Agenda

Return

C. 92

To:	Board of Supervisors
From:
Date:	December 13, 2011

Contra

Costa

County

Subject:

North Pacheco Annexation

APPROVE	OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR	RECOMMENDATION OF BOARD COMMITTEE

Action of Board On: 12/13/2011

APPROVED AS RECOMMENDED

OTHER

Clerks Notes:

VOTE OF SUPERVISORS

AYE:

John Gioia, District I Supervisor
Gayle B. Uilkema, District II Supervisor
Mary N. Piepho, District III Supervisor
Karen Mitchoff, District IV Supervisor
Federal D. Glover, District V Supervisor

Contact:	Rich Seithel, 925-335-1314
cc:	Auditor Controller County Counsel City of Martinez Public Works Department of Conservation and Development County Administrator

I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown.
ATTESTED: December 13, 2011
David Twa,

BY:	, Deputy

RECOMMENDATION(S):

APPROVE and ADOPT Resolution 2011/495 determining the allocation of tax revenue for the proposed North Pacheco Annexation to the City of Martinez (LAFC 11-05) and a 5-year extension for County permit processing.

FISCAL IMPACT:

The County and the City have agreed to use the existing Master Property Tax Agreement outlined in County Resolution 80-1373 (attachment 1). In addition to confirming that the existing Master Property Tax Exchange Agreement factors will apply, proposed Resolution 2011/495 includes a provision that the County will retain the right to process permits for three County-approved residential developments for a 5 year period commencing with the date of annexation. It is estimated that this 5 year extension will provide the County the opportunity to collect approximately $278,800 in permit and plan processing fees. (100% Land Development Fund).

FISCAL IMPACT: (CONT'D)

BACKGROUND:

The City of Martinez filed an application (LAFC 11-05) with the Local Agency Formation Commission to annex an unincorporated area known as the North Pacheco Area. This area includes approximately 61 acres and is bounded by Highway 4 to the south, I-680 to the east, and the City of Martinez to the west.

The City is seeking to annex the North Pacheco Area to facilitate future development at the crossroads of two major highways, SR-4 and I-680; and the gateway to the City from the south and east. The City anticipates that the annexation will facilitate future economic revitalization of the proposed area and visual improvement of a major gateway to the City. The Annexation Area is entirely within the City’s Sphere of Influence.

Section 99 of the Revenue and Taxation Code provides that a city and county shall agree by resolution to exchange property tax revenues among themselves and any affected agencies in the event of a jurisdictional change. The City adopted Resolution Number 105-11, (Attacthment 2), agreeing to a property tax exchange and other negotiated terms, including:

Property Tax Exchange Factors: The City and County will utilize the master property tax exchange factors outlined in County Resolution #80-1373;

Sales and Use Tax Revenues: Sales and Use Tax Revenues collected by the city from the Annexation Area shall be apportioned 55% to City and 45% to County, in recognition of City economic development efforts through which the county will benefit, and;

Residential Developments: In exchange for the sales tax split, the County will continue processing, for a period of up to 5 years from the effective date of annexation, the residential developments in the northwest portion of North Pacheco consisting of Subdivision 8984 (“SD 8984”), Subdivision 7418 (“SD 7418”), and Subdivision 8944 (“SD 8944”) for five years after date of annexation. (See attachment #3- Residential Development Map)

Tax Exchange

It is important to note that, if the Annexation is approved, the City of Martinez will be responsible for providing services in the Annexation Area at the time the annexation becomes effective. However, there will be a time lapse between the time the City of Martinez begins its service and responsibilities and the time the City begins to receive its property tax allocation with respect to the Annexed Area. The City will not be allocated property taxes with respect to the Annexed Area until July 1, 2013.

The City and County have agreed, as outlined in the resolution, to reallocate sales tax revenues to the City to help cover the period from annexation until June 30, 2013. City property tax apportionment estimates in the annexation area were projected in a July 2010, "Economic and Planning Systems (EPS) Annexation Analysis Final Report" to be $13,510 per year. The City and County have agreed to utilize this estimate in determining property tax revenue the City is to receive prior to the State Board of Equalization recognizing and including the Annexation Area on the City of Martinez rolls on July 1, 2013. Assuming the annexation is effective in January 2012, the City will deduct the County's portion of the sales and use tax remittance until the City has received $19,140.

Residential Developments

The three residential developments in the northwest portion of North Pacheco are:

1. SD 8984 = Belmont Terrace/KB Homes a 120-lot development with 41 remaining lots:

2. SD 7418 = First National Bank a 20-lot development with tentative map approved and infrastructure built, and;

3. SD 8944 = William Kelleher an 8-lot development with tentative map approved.

The County has invested years of effort on these developments in reviewing and approving maps, entitlements, and conditions. The 5-year extension will allow the County to collect fees to help defray the costs of planning and processing. It is estimated that this 5 year extension will provide the County the opportunity to receive approximately $278,800 in permit and plan processing fees.

CONSEQUENCE OF NEGATIVE ACTION:

The City of Martinez will not be able to annex the North Pacheco area without a property tax exchange agreement.

CHILDREN'S IMPACT STATEMENT:

N/A

CLERK'S ADDENDUM

Speaker: Tim Platt, resident of Martinez, requesting this item not be adopted.