HomeMy WebLinkAboutMinutes - November 14, 2006 SSCITY OF LODI
INFORMAL INFORMATIONAL MEETING
"SHIRTSLEEVE" SESSION
CARNEGIE FORUM, 305 WEST PINE STREET
TUESDAY, NOVEMBER 14, 2006
An Informal Informational Meeting ("Shirtsleeve" Session) of the Lodi City Council was held Tuesday,
November 14, 2006, commencing at 7:00 a.m.
A. ROLL CALL
Present: Council Members — Beckman, Hansen, Johnson, Mounce, and Mayor Hitchcock
Absent: Council Members — None
Also Present: City Manager King, City Attorney Schwabauer, and City Clerk Johl
B. TOPIC(S)
B-1 "Water Supply Project Financing"
City Manager King provided a brief introduction of the subject matter, stating the
presentation is in response to the City Council's request to obtain information regarding
how Lodi might pay for a water treatment plant or recharge facility.
City Engineer Wally Sandelin introduced Susan Goodwin of Goodwin Consulting Group,
Inc.
Susan Goodwin provided an overview of financing options for a community facilities district
(CFD). Topics discussed included what is CFD financing, financing mechanisms, Mello -
Roos Act of 1982, land -secured financing district, CFDs in California, terminology, why
choose CFD financing, flexibility, burden of proof with benefit finding, development paying its
own way, CFD financing for a water treatment solution, number of projects within
boundaries, annexation of other properties, bonds for lump sum funding, special taxes,
assumptions and conclusions of initial analysis, and comparison of facilities special tax
rates for surrounding cities. Specific information from the presentation is provided in the
staff report and PowerPoint presentation (filed).
Mayor Hitchcock asked what is included in the comparisons with surrounding cities.
Ms. Goodwin stated some CFDs are single funding sources such as schools, but others
are the backbone for infrastructure including water, sewer, and roads.
Mayor Hitchcock inquired about funding for police and fire. Ms. Goodwin stated the
comparisons do not include services such as police and fire, which are often provided for in
an overlapping CFD. Mayor Hitchcock inquired about the rates related to the same.
Ms. Goodwin stated the average rate is $400, but it can vary between $200 and $700.
Council Member Beckman asked if the area selection is left to the Council. City Manager
King stated yes. Council Member Beckman inquired about the 2/3 requirements. City
Manager King stated the applicant may already be conditioned to participate based on the
terms of the agreement, but may be able to opt out by paying cash.
Council Member Beckman asked if the developer gets to decide how the City uses the
water. City Manager King stated the City Council decides how to use the water.
Discussion ensued between Council Member Beckman, City Manager King, and City
Attorney Schwabauer regarding the $6,000 acre fee, the amount of benefit on the project,
and equity considerations in relation to current and future homeowners paying for services.
Continued November 14, 2006
Council Member Hansen asked if a new homeowner can finance the special tax amount in
the purchase price. Ms. Goodwin stated the special tax is factored in at the time of the
purchase and shows on the tax bill.
Council Member Hansen inquired about the impact of a CFD on the affordability of homes.
Ms. Goodwin stated home affordability, which is a statewide problem, is affected by the
infrastructure, not the CFD.
Council Member Hansen inquired about the landscaping and lighting district and the one
vote by the developer system. Ms. Goodwin stated it is one vote if the developer owns the
property and the homeowner has an opportunity to vote in the sales office when the
appropriate CFD disclosures are made.
Mayor Pro Tempore Johnson inquired about the $600 fee per house and the development
agreement. City Manager King stated the chart shows capital and that an additional piece
may exist for services and stated the premise is that both old and new development is
paying its proportionate share so that neither is a drain on the existing community. He also
stated that the applicant can ask for assistance with paying for infrastructure.
Mayor Pro Tempore Johnson asked if enough cushion remains in the value to lien amount.
Ms. Goodwin stated yes because it is based on the value increasing as development
increases.
Mayor Pro Tempore Johnson inquired about timing. Public Works Director Prima stated it is
probably a little over a year depending upon Council's direction.
Mayor Hitchcock inquired about other cities' experience with freezing the commercial rate
at $3,000. Ms. Goodwin stated the range varies and many developers prefer not to exceed
$2,200 to $2,500 per year, which may also reduce the residential rates.
Discussion ensued between Council Member Hansen, Mayor Hitchcock, City Manager
King, and Ms. Goodwin regarding the downside of a CFD to attract new retail and office
business to Lodi.
Mayor Hitchcock inquired about the range for commercial rates. Ms. Goodwin stated the
range varies between $3,000 and $6,000.
PUBLIC COMMENTS:
oo A resident inquired about how a CFD will tie in to existing development agreements for
new projects. City Manager King stated development agreements state that the
applicant will pay for water usage, but is silent as to what the exact usage is, and the
applicants are aware that the solution is going to be financing one way or another. He
stated what the financing piece entails will be determined after further direction from
Council. Ms. Goodwin stated many CFDs are tied into development agreements.
Council Member Beckman suggested analyzing water usage by new development based on
the previous information and formula provided by Public Works.
C. COMMENTS BY THE PUBLIC ON NON -AGENDA ITEMS
None
D. ADJOURNMENT
No action was taken by the City Council. The meeting was adjourned at 7:59 a.m.
ATTEST:
Randi Johl
City Clerk
2
AGENDA ITEM 5601
CITY OF LODI
COUNCIL COMMUNICATION
AGENDA TITLE: Water Supply Project Financing
MEETING DATE: November 14,2006 (Shirtsleeve Session)
PREPARED BY: Public Works Director
RECOMMENDED ACTION: Receive information regardingwater supply project financing.
BACKGROUND INFORMATION: As part of the City's decision-making process on how to utilize our
Woodbridge Irrigation District surface water supply, staff has
suggested that the capital cost would be borne entirely by new
development.
The City Council asked how that could be made to work; specifically, in a manner that would not put the
existing ratepayers at risk. Staff has worked with Ms. Susan Goodwin, of Goodwin Consulting Group of
Sacramento, who has extensive experience in this area to answer this question. Ms. Goodwin will
present the results of a financial model, using a land-based community facilities district financing method.
FISCAL IMPACT:
FUNDING AVAILABLE
RCP/pmt
) Water\CWaterSupplyFinandag doc
Not applicable.
Not applicable.
1
Richard C. Prima, Jr.
Public Works Director
APPROVED: i
Blair King,. anager
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