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HomeMy WebLinkAbout03. Adopt resolutions to initiate formation of the Harper Lane Area Contractual Assessment District (CAD) No. 2018-1 in Danville Page 1 of 9 Item 3. CENTRAL SAN BOARD OF DIRECTORS ' POSITION PAPER MEETING DATE: MARCH 1, 2018 SUBJECT: ADOPT (1) RESOLUTION OF INTENTION NO. 2018-004 TO INITIATE FORMATION OF THE HARPER LANE AREA CONTRACTUAL ASSESSMENT DISTRICT (CAD) NO. 2018-1 FOR THE PURPOSE OF INSTALLING SEWER IMPROVEMENTS ON HARPER LANE, PIXIE LANE, TERRY LANE, HARMONY COURT AND BRADFORD PLACE IN DANVILLE; AND (2) RESOLUTION NO. 2018-005APPROVI NG THE BOUNDARY FOR THE PROPOSED CAD SUBMITTED BY: INITIATING DEPARTMENT: RUSSELL LEAVITT, ENGINEERING ENGINEERING AND TECHNICAL SERVICES- ASSISTANT I I I PDS-RATES AND FEES REVIEWED BY: THOMAS BRIGHTBILL, SENIOR ENGINEER DANEA GEMMELL, PLANNING AND DEVELOPMENT SERVICES DIVISION MANAGER JEAN-MARC PETIT, DIRECTOR OF ENGINEERINGAND TECHNICAL SERVICES Roger S. Bailey General Manager ISSUE Approval of a Resolution of Intention by the Board of Directors is required as the first step in the formation of a CAD. BACKGROUND At its September 1, 2011 meeting, the Board of Directors adopted Resolution No. 2011-053 to initiate March 1, 2018 Regular Board Meeting Agenda Packet- Page 34 of 225 Page 2 of 9 formation of Harper Lane CAD No. 2011-2 and Resolution No. 2011-054 to approve CAD boundaries. On March 1, 2012, the Board of Directors rescinded Resolution 2011-054 and approved Resolution 2012-015 to add two more properties to the CAD boundaries, allow preparation and public review of an Engineer's Report and have the CAD be brought back to the Board for final approval. This last set never occurred, because the CAD contract did not receive a sufficient number of signatures to make it financially viable. I n the interim, several efforts have been made to organize a smaller CAD at the lower end of Harper Lane. Finally, in 2017, due to better neighborhood organization and communication, sufficient support was obtained to request the Board of Directors to approve a smaller CAD. At its September 21, 2017 meeting, the Board of Directors adopted Resolution 2017-043 to initiate formation of the Lower Harper Lane CAD 2017-2 and Resolution 2017-044 to approve the boundary for the proposed CAD. The length of this CAD's sewer was to be approximately 1,650 feet for 22 benefitting properties. Subsequent to the recent initiation of the Lower Harper Lane CAD, property owners along the remainder of Harper Lane began indicating interest in extending the sewer further up Harper Lane and Bradford Place. As a result of additional outreach, the organizers would like to add 12 upper Harper Lane parcels to the Lower Harper Lane group to form a larger Harper Lane Area CAD. The renewed interest in a larger CAD can be attributed to better neighborhood communications and organization, as well as improvements to the general economy since 2012. Signed, non-binding interest statements have been obtained from more than 50- percent of the property owners. The location and boundary of the proposed CAD is shown on Attachment 1. The total length of the larger CAD's sewer would be approximately 2,765 feet for 34 benefitting properties. The CAD Formation Process The following board actions are required to create a CAD: • First Board Meeting - The Board of Directors passes a Resolution of Intention to form the CAD and approves a CAD boundary map. Following the passage of the Resolution of Intention, the participating property owners work with their Engineer to complete improvement plans and secure bids to construct the project. Central San staff prepares an Engineer's Report. Staff also prepares and mails notices and ballots to owners of all parcels which can connect to the project. Under State Law, the CAD is a voluntary agreement which is not subject to Proposition 218; Central San's policy and procedure is to follow the notification and balloting process described in Proposition 218 to the extent possible. • Second Board Meeting - A public hearing is held to receive input and comments. Following the public hearing, ballots are tabulated. If there is sufficient property owner support, the Board of Directors may approve the Engineer's Report, approve the assessments, and order the construction of the improvements. Following the order to construct the improvements, the participating property owners retain a contractor to construct the sewer improvements. Central San inspects the construction of the sewer improvements to confirm that the construction conforms to Central San's Standards and Specifications. • Third Board Meeting - The Board of Directors approves the final assessment amounts and the levy of the assessments. March 1, 2018 Regular Board Meeting Agenda Packet- Page 35 of 225 Page 3 of 9 Key Features of the CAD Program The following are key features of the CAD program: 1. The CAD program creates voluntary assessment districts based on a contractual assessment process. Participating property owners sign a contract with Central San agreeing to pay back funds initially provided by Central San to cover the design and construction of infrastructure. 2. The source of funds to cover the assessment district costs are ad valorem tax revenues which are deposited each year in Central San's Sewer Construction Fund. 3. Assessment district formation criteria includes the requirement of at least five properties directly tributary to a proposed CAD facility; a minimum of 60% of those properties having existing homes served by septic tank systems; no more than two dwellings per Participant Parcel; and persons owning multiple parcels may finance only one parcel through the CAD. This proposed CAD has thirty-four directly tributary properties, all homes are on septic, no property has more than two dwellings, and no persons own more than one parcel. The proposed CAD complies with the terms set forth in the revised Board Policy No. BP 010 - Contractual Assessment Districts, approved at the February 1, 2018 Board of Directors meeting. 4. The obligation to pay assessments is recorded as a lien against the property. Participants are given the option to pay off their assessment within one month of the assessment being set or are allowed to amortize the debt through payments on their property tax bills. 5. The amortization period for paying back funds to Central San is 10 years with no interest penalty for early payoff. 6. The CAD offers financing for the property owners' share of the sewer main extension design and construction costs, including the portion of a private lateral sewer located in the street. Costs specifically excluded from CAD financing include the cost of installing the lateral sewer on a participant's property, abandoning an existing septic tank, and Central San's capacity fee and other fees. 7. CAD participants are responsible for the non-participants' share of the costs of the CAD facilities. Central San will establish reimbursement fees, which will be collected from non-participant parcels at the time of connection to the public sewer system. The reimbursement fees will be used to first reduce the outstanding assessments of the CAD participants, and any remaining reimbursement fees will be distributed to the CAD participants. CEQA Staff has concluded that this project is exempt from the California Environmental Quality Act (CEQA) under CEQA Guidelines Section 15061(b)(3), since it can be "seen with certainty that there is no possibility that the activity in question may have a significant adverse effect on the environment." This certainty is based on the Central San's past experience with numerous sewer construction projects of this nature, the relatively short distance involved, and the impact-limiting nature of Central San's construction specifications that would be required of the project. Approval of this project will establish the Board of Directors' independent finding that this project is exempt from CEQA. ALTERNATIVES/CONSIDERATIONS Reject or defer initiating formation of the CAD. These actions would halt or delay the CAD proceedings. FINANCIAL IMPACTS March 1, 2018 Regular Board Meeting Agenda Packet- Page 36 of 225 Page 4 of 9 The CAD program is structured so that the design and construction costs are all paid by the property owners. There are minor administrative costs for initiating the formation of a CAD. These costs will eventually be paid by the CAD participants if a CAD is actually formed. The estimated total costs for this CAD are $900,000. Staff believes that there is adequate funding within the existing CAD budget shown in the fiscal year (FY) 2017-18 budget to cover the design costs for this CAD of approximately$60,000. District Project (DP) 6603 North Jackson CAD is currently proceeding slower than anticipated and will provide the funding for this new CAD design. A new DP project will be created upon approval of the Resolution of Intention for this CAD. Construction costs will be included in the FY 2018-19 budget. As noted above, the project is still dependent on approval of the participating property owners as outlined in Board Policy 010, Contractual Assessment District. Upon property owner approval, the engineer's estimate of proposed construction costs will be submitted to the Board of Directors for approval. COMMITTEE RECOMMENDATION A smaller Lower Harper Lane CAD was recommended for approval by the Engineering and Operations Committee at its September 12, 2017 meeting and subsequently approved by the Board. RECOMMENDED BOARD ACTION Authorize formation of a CAD consisting of 34 properties on Harper Lane, Pixie Lane, Terry Lane, Harmony Court and Bradford Place in Danville by: 1. Adopting a resolution of intention to create Harper Lane Area CAD No. 2018-1 for the purpose of installing sewer improvements (Attachment 2); and 2. Adopting a resolution approving the boundary of the assessment district (Attachment 3). Strategic Plan Tie-In GOAL ONE: Provide Exceptional Customer Service Strategy 1 - Foster Customer Engagement and Awareness ATTACHMENTS: 1. CAD Boundary Map 2. Proposed Resolution of Intention to Create Harper Lane Area CAD 3. Proposed Resolution Approving Boundary Map March 1, 2018 Regular Board Meeting Agenda Packet- Page 37 of 225 Page 5 of 9 Alamo -" DETAIL AREA OF' � GG�p � SIE ! \ o � / ,gyp /gyp CO / \ o Potential Participant E Existing Sewer g N - Potential Sewer ao 150 soo CAD Area C Feet W C7 Ul Pro osed Boundaries of Har er Lane Area Attachment ICENTRALSAN a p Contractual Assessment District No. 2018-1 z March 1, 2018 Regular Board Meeting Agenda Packet- Page 38 of 225 Page 6 of 9 RESOLUTION NO. A RESOLUTION OF INTENTION BY THE CENTRAL CONTRA COSTA SANITARY DISTRICT TO CREATE HARPER LANE AREA CONTRACTUAL ASSESSMENT DISTRICT NO. 2018-1 FOR THE PURPOSE OF INSTALLING SEWER IMPROVEMENTS WHEREAS, the public health and the environment will be best protected by the expansion of the public sewer system; WHEREAS, the construction and installation of a sanitary sewer pipeline, together with appurtenant work and facilities, in areas not presently connected to the sewer system will facilitate the elimination of potential public health problems due to failing septic systems; and WHEREAS, it would be convenient and advantageous to establish a boundary around an area within which Central Contra Costa Sanitary District (Central San) and property owners may enter into contractual assessments and make arrangements to finance public improvements to parcels which are developed and where the costs and time delays involved in creating an assessment district pursuant to alternative provisions in the law would be prohibitively large relative to the cost of the improvement. THEREFORE, the Board of Directors of Central San (Board) resolves: 1. This Board intends to approve the following improvements under the authority of Chapter 29, Contractual Assessment Districts (CAD), of the Municipal Improvement Act of 1911, as amended, to wit: construction and installation of approximately 2,765 linear feet of sanitary sewer line, together with appurtenant work and facilities located at Harper Lane, Pixie Lane, Terry Lane, Harmony Court and Bradford Place in Danville, California. 2. This Board finds that the parcels within the intended CAD are shown within the boundaries of the map entitled, "Proposed Boundaries of Harper Lane Area CAD No. 2018-1." 3. This Board intends to levy a special assessment upon participating parcels within the described CAD in accordance with the special benefit to be received by each parcel of land, respectively, from the improvements. The improvements proposed will not confer any special benefit upon any publicly owned land. Hence, there shall be omitted from special assessment all public streets, alleys, and places and all land belonging to the United States, the State of California, Contra Costa County, and Central San now in use in the performance of a public function. 4. Central San intends to provide loan financing for the improvements, subject to the availability of funds and any limitation on the commitment or expenditure of funds for the CAD Program as may be established from time to time by the Board. Loans shall be repaid by assessments on the property of participating parcel owners. Assessments shall be paid over a maximum period of ten (10) years with interest at a rate to be fixed by Central San. March 1, 2018 Regular Board Meeting Agenda Packet- Page 39 of 225 Page 7 of 9 Central Contra Costa Sanitary District Resolution No. Page 2of2 5. The procedure for the collection of assessments will be the placement of assessments on participating parcel owners' tax bills. The first assessments may be placed on owners' tax bills in fiscal year 2019-20. 6. This Board appoints Thomas Brightbill, Senior Engineer, as Engineer of Work for this project to prepare the report required by Section 5898.22 of the Streets and Highways Code. 7. A public hearing is expected to be held on this matter before the Board on June 15, 2018 at Central San's Offices at 5019 Imhoff Place, Martinez, California. This date is tentative and may be modified in the future. 8. The Board independently finds that this project is exempt from the California Environmental Quality Act (CEQA) under CEQA Guidelines Section 15061(b)(3), since it can be "seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment." This certainty is based on Central San's past experience with numerous sewer construction projects of this nature, the relatively short distance involved, and Central San's impact-limiting construction specifications that would be required of the project. PASSED AND ADOPTED this 1St day of March, 2018, by the Board of Directors of Central San by the following votes: AYES: Members: NOES: Members: ABSENT: Members: James A. Nejedly President of the Board of Directors Central Contra Costa Sanitary District County of Contra Costa, State of California COUNTERSIGNED: Katie Young Secretary of the District Central Contra Costa Sanitary District County of Contra Costa, State of California Approved as to form: Kenton L. Alm, Esq. Counsel for the District March 1, 2018 Regular Board Meeting Agenda Packet- Page 40 of 225 Page 8 of 9 RESOLUTION NO. RESOLUTION APPROVING BOUNDARY MAP HARPER LANE AREA CONTRACTUAL ASSESSMENT DISTRICT NO. 2018-1 The Board of Directors (Board) of the Central Contra Costa Sanitary District (Central San) resolves: A map entitled "Proposed Boundaries of Harper Lane Area Contractual Assessment District (CAD) No. 2018-1" has been filed with the Secretary of the District. This Board approves the map and adopts the boundaries shown on the map as describing the extent of the territory included in a proposed assessment district to be known as Harper Lane Area CAD No. 2018-1, Central Contra Costa Sanitary District, County of Contra Costa, California. This Board intends to levy a contractual assessment upon participating parcels within the described CAD in accordance with the benefit to be received by each parcel of land, respectively, from the improvement. There shall be omitted from assessment, all public streets, alleys, and places and all land belonging to the United States, the State of California, Contra Costa County, and Central San because it has been determined that no special benefit will be conferred on any such land within Central San. This Board finds that the map is in the form and contains the matters prescribed by Section 3110 of the California Streets and Highways Code This Board directs the Secretary of Central San to certify the adoption of this resolution on the face of the map and to file a copy of the map with the County Recorder for placement in the Book of Maps of Assessment and Community Facilities Districts. PASSED AND ADOPTED this 1St day of March, 2018, by the Board of Directors of Central San by the following votes: AYES: Members: NOES: Members: ABSENT: Members: James A. Nejedly President of the Board of Directors Central Contra Costa Sanitary District County of Contra Costa, State of California March 1, 2018 Regular Board Meeting Agenda Packet- Page 41 of 225 Page 9 of 9 Central Contra Costa Sanitary District Resolution No. Page 2of2 COUNTERSIGNED: Katie Young Secretary of the District Central Contra Costa Sanitary District County of Contra Costa, State of California Approved as to form: Kenton L. Alm, Esq. Counsel for the District March 1, 2018 Regular Board Meeting Agenda Packet- Page 42 of 225