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AGENDA BILL Agenda Item No. 6(8) Date: May 15, 2012 To: El Cerrito City Council From: Mary Dodge, Administrative Services Director/City Treasurer Subject: Public Hearing and Consideration of Resolution to Confirm the Method of Collecting the Storm Drain Reconstruction Fees ACTION REQUESTED Adopt a Resolution approving the Storm Drain Annual Report for Fiscal Year 2012-13 and directing that Storm Drain Fees be collected on the property tax rolls. BACKGROUND In March 1993, the voters of the City of El Cerrito approved the issuance of $6.3 million in revenue bonds for the reconstruction of the City's storm drain system. In June 1993, the City Council adopted Ordinance 93-4, which amends Title 4 (Revenue and Finance) of the El Cerrito Municipal Code by adding a new Chapter 4.4 providing for the imposition and collection of Storm Drain Fees to pay the debt service on the revenue bonds. Ordinance 93-4 set the Storm Drain Fee at $58 for each single-family residential unit in the City, and established other amounts for various other property uses. Ordinance 93-4 further provided that Storm Drain Fees be collected through the property tax based on amounts specified in an annual Engineer's report. This Engineer's report contains the description of each parcel of real property receiving storm drain services and the amount of the annual fee for each parcel. The engineering firm of NBS Local Government Solutions prepared the FY 2012-13 Storm Drain report. The City must annually conduct a public hearing to consider the method of collecting this Storm Drain Fee. Notice of such a public hearing must be made at least twice within a two week period, as specified in Government Code §6066, as follows: Publication of notice pursuant to this section shall be once a week for two successive weeks. Two publications in a newspaper published once a week or oftener, with at least five days intervening between the respective publication dates not counting such publication dates, are sufficient. The period of notice commences upon the first day of publication and terminates at the end of the fourteenth day, including therein the first day. The City met this notification requirement by publishing the notice of public hearing in the West County Times on May 4, 2012 and May 11, 2012. ---PAGE BREAK--- Agenda Item No. 6(8) This hearing is not a consideration of the fee amount, except as the fee may be applied inappropriately based upon th~ actual use of the property. Through Ordinance 93-4, the City Council approved the amount of the Storm Drain Fee, and declared that the Storm Drain Fee shall be collected with the property tax. ANALYSIS The City Council needs to determine whether a majority protest exists with respect to the method of collecting the Storm Drain Fee. If a majority protest is lodged against collecting this fee on the property tax (as a method of collection), then the City Council must authorize the collection of the Storm Drain Fee in some other manner. If the City Council finds that protest is made by the owners of a majority of the parcels of property described in the report, then the report may not be adopted. In the event of such majority protest, the Storm Drain Fees may be collected with the rates for any publicly or privately owned utility through an agreement with such utility. The administrative costs of collecting the Storm Drain Fee through utility services are substantially higher than by using the property tax bill. Also, if collected through a utility, the Storm Drain Fees would not constitute a lien against any parcel or parcels of land, which would make delinquent collections far more cumbersome and costly. The public hearing has a secondary purpose. Since the amount of the Storm Drain Fee is based on property use, it provides an opportunity for property owners to contest the fee amount based on the actual use of their property. The City Council may accordingly adjust the fee amount based on the property use. The adoption of the annual report requires the same two-thirds vote as was required to enact Ordinance 93-4. If approved the Engineer's report must be filed with the County Auditor not later than August 10, 2012, per California Health and Safety Code §5474.4, as follows: On or before the tenth day of August of each year following such final determination, the legislative body shall certify to the auditor a list of the lots or parcels of land, as they appear on the current assessment roll, subject to such fees or charges and the amounts of the installments of such fees or charges and interest to be entered against such lots or parcels on the assessment roll. FINANCIAL CONSIDERATIONS The annual Storm Drain Fee will continue to be assessed at $58 for each single-family residential unit. Such a rate is expected to generate annual revenues of approximately $698,000. The City would apply those proceeds to the payment of debt service on the Storm Drain Revenue Bonds, consistent with the City's FY 2012-13 Budget. Page 2 ---PAGE BREAK--- Agenda Item No. 6(8) LEGAL CONSIDERATIONS California Health and Safety .Code §5470 et seg. requires that a public hearing be held prior to adopting a resolution to accept the Engineer's report and levying the annual Storm Drain Fees. The City has complied with the minimum public notice requirements. Scott Hanin, City Manager Attachments: 1. Resolution 2. Storm Drain Report Page 3 ---PAGE BREAK--- Agenda Item No. 6(B) RESOLUTION 2012-XX RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EL CERRITO ADOPTING THE ANNUAL REPORT AND DIRECTING THAT STORM DRAIN FEES FOR FISCAL YEAR 2012-13 BE COLLECTED THROUGH THE PROPERTY TAX ROLLS WHEREAS, the City of El Cerrito, by Ordinance 93-4, directed the filing of the annual report for the imposition and collection of storm drain fees; and WHEREAS, the Engineering firm of NBS Local Government Solutions has prepared said Annual Report for Fiscal Year 2012-13; and WHEREAS, the City has provided notice of a public hearing held by the City Council on May 4, 2012 and May 11, 2012, with the notice of the hearing being given in the time and manner required by law; and WHEREAS, at the public hearing the City Council afforded to every interested person an opportunity to make a protest to the annual report and the City Council has considered each protest. NOW THEREFORE, BE IT RESOLVED that the City Council of the City of El Cerrito hereby confirms the storm drain fees as set forth in the Annual Engineer's Report, directs the collection of these fees through the property tax rolls, and directs the City Clerk to file the annual report or a certified copy thereof with the County Auditor not later than August 10, 2012. I CERTIFY that at the regular meeting on May 15, 2012 the El Cerrito City Council passed this resolution by the following vote: A YES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: ABSTAINED: COUNCILMEMBERS: IN WITNESS of this action, I sign this document and affix the corporate seal of the City ofEl Cerrito on May XX, 2012. Cheryl Morse, City Clerk APPROVED: William Jones, III, Mayor ---PAGE BREAK--- helping communities fund tomorrow City of El Cerrito Storm Drain Reconstruction Project Fiscal Year 2012/13 Main Office 32605 Temecula Parkway, Suite 100 Temecula, cA 92592 Toll free: [PHONE REDACTED] Fax: [PHONE REDACTED] Regional Office 870 Market Street, Suite 1223 San Francisco, CA 941 02 Toll free: [PHONE REDACTED] Fax: [PHONE REDACTED] ---PAGE BREAK--- CITY OF EL CERRITO 10890 San Pablo Avenue El Cerrito, California 94530 Phone -(51 0) 215-4300 Fax- (510) 215-4319 CITY COUNCIL William C. Jones Ill, Mayor Greg Lyman, Mayor Pro 'Tern Janet Abelson, Councilmember Rebecca Benassini, Councilmember Ann Cheng, Councilmember CITY STAFF Mary Dodge, Administrative Services Director NBS Tim Seufert, Client Services Director Jason Roth, Financial Analyst ---PAGE BREAK--- TABLE OF CONTENTS 1. EXECUTIVE SUMMARY 1 1 2. ASSESSMENTS 2 1 2.1. Method ofAssessment 2-1 2.2. Collection of Fees and Charges 2-2 2.3. Annual Hearing : 2-2 2.4. Notice 2-2 3. LIST OF CHARGES 3 1 ---PAGE BREAK--- 1~ EXECUTIVESUMMARY On March 2, 1993, the qualified voters of the City of El Cerrito (the "City") approved the issuance of revenue bonds, in an amount not to exceed $6.3 million, to finance the first phase of the reconstruction of the City's storm drain system. The qualified voters also approved the repayment of those bonds through the imposition of an annual storm drain fee on property within the City. Sections 5470, et seq. of the California Health and Safety Code authorizes cities to enact an ordinance, approved by a two-thirds vote of the members of the legislative body, establishing fees and charges for services and facilities furnished by the City in connection with its storm drain system. The proceeds of these fees and charges may be used only for the acquisition, construction, reconstruction, maintenance, and operation of its storm drain facilities, including the repayment of principal and interest on bonds issued to finance the construction or reconstruction of such facilities. The storm drain fees and charges shall be used exclusively for the uses and purposes of the storm drain system and for the payment of interest and redemption, including premiums payable from the calling of bonds, for those bonds authorized by the qualified voters on March 2, 1993, and for the payment of interest and redemption, including premiums payable from the calling of bonds, for any other bonds for storm drain construction or reconstruction which may be authorized in the future, provided that such bonds are approved in the manner required by California law. The authorized amounts and rates for storm drain fees and charges are as follows: Classification Rate Single Family residential $58.00 per unit Multi Family residential 2 through 20 units 43.50 per unit Multi Family residential over 20 units 870.00 plus 29.00 for each unit over 20 Commercial/Industrial 870.00 per acre Institutional (Churches, Schools, Fraternal and 406.00 per acre Service Orqanizations) Golf Courses, Cemeteries, Vacant Land 11.60 per acre The following table summarizes the annual levy by Classification of parcel: Classification Number of Parcels Single Family residential 7,502 Multi Family residential 621 Commercial/Industrial 260 Institutional (Churches, Schools, Fraternal 51 and Service Orqanizations) Golf Courses, Cemeteries, Vacant Land 215 Total: 8,649 Includes parcels divided by City boundaries. Storm Drain Reconstruction Project Annual Report - City of El Cerrito Prepared by NBS - Fiscal Year 2012/13 Levy Total $440,154.00 122,765.70 100,461.72 32,273.62 2,390.88 $698,045.92 1-1 ---PAGE BREAK--- 2: ASSESSMENTS 2. 1. Method of Assessment The number of Equivalent Residential Units ("ERUs") was determined for each parcel based upon an estimate of the impervious surface associated with the use of the property. 1) Single Family (detached) Residential ("SFR") parcels were assumed to have an average of 2,900 sq. ft. of impervious surface. Approximately 90% of the properties in the City are SFR. These parcels were assigned 1.0 ERU. 2) Multi Family dwelling unit complexes of up to 20 units were assigned 0.75 ERU (2,175 sq. ft) of impervious surface area per unit. Complexes of more than 20 units were assigned 15 ERU plus 0.5 ERU (1 ,450 sq. ft) for each unit over 20. 3) Commercial/Industrial uses were assigned 15 ERU (43,560/2,900 sq. ft.) of impervious surface area per acre. 4) Institutional uses such as.Churches, Fraternal and Service Organizations were assigned 7.0 ERU (21 ,000 sq. ft.) of impervious surface area per acre based upon the Contra Costa County Report on Stormwater Utility Assessment dated March 1994 (County Report). 5) Golf courses, cemeteries, and other open spaces were assigned 0.2 ERU (580 sq. ft.) per acre based upon the County Report. The storm drain fee for a parcel is calculated by multiplying the number of ERU assigned to such parcel by the rate per ERU. The rate for the 2012/13 Fiscal Year Is $58.00/ERU. The following table shows a breakdown of Classification of parcels by County Use Code and the associated rates for Fiscal Year 2012/13: Classification County Use Code ERU Single Family residential 11, 12, 13, 14, 15, 19, 29,89 1.0 Multi Family residential 2 21,22,23,24,25,26,27,28 0.75*n through 20 units Multi Family residential 21,22,23,24,25,26,27,28 15.0 + 0.5*m over 20 units Commercial/Industrial 31, 32,33,34, 35, 36,41,42, 15.0*A 43 44,46 47,48,49, 53 85 Institutional (Churches, Schools, Fraternal and 70, 71, 72, 75,76 7.0*A Service Organizations) Golf Courses, Cemeteries, 10, 17, 18,20, 30, 37,38, 50, 0.2*A Vacant Land 63, 74, 78, 81 Use Code 79 1s ass1gned to Government Owned, and 1s not charged n = number of residential units up to 20 m = number of residential units over 20 A = acreage, per Contra Costa County Assessor or City Estimate Storm Drain Reconstruction Project Annual Report- City of El Cerrito Prepared by NBS - Fiscal Year 2012/13 Rates $58.00 per unit 43.50 per unit 870.00 + 29.00 for each unit over 20 870.00 per acre 406.00 per acre 11.60 per acre 2-1 ---PAGE BREAK--- 2.-2. Collection of Fees and Charges The storm drain fees and charges shall be collected on the tax roll in the same manner, by the same persons, and at the same time as, together with and not separately from, the City's general taxes. The City Council shall have prepared each year, prior to the commencement of the fiscal year, a written report which shall be filed with the City. The report shall contain a description of each parcel of real property receiving storm drain services and the amount of the annual fee and charge for each parcel. This charge shall be computed in conformity with the fees and charges prescribed in this report. 2.3. Annual Hearing Each year, prior to the commencement of the fiscal year, the City Council shall hold a public hearing at which the Council shall hear and consider all objections and protests, if any, to the written report. The City Council may continue the hearing from time to time. If the City Council finds that protest is made by the owners of a majority of the parcels of property described in the report, then the report shall not be adopted. In the event of such majority protest, the storm drain fees and charges shall be collected with the rates for any other publicly or privately owned public utility through agreement with such utility. If collected in this manner, the storm drain fees and charges shall not constitute a lien against any parcel or parcels of land. 2.4. Notice Notice of the filing of the report and of the time and place of hearing thereon, shall be published once a week for two consecutive weeks prior to the hearing, in a newspaper of general circulation printed, published or distributed in the City. Storm Drain Reconstruction Project Annual Report- City of El Cerrito Prepared by NBS- Fiscal Year 2012/13 2-2 ---PAGE BREAK--- OFFICE OF THE CITY CLERK CITY HALL 10890 San Pablo Avenue, El Cerrito, CA 94523-3034 Telephone (510) 215-4305 Fax (510) 215-4379 http://www.el-cerrito.org May 15, 2012 Regular City Council Meeting Agenda Item No. 6(B) Attachment 2 – Chapter 3, List of Charges Documents are also available for review at: Office of the City Clerk 10890 San Pablo Avenue El Cerrito, CA (510) 215-4305 and The El Cerrito Library 6510 Stockton Avenue El Cerrito, CA