HomeMy WebLinkAboutMINUTES - 03201990 - 2.2 2-0 ca,
TO: BOARD OF SUPERVISORS 5----L-
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Phil Batchelor, County Administrator : :
4° County
DATE: �.ey:-----•••�-��ti
March 13 , 1990 A CUUN�
SUBJECT: LEGISLATION - SB 2165 (Boatwright)
SPECIFIC REOUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION
RECONIlEENDATIONS
1. Adopt a position of OPPOSITION to SB 2165 (Boatwright) which
would allow the Presiding Judge of the Superior Court to
determine which property tax allocation formula should be
applied to future property tax distributions when the
affected jurisdictions are unable, within 30 days, to reach
agreement on the property tax exchange in cases of
annexations.
2. Authorize the Chair to send a letter to Senator Boatwright
expressing the Board's opposition to SB 2165 and the reasons
for such opposition.
BACKGROUND:
Under existing law, LAFCO is prohibited from proceeding with
processing an annexation application until the taxing
jurisdictions which are involved come to agreement on how to
distribute property taxes in the future in the area subject to
annexation. In Contra Costa County, over the past several years
forty-six of forty-six applications for annexation have been
processed following agreement between the County and the city
involved. While in some cases these negotiations have taken
longer than the city might have wished, all such annexations have
been approved.
SB 2165 would provide that if any two or more taxing
jurisdictions ( including for our purposes here the County and a
Yes ,
CONTINUED ON ATTACHMENT: YES SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
4 APPROVE OTHER
SIGNATUREJSJ: Ofmz& k /-/&u 5o�
ACTION OF BOARD ON Marc , 199U APPROVED AS RECOMMENDED X" OTHER
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A TRUE
UNANIMOUS(ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN.
M
CC: ATTESTED AR 2 0 1990
Please see Page 3 . PHIL BATCHELOR,CLERK OF THE BOARD OF
SUPERVISORS AND COUNTY ADMINISTRATOR
M382 (10/88) BY ( DEPUTY
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city) cannot agree on an exchange of property taxes within a 30
day period after receiving the Auditor-Controller' s estimates of
the amount of property tax generated within a proposed annexation
area each agency must file with LAFCO and the Superior Court a
resolution indicating that no agreement was reached and setting
forth the agency' s specific proposal for the exchange of
revenues. The resolution must also indicate that the agency is
willing to be bound by the decision of the Superior Court
regarding the exchange of property taxes, without right of
appeal.
Once a resolution is filed with the Superior Court, the Presiding
Judge must set a date for a hearing within 20 days of the date
the resolution is filed with the Superior Court. After the
hearing, the Presiding Judge of the Superior Court must determine
which of the proposals that have been submitted is the most
reasonable and most accurately reflects the exchange of
responsibilities between agencies. The proposal chosen by the
Presiding Judge thereby becomes the basis for the exchange of
property taxes and the Presiding Judge is required to so . notify
LAFCO. The order of the Superior Court is used by LAFCO as the
basis for making any order or findings with regard to the
exchange of property tax revenues between and among the affected
jurisdictions.
The County Administrator recommends that the Board of Supervisors
oppose SB 2165 for the following reasons:
1. No local jurisdiction would have any motivation whatever to
agree to a property tax exchange if they felt they could get
a more favorable decision from the Presiding Judge.
2. The process of "negotiation" is severely undermined.
Regardless of how much an agency has compromised during the
negotiating process over the period of 30 days, an agency is
apparently permitted to withdraw any and all proposals which
have been discussed and make whatever proposal they wish to
the Presiding Judge, even if such proposal was never
discussed with the other taxing jurisdiction.
3 . Since the Presiding Judge must apparently choose one of the
proposals which has been submitted and cannot modify any of
them, there will probably be a tendency to submit a proposal
which is as favorable as possible to the submitting agency
but sounds reasonable compared to the proposal submitted by
any other taxing agency. The Presiding Judge is then left
to choose whichever proposal sounds the more reasonable,
even if in fact neither proposal is reasonable.
4. SB 2165 will probably effectively result in the Presiding
Judge being required to act on every annexation which is of
any size whatever. This undermines the right of both the
Board of Supervisors and City Council to negotiate and reach
agreement on the terms of any annexation. Since both sides
must also agree in advance not to appeal the decision of the
Presiding Judge, all affected agencies are forced to place
the authority to determine the future distribution of
property taxes in the hands of one individual. The
Presiding Judge is not required to document or explain the
basis for his choice between various proposals.
5. The equitable distribution of property tax revenue is a
complex issue which must take into consideration all of the
services which are being provided to the area subject to
annexation, what services are being transferred to the city,
what services will be left the responsibility of the County,
what other revenue sources will automatically revert to the
city when the annexation takes place and what the relative
cost and value of each of these services is. This is a
�. -3-
great
3-great deal of technical material to expect the Presiding
Judge to be able to absorb and rule on in a relatively short
time frame.
6 . All of the costs of the judicial review of an annexation,
including the cost of the County Clerk, Judge, bailiff, etc.
are the responsibility of the County. The city pays nothing
for these services.
7. The time limits do not appear to be reasonable or workable.
Once an application for an annexation has been filed with
LAFCO, the Assessor has 30 days from the date he is notified
of the filing by LAFCO in which to advise the
Auditor-Controller of the assessed value of the territory
subject to annexation. The Auditor-Controller then has the
balance of 45 days from the date of the filing of the
application to advise each affected jurisdiction of the
amount of property tax generated in the involved area. Once
the local jurisdictions receive the Auditor' s estimates,
they have only 30 days within which to negotiate a property
tax exchange agreement. This is probably not sufficient
time for good faith negotiations to be undertaken and
concluded. Our experience has been that on many occasions
the city does not supply the County adequate information
initially to reach an informed judgment regarding what the
amount of the future property tax increment will be, based
on what plans the city has for the area. This means asking
the city to submit more complete information, which will
quickly exhaust the 30 day time period allowed for
negotiations. Annexations vary widely in size and
complexity. Trying to apply the same timeframe to all of
them seems unrealistic, particularly in a massive proposal
such as the Bishop Ranch annexation to San Ramon or the
pending annexation of Franklin Canyon to Hercules. While it
may not be the intent of the law that other matters become
involved in the discussion over the property tax exchange
agreement, the fact remains that the County frequently has
legitimate concerns about the regional impact of the city' s
plans on problems such as transportation, which may impede
the County' s ability to immediately agree to an annexation.
If agreement is not reached, each agency must file their
proposal with the Superior Court within 15 days after the
end of the 30 day negotiation. period. Given the
requirements for advanced notice of items being acted on by
the Board of Supervisors, 15 days is probably not adequate.
time to consult with the Board of Supervisors, prepare a
final proposal for the Presiding Judge and obtain approval
of the proposal from the Board of Supervisors.
For all of these reasons we believe that the Board of Supervisors
should oppose SB 2165.
cc: County Administrator
Auditor-Controller
County Counsel
Assessor
Executive Officer, LAFCO
Les Spahnn, SRJ. Jackson, Barish & Associates