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HomeMy WebLinkAbout28 - Santa Ana Heights Country Club & South Mesa Drive AnnexationCITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item 28 February 26, 2008 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: City Manager's Office Homer Bludau, City Manager 9491644 -3000 or hbludau @city.newport- beach.ca.us SUBJECT: CITY COUNCIL DIRECTION TO STAFF REGARDING THE ANNEXATION OF THE SANTA ANA COUNTRY CLUB AND SOUTH MESA DRIVE UNINCORPORATED AREAS IN SANTA ANA HEIGHTS ISSUE: Does the City Council want staff to complete a Property Tax Sharing Agreement with Orange County, which would complete the Country Club /South Mesa Drive annexation application and get the issue before the Orange County Local Agency Formation Commission ( LAFCO) Board for an annexation decision? RECOMMENDATION: Direct the City Manager to take no action to negotiate a property tax sharing agreement with the County, with the understanding the application will remain incomplete and will fail to be acted upon by the LAFCO Board before April, when the application will expire. Background: East Santa Ana Heights has always been in the Sphere of Influence (SOI) of Newport Beach. As such, it was annexed in 2003. West Santa Ana Heights was in the SOI of Costa Mesa; however, recognizing that East and West Sana Ana Heights were bound by a County redevelopment area and by other commonalities, Costa Mesa allowed the Sphere of Influence to be changed to Newport Beach and LAFCO allowed its annexation to Newport Beach on January 1, 2008. LAFCO has a policy of attempting to work with cities to gain annexation of unincorporated areas in order to ensure these areas receive better services than could be provided to scattered, isolated areas by the County. Two geographic areas that remain a part of the County but are within the Costa Mesa SOI are known as the "South of Mesa" (Drive) area and the Santa Ana Country Club (SACC). The residents of South of Mesa and the membership of the SACC have expressed strong desires to be detached from the Costa Mesa SOI, be added to the Newport Beach SOI, and be annexed to Newport Beach. When Costa Mesa attempted to annex these two area in 2002, sufficient signatures (over 90% of registered property owners) were obtained to prevent that annexation (in a City Council Direction to Staff regarding Annexations February 26, 2008 Page 2 reorganization area that contains more than 12 registered voters, State law allows 50 % +1 valid signatures of registered voters in the area to reject the reorganization) Numerous residents from these areas, at numerous LAFCO meetings, have sought to be annexed to Newport Beach. In 2007, these residents gained many significantly more valid signatures than required to petition LAFCO to consider their request to be annexed to Newport Beach. The residents fulfilled all annexation application requirements they could fulfill; however, LAFCO does not consider an annexation application complete unless it has an agreement between the County and the city as to how property tax revenues are to be shared. Typically, we used the "Master Property Tax Sharing Agreement" to accomplish our annexations — doing so reflects a roughly 51 %-49% sharing of available property tax revenues between the County and the City. To date, City staff has made no attempt to negotiate a new agreement nor to propose using the Master Agreement. Such a negotiation would not prove difficult to accomplish. A Newport Beach City Council has never taken the position it will support the annexation of these two areas; however, it has never taken the position it would not oppose these annexations. The City Manager is bringing this issue to the City Council so the residents of the affected areas and LAFCO can obtain some certainty of what will happen to the application. The City Manager understands that two significant hurdles are in the way of some residents' desires to annex South of Mesa and the SACC to Newport Beach: 1. Costa Mesa is likely to strongly oppose the SO[ change and any subsequent annexation to Newport Beach. LAFCO typically gives great deference to the opinion of the city undergoing a detachment, even a SOI detachment. 2. LAFCO could still deny the annexation, as legal findings need to be made that Newport Beach is the jurisdiction which can best serve these two areas. Costa Mesa can reasonably make the claim that it can serve the area as well or better than Newport Beach can. Since the City appears to be entering a period when it will be dealing with issues (Banning Ranch, OCTA's Route 55 Alternatives Study, JWA growth pressures, etc.) that will require partnerships with Costa Mesa's elected officials and staff, the City Manager believes the Newport Beach City Council should direct the City Manager to take no action at this time to support the annexation application submitted by South Mesa Drive and Santa Ana Country Club residents and interests. Doing so will cause the residents' application before LAFCO to expire. Fiscal impacts: None 2 City Council Direction to Staff regarding Annexations February 26, 2006 Page 3 Environmental Impact: None. Public Notice: This agenda item may be noticed according to the Brown Act (72 hours in advance of the public meeting at which the City Council considers the item). Submitted by: Ho ertn Bludau City Manager 3 THIS PAGE LEFT BLANK INTENTIONALLY LOCAL AGENCY FORMATION COMMISSION October 2, 2006 TO: Affected Agencies and Interested Parties ORANGE COUNTY CHAIR rivate P pp Y The territory is developed and includes an approximately 74 - private 3O ROBERT 1 be, FROM: Bob Aldrich, Assistant Executive Officer Cry or Laguna Woods VICECHAIR SUBJECT: Proposed "South Mesa /Santa Ana Country Club BILL CAMPBELL or Reorganization to the City of Newport Beach (RO 06-30) Thi,d D hirC Dhmc[ ExKum Office, In accordance with Government Code Section 56828(b), 1 am notifying you PETER HERZOG eowcft p.w, that LAFCO has received an application from area residents foi,a sphere Ciry W Izke PoreN of influence change and concurrent annexation of approximately 134 acres ARLENE SCHAFER of unincorporated territory to the City of Newport Beach. Dimc[a Costa Mesa saniwy Disma your comments regarding this application are important to us and will SUSAN WILSON help LAFCO to fully evaluate this proposal. Please submit any Represwom of comments to LAFCO by no later than Monday, October 16, 2006. am Public Comments may be submitted in writing or via email to TOM WILSON baldrich@orange.lafco.ca.gov. Supen %o, FiRh [)Wia APPLICANT JOHN WITHERS By registered voter petition. Di ecror Whe RaMh Wafer o9ria PURPOSE OF PROPOSAL ALTERNATE PATSY MARSHALL Registered voters residing with the South Mesa /Santa Ana Country Club Cotmcilmember Cityoffluena Par% area have initiated a sphere of influence amendment and concurrent annexation of approximately 134 acres of unincorporated territory. The ALTERNATE RHONDA MCCUNE subject territory has been located within the City of Costa Mesa sphere of Repraerxe0we of General Public influence since 1973. The proposal, if approved by LAFCO, would: (1) change the territory's sphere of influence from the City of Costa Mesa to ALTERNATE JAMES W.31LVA Newport Beach, and 2 concurrently annex the property to the City of p () Y P P Y tY Su econd ol,d D S Dania Newport Beach. ALTERNATE rivate P pp Y The territory is developed and includes an approximately 74 - private CHARLEY WILSON olreaa g olf course /county club facility and approximately 60 acres of single and r Snta MMgaa Wafer Damn multiple family residential units. In addition, there is small neighborhood commercial center on the southwest corner of Mesa. Drive and Irvine JOYCE CROSfHWAnrE ExKum Office, Avenue. 12 Cnric Center Plaza. Room 235. Santa Ana CA 92701 (7 14) 834 -2556 • FAx (714) 834 -2643 httpylwww.orange.lafco.ca.gov 5 September 21, 2006 RE: RO 06 -30 (South Mesa/SACC Reorganization) Page 2 The resident - initiated application lists the following primary reasons for the sphere of influence change /annexation request: The area has social, geographic and governmental ties to West and East Santa Ana Heights The area will receive better services through the City of Newport Beach The entire area has historic ties to the community of Santa Ana Heights LOCATION The 134 -acre South Mesa /Santa Ana Country Club area is generally located south of John Wayne Airport, west of Irvine Avenue, east of Newport Boulevard and north of Bay View Terrace (see attached location map on page 4 of this report). PROPERTY TAX Property tax exchange resolutions will be required to be adopted by the County and the City of Newport Beach prior to consideration of the proposal by LAFCO. ENVIRONMENTAL REVIEW LAFCO, as lead agency under CEQA (California Environmental Quality Act), will be required to complete the appropriate environmental review of the project prior to consideration by the Commission. Again, I am interested in your comments on this proposal. If you have any questions, please feel free to contact me directly at either (714) 834 -2556 or by email at baldrich@orange.lafco.ca.gov. Attachment: Location Map Distribution: Cal McLaughlin Paul Watkins, SACC Allan Roeder, City of Costa Mesa Kimberly Brandt, City of Costa Mesa Homer Bludeau, City of Newport Beach Dave Kiff, City of Newport Beach Philip Bettencourt Barbara Venezia, SAHPAC Paul Jones, IRWD Robin Hamers, CMSD Diana Leach, MCWD 10 September 21, 2006 RE: RO 06 -30 (South Mesa/SACC Reorganization) Page 4 e 0 0.125 0.25 i 4 0.5 MIIeS 0 ur.a N- MROHr -eE'XH RO06 -30 South Mesa/ .Santa Ana Country Club. Reorganization to the City of Newport Beach 7 Orange County Local Agency Formation Commission \ 12 Civic Center Plaza, Room 235 Eeaafi' Santa Ana, CA 92701 TEL(714)834 -2556 FAX(714)834 -2643 This form is to be used for applying to the Orange County Local Agency Formation Commission for a city or district annexation, reorganization, detachment, or a sphere of influence amendment. To facilitate your preparation of the required materials, a pre - application meeting with LAFCO staff is encouraged. The meeting can be used to address applicant questions, Commission polices, timing, boundaries, and other application issues. LAFCO staff looks forward to assisting you with your project. Please fill out this application completely. If a question does not apply to your proposal, indicate "N /A ". Orange County LAFCO is a "paperless" office. It is important that you list all email addresses where indicated on the application. Correspondence, staff reports, resolutions and other LAFCO forms and mailings, whenever possible, I b r rib�e qp r� electronically. l'� V E D APPLICATION FOR: (check all that apply) I�Jn(Sf SEP 1 1 2006 ❑ Annexation to: ❑ Detachment from: LOCAL AGENCY FORMATION COMMISSION ® Reorganization (2 or more changes of organization) of: The part of Area 7 that incluces the Santa Ana Country Club and the Area south of Mesa Drive to be annexed to the City of Newport Beach and removed from the Costa Mesa sphere of influence ❑ Other (explain): ❑ *Sphere of Influence Amendment for: *If requesting a sphere of influence amendment, please answer the following three questions: 1. Why is a sphere of influence amendment needed? 2. How would a sphere of influence affect the present and future need for services in the project area? 3. How would a sphere of influence amendment impact social and economic communities of interest in the project area? S GENERAL DESCRIPTION OF PROPOSAL: What changes of organization are included? What agencies are involved? etc. This proposal asks that the part of Area 7 that includes the Santa Ana Country Club and the area South of Mesa Drive described in the attached mar) and legal description be detached from the Sphere of influence of Costa Mesa and annexed to Newport Beach's corporate limits. STATEMENT OF JUSTIFICATION: Explain the purpose of each request or change of organization. Explain how the proposal provides more logical boundaries or improves the provision of service. This remaining part of Araa 7 has social geographic and governmental ties to West and East Santa Ana Heights The communities share borders, two Redevelopment (RDA) Proiect Areas (Administered by the County of Orange), impacts from John Wayne Airport The whole of Area 7 will receive substantially better services once they are annexed to Newport Beach as detailed in section VII. This whole area is what remains of the historic community of Santa Ana Heights which was formed in the early 1900s served by the Santa Ana Heights Water Company. When the Irvine Company decided to develop the Irvine Ranch they made a decision to not use Santa Ana Heights but rather to create a new city, Irvine nearer the center of the ranch This is described more completely in attachment A WHO INITIATED THIS PROPOSAL? Please select one from the drop -down list: Registered Voters Applications can be initiated by either: (1) a petition signed by five percent of the affected landowners or five percent of the affected registered voters from the annexing area, or (2) a resolution by the legislative body of an affected city, county or special district. The following is attached to this application form: ❑ Resolution (please attach) ❑ Landowner Petition (please attach) ® Registered Voter Petition (please attach) LOCATION AND ADDRESS OF PARCEL(S): See Map and legal description and attachment B LIST OF ASSESSOR PARCEL NUMBERS: (Available from the Orange County Assessor) Attached (Attachment B) MAP AND LEGAL DESCRIPTION: A map and legal description of the proposal, even if prepared by a private engineering firm, must be submitted directly to the Orange County Surveyor for review and final approval. An Q application can be filed with LAFCO without a map and legal, but a proposal cannot be scheduled for LAFCO hearing prior to receipt of a County Surveyor- approved map and legal description. You may contact the County Surveyor at the Resources and Development Management Department, Geomatics /Land Information Systems Division, at (714) 834 -4378. Additionally, the map and legal description must meet the State Board of Equalization's requirements. The BOE's "Change of Jurisdictional Boundary" requirements are available for download at httn: &www.boe ca oov/prootaxes1sp�rl not htm. Please note, the BOE requires an additional vicinity map that shows the project area in relation to a larger geographic area. A map and legal description has been: ❑ Certified by the County Surveyor and is attached to this application. ❑ Submitted for review to the County Surveyor. 0 Other (please explain) Map and legal description is being prepared by the County Suveyor. APPLICANT'S REPRESENTATIVE rif any): Name: Cal McLaughlin Address: 2616 Redlands Drive Costa Mesa CA 92627 Phone: 949 -646 -5191 FAX: email: cal. @uci.edu Contact Person: Title: PROPERTY OW-NER(S): If more than two property owners for proposal area, please provide the name, address and contact information, on a separate page. Name: Address: Phone: FAX: email: Name: Address: Phone: FAX: email: SUBJECT AGENCIES THAT WILL GAIN OR LOSE TERRITORY: A "subject agency" means each city or district for which a change of organization or reorganization is proposed. If more than three subject agencies, please provide the names and information on a separate page. Name: City of Costa Mesa (sph rg d9t9c ment) Address: 77 Fair Drive Phone: 714 -754 -5223 FAX: 714 - 754 -5330 email: ARoeder(Wci costa -mesa ca u Contact Person: Allan Roeder Title: City Manager 1D Name: County ofOrange (loss of unincorporated territory) Address: 10 Civic Center Plaza 3rd Floor Santa Ana CA 92701 Phone: 714- 834 -3100 FAX: 714- 834 -2786 email: Thomas.Mauk @ocgov.com Contact Person: Thomas Mau k Title: County Executive Officer Name: Address: Phone: FAX: email: Contact Person: Title: AFFECTED AGENCIES IN PROPOSAL AREA: An affected agency is a city or district with overlaying boundaries or spheres of influence. If more than three affected agencies, please provide the names and information on a separate page. Name: Irvine. Ranch Water District Address: Post Office Box 57000. Irvine. CA 92619 -7000 Phone: 949 - 453 -5300 FAX: email: iones@irwd.com Contact Person: Paul D. ]ones Title: _General Manaqer Name: CQSta Mesa Sanitary District Address: 234E 17th St., Ste. 205 Costa Mesa. CA 92627 Phone: 949 -631 -1731 FAX: 949 -548 -6516 email: rhamersCa)crosdca.gov Contact Person: Robin V. Harriers Title: Manaqer /Engineer Name: Address: Phone: 949 - 631 -1206 FAX: 949 -574 -1036 email: Dianal-0mesawater.om Contact Person: Diana M. Leach Title: General Manaqer INTERESTED AGENCIES: Interested agencies are cities or districts which provide the same facilities or services in the proposal area that a subject agency will provide. If more than two interested agencies, please provide name and information on a separate page, Name: Orange County Fire Authority Address: P.O. Box 57115 Irvine CA 92619 -7115 Phone: 714 -573 -6000 FAX: email: _ Contact Person: Chip Prather Title: Fire Chief Name: Address: Phone: FAX: email: Contact Person: Title: PERSONS REQUESTED TO BE NOTIFIED: If more than two names, please provide the names and information on a separate page. Name: Cal McLaughlin Address: 2616 Redlands Drive Phone: 949- 6465191 FAX: Name: Paul Watkins Address: 535 Anton Blvd Phone: 714 -556 -0800 FAX: email: cal(Ouci.edu email: Aaul@lawfriend,com REGISTERED VOTER /PROPERTY OWNER MAILENG LIST: Government Code Section 56661requires that landowners within the proposal area, and registered voters both within the proposal area and within 300 feet of the exterior boundary of the property, be notified of a LAFCO hearing at least 21 days in advance of the hearing that includes a proposed reorganization., Orange LAFCO policy requires the applicant to provide mailing labels, envelopes and appropriate postage as part of the application submittal. The following notification Information has been provided (check all that apply): ® Address labels for registered voters /property owners within proposal area and within 300 feet of exterior boundary ® Mailing envelopes with appropriate postage ❑ Application does not require registered voter /property owner notification Explanation: SCHOOL DISTRICTS: Please list school district(s) affected by the proposal. School District: Newoort-Mesa Unified School District (NMUSD) Address: 2985 -A Bear St Costa Mesa CA 92626 Phone: 714- 424 -5000 FAX: 714-424-8925 email: Contact Person: Dr. Robert Barbot Title: Suaertendent School District: Address: Phone: FAX: email: Contact Person: Title: QUESTIONNAIRE: Please respond to all items in the following questionnaire. Indicate N/A when a question does not apply. Any additional information pertinent to the application should be included with the application at the time of submittal. 19 I. LANDOWNER CONSENT Have all property owners involved with the proposal given their written consent? ❑ YES (If yes, please complete Property Owner Consent Form, Attachment I.) ❑ NO (If no, please provide the name, address, and Assessor's Parcel Numbers of those property owners not consenting.) II. LAND USE Acreage of Proposal: 195.55 acres more or less acres Site Information: Surrnundina Land Uses: LAND USE PREZOIRMU IA GENERAL PLAN LAND USE ZONING DESIGNATION NORTH: Commercial DESIGNATION City: Open Space County: County: SOUTH: Recreational, Specific Plan Specific Plan Professional /Admin, City: City: CURRENT: REsidential Single i Family, Residential City: City: Multi =- Family, Commercial Same land uses, County: County: identical Specific Plan components City: City: Specific Plan Single Family Detached, Admin /Prof/ PROPOSED: Financial, Commercioal Multi - Family Residential, Recreational and Environmental Open Space Surrnundina Land Uses: 13 LAND USE ZONING DESIGNATION GENERAL PLAN DESIGNATION Residential County: County: NORTH: Commercial City: City: Residential County: County: SOUTH: City: City: Residential, Open County: County: EAST: Space Recreational i City: City: 13 A. The proposal area is entirely or partially within the sphere of influence of all of the following: CITY: Costa Mesa SPECIAL DISTRICTS: Irvine Ranch Water District, Costa Mesa Sanitary District, B. Describe any land use entitlements or permits approved or pending for the proposal area: None known City and Countv would cooperatively address anypermits pending or planned as the effective date approaches. C. Describe any public easements /oil well operations /major highways /watercourses/ topographical features: Known public easements are onlv for streets, storm drains and flood control D. Number of acres considered Prime Agricultural Land *: 0 acres *As defined by the Soil Conservation Services (i.e., being prime, unique, or of statewide importance) AND by Government Code Section 51201(c) and 56064 E. Number of acres considered Agricultural Lands *: 0 acres *As defined by Government Code Section 56016 III. DEMOGRAPHICS A. Number /Type of Dwelling Units within the proposal area: Existing: Proposed: B.. Is the proposal area considered "inhabited" (i.e. do more than 12 registered voters reside on the territory/property)? /.1 C. Describe how the proposal will assist the City and /or the County in achieving their respective fair shares of the regional housing needs as determined by the appropriate council of.governments (Government Code Section 56668): IV. PLAN FOR PROVIDING SERVICES Describe the services that are provided or are to be provided to subject property: J'1 What effect will this proposal have on the type or level of services both within and outside the proposal area? WITHIN: All the services will either be the same for water. sewer, and schools or substantially better. There will be faster response time for police and fire /EMS services. Proposal should increase residents' ability to use quality library services recration services. Jr. Lifegruard classes etc. OUTSIDE: No significant change. V. SPECIAL REVENUES A. Do agencies whose boundaries are being changed have existing bonded debt? ❑ YES M NO If yes, please describe: B. Will the territory be subject to any new or additional special taxes, benefit charges, or fees? ❑ YES M NO If yes, please describe: 15 Describe Approximate Current Service Proposed Service Level/Range of Service of Proposed Date will be Method to Sei vice Water Provider IRVINE SAME SAME Available no Existing fees RANCH interruption WATER DISTRICT Sewer COSTA MESA SAME SAME no Existing fees SANITARY interruption DISTRICT Police COUNTY OF CITY OF SUBSTANTIALLY upon effective Existing tax ORANGE NEWPORT BETTER date of base BEACH annexation Fire COUNTY CITY OF Fire /EMS services upon effectie Existing tax COUNTY OF NEWPORT SUBSTANTIALLY date of base ORANGE BEACH BETTER annexation Public COUNTY OF CITY OF SUBSTANTIALLY upon effective Existing tax Works ORANGE NEWPORT BETTER date of base BEACH annexiation Parks & COUNTY OF CITY OF SUBSTANTIALLY upon effective Existing tax Recreation ORANTE NEWPORT BETTER date of base BEACH annexiation Other Library: City of SUBSTANTIALLY upon effective Existing tax Services County of Newport BETTER date of base (list) Orange Beach annexiation Code Enforcement County of Orange Animal Control: County of Orange What effect will this proposal have on the type or level of services both within and outside the proposal area? WITHIN: All the services will either be the same for water. sewer, and schools or substantially better. There will be faster response time for police and fire /EMS services. Proposal should increase residents' ability to use quality library services recration services. Jr. Lifegruard classes etc. OUTSIDE: No significant change. V. SPECIAL REVENUES A. Do agencies whose boundaries are being changed have existing bonded debt? ❑ YES M NO If yes, please describe: B. Will the territory be subject to any new or additional special taxes, benefit charges, or fees? ❑ YES M NO If yes, please describe: 15 C. Is the city /district requesting an exchange of property tax revenues as the result of this proposal? ® YES ❑ NO If yes, is a master property tax exchange agreement applicable to this jurisdictional change? ® YES ❑ NO VI. ENVIRONMENTAL ANALYSIS A. Who is the "lead agency" for this proposal? 1AFC0 B. What type of environmental document has been prepared? ❑ None - Categorically Exempt - Class: ❑ Environmental Impact Report (If an EIR has been prepared, attach the lead agency's resolution listing significant impacts anticipated from the project mitigation measures adopted to reduce or avoid significant impacts, and a Statement of Overriding Considerations, if adopted.) ® Negative Declaration (please attach) ❑ Mitigated Negative Declaration (please attach) ❑ Subsequent Use of Previous EIR: L'tf1 11 a d 4L I a(;# (OIA a COU As part of this application, the applicant is required to sign an Indemnification Agreement which is included as Attachment 2. Until this agreement is signed, LAFCO cannot formally schedule a proposal for Commission consideration. VII. FINAL COMMENTS A. Describe any terms and /or conditions that should be included in LAFCO's resolution of approval. B. Provide any other comments or justifications regarding this proposal. Note any changes in the approved project that are not reflected in these materials. Attach any pertinent staff reports and supporting documentation related to this proposal. The following supplemental documentation is attached.: '�? t ,R !lo VIII. CERTIFICATION I certify, under penalty of perjury by the laws of the State of California, that the information contained in this application is true and correct. I acknowledge and agree that the Orange County Local Agency Formation Commission is relying on the accuracy of the information provided and my representations in order to process this application proposal. signature: Name: Calvin S McLaughlin Title: Ph.D. Date: 9/612006 1� ATTACHMENT 1 Property Owner Consent Form (All legal owners must sign a consent form or submit a letter of signed consent.) I, consent to the annexation /reorganization of my property located at (or Assessor Parcel Numbers ) to the City of Newport Beach [agency(ies)]. Signature: Address: City, State, Zip: Date: lg FEB - -'75 -2008 17 :19 P.02 February 25, 2008 CITY PFf`COST4 MESA CALIFORNIA S=B•1200 - ` ! -- j P.O. BOX 1200 FROM THE OFFICE OF THE �AVOf} PRINTED:" 1 VIA FACSIMILE: (949) 644 -3020 City of Newport Beach Honorable Edward D. Selich, Mayor PO Box 1768 Newport Beach, California 92658 -3309 Subject: CITY COUNCIL DIRECTION TO STAFF REGARDING THE ANNEXATION OF THE SANTA ANA COUNTRY CLUB AND SOUTH MESA DRIVE UNINCORPORATED AREAS IN SANTA ANA HEIGHTS Dear Mayor Selich and Council Members: At your meeting of February 26, 2008, the Newport Beach City Council will consider whether to enter into a Master Property Tax Sharing Agreement with the County of Orange for two unincorporated areas currently within the Sphere of Influence of the City of Costa Mesa. The two unincorporated areas — the Santa Ana Country Club (SACC) and the area south of Mesa Drive to University Drive /Santa Ana Avenue to Irvine Avenue — have requested the Local Agency Formation Commission (LAFCO) allow these areas to be annexed to the City of Newport Beach. Absent action by the City of Newport Beach on the tax sharing agreement, the requested applications cannot be legally processed. The City of Costa Mesa strongly opposes any action that permits a change in the existing S01 and the future annexation of these areas to Newport Beach. Our position Is well documented, consistent, and In accordance with State law. While our City cooperated on a change In the $01 for West Santa Ana Heights in recognition of its being part of the larger Santa Ana Heights area already within Newport Beach and as part of the County's redevelopment project area, those facts are not elements of the request before you at this time. Even upon LAFCO's decision to support the annexation of West Santa Ana Heights, we asserted our position that such cooperation should not be taken in any way as an accommodation for future annexations of SACC or the area south of Mesa Drive. That fact was underscored by LAFCO's September 12, 2007 action reaffirming the S01 for the City of Costa Mesa, including these two areas. Beyond the specific action before you is the larger and much more important need for cooperation by our two communities as noted in your staff report. As appropriately pointed out by City Manager Homer Bludau in your staff report, our two cities are entering a period when critical issues will require a strong partnership. These issues — whether pressures on expansion of JWA, the future of Banning Ranch, extension of Rt. 55 or other matters — are complex measures demanding trust and cooperation on all 77 ONR DRIVE PHONE: (714)7545255 - FAY.' (714)7545330 • TOD: (774)754.6244 • WWW.G.0Wt2- MQS2Z2.U8 FEB25 -2008 17 19 P.03 sides. Our confidence in the ability of our two cities to worts together to solve problems that confront. both communities rests with mutual respect and integrity. Action to support any approval of this Master Property Tax Sharing Agreement clearly damages that confidence and trust. We respectfully urge the City Council to reject approval of the Master Property Tax Sharing Agreement so that we can not only put the matter of these annexation requests to rest but focus positively on the matters of greater importance to our respective communities. Sincerely, Eric R. Bever Mayor /cg c. Newport Beach City Council Newport Beach City Manager Newport Beach City Clerk Costa Mesa City Council Costa Mesa City Manager Costa Mesa City Clerk Supervisor John Moodach TOTAL P.03