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Home My WebLink About12-Development Services CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION From: JAMES FUNK, Director Subject: Resolution determining the amount of property tax revenues to be exchanged between the Dept: Development Services City of San Bernardino and the County of San O R J G 1 N A fBernardino relative to the reorganization of three Date: March 19,2003 luPincorporated islands generally located east of Central Avenue, north of Atlantic Avenue. Synopsis of Previous Council Action: File No. 12.01-343 MCC Date: 04-07-2003 01-06-2003 - Resolution No. 2003-15 was approved, authorizing the filing of an application with the Local Agency Formation Commission for a reorganization to include the annexation of three unincorporated islands generally east of Central Avenue, north of Atlantic Avenue. Recommended Motion: ADOPT RESOLUTION ~J~ Contact person: LASZLO "Les" FOGASSY Supporting data attached: Staff Report, Map, Res. Phone: 5026 Ward: 1 FUNDING REQUIREMENTS: Amount: None Source: (Acct. No.) N/A (Acct. Description) N/A Finance: Council Notes: '1Zi2:".:D~L('t';:) 'I St Agenda Item No. J~ Jf/1/tJ3 CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION Staff Report SUBJECT: Resolution determining the amount of property tax revenues to be exchanged between the City of San Bernardino and the County of San Bernardino relative to the reorganization of three unincorporated islands generally located east of Central A venue, north of Atlantic A venue. BACKGROUND: On January 21, 2000, Assembly Bill 1555 became effective, allowing for the annexation of unincorporated territory of 75 acres or less, without the need to obtain property owner or registered voter approval. There were three islands, located in the northeast portion of the City that qualified to be annexed under this bill. The elimination of these islands would result in a more efficient delivery of services by reducing the irregular boundaries that currently exist. The proposal was submitted to the Legislative Review Committee for consideration and on May 23, 2002, the Committee recommended the initiation of proceedings for the proposed annexation. On June 17, 2002, authorization was given by the Common Council to proceed with the proposal and approval was given to execute a contract with the firm of O'Reilly Public Relations to carry out a community outreach program. This was accomplished through mailings submitted by the firm. In response to the mailings, this office received five calls from residents seeking more information about City services or the impact of annexation, but none expressed any significant concerns regarding annexation. On January 6, 2003, Resolution No. 2003-15 was adopted, making application to LAFCO for the proposed annexation. Pursuant to Section 99 of the Revenue and Taxation Code, agencies affected by a change of jurisdictional boundaries must negotiate the re-distribution of property taxes for property within the affected area and respond with a resolution. This must be accomplished within 60 days of receiving a response from the Auditor-Controller. In this case, the negotiations consist of the implementation of a formula that was established by the County in 1983. Although the formula was established 20 years ago, it appears to be a fair determination of revenues to be transferred to the City. The formula was adopted for Countywide implementation and any change likely would require negotiations between the County and the various Agencies and Cities throughout the County. A copy of the action taken by the County Board of Supervisors relative to this formula is attached. Attached for your consideration is a resolution determining the amount of tax transfer that is to occur between the County and the City upon annexation of this territory. A detail of the amount to be transferred, by tax rate area, is attached as Exhibit" A" to the resolution. Upon annexation, the total property tax to be transferred to the City for all areas is $44,721. The County Board of Supervisors adopted a similar resolution at their March 25, 2003 meeting. The deadline for submitting the resolution to LAFCO is April 29, 2003. However, due to scheduling constraints, LAFCO is proposing that this item be agendized for their public hearing to be held on April 16, 2003, subject to the adoption of the resolution. This action only applies to property tax revenues. Additional revenues, such as gas tax and vehicle license fees, would also be received by the City after the annexation is complete. The actual amount of some of these fees could be subject to actions by the State in finalizing its budget. This item is the only formal action that will be required by the City. The remaining proceedings, including the public hearing, will be through LAFCO. Upon completion of the annexation, staff will submit a report on the completion of the annexation. FINANCIAL IMP ACT: Property tax revenues in the amount of $44, 721 will be received for the first year after annexation. Subsequent year's revenue would increase or decrease pursuant to Proposition 13. RECOMMENDATION: Adopt Resolution. ret) ~u Ud Ul:::JbP LHt-.....U :::JU:::J .;:JtjI(-~tjI(J. p.l cc: LAFC - L. Hendon_ CAO - Wells & Reid @ Inc. City Auditor Covt. Relations Leg. Advocate c/o Gove. Relations File ", I . .. E . e ., L ~ .... '" .... .. '0 'Z!- x al LL :;; .. 0 ~ ... , MINUTES OF THE BOARD OF SUPERVISORS OF SAN BERNARDINO COUNTY, CALIFORNIA GO January 3, l-983 :T: APPllOVIIL ITIES-COUNTlt' POLIcY PACKAGF. FOR BETTER COORDINATION AND H}>JlMONY BY CITIES AND COUNTY' MENOATION: Approve tbe attacbed policY st<ltemcnts and programs as the city-county Policy Pack~ge on tbe following i~sues' 1. Annexation tax transfer formulas. This proposal inc~cases the t~x revenues for annexations of developed properties totaling lesS than 100 acres and maintains the current formula for vacant or undeveloped properties. The purpose is to give an incentive for city annexations involving developed property and people which can benefit from city services. 2. Proposed annexation legislation. This propoGal is to simpliry and encourage annexation within city sphere of influences and to provide a more logical boundary line between cities and cities and county. 3. Cities-County Redevelopment Memorandum of under~tanding. This proposal is to set out a series of understanding as to when the cities and county will use redevelopment programs. 4. proposal for joint legislative advocacy. This proposal would allow for joint city~ounty use of our Legislative ~vocate on legislation which is not opposed by the city or County. ActiOJ1 of the Boprd nf Sllpervisors APPROVED BOARD OF SUPERVISORS COUNIY OF SAN BERNARDINO .:"'~'~': W~'\.. . I..... :., . " " H 2 " "' x 1 3 5 BY DATED: t"ec ~U U.,jI UJ.;;JtJp LHt"l.oU ~u~ dtlt-;;)tlt.L -2- BACKGROUND' In the interest of encouraging closer cooperation between San Bernardino city 6nd County, the City Manage~ andCounty Admini~trative Officer have been worldng to como to an agreement on the items listed above. curing the recent City-County ~eeting at Lake Arrowhead, including elected represcntative~, it appeared that there was a consensus developing concerning thcse same points. .In our roost recent City-County Managers' Meeting, the city managers requested that this policy formula he approved by the Board of supervisors prior to action being t;;ll<en by the various cities throughout the County. we therefore recommend the adoption of these policies with the good faith that the cities will earnestly consider and adopt them as presented. If not all the cities agree to the policies, those which do can still be included in this type of progr~. RBR: DID Attachments p..: /0 ~ Feb 20 03 01:~6p LAFCO 909 3B7-~B71 p.3 FORMULA FOR PROPERTY TAX TRANFER PROCESS For proposals processed by the Local Agency Formation Commission involving jurisdictional change, excluding incorporations and formations, a property tax transfer determination is required. This requirement is set out in Section 99 of the California Revenue and Taxation Code. The purpose ofthis process is to establish the new entity's share of property tax revenue to be received within each of the tax rate areas (TRAs) following completion of the proposal. Since 1980, there has been a standard formula for the new division of ad valorem property tax revenues. This formula came out of negotiations by a committee of City Managers and representatives of the County Administrative Office (Earl Goodwin, CAD; Lyn Kirl<hofer, Asst. CAD; and John Michaelson, Administrative Analyst) in 1979 and was officially adopted by the County Board of Supervisors in 1980. The only ch<mge to. this standard formula was adopted in January 1983 and included the following policy declaration by the County: "Annexation tax transfer formula: This proposal increases the tax revenues for annexations of developed properties totaling less than 100 acres and maintains the current formula for vacant or undeveloped properties. The purpose is to give an incentive for city annexations involving developed property and people which can benefit from city services." The formula is developed as follows: 1. The total value for the area is established (County Assessor's office) on a tax rate area basis. The revenues and percentage distribution of those revenues is defined on a tax rate area basis (Auditor Controller's Office - Property Tax Division). 2. The percentage of revenues received by the City in its "Major TRA" is applied to the revenues generated within the proposal area as a whole. (Major TRA is defined for those cities existing prior to Prop 13 as its primary TRA, for cities incorporated after 1979 it is the percentage achieved during the incorporation process as required by statute). This calculation provides the 'share" that the City would have received had the area been within its boundaries. 3. The special districts within the area whose functions are to be taken over by the City (the agencies to be detached) are added together and then subtracted from what would have been the City's historic share. F~b 20 03 01:5Gp LAFCO SOS 387-5871 p.4 4. The balance that remains after this calculation is then split in half between the County and the City - to share the pain of the loss. EXAMPLE: Total TalC Revenue generated in an area Proposed for annexation Current percentage share collected by City In Major TRA $25,000 28% What would have. been historic share ($25.000 x 28%)' $7,000 Current tax revenues generated by districts whose function will be assumed by City (districts to be detached) Fire District CSA Sl-1 CSA 70 Ubrary $2,500 600 100 1,000 Total Transferred Districts $3.200 Historic share minus transferred Districts equals Balance remaining Remainder divided SO/50 between County and City Total transfer to the City (Districts to be detached plus 50% of remainder) $3.800 $1,900 $5,100 This formula provided a .share the pain" transfer to cities based upon losses to the County General Fund. This .share the pain" formula held true for all the cities except the City of Rialto. It held the unique position of having an historic share smaller than the detaching districts. In this case. the residual revenue was transferred to the County General Fund. However, since the ERAF redistribution of revenues in FY 92-93, many cities receive their full historic share with revenues remaining from the detachment of special districts. From 92-93 through roughly 1998, the remaining revenues were transferred in total to the County general fund. However, beginning in approximately 1998 this remainder is distributed in the same SO/50 division as the loss had previously been distributed with the City and County general fund receiving an increased share percentage. 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RESOLUTION OF THE CITY OF SAN BERNARDINO DETERMINING THE 3 AMOUNT OF PROPERTY TAX REVENUES TO BE EXCHANGED BETWEEN AND AMONG THE CITY OF SAN BERNARDINO AND THE COUNTY OF SAN 4 BERNARDINO RESULTING FROM THE JURISDICTIONAL CHANGE DESCRIBED BY LAFCO 2915 FOR THREE ISLANDS OF UNINCORPORATED TERRITORY 5 GENERALL Y LOCATED EAST OF CENTRAL A VENUE, NORTH OF ATLANTIC 6 AVENUE. 7 BE IT RESOL VED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: 8 9 10 Bernardino hereby find and determine that: SECTION 1. Recitals. That the Mayor and Common Council of the City of San 11 12 13 14 15 altered by a proposed jurisdictional change shall negotiate and determine by resolution the A. Pursuant to Section 99 of the Revenue and Taxation Code, prior to the issuance of a certificate of filing by the Local Agency Formation Commission Executive Officer, the governing bodies of all local agencies whose service area or service responsibilities will be 16 amount of property tax revenues to be exchanged between and among such local agencies. 17 18 event that a jurisdictional change would affect the service area or service responsibility of one or 19 B. Except as provided in Section 99.1 of the Revenue an Taxation Code. in the more special districts, the Board of Supervisors of the County of San Bernardino, on behalf of 20 the district or districts, negotiate any exchange of property tax revenues. 21 22 23 Board of Supervisors of the County of San Bernardino have determined the amount of property 24 C. The Mayor and Common Council of the City of San Bernardino and the tax revenues to be exchanged as a result of jurisdictional change described by LAFCO 2915, for 25 the three unincorporated islands generally located east of Central A venue. north of Atlantic 26 Avenue. 27 28 03/19/03 '1Cc . /f, ;f /11t'3 RESOLUTION DETERMINING THE EXCHANGE OF PROPERTY TAX REVENVES BETWEEN THE CITY OF SAN BERNARDINO AND THE COUNTY OF SAN BERNARDINO RESUL TI:\G FROM A 1 CHANGE OF JURISDICTIONAL BOUNDARIES DESCRIBED BY LAFCO 2915. 2 3 SECTION 2. Implementation. 7 8 accepted. 9 10 change and attributable to the local agencies whose service area or service responsibilities will be 11 SECTION 3. The annual tax increment generated in the areas subject to the jurisdictional altered by the p,oposed jurisdictional change shall be allocated in the future years pursuant to the 12 provisions of Section 99 of the Revenue and Taxation Code. 13 14 15 to the passage of this resolution and to cause a certified copy to be filed with the Executive 16 17 18 SECTION 4. The City Clerk of the City of San Bernardino is hereby directed to certify OtYicer of the Local Agency Formation Commission of the County of San Bernardino. il/ 1// 19 20 21 22 23 24 25 26 27 28 03'19'03 2 RESOLUTION DETERMINING THE EXCHANGE OF PROPERTY TAX REVENUES BETWEEN THE CITY OF SAN BERNARDINO AND THE COUNTY OF SAN BERNARDINO RESl'LTING FROM A 1 CHANGE OF JURISDICTIONAL BOUNDARIES DESCRIBED BY LAFCO 2915. 2 3 I HEREBY CERTIFY that the foregoing resolution was duly adopted by the Mayor and 4 Common Council of the City of San Bernardino at a meeting thereof 5 held on the day of .20_. by the following vote, to 6 7 wit: Council Members: A YES 8 NAYS ABSTAIN ABSENT 9 ESTRADA 10 LONGVILLE 11 MCGINNIS 12 DERRY 13 14 15 ANDERSON SUAREZ 16 MCCAMMACK 17 18 19 20 21 22 City Clerk The foregoing resolution is hereby approved this day of ,20_ JUDITH VALLES, Mayor City of San Bernardino 27 28 031] 9/03 3 ~ I/) 'tl r:: .!!! ~ 'tl CIl .... 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'" <0 00 "" o N '" o I- 0:: W LL en Z [2 I- ...J < l- e) ** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT ** RESOLUTION AGENDA ITEM TRACKING FORM Meeting Date (Date Adopted): 4 - 'l- 0 ,~ Item # Vote: Ayes i .'1 Nays -e7 Change to motion to amend original documents: IL Resolution # Abstain .0 '2003' 08 Absent 8 Reso. # On Attachments: / Contract term: - Note on Resolution of Attachment stored separately: ~ Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTY By: Null/Void After:- A - q , 03 Reso. Log Updated: Seal Impressed: ./ Date Sent to Mayor: Date of Mayor's Signature: L.I- ICY ( ';:' Date of Clerk/CDC Signature: '" - I (y l' :)) /./ See Attached: See Attached: See Attached: Date Returned: ~ Date~Memo/Letter Sent for Signature: 60 Day Reminder Letter Sent on 30th day: 90 Day Reminder Letter Sent on 45th day: Request for Council Action & Staff Report Attached: Updated Prior Resolutions (Other Than Below): Updated CITY Personnel Folders (6413, 6429, 6433, 10584, 10585, 12634): Updated CDC Personnel Folders (5557): Updated Traffic Folders (3985, 8234, 655, 92-389): Yes/ No By Yes No --..L- By Yes No ,/ By - Yes No -.L By Yes No V By Copies Distributed to: City Attorney V Parks & Rec. Code Compliance Dev. Services ~ EDA Police Public Services Water Finance MIS Others: L...'S i=C0(F-,S-1 -(',,'iZ'TlhO) I Notes: BEFORE FILING. REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE (Contract Term. etc.) Ready to File: i1li:...... Date: '1-II'o-~ Revised 01112/01