HomeMy WebLinkAbout20 - Newport Coast & Ridge - Santa Ana Heights - Bay Knolls ReorganizationITEM 20
TO: Members of the Newport Beach City Council
FROM: Dave Kiff, Deputy City Manager
SUBJECT. Newport Coast & Ridge/Santa Ana Heights/Bay Knolls Reorganization
RECONPA WDID Direct staff to place Resolution 2000 -_ on the Council's September 26, 2000
ACIION: Agenda. Resolution 2000 -_ as proposed would rescind Resolution 99 -71 and adopt
a new Resolution of Application requesting LAFCO's initiation of proceedings to
reorganize the territory known as Bay Knolls, Santa Ana Heights, and Newport
Coast and Newport Ridge.
SUMMARY: The adoption of a Resolution of Application on September 26, 2000 allows the City to
file a reorganization application with the Local Agency Formation Commission
(LAFCO) that would lead to the eventual:
• Annexation of the unincorporated areas known as Bay Knolls, Santa Ana Heights
(east of Irvine Avenue), and Newport Coast and Newport Ridge to the City;
• Detachment of certain areas of Bay Knolls from the City of Costa Mesa;
The action on September 26, 2000 would rescind and replace Resolution 99 -71
(adopted by the Council on October 25,1999) and is the first step in the
reorganization process as outlined in California Law (Government Code §56000 et
seq.). A new resolution is required because the City has made the following changes
to the proposed Reorganization outlined in Resolution 99 -71:
• Proposed the retention of the Irvine Ranch Water District as the provider of
water, wastewater, and reclaimed water in the Newport Coast and Ridge;
• Added the coastal portion of Crystal Cove State Park (within the City's Sphere of
Influence) to the proposed Resolution; and
• Made minor, non - substantive modifications to the reorganization areas based on
the completion of the metes and bounds for each of the three areas.
BACKGROUND Please refer to the October 25, 1999 Staff Report on this matter (available on the
Internet at www.city.newport- beach.ca.us and the City Clerk's Office) for additional
background about each of the annexation areas.
WHATSNEW: There are several issues that have arisen and either remain challenges or have been
addressed since the Council last heard this issue in October 1999. They are as
follows:
Newport Beach City Council
Page 2
• Newport Coast. As the Council is aware, various Council members and various
members of the City staff have met over a period of 21/2 years with up to seven
members of the Newport Coast Committee of 2000 (NCC2K). NCC2K's
annexation team consists of representatives of Newport Coast -area homeowners
associations, including the Newport Coast Master Association.
A year ago - as negotiations were settling in to two or three key issues — the City
Manager wrote to the NCC2K team to tell them that he would not direct the
filing of an application with LAFCO according to the October 25,1999 proposed
annexation unless the City and the NCC2K annexation team were able to reach
agreement on annexation terms and conditions.
Unfortunately, the adoption of a new - and different - Resolution of Application
is our recognition that we did not reach consensus with the NCC2K annexation
team on all matters. It is also a clear invitation to interested persons in the
Newport Coast to, at the time of the City Council's public hearing on the new
Resolution of Application, voice their concerns, opinions, or questions about the
new proposal. As such, we have notified the NCC2K of the public hearing on
September 12, 2000 and have provided them with this staff report in advance.
The CiVs Offer. Newport Coast residents pay extraordinarily high taxes and tax
rates that fund a wide range of infrastructure. For example, Newport Coast
residents paid for (and pay for) the widening of Pacific Coast Highway and all or
portions of Newport Coast Drive — both are major arterials that many non-
residents use. Newport Coast residents pay into a Mello -Roos District for
schools, two IRWD improvement bonds, one of two multi- million dollar County
Assessment Districts, and dues to two HOAs in addition to their Basic 1% Levy.
As such, a tax bill (1999 Tax Year) from a home with an assessed value of
$500,000 in the Newport Coast would look like this:
WHAT A NEWPORT COAST PROPERTY TAX BILL LOOKS LIKE
This portion of bill
is based on the
value of a parcel.
This portion of the
bill is a "per
parcel" levied
without regard to
parcel value.
AMOUNTS LEVIED BY TAXING AGENCIES
SERVICEAGENCY
AMOUNT
BASIC LEVY
5,000.00
MWD - CMWD -ORIG AR
44.45
SPL ASMNT DIST DEBT
IRWD #140 WAT BD
1.10
IRWD IMP #240 UR
1.10
SPL ASMNT USER FEES
MWD WATER
11.80
ASMNT BD#7
5,807.72
MELLO-R R1
1,003.00
NET VALUES AND TAXES 500,000
11,868.97
Please note that a home in Newport Beach proper with the same $500,000
assessed value typically will have a tax burden of 1.028 %.
Early in our discussions with the NCC2K annexation team, NCC2K consistently
asked for some type of tax relief. In Fall 1997, however, the City Council stated
its resistance to any type of relief on the Mello -Roos or relief using any portion of
the City's share of the Basic Levy. We looked instead to an alternative that is
Page 3
contained in the Terms and Conditions within this Staff Report's Exhibit C.
Item #1 on Exhibit C is the lone remaining issue of some disagreement between
the City and the NCC2K annexation team. NCC2K sought $18 MN in
Infrastructure Buybacks paid out over 10 years - the City offers $18 MN paid out
over 15 years.
City staff and the Council Members who served at various times on the City's
Annexation Subcommittee believe that the City's proposed Terms and
Conditions for the residents of the Newport Coast are fair and appropriate.
Adoption of the proposed Resolution would carry the City's proposed Terms
and Conditions to LAFCO.
The Negotiations. Admittedly, the Terms and Conditions have changed in
various ways since talks began in February 1998. Throughout the 21/2 years of
talks, I was the only City representative who attended each annexation meeting.
Council Members O'Neil, Thomson, Debay, Ridgeway, former Council Member
Edwards, City Manager Bludau, Chiefs McDonell and Riley, and others joined
the meetings over time. The art of negotiating specific Terms and Conditions
subject to later approval by a public deliberative body is difficult to accomplish.
I believe, however, that all City participants have acted in good faith. We were
forced to change draft offers (sometimes to NCC2K's benefit, sometimes to
NCC2K's detriment), yet each time we stressed that the drafts required the
ratification of the full Council. I believe, too, that our counterparts with the
NCC2K annexation team have also acted in good faith. As such, the City
Manager and I hold the NCC2K Team in high personal and professional regard.
While we remain somewhat apart on the issue identified above, the City
Manager and I are confident in recommending the offer outlined in Exhibit C be
formally included by the City in any Terms and Conditions adopted by LAFCO
for the Newport Coast and Ridge.
• Santa Ana Heights. Santa Ana Heights (SAH) - a community of commercial,
residential, residential/ equestrian, and John Wayne Airport (JWA) impacted
areas - is viewed by the City Council as a valuable addition to Newport Beach.
But its number of pre - Proposition 13 assessed values and its status as a
redevelopment project area will limit SAH's property tax contributions through
at least 2035.
PAC Views. Some Santa Ana Heights residents and business owners - acting in
their capacity as the redevelopment area's Project Area Advisory Committee
(PAC) - have asked that the City address seven issues prior to annexation. They
include:
- Opportunities to "partner' with the City to limit any expansion of JWA.
A promise that the City would not hike property taxes or apply a special
assessment district to Santa Ana Heights.
The City's affirmation of the Santa Ana Heights Specific Plan.
Keeping the PAC as a "functioning community organization."
A retention of the same response times for fire and emergency medical
services as provided today by the Orange County Fire Authority (OCFA).
- Services equal to those provided to Newport Beach "at no additional costs."
Page 4
— Early discussions with City staff regarding ongoing maintenance of projects
outlined within the Specific Plan.
City staff believes that these issues should be discussed within the reorganization
process, especially after the City and the County complete a property tax sharing
agreement for all three areas under the proposed reorganization. However, we
can make it clear today that our full intention is to annex Santa Ana Heights
while:
— Working together to preserve and extend the 1985 JWA Settlement
Agreement.
— Not raising taxes or applying a special assessment district to Santa Ana
Heights.
Affirming the Specific Plan (your City Council did this on August 29, 2000),
including actively communicating with SAH about the maintenance of any
and all municipal services or projects in the Specific Plan.
— Working with any SAH -based community organization, including the PAC,
just as we do today with Newport Beach -area homeowners' associations.
— Retaining or improving fire and emergency medical response times.
Providing the same scope of quality municipal services to Santa Ana
Heights as we do to Newport Beach today except refuse collection paid for
via property taxes.
West Santa Ana Heights. A second issue of note beyond the SAH PAC's request
is a concurrent annexation filing by residents within West Santa Ana Heights
(west of Irvine Avenue, north of Mesa, South of the Santa Ana/ Delhi Channel,
and East of Santa Ana Avenue). The City has not taken a formal position on
adding this area to the City's reorganization application, but we have met several
times with West SAH proponents. At the time of the City's LAFCO hearing,
LAFCO may refer to the concurrent filing and recommend that the City add
West Santa Ana Heights to our application. A LAFCO action to this effect may
require later direction by your City Council.
• Bay Knolls. No new issues have arisen relating to Bay Knolls since the Council's
October 1999 action. We have received several calls from persons in the Costa
Mesa Sphere of Influence inquiring as to whether or not the City would be
interested in adding their street or neighborhood to the City's application, but we
have not offered to change the proposed map and legal description of this area.
Conclusion. If the Council adopts the Resolution of Application on September 26,
2000, staff will move forward and complete our annexation application with an
anticipated filing with Orange County LAFCO (see Exhibit D for a full description of
the LAFCO process) shortly threafter. At the same time, we will work promptly to
inform the residents of Newport Beach and of the annexation areas as to the
advantages and disadvantages of this reorganization.
It is important to note that this reorganization is one of the largest and most complex
in the Citys history. It involves a multitude of regulatory agencies and service
providers as well as a resident base that is understandably cautious about any
change in the structure of their local government. The Council, the City's residents,
Page 5
and the communities within the reorganization areas have our assurance that this
process will be pursued in the most open and communicative manner possible,
allowing appropriate input and comment by all parties affected by this action.
Exhibit A: Map of Proposed Reorganization Areas
Exhibit B: Proposed Plan of Service for Reorganization Areas
Exhibit C: Proposed LAFCO Terms and Conditions for Newport Coast/ Ridge
Exhibit D: Summary of LAFCO Process
Exhibit E: DRAFT Resolution Rescinding Resolution 99 -71 and Resolution of
Application to Initiate Proceedings to Reorganize Territory
Page b
Exhibit B
PROPOSED PLAN OF SERVICE
AREA A -- BAY KNOLLS
SERVICE
CURRENT PROVIDER
PROPOSED PROVIDER
EFFECTIVE DATE
Public Safely/
Police Protection
OC Sheriff
Newport Beach PD
March 1, 2001
Fire Protection
OC Fire Authority
Newport Beach Fire
March 1, 2001
Paramedic /Ambulance
OC Fire Authority
Newport Beach Fire
March 1, 2001
Animal Control
County of Orange
Newport Beach PD
March 1, 2001
Utilities
Sewerage
Collection
Costa Mesa San District
Costa Mesa San District
N/A
Treatment /Disposal
OC Sanitation District
OC Sanitation District
N/A
Reclamation
N/A
N/A
N/A
Water
Wholesale /Retail
Mesa Consolidated /IRWD
Mesa Consolidated /IRWD
N/A
Improvement District
N/A
N/A
N/A
Solid Waste
Costa Mesa San District
Costa Mesa San District
N/A
Public Works
Lighting and Landscaping Assessment District
Assessment District
N/A
Flood Control
OC Flood Control
OC Flood Control
N/A
Street Maintenance
County of Orange
City of Newport Beach
March 1, 2001
Street Sweeping
City of Newport Beach
City of Newport Beach
N/A
Commuri j Development
Redevelopment
OC RDA
OC RDA
N/A
Community Services
Parks
None
City of Newport Beach
March 1, 2001
Recreation Programs
None
City of Newport Beach
March 1, 2001
Library Service
OCPL
City of Newport Beach
March 1, 2001
Page 7
PROPOSED PLAN OF SERVICE
AREA B - SANTA ANA HEIGHTS
SERVICE
CURRENT PROVIDER
PROPOSED PROVIDER
EFFECTIVE DATE
Public Safety
Police Protection
OC Sheriff
Newport Beach PD
Much 1, 2001
Fire Protection
OC Fire Authority
Newport Beach Fire
Much 1, 2001
Paramedic /Ambulance
OC Fire Authority
Newport Beach Fire
March 1, 2001
Animal Control
County of Orange
Newport Beach PD
March 1, 2001
Utilities
Sewerage
Collection
IRWD
IRWD
N/A
Treatment/ Disposal
OC Sanitation District
OC Sanitation District
N/A
Reclamation
N/A
N/A
N/A
Water
Wholesale /Retail
IRWD
IRWD
N/A
Improvement District
N/A
N/A
N/A
Solid Waste
Waste Management, Inc.
Waste Management, Inc.
N/A
Public Works
Lighting and Landscaping
N/A
N/A
N/A
Flood Control
OC Flood Control
OC Flood Control
N/A
Street Maintenance
County of Orange
City of Newport Beach
March 1, 2001
Street Sweeping
City of Newport Beach
City of Newport Beach
N/A
Community Development
Redevelopment
OC RDA
OC RDA
N/A
Community Services
Parks
None
City of Newport Beach
March 1, 2001
Recreation Programs
None
City of Newport Beach
March 1, 2001
Library Service
OCPL
City of Newport Beach
March 1, 2001
Page 8
PROPOSED PLAN OF SERVICE
AREA C - NEWPORT COAST AND RIDGE
SERVICE
CURRENT PROVIDER
PROPOSED PROVIDER
EFFECTIVE DATE
Public Safehj
Police Protection
OC Sheriff
Newport Beach PD
March 1, 2001
Fire Protection
OC Fire Authority
Newport Beach Fire
March 1, 2001
Paramedic / Ambulance
OC Fire Authority
Newport Beach Fire
March 1, 2001
Animal Control
County of Orange
Newport Beach PD
March 1, 2001
Utilities
Sewerage
Collection
IRWD
IRWD
N/A
Treatment /Disposal
IRWD
IRWD
N/A
Reclamation
IRWD
IRWD
N/A
Water
Wholesale /Retail
IRWD
IRWD
N/A
Improvement District
IRWD
IRWD
N/A
Solid Waste
Waste Management, Inc
Waste Management, Inc
N/A
Public Works
Lighting and Landscaping
County of Orange
City of Newport Beach
March 1, 2001
Flood Control
OC Flood Control
OC Flood Control
N/A
Street Maintenance
County of Orange, HOAs
City of Newport Beach, HOAs
March 1, 2001
Street Sweeping
City of Newport Beach
City of Newport Beach
N/A
Comnuntty Development
Redevelopment
N/A
N/A
N/A
Community Services
Parks
HOAs, NC Master Assn.
City of Newport Beach
March 1, 2001
Recreation Programs
None
City of Newport Beach
March 1, 2001
Library Service
OCPL
City of Newport Beach
March 1, 2001
Page 9
Exhibit C
Proposed LAFCO Terms and Conditions for Newport Coast/Ridge
lAssessment
Districts
Purchase of Coast Infrastructure. City will purchase specific infrastructure in the Newport Coast (TBD) that, in effect,
reimburses Newport Coast and Newport Ridge owners of improved residential lots for payments made for same facilities.
Amount = $1,200,000 per year for 15 years + remainder of NC Infrastructure Fund upon completion of Certificate of Occupancy
of Community Center.
z
Expert Review of ADs 88.1 and 92.1. City will hire and/or direct in -house staff to examine documents associated with ADs 88-1
and 92 -1 to a satisfactory conclusion. Effort to be overseen by City Council and Newport Coast Advisory Committee. Budget to
be determined.
114C infrastructure
g
Fund
Civic Center. CIty shall allocate up to the entirety of a $7 MN "NC Infrastructure Fund" for a civic center in the Newport Coast.
Primary location to be adjacent to or within Newport Ridge Park depending upon community input. Secondary site at top of ridge
(within new park not yet constructed). Funds available immediately for planning and design, construction anticipated in 2002 -03.
Square footage can be up to 22,000 sf. Can contain gym, library, meeting rooms, ancillary rooms. Center shall be a City-owned
and operated asset with reservation preference ( "preference" does not imply or allow bumping previously - sceduled events) by
residents of the Newport Coast/Ridge. If by June 2006, the Community Center has not been planned and the City Council deems
that a Center is not wanted by the Newport Coast Community, all revenue remaining in the Fund shall be used per #1 above.
q
Remainder of Fund. Upon issuance of a Certificate of Occupancy of the Community Center, the revenue remaining in Fund
shall be used to purchase additional Coast infrastructure per #1 above.
lCouncil
District Representation
5
One Council District. City shall place Coast and Ridge in a single councilmanic district upon annexation through the first
regularly scheduled Council election (November 2002) following annexation.
11vater
6
and Sewer Service
Retention of IRWD. City agrees to retain IRWD as the Coast and Ridge's provider of water, sewer, and reclaimed water service.
City shall enforce and follow the January 2000 Settlement Agreement with IRWD as it relates to rate protection and IRWD's
Improvement District levies ( #140/240 and #160/260).
Fire
7
and Life Safety Service
City Standards. City shall provide the identical Fire and EMS service to the Newport Coast that it provides to the remainder of
the City (similar to that provided to the Coast today by the OC Fire Authority). Includes placement of a Paramedic Assessment
Unit in NC Fire Station.
1�oiice
g
Service
City Standards. City shall provide the identical Police Service to the Newport Coast that it provides to the remainder of the City.
City shall, upon consultation with the Newport Coast Advisory Committee, provide specific on -site but temporary law enforcement
services to the Coast as requested, using facilities at the civic center or fire department for events such as crime prevention
presentations, fingerprinting small children, signing up alarm accounts, distributing material, etc.
Slope and Median Maintenance
8
Full City Maintenance of All Public Areas. City and /or City's contractor shall maintain — to highest City standards — all public
portions of parks, all Coast slopes not within the County/NCCP open space area nor within HOA common areas, and all medians.
lRefuse
Collection
p
City Pays. City will pay for curbside residential trash collection (no commercial, hotel, timeshare, or multi- family) for as long as
such trash collection is provided "free" to residences in Newport Beach's pre -1996 city boundaries. Any change to Measure Q
(1996) that directs all residents to pay for trash collection City-wide would apply to the Coast/Ridge as well.
lizeloresentation
on Aviation Committee
Aviation Appointment(s). Upon annexation, City shall appoint one or more Newport Coast representatives to the City's Aviation
Committee.
filectrical
Transmission Lines
2
SCE Encouragement. City shall use its "best efforts" to encourage Southern California Edison to bury underground power lines
in the Coast and Ridge.
Exhibit D
Summary of LAFCO Reorganization Process
A Graphical Description
City of Newport Beach
affected entWes of public
hearing on reorganization.
T
At noticed pudic herding,
adopts Resolution of
Application to Inmate
Reorganization, Prepares
IAFN Application, Metes
and Bounds, Environmen-
tal tal Documemation and
Plan of Service.
Negotiates Tax
Exchange Agreements
City Council Adopts Tax
Exchange Agreement
Notices Public Hearing In
Newspaper at least 15
days prior to hearing.
Holds Public Hearing at
City Hall to measure
protest
If less than 25%
protest, adopts
Resolution ordering
reorganization.
If between 25% and 49%
protest, schedule an
election for Coast residents
on the reorganization.
If Question passes,
adopts Resolution
ordering reorganization.
City begins providing
services as of the effective
date of the reorganization.
County ofCrenge
Audl2orlonho/krand
Asses rcakukle
amounfofwop *t"
aAededbypropased
anxr0d04 nodlyoMer
aA'ecledagentyez
Awyrotiale TaxEwhaVe
Agreemencs
"Id of Swemh;o�
Adopts Tar&rhafW
Afire fit
CbunfyR"nfer
r IlmS catdxale a
OlWlefion fo L4&-O
AssessarandAUdilor-
Conoo/krre Jvv
SGlemenfcv`Soaobry
Gxmge
Page 10
...... ............R�aArea W ............
Residents M Area ro be
May file written protest
against the remgan®tion
up until the dose of the
Citys hearing
May vote on the Question
"shall (area) be annexed ro
the City of Newport
Beach?"
Residents begin receiving
services from
City of Newport Beach.
Page 11
Exhibit E
DRAFT
RESOLUTION NO. 2000-
A RESOLUTION RESCINDING RESOLUTION 99 -71 AND
A RESOLUTION OF APPLICATION
REQUESTING THE LOCAL AGENCY FORMATION COMMISSION
TO INITIATE PROCEEDINGS
FOR THE REORGANIZATION OF TERRITORY
WHEREAS, the City of Newport Beach desires to initiate proceedings pursuant to the
Cortese -Knox Local Government Reorganization Act of 1985, commencing with Section 56000 of
the California Government Code, for a reorganization which would concurrently:
(1) Annex territory to the City of Newport Beach; and
(2) Detach territory from the City of Costa Mesa;
WHEREAS, this reorganization shall be known as the "Newport Coast /Bay
Knolls /Santa Ana Heights Annexation' and include three distinct "areas" that shall be known
as follows:
Area A - Bay Knolls
Area B - Santa Ana Heights
Area C - Newport Coast and Ridge
WHEREAS, notice of intent to adopt this resolution of application has been given by
mail to affected and interested agencies; and
WHEREAS, the principal reasons for the proposed reorganization are as follows:
(a) the City anticipates that it can provide more efficient municipal services, especially
in the areas of law enforcement and community recreational services, to the Areas
than currently provided; and
(b) the annexation of the Areas, with limited exception, is an anticipated result of the
City's review of service provision to the property within its Sphere of Influence;
(c) the City seeks to assist the County of Orange and Orange County LAFCO in
improving and simplifying the service delivery, jurisdiction, and governance of
several unincorporated "islands" adjacent to the City.
Page 12
WHEREAS, the following agencies would be affected by the proposed jurisdictional
changes:
AGENCY NATURE OF CHANGE
City of Newport Beach Annexation
City of Costa Mesa Detachment
WHEREAS, the territory included within the boundaries of the reorganization - which
may be completed in separate and distinct phases -- is inhabited and a description of the
ultimate boundaries of the territory after all phases are complete is set forth in:
Area A - Exhibit A
Area B - Exhibit B
Area C - Exhibit C
and attached hereto and by this reference incorporated herein; and
WHEREAS, spheres of influence will be concurrently amended for the City of Newport
Beach and the City of Costa Mesa; and
WHEREAS, it is desired that the proposed reorganization be subject to terms and
conditions established by the Local Agency Formation Commission, including the terms and
conditions proposed within Exhibit D to this Resolution (Term Sheet for Newport
Coast /Ridge); and
WHEREAS, the City of Newport Beach will or has prepare(d) environmental documents
for the reorganization in compliance with the California Environmental Quality Act and State
CEQA Guidelines in conjunction with, where applicable, the adoption of a General Plan
Amendment and Prezoning for the Areas; and
WHEREAS, on October 25, 1999, the Newport Beach City Council adopted Resolution
99 -71 which authorized City staff to proceed with a reorganization application before the Local
Agency Formation Commission and the City has since determined that Resolution 99 -71 should
be repealed and another Resolution of Application adopted based on changes to the
reorganization area as first proposed within Resolution 99 -71; now, therefore be it
RESOLVED that the City Council of the City of Newport Beach hereby adopts and
approves this Resolution of Application, and the Local Agency Formation Commission of
Orange County is hereby requested to taking proceedings for the reorganization of territory as
illustrated in Exhibits A, B, and C (the "Newport Coast /Bay Knolls /Santa Ana Heights
Annexation "), according to the terms and conditions established by LAFCO and in the manner
provided by the Cortese -Knox Local Government Reorganization Act of 1985; and also be it
Page 13
RESOLVED that the City Council of the City of Newport Beach hereby rescinds and
replaces Resolution 99 -71 as adopted October 25, 1999.
ADOPTED this 26th Day of September, 2000.
JOHN E. NOYES
MAYOR
ATTEST:
LaVONNE HARKLESS
CITY CLERK