Attachment E
RESOLUTION NO. 24-107
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VICTORVILLE, CALIFORNIA, ADOPTING CITY COUNCIL POLICY
NO. CP -24-06, COMMUNITY FACILITIES DISTRICT NO. 2024 -01 (MUNICIPAL SERVICES)
WHEREAS, the City Council (“City Council”) of the City of Victorville (the “City”) adopted Resolution No. 24-102, forming Community Facilities District No. 2024-01 of the City of Victorville (Municipal Services) ("Community Facilities District No. 2024-01" or the "District") pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5 of Part 1 of Division 2 of Title 5 of the California Government Code (the "Act"); and
WHEREAS, as part of Resolution No. 24- 102, the “ Rate and Method of Apportionment” (“RMA ”) outlines the annual escalator, applicability and special taxes rates (“Rates”) for properties that fall within the boundary of the District; and WHEREAS, an annual review of the District’s Rates must be done in accordance with the RMA and to ensure the Rates are sufficient to mitigate the economic impacts of providing services as outlined in the RMA to the properties; and WHEREAS, there is no requirement to implement the Rates at t he maximum allowable rate as allowed per the RMA and it is within the discretion of the City Council to establish the Rates at an amount less than the maximum allowable rate; and WHEREAS, the City Council desires to establish administrative guidelines for the District to ensure transparency in the annual review of the Rates, as outlined in City Council Policy CP-24-06 (attached hereto as Exhibit A).
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF VICTORVILLE DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:
SECTION 1. The above recitals are true and correct and incorporated and made a part of Resolution by this reference, including any definitions contained therein.
SECTION 2. The City Council has reviewed and hereby adopts City Council Policy CP- 24-06 attached hereto as Exhibit A.
SECTION 4. This Resolution shall be effective upon its adoption.
SECTION 5. The City Clerk shall certify to the passage and adoption of this Resolution; shall enter the same in the book of original Resolutions of the City; and shall make a minute of passage and adoption thereof in the records of the proceedings of the City Council, in the minutes of the meeting at which this Resolution is passed and adopted.
Exhibit A
City of Victorville
Council Policy
SUBJECT: Policy No. CP-24-06
VICTORVILLE COMMUNITY FACILITIES
DISTRICT NO. 2024-01 (MUNICIPAL
SERVICES)
Adopted: Dec. 17, 2024
I. Purpose
The purpose of this policy is to establis h guidelines for the implementation of Community Facilities District No. 2024-01 (Municipal Services) (CFD 2024-01) for Special Tax A and Special Tax B and the as sociated Administrative Expenses as adopted by the City Council. Special Tax A is for expenses related to public safety, including police, fire and code enforcement. Special Tax B is for maintenance services related to maintenance of project parks, parkways, park lighting, sidewalks, signage, landscapi ng in public areas, easements or right of way and open space, flood and storm protection servic es, the operation of storm drainage systems, maintenance of streets and roadways, traffic signals and street lighting, graffiti and debris removal from public improvements. Capitalized terms are defined in the Rate and Method of Apportionment for CFD 2024-01.
II. Implementation
As adopted at the December 17, 2024, Cit y Council meeting, CFD 2024-01 is a special district as formed under the pr ovisions of the Mello-Roos Community Facilities Act of 1982. The City started conditioning projects, as of August 10, 2022, requiring mitigation of ongoing economic im pacts that require the provision of additional municipal services following formation of a city-wide CFD. The formation of CFD 2024-01 established a uniform, standardized city- wide rate structure for this purpose. In the event the project decides not to annex into the City’s CFD, the condition of approval gives the project ow ner the option to establish a separate funding mechanism to provide an ongoing source of funds for the additional services comparable to the uniform, standardized city-wide rate established in the CFD Resolution.
As the CFD is now formed, projects during the pre-development entitlement phase are required to annex into the CFD or es tablish a separate comparable funding mechanism. Projects are hereby defined as new subdivision maps for single-family residential (i.e., tentative tract and parcel maps) and the development of new commercial, industrial, multi-family or mixed-use developments.
Applicability of Projects
A. Projects approved by the Planning Co mmission prior to December 17, 2024, with a recorded final map or issued building permit – are not required to annex into the CFD 2024-01. These projects are required to annex into existing assessment districts to mitigate their impact or establish a funding mechanism to provide an ongoing source of funds for landscaping, drainage, and/or general maintenance.
B. Projects with a Condition of Approval requiring mitigation of ongoing economic impacts for the provision of additional m unicipal services that were approved by the Planning Commission prior to De cember 17, 2024, without a recorded final map or issued building permit as of December 16, 2024 – are required to annex into CFD 2024-01 or establish an alternative funding mechanism to provide an ongoing source of funds for t he additional services comparable to the uniform standardized city-wide rate(s) established in the CFD Resolution of Formation.
C. Projects approved by the Planning Commission on or after December 17, 2024 – are required to annex into CFD 2024-01 or establish an alternative funding mechanism to provide an ongoing source of funds for the additional services comparable to the uniform standardized city-wide rate(s) established in the CFD Resolution of Formation.
III. Annual Maximum Allowable Levy Amount
Following the initial effective date of December 17, 2024, on July 1, of each year, commencing on July 1, 2026, the maximum allowable levy amount for Special Tax A and Special Tax B will be determined by ut ilizing the December year-over-year percentage change in the Cons umer Price Index (CPI) or five percent (5%), whichever is greater.
For Special Tax A, the levy will only be for Developed Property, which includes all Assessor’s Parcels of Taxable Property that: (i) are included in a Final Map that was recorded prior to January 1st preceding the Fiscal Year in which the Special Taxes are to be levied, and (ii) for which a Building Permit for new construction has been issued on or prior to June 1st preceding the Fiscal Year in which Special Tax A or Special Tax B is being levied.
For Special Tax B, the levy will be for Developed Property , which includes all Assessor’s Parcels of Taxable Property that: (i) are included in a Final Map that was recorded prior to January 1st preceding the Fiscal Year in which the Special Taxes are to be levied, and (ii) for which a Building Permit for new construction has been issued on or prior to June 1st preceding the Fiscal Year in which Special Tax A or Special Tax B is being levied. However, if additional funds are needed to satisfy the revenue requirements for Special Tax B, Special Tax B shall be levied Proportionately on each Parcel of A pproved Property at up to 100% of the Maximum Special Tax B for Approved Pr operty; Approved Property means all Assessor’s Parcels of Taxable Property: (i) that are included in a Final Map that was recorded prior to the January 1st of preceding the Fiscal Year in which Special Tax B is being levied, and ( ii) that have not been issued a Building Permit on or before June 1 st preceding the Fiscal Year in whic h the Special Taxes are to be levied. If funds are still required to m eet revenue needs, after levying developed property and Approved Property, Council may levy Special Tax B against Undeveloped Property; Undeveloped Property means, for each Fiscal Year, all Taxable Property not classified as Developed Property or Approved Property.
In summary, Special Tax A is only assessed on Developed Property. However, for Special Tax B, if infrastructure is constructed and accepted by the City for maintenance, annually the City will review the expense bu dget for the cost of maintaining the infrastructure and amenities. The corresponding revenue to offset these expenses is first derived from Special Tax B assessed on Developed Property. If there is a shortfall because the revenue generated from Developed Property cannot cover the budgeted expens es, the City can then approve taxing Approved Property to cover the shortfall. If there is still a s hortfall and additional revenue is needed to cover the budgeted expenses, the City may elect to also tax Undeveloped Property to ensure the bud geted expenses and Administrative Expenses are covered.
An example of the above scenario woul d be if a developer has a three-phase construction project but decides to insta ll all landscaping during the first phase of the project, and the City a ccepts those improv ements as complete and is then required to maintain the infrastructure . An expense budget would be created to cover all expenses associated with maintain ing the infrastructure – personnel, contracts, utility costs, etc. As the anticipated revenue derived solely from the first phase of Developed Property would not be sufficient to cover the budgeted expenses for all three phases of the project, Approved Property and Undeveloped Property can be taxed in order to generate sufficient revenue to cover the cost of the expenses.
IV. Enrolled Levy Amount
Before June 1 of each year, the City M anager or designee will bring forth to the City Council a report of the annual maximum a llowable levy amount, a recommendation for the proposed enrolled levy amount and a resolution directing staff to proceed with collection of the proposed enrolled levy amount in the same manner as the ad valorem property taxes are collected through the San Bernardino County Tax Assessor. Notwithstanding the recommendation from staff, it shall be at the discretion of the City Council to enroll a lesser amount or any amount up to the annual maximum allowable levy amounts for Special Tax A and Special Tax B.
If Council elects to enroll a lesser amount than the annual maximum allowable levy amount, the maximum allowable amount will still increase by the escalation factor as previously described in Section III. Th is would essentially create a situation where the Maximum Special Tax A and Maximum Special Tax B provide for excess capacity as compared to the enrolled le vy, and the City Counc il would have the option to utilize that excess capacity at a future date.
As an example, if the annual escalator for Special Tax B was determined to be five percent (5%) in a given year and the City Council decided to move forward with an escalator of only three percent (3%), the Maximum Special Tax B would still increase by the full five percent (5%) , but the property owners would only be assessed an enrolled levy based on the thr ee percent (3%) increase. If in the following year the annual escalator for Special Tax B was determined to be only one percent (1%), but the cost-of-service analysis demonstrates the enrolled levy needs to be increased by more than one perc ent (1%) to fully fund services, the City Council may elect to escalate Special Tax B up to the Maximum Special Tax B and recapture some or all of the amount they chose to forego in the prior year.
V. Collection of Special Tax
The Special Tax A or Special Tax B shall be collected in the same manner and at the same time as ordinary ad valorem prop erty taxes. Special Tax A and Special Tax B will be paid by the property owner to the Auditor/Controller/Tax Collector for San Bernardino County, and then paid to t he City from the Auditor/Controller/Tax Collector during its normal property tax distribution cycle.
VI. Determination of Ap plicable Annexation
The applicable annexation requirement for a ll land use types will be determined based on the date of either the final recorded map or building permit issuance.
VII. Exemptions
The following categories of projects shall be exempt from the requirement to annex into CFD 2024-01.
A. City-owned Property – means any devel opment of facilities on land owned by the City or any of its subs idiary agencies, provided said land is developed for public use or benefits the health, safety and welfare of the community at large.
B. Accessory Dwelling Units (ADUs) – means an attached or a detached residential dwelling unit that provides complete independent living facilities for one or more persons and is located on a lot with a proposed or existing primary residence pursuant to California Government Code Section 65852 et seq.
C. Public Entity Property – any parcel(s) which are owned by, irrevocably offered for dedication, encumbered by or restricted in use by any public entity.
D. Easements – any parcel(s) with public or utility easements making impractical their utilization for other than the purposes set forth in the easement.
E. Public Use – any parcel(s) which ar e privately owned but are encumbered by or restricted solely for public use.
F. Building Expansions – m eans any building expansion to, (1) existing residential projects that do not incr ease the number of primary residence units onsite, or (2) existing commercial, industrial or mixe d-use projects that do not increase the building floor area beyond 25 percent (25%) of the existing floor area as of December 16, 2024.