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File #: 21-2055    Version: 1 Name:
Type: Consent Calendar Status: Agenda Ready
File created: 2/27/2023 In control: City Council Meeting
On agenda: 3/14/2023 Final action:
Title: Resolution of Intent to form Community Facilities District No. 112 (The Gardens Phase One).
Attachments: 1. Resolution of Intent, 2. Resolution to Incur Bonded Indebtedness, 3. Proposed Boundary Map
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FROM:

Finance

 

SUBJECT:

Title

Resolution of Intent to form Community Facilities District No. 112 (The Gardens Phase One).

End

 

RECOMMENDATION:

Recommendation

1.                     Adopt Resolution No. 2023-016, of the City Council of the City of Fontana of Intention to Establish a Community Facilities District and to Authorize the Levy of Special Taxes.

 

2.                     Adopt Resolution No. 2023-017, of the City Council of the City of Fontana to Incur Bonded Indebtedness of the Proposed City of Fontana Community Facilities District No. 112 (The Gardens Phase One).

 

End

 

COUNCIL GOALS:

 

•                     Practice sound fiscal management by developing long-term funding and debt management plans.

 

DISCUSSION:

 

North Fontana Investment Company, LLC has initiated the process to form a Community Facilities District for the purpose of financing the acquisition of certain public facilities that are eligible under the City financing goals and policies, namely sewer, storm drain, street improvements, landscaping, and development impact fees. The formation of the district will benefit the City by funding the infrastructure projects outside of the typical improvements that would be required for the project including a contribution for a project of community benefit. CFD bond funding will allow for infrastructure to be built at one time reducing construction inconvenience for earlier residents and enhancing the overall community aesthetics.

The project consists of approximately 69.97 gross (48.15 net taxable acres) (526 residential lots), is located on the west side of Sierra Avenue north of Casa Grande Avenue.

 

The proposed Rate and Method of Apportionment (RMA) includes rates to pay for bonded indebtedness and maintenance of street lighting, landscaping and parks.  Initial assigned residential rates are proposed as follows:

 

Land Use Class

 

Planning Area

    Residential Floor Area

 

  Bond Debt

 

    Maint

 

    Total

1

 

7, 8, 9 &10

Two Story - 3,400 sf or Greater

 

$5,626

 

$576

 

$6,202

2

 

7, 8, 9 &10

Two Story - 3,200 to less than 3,400 sf

 

$5,417

 

$576

 

$5,993

3

 

7, 8, 9 &10

Two Story - 3,000 to less than 3,200 sf

 

$5,208

 

$576

 

$5,784

4

 

7, 8, 9 &10

Two Story - 2,800 to less than 3,000 sf

 

$5,007

 

$576

 

$5,583

5

 

7, 8, 9 &10

Two Story - 2,600 to less than 2,800 sf

 

$4,883

 

$576

 

$5,459

6

 

7, 8, 9 &10

Two Story - 2,400 to less than 2,600 sf

 

$4,381

 

$576

 

$4,957

7

 

7, 8, 9 &10

Two Story - 2,200 to less than 2,400 sf

 

$4,164

 

$576

 

$4,740

8

 

7, 8, 9 &10

Two Story - 2,000 to less than 2,200 sf

 

$3,947

 

$576

 

$4,523

9

 

7, 8, 9 &10

One Story - 2,000 sf or Greater

 

$4,829

 

$576

 

$5,405

10

 

7, 8, 9 &10

One Story - Less than 2,000 sf

 

$4,613

 

$576

 

$5,189

11

 

5 & 6

1,900 sf or Greater

 

$3,845

 

$550

 

$4,395

12

 

5 & 6

1,700 to less than 1,900 sf

 

$3,414

 

$550

 

$3,964

13

 

5 & 6

1,500 to less than 1,700 sf

 

$2,953

 

$550

 

$3,503

14

 

5 & 6

1,300 to less than 1,500 sf

 

$2,768

 

$550

 

$3,308

15

 

5 & 6

Less than 1,300 sf

 

$2,583

 

$550

 

$3,133

 

Sales prices for the homes have been estimated at $504,798 to $824,058.  The proposed rates have been established to provide a total tax rate of less than 1.95% of the home value per City Policy.

 

The proposed rates for bonded indebtedness will support $28.4 million of bonds, providing funds to finance $24.0 million of facilities and/or fees.  The proposed annual rates for maintenance of $576 for planning areas 7, 8, 9 and 10 and $550 for planning areas 5 and 6 will be sufficient to fund the annual maintenance costs for street lighting, landscaping and parks within and surrounding the area of the CFD.  The rate also includes the maintenance costs related to the water quality system required by the State of California.  The maximum annual tax rate for maintenance have been set at $810 per unit for planning areas 7, 8, 9 and 10 and $770 per unit for planning areas 5 and 6 with a 2% escalator per City Policy.

 

This action represents the first step in the process to establish the new district.  Adoption of the proposed resolutions will set the public hearing for April 25, 2023.  The levy of the proposed special taxes will be subject to the approval of the qualified electors of the new Community Facilities District at a special election.

 

The recommended action complies with the City Council's debt management objectives.

 

FISCAL IMPACT:

Most of the issuance costs are contingent upon the sale of the bonds and will be paid from proceeds.  The developer has deposited $50,000 with the City to pay for appraisal and miscellaneous costs that are non-contingent.

Annual debt service and maintenance costs will be paid from special taxes levied on the future homeowners within the district.

 

MOTION:

Approve staff recommendation.