HomeMy WebLinkAboutAgenda: Study Session C: Annual Rate for Re-Balloting of Citywide Street Lighting Assessment DistrictSTAFF REPORT
Public Works Services Department
DATE: February 2, 2010
TO: Mayor and City Council
FROM: Tom Tait, Public Works Services Director
Prepared by: Maria A. Taylor, Senior Management Analyst
SUBJECT: UPDATE OF THE ASSESSMENT METHODOLOGY AND ANNUAL
RATE FOR THE RE- BALLOTING OF THE CITYWIDE STREET
LIGHTING ASSESSMENT DISTRICT
Recommendation: Provide Direction
SUMMARY
The Street Lighting Maintenance District is set to expire on June 30, 2010, which will
obligate the City to fund all street lighting costs, approximately $980,725 beginning in
fiscal year 2010/11. While it varies slightly from year to year, property owners
contribute approximately $400,000 each year which offsets approximately 40% of the
cost to provide street lighting.
This year's Capital Improvement Budget includes a project to revisit the formation of a
new Citywide street lighting assessment district. On September 1, 2009, the City
Council awarded a contract to Willdan Financial Services for assessment engineering
services. Additionally, at the November 17, 2009 study session, staff presented the City
Council with options for Assessment District methodology and budget assessment to
determine the new annual assessment rate for each property.
As a result, the methodology that was preferred by the Council is based on a two -zone
approach. Zone 1 is for property owners on arterial streets who receive street lighting
benefit. Zone 2 is property owners who are not located on arterial streets receiving
street lighting benefit. Additionally, property owners in Zones 1 and 2 who have sparse
lighting will pay twenty percent (20 %) of what the annual rate is for single family
property owners. Areas in the City that do not have street lighting will not be assessed.
Therefore, staff is seeking the City Council's affirmation that this assessment
methodology is acceptable and whether the City Council prefers a 50/50 or 60/40 cost
sharing split to determine the annual street lighting assessment rate for fiscal year
2010/11.
Page 1 of 4
Mayor and City Council
February 2, 2010
BACKGROUND
In November 2008, the City conducted ballot proceedings to address two major issues.
First, when the current district was formed under the Street Lighting Act of 1919 during
the 1970s, it created inequity of assessments. The assessments were based on the
value of the property when it was originally purchased; with some properties being
assessed on their 1970 purchase price while others are assessed on their 2009
purchase price. Additionally, not all properties were included in the original
assessment.
Second, when the current district expires on June 30, 2010, the City will lose the
funding that the district provides to help pay for a portion of the street lighting
maintenance and operating costs. Unfortunately, the November 2008 ballot was not
approved and the City Council abandoned the district formation last December 2008.
This year's Capital Improvement Budget includes a project to revisit the formation of a
new Citywide street lighting assessment district. On September 1, 2009 the City
Council awarded a contract to Willdan Financial Services for assessment engineering
services. Additionally, at the November 17, 2009 study session, staff presented the City
Council with options for Assessment District methodology and budget assessment to
determine the new annual assessment rate for each property.
DISCUSSION
A. Proposed New Methodology and Assessment Rates for FY 2010 -11
The methodology that was preferred by the Council is based on a two -zone approach.
Zone 1 is for property owners on arterial streets who receive lighting benefit. Zone 2 is
for property owners who are not located on arterial streets receiving lighting benefit.
Additionally, property owners in Zones 1 and 2 who have sparse lighting will pay twenty
(20) percent of what the annual rate is for single family property owners. Areas in the
City that do not have street lighting will not be assessed (see attached map).
The total annual budget for this assessment is 1,032,725, which includes the annual
street lighting budget of $980,725 plus $52,000 in district administration. Using the
single - family property as the baseline for the assessment, the table below lists the
estimated new assessment rate options for each zone based on a 50/50 and 60/40 cost
sharing split between the City and the District.
Page 2 of 4
Mayor and City Council
February 2, 2010
Proposed Annual Assessment Rate Based on a Single- Family Property
* Annual Assessment Rate for properties in Zones 1 and 2 that have sparse lighting
The first option is a 50/50 split with the City and the District each paying 50% of the total
lighting cost (or $516,363). The second option is a 60/40 split with the City paying 60%
of the total lighting cost ($619,635) and 40% is paid by the District ($413,090).
Also the above costs are the maximum proposed assessment that each assessed
single - family property will pay for 2010/11 property tax roll, with a 3% inflationary
adjustment rate for each fiscal year to account for reasonable increases in electricity
and inflation that are inevitably associated with the ongoing maintenance and
operations of street lights. In the event that the proposed annual budget for street
lighting is less than the annual assessment, the lower amount will be applied.
B. Public Outreach Strategy - Update
During the last study session, Council also addressed several major issues that
contributed to the failure of the November 2008 lighting assessment ballot. These
issues included the complexity of the issue itself; the notice and ballot were complicated
and need to be more user - friendly; and the public outreach efforts utilized were
inadequate in educating and informing the voters the need for an assessment.
To address these concerns, staff is currently seeking Request for Proposals from
qualified consultants /firms to provide public outreach plan and communication strategy
to improve the City's chances of a successful measure for the July 2010 ballot. Staff
will seek Council's approval on March 2, 2010 to award a contract to the most qualified
consultant.
Therefore, in order to proceed with the re- balloting of the citywide lighting assessment,
staff is seeking the City Council's affirmation that the new assessment methodology is
Page 3 of 4
Total Annual Budget
City /District Budget
50/50 Contribution
City /District Budget
60/40 Contribution
Citywide District
$1,032,725
$516,363
$619,635/$413,090
Zone 1
$319,111
$19
$17
Primary Lights
($4)*
($3)*
Zone 2
$713,614
$35
$27
Local Lights
($7)*
($6)*
Mayor and City Council
February 2, 2010
Proposed Annual Assessment Rate Based on a Single- Family Property
* Annual Assessment Rate for properties in Zones 1 and 2 that have sparse lighting
The first option is a 50/50 split with the City and the District each paying 50% of the total
lighting cost (or $516,363). The second option is a 60/40 split with the City paying 60%
of the total lighting cost ($619,635) and 40% is paid by the District ($413,090).
Also the above costs are the maximum proposed assessment that each assessed
single - family property will pay for 2010/11 property tax roll, with a 3% inflationary
adjustment rate for each fiscal year to account for reasonable increases in electricity
and inflation that are inevitably associated with the ongoing maintenance and
operations of street lights. In the event that the proposed annual budget for street
lighting is less than the annual assessment, the lower amount will be applied.
B. Public Outreach Strategy - Update
During the last study session, Council also addressed several major issues that
contributed to the failure of the November 2008 lighting assessment ballot. These
issues included the complexity of the issue itself; the notice and ballot were complicated
and need to be more user - friendly; and the public outreach efforts utilized were
inadequate in educating and informing the voters the need for an assessment.
To address these concerns, staff is currently seeking Request for Proposals from
qualified consultants /firms to provide public outreach plan and communication strategy
to improve the City's chances of a successful measure for the July 2010 ballot. Staff
will seek Council's approval on March 2, 2010 to award a contract to the most qualified
consultant.
Therefore, in order to proceed with the re- balloting of the citywide lighting assessment,
staff is seeking the City Council's affirmation that the new assessment methodology is
Page 3 of 4
Mayor and City Council
February 2, 2010
acceptable and whether the City Council prefers a 50/50 or 60/40 cost sharing split to
determine the annual street lighting assessment rate for fiscal year 2010/11.
FISCAL IMPACT
The Capital Improvement Program includes a Street Lighting Assessment District
Project for $136,300.
Upon a successful establishment of a citywide street lighting assessment district, the
LLD 1972 would allow the City to include this project cost as part of the special benefit
assessment and would be collected from the property owners' annual property tax bill.
Additionally, a Citywide assessment via the Landscaping and Lighting Act of 1972 will
provide an equitable cost distribution based on lighting benefit to each property for
assessing street lighting costs.
RECOMMENDATION
Provide Direction on the Annual Assessment Rate for the Re- balloting of
the Citywide Lighting Assessment District
Attachment
Approved by: D Pt-►- ..-
Page 4of4
Donald Penman, City Manager
WI LLDAN
Financial Services
Arcadia Citywide Streetlight District
m
Foothill 81
Legend
SIM
Arcadia City Boundary
Arterials
Zone 1 - Arterial Parcels
Zone 2 - Non - Arterial Parcels
Areas with No Lighting
Areas with Sparse Lighting
0.25 0.125 0 0.25
Miles
0.5 0.75
Huntington Dr
M.} Pell:: , 11•,,i9