Item Number: 22
City Council / Board of Directors
Written Communications
Meeting of: June 16, 2026
Submitted By:
Fredy Bonilla, City Engineer
Subject:
Community Facilities District (CFD) 2024-01 (Municipal Services) Annual CFD Report for FY 2025–26 and Consideration of the Special Taxes Levy for FY 2026–27 Recommendation:
That the Honorable City Council adopt Resolution No. 26-061, accepting the Annual Community Facilities District Report for FY 2026-27 and approving the Community Facilities District (CFD) 2024-01 (Municipal Services) Special Taxes Levy for FY 2026-
27. Fiscal Impact:
The revenue to be generated from the FY 2026-27 Special Taxes for CFD No. 2024-01 was unknown at the time of budget preparation. As a result, revenues for Fund 380 – Special Tax A, Public Safety and Fund 381 – Special Tax B, Maintenance Services will be incorporated into the FY 2026-27 Midyear Budget review process. Based on the recommended levy amounts, the anticipated revenues are approximately $334.77 for Special Tax A (Fund 380) and $3,180.66 for Special Tax B (Fund 381).
Special Tax A funds the costs related to public safety services under the Rate and Method of Apportionment (RMA), the Maximum Special Tax A is adjusted annually beginning July 1, 2026, by the greater of the Consumer Price Index (CPI) percentage change or five percent (5%). With the CPI change calculated at 3.28%, the Maximum Special Tax A Rates will increase by 5% on July 1, 2026. A detailed rate schedule is included in Exhibit 1 of Attachment A. Based on rising public safety costs, including a 7.8% increase in the San Bernardino County Sheriff Department’s contract, staff recommends levying all parcels subject to Special Tax A at their Maximum Special Tax A Rate for FY 2026-27 to keep up with the cost to provide the services.
Special Tax B funds the perpetual maintenance of public infrastructure such as landscaping, lighting, and street and sidewalk improvements. Maximum Special Tax B 4 7
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Rates are determined by Tax Zone and are adjusted annually beginning July 1, 2026, using the same CPI-or-5% methodology. With CPI at 3.28%, the Maximum Special Tax B Rates will also increase by 5% on July 1, 2026. A breakdown of rates is included in Exhibit 1 of Attachment A. Following review of annual maintenance needs and projected cost increases, staff recommends levying all parcels subject to Special Tax B at their Maximum Special Tax B Rate for FY 2026-27.
Strategic Plan Goal:
The City Council adopted the updated Strategic Plan with seven overarching goals to be achieved between 2023 and 2026, along with targeted strategies to support each goal.
Goal A, Financial Sustainability, includes Strategy 5, which calls for evaluating the creation of a Community Facilities District (CFD) or other long-term financing mechanisms to support the installation, operation, and ongoing maintenance of public improvements.
The formation of CFD No. 2024-01 (Municipal Services) and the annual levy process directly advances this strategy by establishing a Citywide services CFD and providing a mechanism for future development projects to annex into the District. Implementing this CFD helps alleviate financial pressure on the General Fund by ensuring that new development contributes proportionately to the public safety and maintenance services required to serve it.
Background:
On December 17, 2024, the City Council formed the City of Victorville Community Facilities District No. 2024-01 (Municipal Services), hereinafter CFD No. 2024-01, and adopted Ordinance No. 2453, authorizing the levy of Special Taxes A and B. As part of the formation proceedings, the City Council also adopted Resolution No. 24-102 (Resolution of Formation), which established the initial boundary map for Tract Map 14525 located along Stoddard Wells Road and designated a Citywide Future Annexation Area. The Future Annexation Area encompasses the entire City and allows future development projects to annex into CFD No. 2024-01 upon receipt of the property owner’s written Unanimous Approval at the time of annexation.
On December 17, 2024, the City Council also adopted Policy No. CP-24-06, establishing guidelines for administration of CFD No. 2024-01. The policy requires an annual review of the Maximum Special Tax Rates and provides that staff recommend annual Special Tax A and Special Tax B levy amounts to the City Council. At its discretion, the City Council may enroll levy amounts up to, but not exceeding, the Maximum Special Tax Rates established in the Rate and Method of Apportionment (RMA).
Prior to the formation of CFD No. 2024-01, Planning staff began, in August 2022, including conditions of approval requiring development projects to annex into a future CFD upon its establishment, provided project permits had not yet been issued.
On February 22, 2024, the Zoning Administrator approved Planning Case No.
ADMN23-00078, authorizing the development of a new Pollo Campero drive-thru restaurant building on an undeveloped parcel within the existing Vallarta Supermarkets 4 7
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shopping center on Amargosa Road. As a Condition of Approval, the project was required to annex into a Citywide CFD, if established prior to permit issuance, or otherwise provide mitigation for its ongoing impacts on City services
On October 9, 2024, the Victorville Planning Commission unanimously approved Planning Case No. PLAN24-00001, which included an entitlement for the development of an approximately 2,900 square foot Raising Cane’s restaurant on Roy Rogers Drive, just west of Civic Drive. One of the Conditions of Approval for the project was to annex into a Citywide CFD, if established prior to permit issuance, or otherwise mitigate the economic impacts of the development.
On November 18, 2025, the City Council adopted Resolution No. 25-079, accepting the Unanimous Approval of the property owner and annexing the Raising Cane’s development into CFD No. 2024-01 as Annexation No. 1. Because this was the first annexation following the formation of the CFD No. 2024-01 in December 2024, the item was brought forward as a Written Communication item to provide additional visibility. Staff noted at that time that future annexations would be considered routine and placed on the Consent Calendar.
On January 20, 2026, the City Council adopted Resolution No. 26-006, accepting the Unanimous Approval of the Pollo Campero property owner and approving Annexation No. 3 into CFD No. 2024-01. This action established Tax Zone 4 for the development and authorized the levy of Special Taxes consistent with the RMA. Each newly annexed development is assigned a tax zone and annexation number at the time its application is processed. Depending on the timing and sequence of project submittals, annexations are numbered in the order applications are received for administrative tracking purposes. At this time, Annexation No. 2 remains pending and is anticipated to be presented to the City Council for approval within the coming months.
On an annual basis and in accordance with Council Policy CP-24-06, the City Manager or designee prepares the Annual CFD Report, which includes the maximum allowable levy calculation based on the CPI or five percent (5%) escalator, annexation activity, and the proposed enrolled levy amount for City Council consideration. Upon approval, the levy is transmitted to the San Bernardino County Auditor-Controller for inclusion on the secured property tax roll.
Discussion:
The City formed CFD 2024-01 to establish a long-term, sustainable mechanism for funding public safety and maintenance services required as a result of new development.
CFD No. 2024-01 levies Special Tax A for public safety services and Special Tax B for maintenance services, and includes a Citywide Future Annexation Area, enabling subsequent development projects to annex into the District upon receiving Unanimous Approval from property owners.
As development projects continue to move through the entitlement and construction process, annexations into CFD No. 2024-01 result in the creation of new tax zones, each 4 7
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reflecting the specific infrastructure, service demands, and maintenance responsibilities associated with the project. Tax zones are assigned at the time of application, and annexation numbers are issued sequentially for administrative tracking. CFD No. 2024- 01 currently includes Tax Zone 1 (Tract Map 14525), Tax Zone 2 (Raising Cane’s), and Tax Zone 4 (Pollo Campero), each annexed by separate actions of the City Council. As of June 1, 2026, only Tax Zone 2 (Raising Cane’s) and Tax Zone 4 (Pollo Campero) include developed property for the FY 2026-27 tax levy.
In accordance with the RMA adopted at formation, the annual maximum allowable levy amount for Special Tax A and Special Tax B is adjusted each year by the greater of the December year-over-year CPI of 3.28% or five percent (5%). For Fiscal Year 2026-27, staff is recommending application of the 5% escalator for both Special Tax A and Special Tax B.
In evaluating the recommended levy for FY 2026-27, staff also reviewed the City’s current cost-of-service for public safety and maintenance activities funded through the CFD No. 2024-01. Personnel costs have risen due to a 3% COLA increase for City staff and a 3% increase under the Fire Services MOU. Public safety service costs continue to escalate as well, including a 7.8% increase in the Sheriff’s contract over the prior year. Additionally, inflation in contract services, materials, utilities, and infrastructure maintenance has increased the cost of providing ongoing maintenance services within each tax zone.
These conditions exceed the CPI benchmark and support levying Special Tax A and Special Tax B at their Maximum Special Tax Rates for FY 2026-27 to ensure service levels are fully funded without shifting costs to the General Fund.
Given these cost pressures and the service obligations of the District, staff recommends levying all parcels subject to Special Tax A at the Maximum Special Tax A Rate for FY 2026-27 to ensure adequate funding for public safety services. Similarly, following a review of annual maintenance needs and projected increases in service and utility costs, staff recommends levying all parcels subject to Special Tax B at the Maximum Special Tax B Rate for FY 2026-27.
The recommended levy amounts for each active tax zone are included in the Annual CFD Report and reflect the maximum rates authorized under the RMA, adjusted for the FY 2026-27 escalator, as outlined in Exhibit 1 of Resolution No. 26-061 (Attachment A).
The Annual CFD Report (Exhibit 1 to Attachment A) provides parcel-level levy calculations for each active tax zone and identifies the proposed enrolled levy for the upcoming fiscal year. These calculations also incorporate required San Bernardino County enrollment fees, including per-fund and per-parcel charges applicable to all direct assessments. Collectable revenue is adjusted accordingly to reflect these costs.
For the 2026-27 tax year, the recommended enrolled levies result in Special Tax B assessments for Tax Zone 2 (Raising Cane’s) and Tax Zone 4 (Pollo Campero), with no levy for Tax Zone 1, as no developed property exists within that tax zone at this time.
These proposed levies are within the maximum amounts authorized by the RMA and are 4 7
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necessary to ensure that the cost of providing municipal services to annexed developments is not borne by the City’s General Fund.
Should the City Council move forward with the staff recommendation and approve Resolution No. 26-061, the enrolled levy amounts will be transmitted to the San Bernardino County Auditor-Controller in the required electronic format for inclusion on the secured property tax roll for Fiscal Year 2026-27.
Staff is available for any questions the Council may have.
Prepared By:
Mel Krejckant, Public Works and Water Administrative Manager Attachments: A. Resolution No. 26-061