HomeMy WebLinkAbout05 - Surplus Assessment District FundsCITY OF NEWPORT BEACH
CITY COUNCIL STAFF REPORT
Agenda Item No. s
July 27, 2004
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Administrative Services Department
Dennis Danner, Administrative Services Director, (949) 644 -3123
ddanner@city.newport-beach.ca.us
SUBJECT: Declaration of Surplus Assessment District Funds
ISSUE:
1913 Act Assessment Districts, often used to finance the undergrounding of public
utilities, require formal Council approval to accept the completion of the improvement
and declare a surplus of excess improvement fund balances prior to distribution of
surplus balances.
RECOMMENDATION:
Adopt resolution number 2004 -_ to declare improvement fund surpluses in the
following assessment districts:
60 West Bay Avenue from 8th Street to 64 Channel Road
15`h Street 65 West Coast Highway
61 Bay Avenue and East Bay Front 66 Bay Avenue from 7`h Street to 8`h
62 Hazel Drive south of PCH Street
63 Newport Island 72 Balboa Coves
Authorize the Administrative Services Director to choose an appropriate distribution
method to return remaining funds, with interest, consistent with the 1913 Act on a
district by district basis.
DISCUSSION:
In order to formally close -out various assessment district projects, Accounting staff has
analyzed many of the completed underground utility projects to determine the amount
and extent of remaining improvement funds. Upon approval of the above referenced
resolution, the City will return the remaining surplus improvement funds (with interest) to
the current property owners in the form of a direct refund or credit against their
remaining assessment. Accounting staff has started with the oldest of the City's active
Declaration of Surplus Assessment District Funds
July 27, 2004
Page 2
assessment districts and will continue the analysis to include all current assessment
districts where Public Works staff has determined the improvements are final and
complete.
Background:
Over the years, the City has participated in the formation of many special improvement
districts to finance certain public improvements including the acquisition and
development of public property, frontage improvements, and the process of
undergrounding public utilities. Upon the completion of the improvement, surplus
improvement funds can be utilized to reduce the outstanding assessment or refunded to
the assessed property owners as specified by the district's bond indenture or related
financing code or improvement act.
Most of the City's special assessment districts were formed under the legal provisions of
the California Streets and Highway Code, Municipal Improvement Act of 1913 (1913
Act) and were utilized to finance the undergrounding of public utilities. After City Council
has declared a surplus in the improvement funds, the 1913 Act provides that any of the
following can be done with the surplus:
1. All or a portion of the surplus funds can be utilized for the continued maintenance
of the improvements.
2. All or a portion of the surplus can be applied as a credit or payment to property
owners within the district on a pro rata share of the original confirmed
assessment.
3. A portion of the surplus monies can be applied towards a bond call within the
assessment district debt.
4. The lesser amount of $1,000 or 5% of the amounts expended from the
improvement fund can be transferred to the General Fund of the City.
Prepared by:
15-an Matusiewicz
Finance Officer
Attachments: Resolution No. 2004-
Submitted by:
Dennis Danner
Administrative Services Director
RESOLUTION NO. 2004-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT
BEACH DECLARING SURPLUS IMPROVEMENT FUNDS HELD FOR
ASSESSMENT DISTRICTS NOS. 60, 61, 62, 63, 64, 65, 66, AND 72
AND AUTHORIZING USE OF THE SURPLUSES.
WHEREAS, the City Council of the City of Newport Beach, has conducted
proceedings and completed construction for certain works of improvement in special
assessment districts pursuant to the terms and provisions of the "Municipal
Improvement Act of 1913," being Division 12 of the Streets and Highways Code of the
State of California; said special assessment districts known and designated as
Assessment District Nos. 60, 61, 62, 63, 64, 65, 66, and 72 (hereinafter referred to as
the "Assessment Districts ");
WHEREAS, after completion of the improvements and payment of all the claims
from the Improvement Funds for said Assessment Districts, there remains a surplus in
the Improvement Funds, and this legislative body is desirous at this time to make the
disposition of said surplus as prescribed by Section 10427, et seq., of the Streets and
Highways Code of the State of California;
NOW, THEREFORE, IT IS HEREBY DETERMINED AND RESOLVED AS FOLLOWS:
SECTION 1. The above recitals are all true and correct.
SECTION 2. The works of improvement, as set forth and described in the resolution of
intention for each of the Assessment Districts proceedings, have been
completed to the satisfaction of this legislative body, and all payments
have either been made or set aside for all existing or potential claims,
costs and expenses.
SECTION 3. The Director of Administrative Services is hereby authorized and directed
to apply all surplus monies at this time remaining in the Improvement
Funds as follows:
A. As a credit or payment to property owners within the boundaries of
the Assessment Districts on a pro -rata basis generally determined
as follows:
1. To those who paid in cash, the proportionate share of the
surplus shall be returned in cash to the person or persons
owning the property for which the assessment or installment
has been paid;
1
2. Where any part of an individual assessment remains unpaid
and is payable in installments, the amount apportioned to
each parcel shall be refunded in cash, used to reduce the
original assessment, or both;
B. To call bonds of the respective Assessment Districts;
C. To pay for the maintenance of the improvements financed by the
Assessment Districts;
D. To a transfer to the general fund of the City, provided such transfer
is the lesser amount of $1,000 or five percent (5 %) of the amounts
expended from the respective Improvement Funds.
The Director of Administrative Services is authorized to apply the
surpluses in his discretion in any one or any combination of the uses
stated above so long as each surplus is applied only with respect to its
respective Assessment District.
SECTION 4. This resolution shall take effect from and after its adoption.
PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the
City of Newport Beach, held on the 27th day of July, 2004, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
City Clerk
2
Mayor