor. These charges are currently estimated to result in revenue per district in the amount of $90,300 and $337,980 respectively.
The District will incur a small expense from processing the required notices and publishing the required Notice of Public Hearing (NOPH), estimated to be under $7,000. These expenses were budgeted in the current Fiscal Year in the account listed below. •4100030-52300 – Water Administration, Contract Services 3 5
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Strategic Plan Goal:
This item aligns with Goal A, “Financial Sustainability” of the City’s Strategic Plan. A large portion of standby fees collected provide a revenue source that is pledged to an outstanding bond. The remaining portion helps pay for the operating costs to maintain the water system. The collection of the standby fee also helps to maintain water rates as low as possible.
Background:
Each year the District must take steps, in compliance with California Water Code Section 31031 et seq. and Government Code Section 6066, to levy and collect standby charges.
These steps include:
(1) initiating proceedings to fix, levy, and collect water standby charges for the Fiscal Year (establishing a hearing date, etc.);
(2) notifying the general public of the Public Hearing with publications in the newspaper on two separate dates;
(3) mailing notices of the hearing to the affected parcel owners; and (4) conducting the Public Hearing.
Water Improvement District Number One (WID1)
Since 1975, WID1 (formerly known as the Victor Valley Water District) has assessed a water standby charge. This charge, authorized by California Water Code Section 31031, may not exceed $10.00 per acre per year for each acre of land, or ten dollars per year for each parcel of land less than an acre. For example: 0.2 acres = $10.00; 5.0 acres = $50.00; and 5.2 acres = $60.00. By means of the proposed Resolution No. VWD 24-002, the District is initiating the process to fix, levy, and collect this charge (at the same rate as last year) as to all parcels within WID1 for which water service facilities have been constructed within close proximity thereto (660 feet). Any parcel of land which is connected to and obtains water from the District’s water system, as well as any governmental or public agency, is exempt from the assessment.
Water Improvement District Number Two (WID2)
Since 1969, WID2 (formerly known as the Baldy Mesa Water District) has assessed a water standby charge. This charge, authorized by California Water Code Section 31032.1, may not exceed $30.00 per acre per year for each acre of land, or $30.00 per year for each parcel of land less than an acre. The proposed charge remains unchanged at $15.00 rather than the allowable maximum of $30.00 and is prorated based on the number of acres in excess of one acre. For example: 0.2 acres = $15.00; 5.0 acres =$75.00; and 5.2 acres = $78.00. By means of the proposed Resolution No. VWD 24- 003, the District is initiating the process to fix, levy, and collect this charge (at the same rate as last year) as to all parcels within WID2 for which water service facilities have been financed and constructed. All governmental or public agencies are exempt from the assessment.
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Discussion:
Standby charges must be assessed annually, on an uninterrupted basis, in order to maintain the previously fixed assessment rate. The proposed resolutions do not change the rate or calculation by which these charges are assessed. If standby charges are discontinued, they may not be reinstated in a subsequent year, except as noted in California Government Code Section 53753 and in compliance with notice, protest, and hearing procedures applicable to increased assessments under Proposition 218.
The revenues from the water standby charge directly offset WID1’s actual cost to maintain facilities, including water mains, which are immediately available to provide water service to those parcels. For WID2, the revenues directly offset the actual cost of financing water infrastructure capital facilities within the Water Improvement District. These revenues are pledged to the debt service on the issuance of a Certificate of Participation (bond).
Provisions of the LAFCO consolidation action requires debt incurred in one Water Improvement District to be paid by the rate payers of that same Water Improvement District.
Staff recommends that the Board of Directors approve Resolution Nos. VWD 24-002 and VWD 24-003 authorizing the Victorville Water District to initiate proceedings to fix, levy, and collect standby charges for Water Improvement Districts 1 and 2 for Fiscal Year 2024- 2025 and set May 21, 2024, as the date for the Public Hearing.
Staff remains available for any questions or comments the Board may have.
Attachments: A. Resolution No. VWD 24-002
B. Resolution No. VWD 24-003
C. Water Code Sections 31031 through 31032.9
D. Notice of Public Hearing on Water Standby Charges- WID 1 E. Notice of Public Hearing on Water Standby Charges- WID 2