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HomeMy WebLinkAbout1993-03-09 - AGENDA REPORTS - SANITATION DISTRICTS (2)NEW BUSINESS DATE: SUBJECT: DEPARTMENT: BACKGROUND AGENDA REPORT March 9, 1993 City Manag Item to be Lynn M. Harrlsy!P.2 J r County Sanitation Districts of Los Angeles County - Policy Issues Community Development The Sanitation Districts will be holding a public hearing in the City Council Chambers on March 18, 1993, on proposed service charge Increases in Districts 26 and 32. The Board of Directors will also discuss and consider adoption of a policy statement to establish guidelines for Sanitation District staff regarding public hearings and processing of annexations to the Sanitation Districts. The board of directors Is the governing body of a Sanitation District. It has the ultimate power to determine its policies and control Its activities. The County Sanitation Districts of Los Angeles County are a confederation of 27 Independent special districts, two of which serve the Santa Clarita Valley. Each District has a separate board of directors consisting of the presiding officers of the local jurisdictions located within the District. The Districts work cooperatively under a Joint Administration Agreement, each paying Its proportionate share of the administrative costs of one administrative staff headquartered near Whittier. Over the past six months, the Board has encountered several procedural and policy Issues during the conduct of its normal business. While some of these are addressed by general Sanitation District policies, the Board has learned that there are few policies which guide the specific business of Districts 26 and 32. The Board has Indicated a general Interest In the following policy Issue areas: temporary connections for District services, CEQA project review and document preparation, use of growth/population projections, pre -agenda meetings, calling and location of public hearings, fee Increases, system capacity reports, and similar related Issues. In response, the Board has asked City staff to study existing procedures and recommend policies for discussion and potential adoption. On October 15, 1992, staff forwarded a letter to Charles Carry, Chief Engineer for the Sanitation Districts, requesting information regarding Sanitation District procedures, and received Mr. Carry's response on November 23, 1992. Both letters are attached. POLICY ISSUES City staff has prepared the following policies for the Council's consideration, and for recommendation to the Board: you Agenda Item: ■ Temporary sewer connections may be permitted as follows: 1) The applicant shall file a formal request for annexation with the Sanitation Districts prior to temporary connection; and 2) Temporary sewer connections shall be subject to the prior approval of the Board of Directors. ■ Previously prepared environmental documents may be used for California Environmental Quality Act (CEQA) clearance for annexations to the Sanitation Districts as follows: 1) When the project/entitlement for which they were prepared is still active; or 2) When the documents were prepared within the last five years, whichever Is less. 3) The above Information shall be included In the agenda packet for the Board's review. at such time as a "Resolution of Application" for a proposed annexation Is scheduled for action. ■ While the Sanitation Districts must by .law utilize Southern California Association of Governments (SCAG) growth projections, Sanitation Districts staff shall consider the City and County growth projections when calculating future sanitation needs within the City's planning area. The Sanitation Districts should participate in the SCAG's studies, Including the Regional Comprehensive Plan (RCP) update, to ensure that the SCAG numbers reflect local population projections. The Sanitation District staff shall make regular status reports to the Board on the progress of this participation. ■ Staff analysis of each proposed annexation (assuming eventual connection) will Include the projected flow from the annexation, and the remaining capacity of the system after annexation and connection. ■ The Sanitation Districts staff, in conjunction with City staff, will hold pre -agenda meetings, prior to each monthly meeting of the Board of Directors to discuss regular and special items on the Board's meeting agenda. ■ Local public hearings will be held, following appropriate notice; for all proposed fee Increases. ■ The Sanitation District Board may periodically review these policies at Its discretion, and may amend them as the Board deems appropriate to further the business of Sanitation Districts 26 and 32. RECOMMENDATION Staff recommends that the Council: 1) Consider the proposed policies and, 2) Make a recommendation to the Board of Directors of Sanitation District Nos. 26 and 32 to adopt the proposed policies. ATTACHMENTS 1. Letter to Charles Carry, dated October 15, 1992 2. Letter from Charles Carry, dated November 23, 1992 +dV V*dnn«.kMk City of Santa Clarita Jai Kajic Mayor Jan Heidt Mayor Pro -Tem Carl Boyer CouncAmember Jo Anne Darcy Councilmember George Pederson Councdrwrnber 23920 Valencia Blvd. Suite 300 City of Santa Clarita California 91355 October 15, 1992 Phone (805)259-2489 Fax (805) 259-8125 Mr. Charles Carry Los Angeles County Sanitation District Nos. 26 and 32 P.O. Box 4998 Whittier, CA 90607 Dear Mr. Carry: We appreciate the conversations, meetings, and exchanges which have occurred between the Sanitation District staff and the City of Santa Clarita staff over the past month or so. The information received has expanded our knowledge of some Sanitation District pollCles,•as well as the general processes which govern the Districts' activities, and we thank you and your staff for the effort. In spite of this, however, We -continue to have some questions about existing policies regarding annexation of properties to the Sanitation Districts. In part, we feel we may not be receiving all the information required to enable us to make Informed decisions regarding these annexations, and our concerns about the Districts, ability to serve new development, the adequacy of environmental review, the purpose and timing of property tax negotiations, and other Issues related to annexations are still with us. In light of the above, please answer the following questions so that we can better assess existing policies and processes. I. We understand that when annexation of a property Is proposed, but prior to action by the Board to Initiate annexation, the District staff begins negotiations with other agencies for a percentage of property taxes. Is this understanding correct and, If so, why are negotiations undertaken prior to Board direction? 2. What Is the basis for these negotiations, and how Is the tax money used by the Districts? 3. . Does the amount of tax money collected by the Sanitation District Increase with the value of the property? 4. If this negotiation Is based on the value of the annexing property prior to development, It seems this could result in a fiscal disadvantage to the Districts, and that this negotiation could more appropriately take place following development. Is this assumption reasonable? If not, why not? 5. Does annexation of the property prior to project development result in a fiscal advantage to the developer? If not, why do developers often seek annexation to the Districts prior to project development? Mr. Charles Carry October 15, 1992 Page 2 6. As annexation costs the applicant time and money, we feel that applicants would not annex if they -were not planning to develop the property and possibly realize some non-financial gain by annexing prior to development. Is this assumption reasonable? If not, why not? 7. Is It current District policy to know, before annexation to the District occurs, how a property is to be developed? if not, how is it determined that the Sanitation Districts have the capacity to accommodate the future development? 8. Barring actual development of a property prior to annexation, does the District require knowledge of, receipt of, and/or review of development entitlements which may have been previously approved by the City or the County, so that service capacity requirements can be determined? If not, why not? 9. Do the Districts currently have any assurance that properties annexed to the Districts will be developed according to any approved entitlements which may exist at the time of annexation? That Is, could an applicant seek annexation with an approved project then, after annexation has occurred, modify that project, or propose a completely different development? If not, why not? If this is the case, could this change result in a negative Impact to the Districts' ability to ensure sufficient capacity to serve the new project? 10. Annexations to the Districts are subject to the California Environmental Quality Act (CEQA). CEQA review and documentation is normally prepared by the lead agency, which in the case of annexations Is the Local Agency Formation Commission (LAFCO). However, the LAFCO for the County of Los Angeles does not typically undertake Independent environmental review, relying Instead on documents previously .approved by either the County of Los Angeles or the City In connection with the entitlement process. 11. As a consequence of the above, documents used often do not address annexation to the Districts, or are outdated, incomplete, or based on entitlements that are expired, thereby potentially making the environmental documentation for the annexation inadequate. Should this be a cause of concern to the Sanitation District staff? If not, why not? 12. Can and should the Sanitation District undertake environmental review and provide such documentation for use by the LAFCO? It not, what other practices might be Implemented to ensure CEQA compliance? We would appreciate a timely response to the questions above, so that several pending decisions before the Board can be addressed in a timely manner. If you have any questions concerning this letter, please contact Deputy City Manager Lynn Harris at (805) 255-4345, or Senior Planner Don Williams of her staff at Mr. Charles Carry October 15, 1992 Page 3 (605) 255-4330. Once again; we thank you for time and assistance thus far, and look forward to hearing from you soon. Sincerely, JIII aJlc Bo d Member Sanitation District Nos. 26 and 32 Cl-iJ &e& J Heidt rd Member Sanitation District Nos. 26 and 32 cc: Counciimembers Boyer, Darcy and Pederson George Caravaiho, City Manager Lynn M. Harris, Deputy City Manager, Community Development Gary Cusamano, Newhall Land and Farming JK/JH:KMK .dv -kC*IYW nk YFCl1MSNON SONO WASTE MANAGEMEN RECEIVED DEC 0 8 1992 COUNTY SANITA-110 ; L5TRICTS 1955 Workman Mill Road, "Whittier, CA 90601.4998 Mailing Address: P.O. Box 4998, Whittier, CA 90607.4998 Telephone: 13101 699-7411, FAX: (310) 695.6139 Boards of Directors County Sanitation Districts Nos. 26 & 32 of Los Angeles County Directors: OF LOS ANGELES COUNTY CHARLES W. CARRY Chief Engineer and General Manager November 23, 1992 File No: 31-150.13.10 26-0o.00.00 DEC 11992 32-00.00-00 Response to Annexation Questions The Sanitation Districts received from Directors Jill Klajic and Jan Heidt a letter dated October 15, 1992 in which several questions regarding the Districts' annexation program were raised. This letter responds to those questions. Before answering specific questions, it would be helpful to review the statutory provisions related to: a County Sanitation District annexation. Annexation of territory is governed by the Cortese -Knox Local Government Reorganization Act of 1985. The Board of Directors is required to take into .account the following criteria. 1. The property is contiguous to said District, or if not contiguous, may be drained by gravity to a trunk sewer of the District. 2 The property is not included in whole or in part in any District formed for purposes similar to those of the District 3. The proposed annexation will be for the interest of landowners or present or future inhabitants within a district and within territory proposed to be annexed. Question 1. We understand that when annexation of a property is proposed, but prior to action by the Board to initiate annexation, the District staff begins negotiations with other agencies for a percentage or property taxes. Is this understanding correct and, if so, why are negotiations undertaken prior to Board direction? No actual 'negotiations" occur between the local. agencies. Instead, tax sharing resolutions are submitted to the local taxing agencies for approval. These tax sharing resolutions were the direct result of new statutes, Sections 99 (Assembly Bill 8 - 1979) and 99.1 (Senate Bill 180 - 1980) of the Revenue and Taxation Code (Chapter 6). The form of the resolution and the tax sharing formula were developed jointly by County Counsel, LAFCO and the Board of Supervisors in 1981. Tax sharing resolutions are further explained under Question No. A. The Districts' staff could initially request the Board of Directors for authorization to receive and begin processing an annexation application. However, the Board would not have sufficient information at that stage Boards of Directors 2 November 23, 1992 f to decide whether the application should be processed. The Board would require the annexation map, tax sharing resolution, and CEQA finding. These documents are normally prepared for the'MakingApplication" Board action which is the first time the Board currently reviews an application. The tax sharing resolution would be necessary because the Board would need to know whether or not a local taxing agency had any objection to sharing tax revenue with the District. If a local taxing agency objected to sharing the tax revenue, Districts' staff could then make a recommendation to the Board of Directors to deny the annexation request. Question 2. What is the basis for these negotiations, and how is the tax money used by the Districts? See answer to Question No. 4. Question 3. Does the amount of tax money collected by the Sanitation District Increase with the value of the property' See answer to Question No. 4. Question 4 If this negotiation is based on the value of the annexing property prior to development, it seems this could result in a fiscal disadvantage to the Districts, and that this negotiation could more appropriately take place following development. Is this assumption reasonable? If not, why not? Questions Nos. 2-4 are interrelated and are answered together Sections 99 and 99.1 of the Revenue and Taxation Code established the basis for tax negotiations. These negotiations for sharing tax revenue between the local -agencies was completed in 1981.' At that time, a joint resolution format and a formula were developed by representatives of the Chief Administrative Officer, Auditor -Controller and County Counsel for the County of Los Angeles. These negotiations resulted in local agencies agreeing to allocate a portion of the annual tax increment to a Sanitation District from a newly annexed area that was proportional to the amount of tax revenue received by that Sanitation District in an adjoining tax rate area already in the District. These tax sharing ratios for each agency are updated annually. It is now standard procedure to submit a tax sharing resolution for each annexation application directly to each affected local taxing agency for ratification. The assumption that tax sharing is based on the value of the. annexing property prior to development is incorrect. The amount of tax money collected from the local agencies is limited to the property tax revenue from the annual tax increment subsequent to annexation (Section 99.1(2) of the Revenue and Taxation Code). For example, if territory being annexed is developed with a single-family home valued at 5300,000, the District's share of property tax would be calculated from the annual tax increment for that improved parcel (which currently cannot exceed 2%). However, if territory being annexed is a vacant lot valued at $100,000 and is subsequently developed as a single-family home with a total value of 5300,000, the District's share of property tax would be based on the $200,000 increase in valuation plus the annual 2% tax increment. The amount of tax money collected is a function of -the value of the tax increment after annexation. As the value of the tax increment increases, the amount of tax revenue will increase. The tax money collected is used to offset operations and maintenance expenses and for capital facilities which benefit existing users. uestion 5. Does annexation of the property prior to project development result in a fiscal advantage to the developer? If not, why do developers often seek annexation to the Districts prior to project development? See,answer to Question No. 6. Boards of Directors 3 November 23, 1992 Question As annexation costs the applicant time and money, we feel that applicants would not annex if thy were not planning to develop the property and possibly realize some non-financial gain by iiia annexing prior to development. Is this assumption reasonable? If not, why not? rte_ Annexation does attach benefit to the land. It means the property can be serviced by a Sanitation District, provided sewerage facilities are available. Annexation in itself, however, does not guarantee sewer service. Property annexed to a Sanitation District with the benefit of sewer service will be more desirable than property which is not annexed to a Sanitation District and, therefore, without the benefit of sewer service. It is not clear what "non-financial gain" might accrue. It should also be pointed out that developers have no choice in this matter and are required to apply for annexation prior to project development. Local jurisdictions require the territory being developed to have a means for safe disposal of wastewater to insure protection of public health. The Districts will not provide sewer service to any territory which is not within the jurisdictional boundaries of the District unless by special contract. Local jurisdictions will not approve a tentative tract map until developers have applied for annexation. Question 7. Is it current District policy to know, before annexation to the District occurs, how a property is to be developed? If not, how is It determined that the Sanitation Districts have the capacity to accommodate the future development. Every annexation applicant must complete a Request forAnnexation form. This is a five-page document which asks questions pertaining to the proposed annexation, physical features, population/housing data, land use, status of project and environmental data. The description of the project, whether existing or proposed, is also provided. If the project happens to be vacant land, current zoning is noted and verified through public records (latest assessor's equalized assessment roll). The Districts have developed wastewater generation factors based on zoning. These factors are applied to estimate potential wastewater flow for all annexation applications. The estimated wastewater flow is included in the plan for services portion of the annexation application submitted to LAFCO. Also see the answer to Question No. & Question & arring actual development of a property prior to annexation, does the District require owledge of, receipt of, and/or review of development entitlement which may have been reAously approved by the City or the County, so that service capacity requirements can be etermined? If not, why not? T The Districts keep track of potential wastewater related impacts of all proposed developments within its sphere of influence, whether it is within.a District's present boundary or outside, through a development monitoring system (DMS). The necessary information is obtained through 'will serve" inquiries and review of CEQA documents submitted to the Districts as a responsible agency. The DMS is a planning tool which tracks proposed developments in order to better project future demand on services. It monitors the nature and location of growth and provides the Districts with information for facility and sewer planning purposes. The County Department of Regional Planning (DRP) also monitors development in areas designated in the County's General Plan as'aear,N MANSION'. This designation includes the Santa Clarita Valley and DRP incorporates information from the City of Santa Clarita. DRP tracks three types of developments which are 'PENDING", "APPROVED', and ."RECGRDED". When the tentative tract map for a proposed project is submitted for approval, the project is categorized as a "PENDING" project. "APPROVED" and "RECORDED" Categories are Boards of Directors 4 November 23, 1992 sell -explanatory. DRP continuously monitors the status of these developments. Based on this information, the DMS sums up the approved and recorded demand for wastewater service for the area. The Districts and DRP routinely exchange information to review available capacity and to cross-check their respective DMS data. The Districts also provide 'will serve' Information to the City on a monthly basis. Question 9. tthe Districts currently have any assurance that properties annexed to the Districts will be according to any approved enddement which may exist at the time of annexation? t Is, could an applicant seek annexation with an approved proms, then, atter anneaadon has occurred, modify that project, or propose a completely different development? If not, why not? If this Is the ease, could this change result In a negative Impact to the Districts' ability to ensure sufficient capacity to serve the new project? INo, there is no assurance. Yes, it is possible that a property could anus based on a proposed project and develop. as a different project. However, if a property is not developed in accordance with what was represented in the annexation application, it is the responsibility of the local jurisdiction as the lead agency on the developrrtene itself to require the developerlowner to prepare a new CEQA document. The Districts, as a responsible agency, will review any additional environmental documents submitted by the local jurisdictions and will have the opportunity to comment on any new impact on the Districts. Annexation does not guarantee sewer service for a project. Ability to serve is again reviewed at the time the Districts' Sewerage System Connection Fee application is made. A final check to insure: that industrial waste permit requirements have been met is also made at that time. Question 10. Annexations to the Districts are subject to. the California F,nvtroamental Quality Act (CEQA). CEQA review and documentation is normally prepared by the lead agency, which In the can of anuezillbus L the Loot Agency Formatter Commisslaa (LAFCO). However, the LAFCO for the County of Loa Angels does not typically undertake Independent enAroamestad review, relying Instead on documents previously approved by either the Cooney of Loa Angeles or the City in connection with the endtlement process. Sec answer to Question No. 1L Question 1L As a consequence of the above, documents coed ofte do not address gnnexatIon to the Districts, or are outdated, hrcempige, or based as eutidement that are expired, thereby Poteud lly wkiaK the mVironmental documentation ror the annexation Inadequate, Should this be a came of mown to the Sadtadon Disufet sftV if not, why not! In terms of approval of a proposed.project, the lead agency would be the local jurisdiction and the Districts would be a responsible ageney Providing comments. In terms of processing the annexation request, the lead agency is the County Sanitation Disufas of Los Angela County. The Districts staff reviews the environmental documents approved by the local Jurisdiction for the Proposed Project in addition to the environmental data provided through the Request fo►Annacaips form. After review is complete, staf f auks a determination as to adequacy of the environmental documents. Staff then prepam a Notice of Finding which makes a recommendation to the Board of Directors. Finally, the Board, using its independent judgement, determines whether to submit the annexation appliatkm to LAFCO. Upon submittal of the annexation application to LAFCO, LAFCO becomes the lead agency for LAFCO processing of the annexation application. Boards of Directors . 5 November 23, 1992 In the case of an outdated, incomplete or inadequate CEQA document, the Districts' staff will discuss the matter with the local jurisdiction which serves as the lead agency on the development project and request that it determine if additional environmental documents are required. Question 12. Can and should the Sanitation District undertake environmental review and provide such documentation for use by the LAFCO? If not, what other practices might be implemented to ensure CEQA compliance? Sanitation Districts do perform environmental review and make determinations of adequacy of environmental documents prior to providing this information to LAFCO. The environmental review consists of the following steps: (a) The project is reviewed to insure that the project covered by the CEQA document is the same as the project proposed in the application for annexation. (b) The CEQA document is reviewed to determine whether the availability of sewerage service was discussed and any District's comments addressed. (c) A verification is made that the legislative body of the local jurisdiction approved and certified the CEQA document and filed a notice of determination with the County Clerk. (d) All supplemental environmental information in the Request forAnnemtion form is also considered. (e) If the environmental documentation is determined to be insufficient, the annexation application is held until the applicant or local jurisdiction provides additional documentation. Regarding annexations in general, it should be noted that there is another option available to property owners (applicants) who wish to annex to a County Sanitation District. This option is for the applicant to submit the request for annexation directly to LAFCO. The Board of Supervisors would be the conducting authority for this type of annexation requesL Upon completion of proceedings and approval by the LAFCO, the Board of Supervisors may order the annexation as provided in Section 57075 or 57076 of Cortese Knox. We would bepleasedto provide any additional information. Very trulyours, Charles W. Carry. CWC:mah cc: Coucilmembers Boyer, Darcy and Pederson George Caravalho, City Manager Lynn M. Harris, Deputy City Manager, Community Development Donald Williams, Senior Planner Gary Cusamano, Newhall Land & Farming LUNNEXFPE,CSD20 SCANXOVELTR