FROM:
Finance
SUBJECT:
Title
Levy of a Special Tax in Community Facilities Districts (Maintenance) for Fiscal Year 2026-2027.
End
RECOMMENDATION:
Recommendation
Adopt Resolution No. 2026-057, Authorizing the Levy of a Special Tax within Community Facilities Districts (Maintenance) for Fiscal Year 2026-2027.
End
COUNCIL GOALS:
• Invest in the City’s infrastructure (streets, sewers, parks, etc.) by improving the aesthetics of the community through code enforcement, street sweeping, and landscape maintenance.
DISCUSSION:
Community Facilities Districts (CFD) for maintenance services were established for the purpose of funding annual landscape, lighting, and park maintenance within each District and the surrounding areas throughout the City. The City maintains 106 maintenance CFD’s including 82 in this item and the other 24 being presented as companion items on today’s agenda. Of the 106 CFDs being considered on today’s agenda, the average increase is 3.82% (does not include one CFD that is increasing due to additional development having been completed over the last fiscal year).
CFDs are categorized in three financial categories including solvent/self-sufficient, at risk/structurally imbalanced, and operational deficit and are detailed below:
• Solvent/Self-Sufficient: Based upon current funding levels, 37 CFDs are considered to be solvent with no going-concern as their revenue is sufficient for their operating expenditures or the use of fund balance annually supports the CFD for more than 20 years. As such, 17 of these CFDs have recommended increases for 2026-27 to maintain their solvency.
• At Risk/Structurally Imbalanced: Current funding levels for 61 CFDs are inadequate and as programmed require use of the individual district’s fund balance (one-time revenue) to support operations. These CFDs are at risk and will have an operating deficit in less than 20 years (27 CFDs within five (5) years, 21 within 10 years, and 13 within 10-20 years). Increases are being recommended in 2026-27 for these CFDs to mitigate the current and future risk.
• Operational Deficit: Current funding levels for 8 CFDs are inadequate and as programmed are operating in a deficit (expenses exceed revenues). Increases are being recommended for these CFD’s as part of a five-year funding plan to mitigate their current deficiencies.
Pursuant to Government Code Section 53340, Ordinances have been adopted to levy a special tax at the rate and in the manner specified in each district Rate and Method of Apportionment. Each district Rate and Method of Apportionment has been approved and adopted by the City Council. Annually, the City Council adopts a resolution as required by the County of San Bernardino Auditor-Controller/Treasurer/Tax Collector to place the special tax on the next County assessment roll.
The proposed Fiscal Year 2026-27 special tax rates are shown for each district in the Exhibit attached to the resolution. Of the 82 CFD’s presented in this item, 55 are proposed to receive rate increases, while the remaining 27 will remain unchanged from the prior fiscal year:
The special tax levied on each assessable parcel within each CFD is necessary to pay the costs and expenses of each CFD. A list of each parcel and the related specific tax for each parcel is available for viewing in the City Clerk's Office.
The CFDs were established after the adoption of Proposition 218 and comply with its requirements because the CFDs and the special taxes were approved by the consent of the property owners at the time each CFD was formed.
FISCAL IMPACT:
The proposed Fiscal Year 2026-2027 special tax rates will generate approximately $6.69 million to fund annual landscape and lighting maintenance costs within each CFD.
MOTION:
Approve staff recommendation.