HomeMy WebLinkAbout1989-11-14; City Council; 10369; GROWTH MANAGEMENT FINANCING“V I ,’ +
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CITmF CARLSBAD - AGENDmlLL
AB# iej36 7 TITLE: DE
CI1 MTG. 11-14-89 GROWTH MANAGEMENT FINANCING
DEPT.& CI1
RECOMMENDED ACTION:
1) Adopt by motion a revised City Council Policy 38 - Policy for of Mello-Roos Community Facilities Act of 1982.
2) Direct staff to return with the appropriate documents to form first Community Facilities District.
ITEM EXPLANAT I ON :
On January 10, 1989, the City Council directed staff to develo comprehensive citywide financing program to be used in conjunction \ the City‘s Growth Management Program and to investigate the use c Community Facilities District.
The need to create a comprehensive financing plan arose bekuse it bel apparent that continuing on the pay-as-you-go fee system will not a the city to provide necessary major public facilities as required by Growth Management Program. It also was a result of the inabilitj individual Local Faci 1 it i es Management Zone Financing P1 ans to address provide financing for these necessary major facilities. As presen’ these individual financing pl ans would create a piecemeal approach tow the overall financing of facilities and did not adequately address financing requirements for major public facilities.
Staff has completed a thorough review of the Community Facilities Disti (Mello-Roos) and has determined how it could be used as part of overall Growth Management Financing Program. Attached as Exhibit #i a memorandum to the City Manager dated November 6, 1989 which descr- in detail the work undertaken by staff and the finance program b( recommended. The recommended program i s a pub1 i c financing proposal wt will impact vacant land. No developed properties will be effected by proposed program.
As a result of staff’s work on this program and corresponc recommendations, City Council Policy 38, which defines the use of Mello-Roos Community Facilities Act of 1982, has been revised to impler the Growth Management Financing Program.
FISCAL IMPACT:
The goal behind the creation of the proposed Growth Management Financ Program is to create a comprehensive plan that guarantees funding major public facilities in conformance with the public facil performance standards of the Growth Management Program. The Grc Management Financing Program as currently structured does not guarar funding for all capital improvements, however, it does provide for tt major facilities which are general in nature and are too large to funded by one developer without the use of public debt.
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Page Two of Agenda Bill No. /o i 36Y
The use of the Mello-Roos District as a financing tool matches the fun(
for key improvements with the demand for services as measured by Growth Management Program. The Mello-Roos Community Facilities Dist recommended to be used to fund major facilities with debt which currently within the City’s existing fee programs. Therefore, t
permits are pulled.
Without this overall financing program, each Local Facilities Manage Zone Plan would have to deal with the funding of these major improveme If no coordinated program with all other agencies and the developer adopted by the City, the funding of major public facilities require the Growth Management Program will be extremely complex and difficul guarantee.
The effect on the property owner and eventual homeowner has bec principal concern throughout this process. The tax structure and prop tax rates included in this proposed financing district result approximately the same cost to the property owner or homeowner as if existing fees had been paid when development occurred.
The advantage to the City is the ability to levy a vacant land tax w
public facility improvements concurrent with demand.
developers in the district will receive fee reductions when buil
allows the issuance of bonds in order to guarantee the financing of m
EXH I BITS :
1. City Council Policy 38 as revised.
2. Memorandum to City Manager dated November 6, 1989.
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Page 1 of 5 CITY OF CARLSBAD
Policy No. 38
COUNCIL POLICY STATEMENT Date Issued WW
Effective Date 11/1
Cancellation Date
Supersedes No. 38
General Subject: AS s E s SM ENT D I STR I CT F I N ANC I N G
OF PUBLIC IMPROVEMENTS
Specific Subject: POLICY FOR USE OF THE MELLO-ROOS
IO/
COMMUNITY FACILITIES ACT OF 1982
Copies to: City Council, City Manager, City Attorney, Departmenf Divisions Heads, Employee Bulletin Boards, Press, File
BACKGROUND:
The City Council has adopted a Growth Management Program which contemplates construction of a large number of various public facilities in the coming ye(
provides a flexible tool which may be useful in providing financing for construction of public facilities in conjunction with development and has crel an overall financing program to provide public financing for certain type! publ ic facilities.
As well as the City's Growth Management Financing Program, the City COUI anticipates that from time to time they will receive requests from prop1 owners to use the Mello-Roos legislation for the construction of public fa1 ities.
PURPOSE:
To establish a policy which will permit the use of the Mello-Roos Commu Facilities Act in conjunction with the Growth Management Financing Prograi assist in financing major public facilities.
To provide a procedure for processing applications for Community Faci District financing and to provide a staff committee to review such applicat and to consider initiating Districts for Council consideration where appropri
This policy is primarily intended to apply to Community Facility Distr proposed for property which is predominantly undeveloped and where the elects to use publ ic financing for appropriate public improvements.
The City Council recognizes that the Mello-Roos Community Facilities Act of
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Page 2 of 5
Policy No. 38
COUNCIL POLICY STATEMENT Date Issued 11/14/1
Effective Date 11/
Cancellation Date
OF PUBLIC IMPROVEMENTS Supersedes No. 38
CITY OF CARLSBAD
General Subject: ASS ES SM ENT D I STR I CT F I N ANC I N G
Specific Subject: POLICY FOR USE OF THE MELLO-ROOS COMMUNITY FACILITIES ACT OF 1982
Copies to: City Council, City Manager, City Attorney, Department
Divisions Heads, Employee Bulletin Boards, Press, File
POLICY:
1. The City may allow the financing of public improvements or services ut the provisions of this policy where the public facilities or serv. represent, in the City's opinion, a significant public benefit, those 1 cannot be specifically identified as being related to a single zonc development, and are so expensive that a coordinated effort is require
Facilities which may be considered shall be public facilities of gent benefit such as administrative facilities, libraries, fire stations, pal schools, arterial highways, major bridges and freeway interchanges.
3. For all Districts the City shall select the special tax consultant, I counsel, and, if required, the financial consultant. The design engii and the underwriter will also be selected by the City but in consulta' with proponents of the District.
Where Districts are initiated by property owners,a sum sufficient to pay
fees and costs for the proposed Community Facilities District shall deposited with the City by the proponents of the district prior to awar any contract. The proponents shall also be required to deposit with 1 a sum sufficient to cover all City costs incurred in connection with re of a proposed district including staff review, legal review, administrat plan checking, investigation, City Council review and inspection. 1 sums will be retained by City to the degree used if the district is successfully completed or if such costs are not recovered by City fron district. Where the district is successfully completed deposits ma credited against taxes or reimbursed by the district under the terms prior agreement.
5. Where Districts are initiated by the City, all costs associated with preparation, organization, and formation shall be recovered through District.
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4.
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Page 3 of 5 CITY OF CARLSBAD
Policv No. 38
COUNCIL POLICY STATEMENT Date Issued 11/11
Effective Date 11)
OF PUBLIC IMPROVEMENTS Supersedes No. 38
POLICY FOR USE OF THE MELLO-ROOS COMMUNITY FACILITIES ACT OF 1982
General Subject: ASSESSMENT DISTRICT FINANCING Cancellation Date
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Specific Subject:
Copies to: City Council, City Manager, City Attorney, Departmeni
Divisions Heads, Employee Bulletin Boards, Press, File
6. If the City Council determines it is necessary, a financial fe( bility/market absorption study may be required prior to initiation ( District. Where such a study is required the City will select and re the consultant with funds deposited by project proponents. It is expel that the project property value to-debt ratio should 4:l after installation of the improvements to be financed. A project may be appr with a ratio between 4:l and a minimum of 3:l if the ratio is recomme by both bond counsel and the underwriter and if the City Council finds reduced ratio to be within parameters acceptable to them. The value of property proposed to be taxed shall be determined by an M.A.I. apprai performed by an appraiser selected by the City.
8. The Developer of residential property shall be required to discharge
portion of the Mello-Roos for City facilities at the time building per
are issued.
The Developer of non-residential property will be required to provide full and complete disclosure of any Community Facilities District finan applicable to the property to prospective purchasers. The requ procedure shall include, but not be limited to, all of the following:
a. Provide for full disclosure of this and any other assess financing applicable to the property to prospective purcha including prinicpal, interest rate, duration and amount of mon payments .
List the amount of the tax in all sales brochures, all adverti
and all purchase documents adjacent to the sales price of proeprty and in the same size type.
Give prospective purchaser an option to have the tax disch; prior to close of escrow or to assume the tax by a pass thr
assessment.
9.
b.
c.
as a part of the sales price or by a reapportionment of
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Page 4 of 5
Policy No. 38
COUNCIL POLICY STATEMENT Date Issued 11/14
Effective Date 11/
CITY OF CARLSBAD
General Subject: ASSESSMENT DISTRICT FINANCING Cancellation Date
OF PUBLIC IMPROVEMENTS Supersedes No.
Specific Subject; POLICY FOR USE OF THE MELLO-ROOS COMMUNITY FACILITIES ACT OF 1982
Copies to: City Council, City Manager, City Attorney, Departmen1
Divisions Heads, Employee Bulletin Boards, Press, File
10. The City or a consultant selected by the City will determine the t formula. Although this policy does not fix the method of determinin formula, strong consideration should be given to (a) a fixed annual a
or (b) a fixed amount increased annually by a small percentage.
PROCEDURE:
1. Proponents desiring to form a Mello-Roos district shall submi application requesting a study for the establishment of a Comm
Facilities District which shall do all of the following:
a. Request the City Council to consider proceedings to establish a M Roos Community Facilities District.
b. Describe the boundaries of the territory proposed for inclusion i District.
c. State the types of facilities to be financed by the District.
d. Provide a detailed financial alternative analysis exploring altern funding options and demonstrating the advantages which make a P Roos Community Facilities District the most desirable fina mechanism for the proposed improvements.
e. Be signed by not less than ten (10%) percent of the registered v residing within the proposed District or by owners of not less tha (10%) percent of the land area within the proposed District.
2. It is the intention of the City Council that proponents of a District an early opportunity to have the proposal reviewed by City staf compliance with this policy. In that regard, the City Council h directs the creation of the Project Review Committee. The Committee consist of the City Manager, Assistant City Manager, Assistant to the Manager, City Attorney, Community Development Director, Finance Dire Planning Director, and City Engineer. The Committee shall meet on re with proponents of a district to review a project to determine wheth not the requirements of this policy have been satisfied. Committee r shall take place prior to the presentation of a Community Facil District project to the City Council. Whenever any such projel presented to the Council it shall be accompanied by a report containir
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Page 5 of 5 CITY OF CARLSBAD
Policy No, 38
COUNCIL POLICY STATEMENT Date Issued 11/14
Effective Date 11/
OF PUBLIC IMPROVEMENTS Supersedes No. 3
POLICY FOR USE OF THE MELLO-ROOS
General Subject: ASSESSMENT DISTRICT FINANCING Cancellation Date
Specific Subject: COMMUNITY FACILITIES ACT OF 1982
Copies to: City Council, City Manager, City Attorney, Departmeni
Divisions Heads, Employee Bulletin Boards, Press, File
findings and recommendations of the Committee made in regard to project. The Committee may require the proponents to furnish any additi information necessary to the evaluation of the proposed District.
3. Upon review of the proposed Community Facilities District and a considering the report of the Committee, the City Council shall deter whether or not to approve proceeding with the formation of the Distr It is the policy of the City Council of the City of Carlsbad to 1 projects to the criteria set forth in this policy. The City Cou reserves to itself the authority to approve or disapprove any prop Community Facilities District based upon the evidence received at hearings held by the City Council. Any exceptions to the criteria of policy will be approved only upon an express finding by the City Cou that the project is so affected with a public interest that the City sh assist in providing tax-free financing for the improvement in orde satisfy a public need. If the City Council approves proceeding with formation of the District, City staff and the proponents shall procee accordance with State law and the requirements of this policy.
4. Where there are multiple proponents of a proposed District they 5 designate a spokesman authorized to act for the proponents in their deal
with the City. The spokesman shall be responsible for collecting any for deposit with the City, providing any necessary information to the ( and for communicating as necessary back to the proponents.
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EXHIBIT f2 November 6, 1989
TO: CITY MANAGER
FROM: Assistant to the City Manager!' City Engineer Finance Director ?P GROWTH MANAGEMENT FINANCING PROG M RECOMMENDATION
Introduction:
As directed, staff has completed a comprehensive review of the use Community Facilities District in relationship to the City's Gr Management Program. The following will provide an overview of the pro
undertaken and the recommendations being made as a result of this wo
Backsround :
The adoption of the Growth Management Program in 1986 set in motil comprehensive review of capital facility financing alternatives. P to this action the City had depended on a Pay-as-you-go program suppo by development fees. With growth management came the responsi bil it properly coordinate the capital program and to bring the develop community into the planning process.
For some time the City considered the funding alternatives that w allow the maintenance of facility standards while the community g These alternatives are shown below.
1. Pay-as-you-go - The Capital Improvement Program (CIP) for the City has historically been based on a pay-as-yo concept. The various development fees (PFF, Traffic Imp Bridge & thor. etc) were created to collect the funds neces to construct the infrastructure of the City. However, alternative did not supply funds when they would be requ to support the cost of design and construction of facilit to guarantee that these improvements were available to demand (standards). The cash flow was adequate in total, was inadequate in timing to meet the standards required bj Growth Management Program. The Council addressed this i in part when the PFF was revised to include debt service c for the Library, Macario Canyon Park and City Hall.
2. Mello-Roos financing of key facilities - The pay-as-yc CIP had its advantages, but was evident that it could nc used as the sole method of financing infrastructurc standards were to be met. The staff and Council considered the inclusion of debt financing methods for cer types of projects. These projects fell into two n
categories: projects that were generally too large f
single developer to provide an adequate guarantee of func and major streets.
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The Mello-Roos Community Facilities District was a financ method that provided the City with the ability to fund sevi types of major projects. Some of the features of Mello-l districts are shown below;
o District may be formed by a vote of land owners o The tax formula may allow for the taxation of vacant land o Bond issues can be timed to guarantee the construction of certain major facilities concur with demand The Mello-Roos district may be used to finance o wide variety of infrastructure including: - Libraries and civic buildings
- Circulation improvements
- Operating and administrative costs - Schools
o Tax rates are set annually by the governing bod
The ability to impose a tax on vacant land allows the issu of debt which provides the necessary financial guarante meet the performance standards ofthe Growth Management Pro without depending on a pay-as-you-go program.
Assessment District Financing (1913/1915 act assessments Under this option the major roads could be constructed u 1913/1915 act bonds. The City has used assessments of type in other areas to construct College Blvd and Pal Airport Road. In these cases the assessments were place commercial or industrial property. The City has
established a 1913115 act district in residential areas. of the major features of the 1913/15 act assessment are s bel ow:
3.
o Assessment districts have a long and well established history with a strong legal base o Assessment districts are formed by the City and exi sting 1 and owners o Assessments are set at the time of project construction and are not the subject of further public hearings over the life of the debt o Roads to be constructed could include:
- Rancho Santa Fe
- Alga / Poinsettia
- Cannon
- Melrose
- Carrillo Way - El Fuerte
- Palomar Airport Road - College
Overview:
On January 10, 1989, the City Council directed staff to investigatc use of a Community Facilities District and to develop a compreher financing program for major public facilities. Staff began this WOI hiring NBS/Lowry Engineers and Planners to assist in the initial data structuring and cash flow analysis. Staff also hired Mac Brow
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Brown and Diven to provide additional guidance dealing with the pro( and legal structures of the Mello-Roos Community Facilities Distr
and Carl Kadie of Kadie-Jensen, Johnson and Bodnar to provide additi f i nanci a1 anal ysi s functions.
The initial structure of the overall financing program was to provide major city and school district public facilities. The City Cou directed staff to work with the four school districts which serve the to determine their interest in pursuing a joint financing district. S has been in contact with each of the four districts and to date, Carlsbad Unified School District, San Dieguito Union School District the San Marcos Unified School District have indicated a desire participate in an overall financing program with the City. The Encin Union High School District has indicated that they are not intereste participating in such a financing district.
During the review of the proposed financing plan, it was determined the major circulation improvements required as a result of the L
Facilities Management Plans should also be included in the overall p Therefore, in February, staff returned to the City Council to rec specific direction as it related to the financing of these m ci rcul ati on roadways.
Staff has received a great deal of input from the property owners in undeveloped areas of the City. Several property owner meetings
conducted by staff to explain the overall program and to address questi Over 100 property owners participated in these meetings. Additiona numerous meetings were held with the various consultants working with m property owners in the City. The recommended program takes consideration the comments, suggestions, and concerns of these prop owners. Although, not all of these suggested have been incorporated the proposed financing program because they generally are aimed at pro specific concerns and issues.
Issues:
During the review of the proposed financing program with property oh several issues were discussed:
1. Development Aqreements/Entitlement Guarantees
Property owners expressed an interest in having the City enter
stressed the need for this type of agreement was not neces: The property owners were told the most effective way to ensure t rights to develop is to provide the public facilities require maintain conformance with the pub1 ic facil ity performance stand; The Growth Management Program allows development to occur so as public facilities improvements are made and future improven financially guaranteed so these standards can be met.
The proposed financing program presumes a certain amouni development will occur to provide the cashflow necessary to fun( debt service of the outstanding bonds. As individual zone finar plans are prepared to meet the specific zone requiremc development will be allowed to begin and will be sufficien maintain the cashflow necessary to fund the debt required for 1 facility improvements.
Development Agreements with them as part of this program. :
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2. Pass throuqh of Taxes
The proposed program recommends no pass through of taxes residential development. The program is being created as a wa. finance public facilities which are currently within the Ci, existing fee programs. The developers within the district \ receive fee reductions when building permits are pulled. The 1 does not currently allow fees to be passed through to the home bl in the form of a tax or assessment and as result the proposed pro' does not pass these taxes through to the home buyer. It shouli emphasized the home buyer may pay for the cost of the distric the price of the home just as the current fees are absorbed the buy of the home.
Non-residential pass through is being recommended because of unique nature of commerci a1 and industri a1 development. The bu of the non-residential property are also sophisticated and it common business function to prepare complex financial pro-forma part of any purchase or lease arrangement.
3. Vacant Land Taxes
Efforts have been made throughout the formation of the progra create the lowest practical vacant land tax. The vacant land t will be kept as low as possible so long as the cashflow needs of district are met.
The program will allow the vacant land tax on non-residential to be adjusted as development takes place to meet the cashflow n of the district. As more land is developed, the revenue developed taxes increases and the vacant land tax on non-residen land can be reduced while the cashflow remains sufficient to the debt service.
4. Aqri cul tural Land
The intent of this program is to allow property owners who wan
The structure of the program will bring agricultural land, t areas defined in the Local Coastal Plan or designated as agricult through zoning, into the district at a zero tax. Once a develop proposal is submitted for this property, then this land mus annexed into the district and taxed according to the existing gen pl an.
keep their land in agricultural uses to do so as long as they w
Fi nanci nq Assumptions :
In order to effectively choose the most appropriate financing mechanism the following financing assumptions were considered and must be revie
1. There is a limited ability to issue debt on the avail vacant land within the city.
2. Public debt financing mechanisms should be used firs provide for major city and school facilities, then use provide for major circulation roadways and associated 3 and water facilities.
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3. Vacant land taxes should be kept as low as practical to pro! the necessary cash flow to fund these needed public facilit
The amount of debt allowed to be passed through to propi owners within the city should be limited.
(The examples used in this report limit the pass througl $1800 per dwelling unit which includes school facilities major circulation improvements.)
Facilities District should be limited to:
4.
5. The public projects to be financed using the Commu
those that cannot be specifically identifiei
and
financing effort is required.
a) being related to a single zone or developm
b) those that are so expensive that a coordin
Growth Manaqement Financi nq Proposal - Overview:
The proposed Growth Management Financing Program is one component of overall financing mechanisms to fund capital improvements. The Gr Management Financing Program operating in combination with the Ci established Capital Improvements Program will create the complete finan mechanisms to be used to fund future City capital improvements.
The Growth Management Financing Program can be divided in three sepa segments.
First Seqment:
Proposes to use a Mello-Roos Community Facilities District to fund following improvements:
Mello-Roos Community Facility District Proposed Schedul e (Mi 11 ion Dol 1 ars)
Years Years Years YE Pr 0.1 e c t cost 1-5 6- 10 11-15 - 1E
Library $ 16.0 $12.0 $- $ 4.0 $ City Hall 20.0 - 20.0 -
Macario Park 14.0 - 7.0 -
Faraday Ave. 3.0 3.0 - -
Cannon Rd. 6.5 6.5 - -
La Costa Ave. 5.0 5.0 - -
01 ivenhain Rd. 6.0 - 6.0 - Leucadi a B1 vd. 3.5 - - - La Costa Intchg. 7.0 7.0 - - Poinsettia Intchg 9.4 9.4 - - Pal. Arpt. Rd. Intchg . 9.45 9.45 - - Maintenance and
Warehouse Fac. 3.54 3.54 -
Total City: $103.39 $52.35 $36.54 $ 4.0 $:
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The Me1 1 o-Roos Community Faci 1 i ti es Di stri ct i s proposed to f i ni facilities currently funded by various City fee programs. Therefc participants in the Mello-Roos District will be paying for these facilii through the district and as a result will have reduced Public Faci' Fees, Traffic Impacts Fees, and no Bridge and Thoroughfare Fees to be I at the time building permits are pulled.
Second Seqment:
Creates debt space for the various school districts operating in Carl to implement their own debt financing program for school facilities.
Third Seqment:
Proposes to finance major circulation improvements through the USI
1913/1915 Act Assessment Districts. These circulation improvements include:
- Rancho Santa Fe
- Alga / Poinsettia - Cannon - Melrose
- Carrillo Way
- El Fuerte - College - Palomar Airport Road
Recommendat i ons :
Based upon review of these financing assumptions, staff was able to ana various financial alternatives. It is necessary to point out that the beginning of the review process, it has been apparent that contin on the pay-as-you-go fee system will not allow the city to provide necessary pub1 ic facilities as required by the Growth Management Prog Although the fee program could eventually fund these projects, the ti of the financing falls short of the timing of the need. The most vi alternative available for matching the timing of funding and need facilities is the use of a debt financing mechanism(s).
Citywide Growth Manaqement Finance Proqram - Mello-Roos & 1913/1915 Finar Program - Limited Pass Throuqh:
The facilities listed in the Overview section of this memorandum st be funding using a Mello-Roos Community Facilities District. 1 facilities are consistent with the assumptions and goals of the pro!
The tax structure for this district should take into consideratior
total tax and assessment burden placed on the property owner. The pc recommended seeks to limit the tax burden placed on the homeowne requiring all Mello-Roos obligations for City facilities be paid ai time building permits are issued rather than allowing these taxes to through to the homeowner.
The policy further recommends that Mello-Roos taxes related to residential development be allowed to pass through to the property 01 Non-residential development is different from residential develol because it is used to generate an income for the owner. In structi long-term financing program which depends on land to generate suffii
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funds to issue debt, it is more cost effective to allow the tax tc passed through in the form of an annual payment so these costs ma) amortized over a longer period. Non-residential 1 and buyers undersi the financial obligations placed upon potential properties they wid
purchase and have the sophistication to make complex fiscal calculat and decisions prior to purchasing the property.
The tax structure proposed in Policy 38 allows sufficient leveragt remain in the property to adequately finance school faci 1 i ty construc programs using a Mello-Roos district. In addition, any finan capabilities of the land not reserved by a school district could be to finance facilities such as major circulation roadways. It recommended that each school district administer their specific finan district separately from the City’s and we continue to coordination t act i vi ti es .
Major circulation roadways throughout the undeveloped areas of the could be financed with the use of assessment district financing. T improvement costs should be included within the overall structure of financing program to ensure the ultimate debt levied against vacant is completely analyzed and considered.
The overall Growth Management Financing Program shall be incorporate
property. The overall structure of the program wi71 be estab7i
initially, although, only a portion of the total undeveloped areas of City will form the first finance district. It is anticipated completion of the overall district will be made through the annexatio additional vacant land as the Local Facilities Management Zone Plans completed and approved in those areas.
all undeveloped areas of the City, This program will not effect devel
Recommendation Summary:
Based upon all of the information analyzed and input from property own it is recommended that the City Council adopt the revised Council Po 38 and direct staff to return with the necessary documents to imple the first Growth Management Financing District. The following compon would be included:
1. Public financing would be restricted to:
a) Citywide facilities
b) School facilities
c) Major circulation roadways and associated water and 5 facilities
2. Residential developers would be required to discharge the pou of the Mello-Roos tax related to City projects when building per are pull ed. Developers of non-residenti a1 property would be a1 1 to pass through Mello-Roos taxes to the future property owner. buyer of the non-residential property will have the option tc out of the district.
Vacant land tax would be established at a set rate with the form? of the CFD. Additional areas will be annexed into the CFD wit1 adoption of the Local Facilities Management Zone Plan.
3.
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- 4. Circulation facilities shall be spread by benefit formula using conventional 1913/15 assessment district process, The assessm
related to these improvements may be a'i'lowed to pass through to property owner as defined in City Council Policy 33.
Active disclosure shall be required to enable the buyer to ch the option which best suits their needs as it relates to financing of circulation improvements (assessments may be paic time of escrow at owner's option). Non-residential buyers will the ability to buy out of both the mello-roos district and assessment district.
6. There will be no exemptions from growth management shortfa Financing facility deficiencies would be the responsibility of developers or will be financed as established in the City's Cap Improvement Program.
No development agreements or entitlement guarantees will be mad part of this program.
8. The total tax (school facilities) and assessment (circula improvements) burden for the average residential unit should exceed $1,800 (in 1989 dollars).
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ZONE 5 LANDOWNERS
Carlsbad Airport Center Morgan/Palomar I
Carlsbad Research Center Huntington Beach Corn
Carlsbad Oaks East, Ltd. Bedford Properties
November 14,
Honorable Mayor and Members of the City Council City of Carlsbad City Hall
1200 Elm Avenue Carlsbad, California 92008
Re: Citywide Growth Manaqement Financinq Plan - Zone 5 Concern:
Honorable Mayor and Members of the City Council:
Since January 1989, the Zone 5 Landowners have worked diligent:
the City staff toward developing a comprehensive citywide final proposal. Several key issues related to the unique nature of : have been discussed, but as yet remain unresolved. We are anx. resolve these concerns, so that the Zone 5 property owners and businesses may support the citywide financing program. It is ( that the outstanding concerns can be fully resolved. City Coui direction is required in several areas however, to allow staff incorporate the remaining issues into the program.
The present concerns arise because Zone 5 presents a situation found in other developing zones in the City. The zone contain: residential developments and no homeowners. Zone 5's industri, commercial landowners and businesses have long term ownership commitments to the zone, and the economic terms and structure I proposed financing are of heightened importance. The zone's u
ownership is composed of new and ongoing businesses. businesses are extremely sensitive to the specific structure, .
and method of apportioning special taxes. Further, Zone 5 facl
specialized parks facilty and circulation requirements which C~
be financed with traditional assessment techniques.
These
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The Zone 5 Landowners have previously indicated the key remain:
elements which must be part of any financing program which can
workable within Zone 5:
_LT Special Tax Formula - The Special Tax formula needs tc provide separate rates for undeveloped vacant land and fc developed properties. Given the zone's long period of p: development, the vacant land rate must be reduced to the minimum possible, and the developed land rates increased according to land use and intensity.
2J Additional Financinq - Zone 5 has additional parks an( infrastructure financing requirements not present in otht zones. These items cannot be financed through the tradil assessment district approaches and must be recognized in citywide program. The Zone 5 Parks and Recreation complt needs to be included in the proposed financing program a: special assessment only to the Zone 5 Landowners, along F other infrastructure which is part of the Zone's Growth Management conditions.
a Securinq the Financing - The financing program must pi a level of assurance that the infrastructure items, once financed, will provide the uninterrupted level of
infrastructure capacity necessary to justify the require( special tax payments and to permit the development appro1 the adopted zone plan.
On August 10, 1989 the Zone 5 Landowners submitted a $14 millic Facilities Financins Plan and CFD Formation Proposal to the Cil Carlsbad. The Financing Plan includes financing both the growl management conditions specific to Zone 5 and the Zone 5 "fair : of the Citywide Mello-Roos program. This Zone 5 Plan can eithc incorporated within the City staff's current proposal, or implt separately, but in consistency with, the current staff proposa:
unique Zone 5 issues which still remain outstanding.
With the schedule outlined by staff for implementing the cityw program, the Zone 5 participation issues must be resolved in tl
near future. We believe the outstanding issues can be resolvec successfully, with direction from the City Council. Zone 5 cai successfully participate in either a modified citywide financii program, or a Zone 5 "stand-alonett financing program, implemen consistency with the City's overall guidelines.
believe this proposal offers the City a clear method of resolv
e w -2 - ". -.
i-
The Zone 5 Landowners respectfully requests the City Council pr
the necessary direction to staff to allow incorporation of the
policies presented above into the City of Carlsbad financing program.
resentative