Title
Public Hearing to Consider Adoption of Resolution Calling a Special Election Regarding Alteration of the Rate and Method of Apportionment of Special Taxes for Community Facilities District No. 17-1 (Alameda Point Public Services District); and
Adoption of Resolution Amending the Fiscal Year 2018-19 Budget for the Community Facilities District 17-1 Fund by Increasing Estimated Revenue by $174,051 and Increasing the Expenditure Budget by $35,000. (Base Reuse 819099)
Body
To: Honorable Mayor and Members of the City Council
From: David L. Rudat, Interim City Manager
EXECUTIVE SUMMARY
The first recommended action will alter the Rate and Method of Apportionment of Special Taxes (RMA) for Community Facilities District (CFD) 17-1 to modify the definitions of “Developed Property” and of “Non-Residential Property” in the RMA, so that an unintended error is corrected and the RMA reflects what was intended by the City and property owners at the time of formation of the CFD.
The second recommended action will amend the City’s Fiscal Year (FY) Budget to appropriate monies in the CFD 17-1 Fund to pay for the proceedings necessary to amend the RMA and various operating costs.
BACKGROUND
On March 21, 2017, the City Council adopted Resolution No. 15249 pursuant to which it formed CFD 17-1 (Alameda Point Public Services District) in connection with the development of Alameda Point. CFD 17-1 was established in order to finance annual public services and transportation demand management services and programs associated with the development of the 68-acre Site A development. Other areas of Alameda Point are included in a “Future Annexation Area” for the CFD and are to be annexed into the CFD prior to their transfer to private property owners. The first such annexation occurred on March 15, 2018, in connection with a transfer of a portion of the Site A land.
The Resolution that formed the CFD approved the RMA, which sets forth the manner in which the City Council will levy special taxes on property in the CFD to pay the costs of services eligible to be funded by the CFD, and to pay the costs of the City to administer the CFD. Following the formation of the CFD, it was discovered that there was an unintended error in the RMA that would prevent the levy of special taxes on property to be included in Zone 2 of the CFD (the Adaptive Reuse Area). While the City expected to be able to levy special taxes on all property in, or annexed to, Zone 2 of the CFD that was developed, the definition of “Developed Property” in the RMA would not allow for the special tax levy on certain parcels. The owners of all property in Zone 2 of the CFD were advised of the expected special tax levy. The proposed change in the RMA alters the definitions of “Developed Property” and of “Non-Residential Property” to reflect what was intended by the City and property owners at the time of CFD formation.
On October 2, 2018, the City Council adopted a Resolution of Consideration to alter the RMA to correct the unintended error, and set a public hearing for October 16, 2018, regarding the proposed alteration. A notice of the public hearing has been published as required by law. Following the public hearing, staff recommends that the City Council approve a resolution calling for a special mail ballot election of the owners of property in the CFD regarding the alteration.
DISCUSSION
The CFD was formed pursuant to the City’s Special Tax Financing Improvement Code (Municipal Code Section 3-70.1 and following), which provides for a process to alter the RMA for the CFD. That process began with the adoption by the City Council on October 2, 2018 of a Resolution of Consideration to alter the RMA, which described the proposed alteration and called for a public hearing on October 16 regarding the alteration.
The revised definition of “Developed Property” means for each Fiscal Year: (i) all Taxable Property in Tax Zone 1 for which a building permit was issued after January 1, 2016, and on or before May 1 of the Fiscal Year preceding the Fiscal Year for which the Special Taxes are being levied; and (ii) all Taxable Property in Tax Zone 2 which have transferred from public ownership to private ownership or have been improved with any improvements that have or have had an improvement value on the County Assessor’s roll.
The amended definition of “Non-Residential Property” means all Assessor’s Parcels of Developed Property that have been improved with vertical improvements other than one or more residential facilities, and includes Taxable Property Owner Association Property and Taxable Public Property.
Following the public hearing, the City Council, if it decides to proceed with the alteration, will consider adoption of a resolution calling for a special mail ballot election of the owners of property in the CFD to approve the alteration, with each landowner entitled to one vote per acre or portion of an acre of land that it owns in the CFD. The election, to be set for December 6, 2018, will be conducted by the City Clerk with the assistance of the City’s Bond Counsel and the Special Tax Consultant for the CFD. If more than two-thirds of the votes cast at the election are in favor of the alteration, the City Council will canvass the election and declare that the alteration of the RMA is effective.
FINANCIAL IMPACT
There is no impact to the General Fund to modify the RMA for the CFD. All costs related to the alteration proceedings are to be paid from funds derived from the special tax levy in the CFD. The annual costs to administer the CFD are to be paid from annual special taxes levied on property within the boundaries of the CFD. CFD 17-1 Budget was not established as part of the Mid-Cycle Update as this is a new Fund that was inadvertently missed during the Budget process. CFD revenue for FY 2018-19 is estimated at $174,051. Expenditures, including county fees and consultant expenses to alter the RMA, are estimated at approximately $35,000. Staff recommends that the City Council approve a resolution amending the City’s FY 2018-19 budget to appropriate both the revenue and expenditures for the CFD 17-1 Fund.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The Municipal Code contains, in Section 3-70, the City of Alameda Special Tax Financing Improvement Code pursuant to which the CFD was formed, and pursuant to which the alteration of the RMA is being processed.
ENVIRONMENTAL REVIEW
On February 4, 2014, the City of Alameda certified the Alameda Point Final EIR in compliance with the California Environmental Quality Act (CEQA). The Final EIR evaluated the environmental impacts of redevelopment and reuse of the lands at Alameda Point consistent with Alameda Point Zoning District, including the adaptive reuse area and with the Alameda Point Waterfront Town Center Plan, which included Site A. The formation of the CFD, and the action to alter the RMA, are consistent with the prior approvals and will not result in any new or substantially more severe environmental impacts than were previously identified in the Final EIR.
RECOMMENDATION
Conduct a Public Hearing to consider adopting a Resolution Calling a Special Election Regarding Alteration of the Rate and Method of Apportionment of Special Taxes for Community Facilities District No. 17-1 (Alameda Point Public Services District).
Adopt a Resolution amending the FY 2018-19 Budget for the Community Facilities District 17-1 Fund by increasing estimated revenue by $174,051 and increasing the expenditure budget by $35,000.
Respectfully submitted,
Debbie Potter, Base Reuse & Economic Development Director
By: Michelle Giles, Redevelopment Project Manager
Financial Impact section reviewed,
Elena Adair, Finance Director