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    15.    
City Council Regular
Meeting Date: 10/24/2017  

SUBJECT:
ANNUAL REPORTS AND RESOLUTIONS SETTING SPECIAL TAX FOR 2018 FOR COMMUNITY FACILITIES DISTRICTS NO. 1, 2, 4, 5, 6, 8, 9, AND 10
RECOMMENDATION:

1. Receive and file the annual reports for Community Facilities Districts No. 1, 2, 4, 5, 6, 8, 9 and 10 (Exhibit A), pursuant to Government Code Section 53411. 
 
2. Adopt the following Resolutions entitled:
  1. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, ACTING IN ITS CAPACITY AS THE GOVERNING BODY OF COMMUNITY FACILITIES DISTRICT NO. 1, ESTABLISHING THE ANNUAL SPECIAL TAX;
     
  2.  A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, ACTING IN ITS CAPACITY AS THE GOVERNING BODY OF COMMUNITY FACILITIES DISTRICT NO. 2, ESTABLISHING THE ANNUAL SPECIAL TAX;
     
  3. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, ACTING IN ITS CAPACITY AS THE GOVERNING BODY OF COMMUNITY FACILITIES DISTRICT NO. 4, ESTABLISHING THE ANNUAL SPECIAL TAX;
     
  4. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, ACTING IN ITS CAPACITY AS THE GOVERNING BODY OF COMMUNITY FACILITIES DISTRICT NO. 5, ESTABLISHING THE ANNUAL SPECIAL TAX;
     
  5. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, ACTING IN ITS CAPACITY AS THE GOVERNING BODY OF COMMUNITY FACILITIES DISTRICT NO. 6, ESTABLISHING THE ANNUAL SPECIAL TAX;
     
  6. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, ACTING IN ITS CAPACITY AS THE GOVERNING BODY OF COMMUNITY FACILITIES DISTRICT NO. 8, ESTABLISHING THE ANNUAL SPECIAL TAX;
     
  7. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, ACTING IN ITS CAPACITY AS THE GOVERNING BODY OF COMMUNITY FACILITIES DISTRICT NO. 9, ESTABLISHING THE ANNUAL SPECIAL TAX; AND
     
  8. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, ACTING IN ITS CAPACITY AS THE GOVERNING BODY OF COMMUNITY FACILITIES DISTRICT NO. 10, ESTABLISHING THE ANNUAL SPECIAL TAX.
     
BACKGROUND/ANALYSIS:
Annually, in accordance with California Government Code Section 53411, the City’s Finance Director must file a report with the City Council which identifies the funds collected and expended for each of the City’s Community Facilities Districts (CFDs). 
 
In addition, annually the City Council adopts a resolution establishing the Community Facilities Districts (CFDs) tax rate for the next calendar year and fiscal year.  The CFDs were formed to finance certain infrastructure in the development of the Chino Hills areas.   The CFDs within Chino Hills and their proposed tax rates for the 2018 calendar year and 2018-19 fiscal year are as follows:
    Tax “A”1      Tax “B”2      Tax “C”3 
CFD No. 1 Rolling Ridge $4,951.59 $599.73   N/A
CFD No. 2   Los Ranchos $4,951.59 $599.73   N/A
CFD No. 4     The Oaks $4,951.59 $599.73   N/A
CFD No. 5 Soquel/Rincon/Woodview $4,951.59 $599.73   N/A
CFD No. 6 Carbon Canyon $4,951.59 $599.73   N/A
CFD No. 8 Butterfield N/A4 $599.73   N/A
CFD No. 9  Rincon $4,951.59 $599.73   (By agreement)
         
                                                                  Special Tax
      Residential        Non-Residential
      $ per unit         $ per acre
CFD No. 105 Fairfield Ranch      
  Zone 1   $1,419.67 to $2,473.72 $24,177.35  
           
  Zone 2   $1,676.76 to $2,606.54 $27,302.35  

The formation documents for CFDs 1, 2, 4, 5, 6 and 9 provide for an annual escalation in Tax “A” of three percent.  The formation documents for CFDs 1, 2, 4, 5, 6, 8 and 9 also provide for an annual escalation in Tax “B” of two percent, effective January 1 each year.  The formation documents for CFD 10 provide for an escalation in the Special Tax of two percent on July 1 each year.  The escalation factor for Tax “A,” which is a one-time tax payable when a building permit is issued, can be implemented as of January 1 each year, and has been reflected in the proposed resolutions.  However, the escalation factor for Tax “B” cannot be implemented until July 1 each year because the January 1 effective date falls during a tax year for which Tax “B” has already been levied. Therefore, the escalation factor for Tax “B” and for the CFD 10 Special Tax has been implemented as of July 1 and is reflected in the proposed resolutions.

 
1  Tax “A” is a pass through, collected at the building permit stage, to the Chino Valley Unified School District for school development purposes.
2  Tax “B” is a per residential dwelling unit charge, or per equivalent dwelling unit, levied for CFD debt service and infrastructure improvements collected on an annual basis beginning with initial occupancy for a maximum of 25 years.
3  Tax “C” is a development financing mechanism “unique” to CFD No. 9.
4  For CFD No. 8, Chino Valley Unified School District and developer handled school development by separate agreement, negating the need for Tax “A” within this CFD.
5  Special Taxes for CFD No. 10 Residential Properties are assessed based on building square footage.  The Special Tax is levied to fully satisfy the Zone 1 Special Tax Requirement and Zone 2 Special Tax Requirement, but in no event shall it be levied after Fiscal Year 2038/2039.
 
ENVIRONMENTAL (CEQA) REVIEW:
These recommended actions are exempt from review under the California Environmental Quality Act (California Public Resources Code §§ 21000, et seq., “CEQA”) and CEQA regulations (14 California Code of Regulations (“CCR”) §§ 15000, et seq.) because these actions involve government fiscal activities which do not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment and constitute an organizational or administrative activity that will not result in direct or indirect physical changes in the environment.  Accordingly, the recommended actions do not constitute a “project” that requires environmental review (see specifically 14 CCR § 15378(b)(4-5)).
FISCAL IMPACT:
Approval of this item will provide the necessary funds to insure adequate debt service funding, construction, and acquisition of needed public facilities. All assessments received by the CFDs are deposited into accounts restricted in use for CFD purposes.
REVIEWED BY OTHERS:
This agenda item has been reviewed by the City’s bond counsel, Norton Rose Fulbright, Willdan Financial Services, and the City’s Consultant for Special District administration services, Harrell & Company Advisors.  
Attachments
CFD No. 1
CFD No. 2
CFD No. 4
CFD No. 5
CFD No. 6
CFD No. 8
CFD No. 9
CFD No. 10
Exhibit A

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