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HomeMy WebLinkAboutRes 04-37 through 04-39 - Landscape and Lighting Districts Shepherd Lande/Hovley LaneCITY OF PALM DESERT DEVELOPMENT SERVICES STAFF REPORT REQUEST: Approval to Initiate the Proceeding to Form the Following Landscape and Lighting Districts: 1. Olive Court (Shepherd Lane) 2. Petunia I (Shepherd Lane) 3. Petunia II (Shepherd Lane) 4. Sundance East (Shepherd Lane) 5. College View Circle (Shepherd Lane) 6. The Boulders (Shepherd Lane) 7. Palm Court (Hovley Lane) DATE: May 13, 2004 CONTENTS: Resolution No. 04-37 Resolution No. 04-38 Resolution No. 04-39 Preliminary Engineers Reports (All Seven Districts) Location Maps Recommendation: Waive further reading and adopt: 1. Resolution No. 04-37 initiating proceedings for the formation of the Olive Court; Petunia I; Petunia II; Sundance East; College View Circle; The Boulders; and Palm Court Landscape and Lighting Districts; and the concurrent annexation of said districts and territory into the Palm Desert Consolidated Landscaping and Lighting District. 2. Resolution No. 04-1R approving the Preliminary Engineers' Reports regarding the formation of the Olive Court; Petunia I; Petunia II; Sundance East; College View Circle; The Boulders; and Palm Court Landscape and Lighting Districts; 3. Resolution No. 04-39 calling for a property owner protest proceeding to submit to the qualified property owner the question of levying such assessments and establishing an assessment range formula for said district and the levy and collection of annual assessment related thereto commencing with Fiscal Year 2004-2005. Staff Report 2004 New Landscape and Lighting Districts Page 2 of 3 May 13, 2004 Executive Summary: On March 25, the City Council authorized staff to form sevend and d lighting ties of districts that were lacking a mechanism to pay for the maintenance perimeter landscaping. The attached resolutions initiate the proceedings to form individual landscape and lighting districts for these seven single-family tracts and will approve a Preliminary Engineers Report for each adirict.ev The Peach reliminarY Engine l for Fiscal ers' annual Report establishes a budget for each tract and an Y Year 2004/2005. The budgets include a ten percent reserve and up to three percent annual cost of living adjustments. If the resolutions are approved, staff will: • Meet with the residents of the proposed districts to inform them of the details of the proposed annual levy. • Call for a property owner ballot proceeding for each district. • Schedule a public hearing for July 8, 2004, to declare the results of the balloting. Discussion: The City has seven single-family subdivisions without a homeowners so landscaping. (HOA)g or a landscape and lighting district (LLD) to maintain the perimeter Attached to the report are two maps identifying the location of these subdivisions. The attached resolutions and Engineers Reports allow the City to initiate the formation of the districts, approve the preliminary budget and annual levy for each district. Since the completion of these subdivisions, the perimeter landscaping areas have gone without maintenance and have become a blight to the neighborhoods. Staff has received phone calls and letters from residents inquiring about the condition of the landscaping and the lack of a maintenance district. The proposed landscape and lighting districts will allow the City to collect an annual levy to pay for maintenance, utilities and administration of the districts. Budgets have been established to adequately cover annual maintenance costs of a water efficient landscaping and irrigation system. Each budget includes a ten percent (10%) annual reserve and a three percent cost of living adjustment. If the attached resolutions are approved, staff will send a notice to each property owner informing them of the proposed landscape and lighting district and of a scheduled resident meeting. Staff Report Districts 2004 New Landscape and Lighting Page 3 of 3 May 13, 2004 The following tables outlines each district's proposed annual levy: Conclusion: adjustments, each With the proposed annual levies, resew I� maintainedt Therefore, staff recommends of living subdivisions can be self-supporting and the City Council adopt the attached resolutions. Submitted By: artin Alvarez Senior Management Analyst Approval: Paul Gibson Director of Finance Carlos L. Ortega City Manager Department Head: Homer Cro ACM for pment Services RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY FOR OF PALM THE DESERT, CALIFORNIA, INITIATING PROCEEDINGS FORMATION OF SEVEN (7) LANDSCAPING AND LIGHTING ZONES AND/OR SUB -ZONES WITHIN THE Y'S CONSOLIDATED NSOLIDA ED LANDSCAPING AND LIGHTING DISTRICT; NT ANNEXATION OF SAID ZONES AND/OR ESERTSUB-ZONES AND CONSOLIDATED TERRITORIES INTO THE PALM LANDSCAPING AND LIGHTING DISTRIANNUAL ENTSAND RELATEDLEVY THERETO COLLECTION NCI WITH FISCAL YEAR 2004/05 COMMENCING WHEREAS, the City Council pursuant to the provisionshe Landscaping Highways Code not d Lighting Act of 1972, Part 2 of Division 15 of the Streets and California, beginning with Section 22500 (hereafter reZones or ") desires to f as sub Zones" (hereafter initiate proceedings for the formation of seven (7) new referred to as the "Zones") and concurrently annex saidZones anterreferred to ae "Palm Desert Consolidated Landscaping and Lighting (hereafter for the the "Consolidated District"), and to levy and collect landscapng,alightingsandtalloappurtenant pay operation, maintenance and servicing of n facilities related thereto. The Act provides for the concurrent ron focle rmation and dthe levy lion of an assessment district or zones pursuant to Chapter collection of assessments by the County on behalf of the City pursuant to Chapter 4 Article 2; and, WHEREAS, the City Council has retained MuniFinancial the annexationneer of said Zones of Work, for the purpose of assisting with the formation of the Zones, and territories into the Consolidated District, the establishment of annual assessments, and to prepare and file an Engineer's Report with the City Clerk in accordance with the Act. NOW, THEREFORE, BE IT RESOLVED, DETERMINED, AND ORDERED BY THE CITY COUNCIL FOR THE ZONES, AS FOLLOWS: Section 1: The City Council hereby orders Muni f i theci Zones prepare to dthe the Engineer's o gin went Report concerning the formation o annexation of said Zones and territories into the Consolidated District, and the levy of assessments for properties within the Zones. Section 2: The improvements include the operation, adfacilities and maintenance and servicing of all improvements and appurtenant associated with the Zones that were installed as part of the residential developments associated with the Zones and will be provided by the City of Palm Desert through annual assessments. Section 3: The proposed Zones will be named as follows and include the following residential tracts: • Olive Court, Tract 30269 • Petunia I, Tract 30025 • Petunia II, Tract 30275 • Sundance East, Tract 30503 • College View Circle, Tract 29444 • The Boulders, Tract 30030 • Palm Court, Tract 25373 PASSED, APPROVED, AND ADOPTED at a regular meeting of the Palm Desert City Council, held on this day of , 2004, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAINED: ATTEST: RACHELLE D. KLASSEN, City Clerk City of Palm Desert, California ROBERT A. SPIEGEL, Mayor City of Palm Desert 2 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT, CALIFORNIA, FOR PRELIMINARY APPROVAL OF THE ENGINEER'S REPORT REGARDING THE FORMATION OF SEVEN (7) LANDSCAPING AND LIGHTING ZONES AND/OR SUB -ZONES; THE CONCURRENT ANNEXATION OF SAID TERRITORIES AND ZONES AND/OR SUB -ZONES INTO THE PALM DESERT CONSOLIDATED LANDSCAPING AND LIGHTING DISTRICT; AND THE LEVY AND COLLECTION OF ANNUAL ASSESSMENTS RELATED THERETO FOR FISCAL YEAR 2004/05 WHEREAS, the City Council has ordered the preparation of an Engineer's Report (hereafter referred to as the "Report") regarding the formation of seven (7) Zones and/or Sub -Zones (hereafter referred to as the "Zones"), and the concurrent annexation of said Zones and territories therein, into the Palm Desert Consolidated Landscaping and Lighting District (hereafter referred to as the "Consolidated District"), and the levy and collection of assessments, pursuant to the provisions of the Landscaping and Lighting Act of 1972, Part 2 of Division 15 of the Streets and Highways Code of California, beginning with Section 22500 (hereafter referred to as the "Act"); and, WHEREAS, there has now been presented to this City Council the Report as required by Chapter 2, Article 1, Section 22586 of said Act; and, WHEREAS, the City Council has carefully examined and reviewed the Report as presented and is preliminarily satisfied with the Zones, each and all of the budget items and documents as set forth therein, and is preliminarily satisfied that the proposed annual assessments have been spread in accordance with the special benefits received from the improvements, operation, administration, maintenance and services to be performed within the Zones, as set forth in said Report. NOW, THEREFORE, BE IT RESOLVED, DETERMINED, AND ORDERED BY THE CITY COUNCIL FOR THE ZONES, AS FOLLOWS: Section 1: That the preceding recitals are all true and correct. Section 2: That the Report as presented, consists of the following: a. A Description of Improvements. b. A Boundary Map of the Zones. c. The proposed Annual Budgets for the first fiscal year (Costs and Expenses). d. The Method of Apportionment that details the method of calculating each parcel's proportional special benefits and annual assessment. e. The proposed initial "Maximum Assessment" (levy per EDU) and an "Assessment Range Formula" that must be approved by the property owners pursuant to the California Constitution Article XI/ID. f. The Assessment Roll containing the Levy for each Assessor Parcel within the Zones commencing Fiscal Year 2004/05. Section 3: The Report is hereby approved on a preliminary basis, and ordered to be filed in the Office of the City Clerk as a permanent record and to remain open to public inspection. Section 4: The Maximum Assessment and Assessment Range Formula described in the Report are hereby approved on a preliminary basis, and shall be submitted to the property owners within the District for approval pursuant to the provisions of the California Constitution Article XII/D (Proposition 218). Section 5: The City Clerk shall certify to the passage and adoption of this Resolution, and the minutes of this meeting shall so reflect the presentation of the Report. PASSED, APPROVED, AND ADOPTED at a regular meeting of the Palm Desert City Council, held on this day of , 2004, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAINED: ROBERT A. SPIEGEL, Mayor ATTEST: RACHELLE D. KLASSEN, City Clerk City of Palm Desert, California RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT, CALIFORNIA, DECLARING ITS INTENTION TO FORM SEVEN (7) LANDSCAPING AND LIGHTING ZONES AND/OR SUB - ZONES; AND CONCURRENTLY ANNEX SAID ZONES AND/OR SUB - ZONES AND TERRITORIES INTO THE PALM DESERT CONSOLIDATED LANDSCAPING AND LIGHTING DISTRICT; AND TO LEVY AND COLLECT ANNUAL ASSESSMENTS RELATED THERETO COMMENCING FISCAL YEAR 2004/05; AND CALLING A PROPERTY OWNER PROTEST PROCEEDING TO SUBMIT TO THE QUALIFIED PROPERTY OWNERS THE QUESTION OF LEVYING SUCH ASSESSMENTS AND ESTABLISHING AN ASSESSMENT RANGE FORMULA FOR SAID ZONES AND/OR SUB -ZONES WHEREAS, the City Council pursuant to the provisions of the Landscaping and Lighting Act of 1972, Part 2 of Division 15 of the Streets and Highways Code of California, beginning with Section 22500 (hereafter referred to as the "Act") and by previous Resolution, has initiated proceedings for the formation of the seven (7) landscaping and lighting zones and/or sub -zones (hereafter referred to as the "Zones"); and the concurrent annexation of said Zones and territories into the Palm Desert Consolidated Landscaping and Lighting District (hereafter referred to as the "Consolidated District"), and to levy and collect annual assessments to pay for the operation, maintenance and servicing of landscaping, lighting and all appurtenant facilities related thereto; and, WHEREAS, the City Council desires to form the Zones; concurrently annex the Zones and territories into the Consolidated District; and to levy and collect annual assessments against Tots and parcels of land within the proposed Zones to pay the cost and expenses related to the improvements described in Section 4 of this Resolution; and, WHEREAS, the Engineer selected by the City Council has prepared and filed with the City Clerk a Report in connection with the proposed formation, annexation and levy of assessments commencing with Fiscal Year 2004/05 (July 1, 2004 and ending June 30, 2005) in accordance with Chapter 1, Article 4 of the Act, and the Council did by previous Resolution preliminarily approve such Report. NOW, THEREFORE, BE IT RESOLVED, DETERMINED, AND ORDERED BY THE CITY COUNCIL FOR THE ZONES, AS FOLLOWS: Section 1: The City Council hereby declares its intention to form the Zones and levy and collect annual assessments against parcels of land within the Zones; and concurrently annex said Zones and territories into the Consolidated District commencing Fiscal Year 2004/05. Section 2: The City Council declares its intention to conduct a public hearing regarding the formation of the Zones and the annexation of said territories into the Consolidated District and calls for a property owner protest balloting proceeding related thereto pursuant to the Act and the California Constitution Article X111D. The City Council finds that the public's best interest requires such action and levy of assessments. Section 3: The proposed territories within the Zones and concurrent annexations to the Consolidated District includes all Tots and parcels within the residential subdivisions and tracts known as: • Olive Court, Tract 30269 • Petunia I, Tract 30025 • Petunia II, Tract 30275 • Sundance East, Tract 30503 • College View Circle, Tract 29444 • The Boulders, Tract 30030 • Palm Court, Tract 25373 Section 4: The proposed assessments for the Zones within the Consolidated District are outlined in the Engineer's Report. The Report details the proposed assessments necessary to provide for the annual operation, administration, services and maintenance of the improvements for the first fiscal year described in Section 4 of this Resolution. In subsequent years, the City Council will hold a Public Hearing for the Consolidated District prior to approving the annual levy of assessments for the upcoming fiscal year. An increase to the annual assessment requires approval of that increase by the property owners through protest ballot proceedings. An increased annual assessment is defined as an assessment that is greater than the Maximum Assessment plus the annual inflationary adjustment previously approved by the property owners. (The initial Maximum Assessment and annual inflationary adjustment are outlined in the Engineer's Report for Fiscal Year 2004/05 and must be approved by the property owners before any assessment is levied). 2 Section 8: Section 5: The City Council hereby declares its intention to conduct a Public Hearing concerning the formation of the Zones, and concurrent annexation of territory into the Consolidated District, and the levy of assessments for the improvements in accordance with Chapter 2, Article 1, Section 22587 (e) of the Act. Section 6: The City Clerk shall cause notice to be given of the time and place of the Public Hearing by causing the publishing of this Resolution once in the local paper for two consecutive weeks not less than ten (10) days before the date of the hearing and by posting a copy of this Resolution on the official bulletin board customarily used by the City Council for the posting of notices. Section 7: Notice is hereby given that a Public Hearing on these matters will be held by the City Council on Thursday, July 8, 2004 at 4:00 p.m. or as soon thereafter as feasible in the regular meeting chambers of the City Council located at 73-510 Fred Waring Drive, Palm Desert, California. Property owners subject to an assessment will be mailed a protest ballot regarding the proposed levy of assessments and the assessment range formula, as well as a notice of the Public Hearing regarding the formation of the Zones and annexation to the Consolidated District. Any interested person may file a written protest with the City Clerk prior to the conclusion of the hearing, or having previously filed protest, may file a written withdrawal of that protest. A written protest shall state all grounds of objection and protest by a property owner shall contain a description sufficient to identify the property owned by such property owner. At the public hearing, all interested persons shall be afforded the opportunity to hear and be heard. Valid property owner protest ballots must be completed and received by the City Clerk prior to the conclusion of the Public Hearing for tabulation. The property owner protest ballot proceeding conducted for the Zones shall constitute the property owners' approval or rejection of the annual levy of assessments and assessment range formula. A notice of the hearing and ballot shall be distributed by first class mail to the property owner of record for each parcel within Zones subject to an assessment, pursuant to the California Constitution Article XIIID. Each landowner may return the ballot by mail or in person to the City Clerk not later than the conclusion of the Public Hearing on Thursday, July 8, 2004. At the Public Hearing, pursuant to the California Constitution Article XIIID Section 4, Sub -Section 4 (e), the City shall tabulate the ballots returned to determine if majority protest exists. The ballots shall be weighted according to the proportional financial obligation of the affected properties. Majority protest exists if, upon the conclusion of the hearing, ballots submitted in opposition to the assessment exceed the ballots submitted in favor of the assessment. Section 9: The City Council hereby authorizes and directs the City Clerk or eir designee to prepare and mail notice of the Public Hearing; and in thesame or separate mailing, mail property owner protest ballots to the subject property owners regarding the proposed levy of the assessments and the assessment range formula pursuant to California Constitution Article XIIID and as outlined in the Engineer's Report. PASSED, APPROVED, AND ADOPTED at a regular meeting of the Palm Desert City Council, held on this day of vote, to wit: , 2004, by the following AYES: NOES: ABSENT: ABSTAINED: ATTEST: RACHELLE D. KLASSEN, City Clerk City of Palm Desert, California ROBERT A. SPIEGEL, Mayor City of Palm Desert 4 City Owned City Owned City Owned 6ERALD FORDDR— _.-.._'--.-_-.-.-- . - __ . _ __ GERgLp f'or > DR :. `717 o� TT g Q LWw a L ert ,-,,O City �.. 2 5 Owned e`R, cac City City Owned Owned City City Owned Owned TT13�269 Conceptual TT 31020 — --- Conceptual 7 7T 307 6 O ACTT A EMY80� O j Petunia Place '�_,_,\ 7T -7T 300 -6 2 -30025 4 Petunia Place Z E TT 30216 .z TT 305 C 02KaR'," �xaaK City of Palm Desert aeao� 03-10-04 -.. HE4THERWOOD DR -. . FRANKSINATRA DR __ 0. S. W0615WAR0I R TT30216 TT31860 ROR'OPELZY CMRc 03 Sundance - East �° 7T 29444 TT 29444 O y.- .-` COLCEGEVJEW v CLR w �O1lEGP'- --- TT 30030 — 'AL-tK ._��--- TT 29469 DAISYIK_._ CITY COUNCIL SUBDIVISIONS WITHOUT LANDSCAPE AND LIGHTING DISTRICTS OR HOMEOWNER ASSOCIATIONS LCollege View Estates l t The Boulders Daisy Lane F. 400 800 Feet FRANK City of Palm Desert 03-10-04 -=S1RAt�A7A0YA VLA BARBATp ,3411, ORT,_ , 5UGAR- aaf 0o� vat- F✓E{I TREE£T, PER6! +xik /;`'a a R eOL COUNTRY CLUB DR VIA pQ9° Zr. IEOC k VL4 SAN MARTINO s Palm Court PIA CAL VIA SAN MAR / Q VIA DEL PELLEGRINO N; Na h�� , ev K ti a: z,k Qoa et ea Sj it 44 O U� HOVLEYLN W._ -i ne 4� CQ H �euc R Cli 1Ai.LCtMAi JANXE7�CT L4 PA23fr4Y A 45 °i CITY COUNCIL o —"'k Q 3 , pr SOL t 'AVENID,g � _--_- i0 VILL �� rQn/ >�3JfRRA 014 Q 'f St .hrA RMINQARROY011t = : ;.�. , . A .CORDOBA-WAY GRAN VIA - GRAN V1.4.=' a_ $A'VERA = SUBDIVISIONS WITHOUT LANDSCAPE AND LIGHTING DISTRICTS OR HOMEOWNER ASSOCIATIONS 400 800 Feet CITY OF PALM DESERT ENGINEER'S REPORT OLIVE COURT / SHEPHERD LANE LANDSCAPING AND LIGHTING DISTRICT FORMATION Fiscal Year 2004/2005 Intent Meeting: Public Hearing: May 13, 2004 July 8, 2004 `gal MuniFinancial Corporate Offix Regional Offices Antelope Valley, CA Los Angeles, CA Oakland, CA Orange County, CA 27368 Via Industria Suite 110 Temecula, CA 92590 Tel: (909) 587-3500 Tel: (800) 755-MUNI (6864) Fax: (909) 587-3510 www.muni.com Phoenix, AZ San Diego, CA Sacramento, CA Seattle, WA ENGINEER'S REPORT AFFIDAVIT Formation of and Establishment of Annual Assessments for the: Olive Court/Shepherd Lane Landscaping and Lighting District City of Palm Desert Riverside County, State of California This Report identifies all the parcels within the District and all relevant zones therein, as they existed at the time of the passage of the Resolution of Intention. Reference is hereby made to the Riverside County Assessor's maps for a detailed description of the lines and dimensions of parcels within the District. The undersigned respectfully submits the enclosed Report as directed by the City Council. Dated this day of , 2004. MuniFinancial Assessment Engineer On Behalf of the City of Palm Desert By: Brian Jewett, Principal Consultant Financial Consulting Services By: Richard Kopecky RC.E.# 16742 TABLE OF CONTENTS I. OVERVIEW 1 A. INTRODUCTION 1 B. GENERAL DESCRIPTION OF THE DISTRICT 2 II. PLANS AND SPECIFICATIONS 3 A. DESCRIPTION OF THE DISTRICT 3 B. DISTRICT IMPROVEMENTS AND SERVICES 3 GENERAL PROVISIONS OF THE LAW 3 LOCATION AND EXTENT OF IMPROVEMENTS 4 III. METHOD OF APPORTIONMENT 6 A. IMPROVEMENT BENEFIT FINDINGS 6 GENERAL BENEFITS 6 SPECIAL BENEFITS 7 B. DESCRIPTION OF THEMETHOD OF APPORTIONMENT8 EQUIVALENT BENEFIT UNITS: 9 EBU APPLICATION BY LAND USE: 9 C. ASSESSMENT RANGE FORMULA 12 IV. DISTRICT BUDGET 14 A. CALCULATION OF THE MAXIMUM ASSESSMENT 14 B. DISTRICT BUDGET FOR FISCAL YEAR 2004/2005 15 APPENDIX A - DISTRICT ASSESSMENT DIAGRAM 16 APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL 19 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District OVERVIEW A. Introduction The City of Palm Desert ("City") proposes to form the Olive Court/Shepherd Lane Landscaping and Lighting District ("District") for Fiscal Year 2004/2005. The City Council on behalf of the City proposes to levy and collect special assessments on the County tax rolls to provide funding for the costs and expenses required for maintenance of the landscaping and lighting improvements associated with the District. Upon successful formation of the District and approval of the assessments, the territory within the District will be concurrently annexed into the existing Palm Desert Consolidated Landscaping and Lighting District ("Consolidated District") as the Olive Court sub -zone of Zone 16 (Shepherd Lane). The District will be formed, annexed into the Consolidated District, and levied pursuant to the Landscape and Lighting Act of 1972, Part 2 g'Dizision 15 j the California Streets and Highzaos Cale (the Act), and in compliance with the substantive and procedural requirements of the California Constitution Article XIIID. This Engineer's Report ("Report") describes the District and assessments to be levied against properties within the District commencing with Fiscal Year 2004/2005. The assessments described herein are based on the estimated cost to maintain the improvements that will provide a direct and special benefit to properties within the District. Improvements to be maintained and funded through annual assessments shall be constructed and installed in connection with the development of these properties. The annual costs and assessments described herein include all estimated direct expenditures, incidental expenses, deficits, surpluses, revenues, and reserves associated with the maintenance and servicing of the improvements. The word "parcel," for the purposes of this Report, refers to an individual property assigned its own Assessment Number by the County of Riverside Assessor's Office. The County of Riverside Auditor/Controller uses Assessment Numbers and specific Fund Numbers to identify properties assessed on the tax roll for special district benefit assessments. At a noticed Public Hearing, the City Council will consider all public comments and written protests presented. Upon conclusion of the Public Hearing, the City Council will tabulate property owner protest ballots received to determine whether majority protest exists, and by resolution confirm the results of the protest ballot tabulation. Proceedings for the formation of the assessment district shall be abandoned if majority protest exists. If tabulation of the property owner protest ballots indicates approval of the assessments and the assessment range formula presented, by resolution the City Council will approve the Engineer's Report as submitted or amended (amendments may not increase the assessments approved by the property owners). Following approval of the Report, the City Council will by resolution, order MuniFinanaal Page 1 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District the formation of the District, the annexation of the territory into the Consolidated District, and confirm the levy and collection of assessments pursuant to the Act. In such case, the assessments as approved may be submitted to the Riverside County Auditor/Controller to be included on the property tax roll for each parcel for Fiscal Year 2004/2005, or reviewed and confirmed at the annual public hearing for the Consolidated District along with all other assessments within the Consolidated District. B. General Description of the District The District consists of all lots, parcels and properties within the residential subdivision known as Olive Court within the development area known as Shepherd Lane located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally west of the Monterey Avenue. The improvements and services that provide a special benefit to properties within the District generally include, but are not limited to: • Parkway landscaping on Shepherd Lane adjacent to the residential development installed as part of the development of properties therein; • Perimeter landscaping for the Shepherd Lane residential developments. Tract 30269 is one of several residential subdivisions within the area known as Shepherd Lane, that includes parkway/perimeter landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. These improvements benefit all property development within the Shepherd Lane area and each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Any entryways, open space areas or other landscaped areas associated with the development of properties within the District that will be maintained by the District; • Street lights within and adjacent to the residential subdivision. The estimated annual cost to provide and maintain the improvements associated with the District have been allocated to each property in proportion to special benefits received. The Method of Apportionment described in this Report utilizes commonly accepted assessment engineering practices and has been established pursuant to the 1972 Act and the provisions of Article XIIID of the California Constitution (Proposition 218). MuniFinan ialal Page 2 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District II. PLANS AND SPECIFICATIONS A. Description of the District The District consists of all lots and parcels within the residential subdivision known as Olive Court (Tract 30269) located on the west side of Shepherd Lane at the intersection of Jeri Lane. This tract is generally located west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive and generally east of the Monterey Avenue. Refer to the Assessment Diagram for details of the District boundary. The proposed District includes all parcels of land that have been approved for residential development within Tract 30269. • Tract No. 30269 (Jeri Lane) — Sixteen (16) single-family residential parcels (lots 1-16) identified on the County Assessor's Map as APN Book 653, Page 37, (Assessor's Parcel Number 653-790-001 through 016). This tract includes two landscape easements identified as the parkway landscaping on the west side of Shepherd Lane adjacent to the tract north and south of Jeri Lane adjacent to the tract. The parcels to be assessed receive special benefit from the installation and maintenance of street lighting and parkway landscaping adjacent to the development and perimeter landscaping associated with the development of all properties within the Shepherd Lane area. The improvements to be funded through District assessments have either been installed as a condition of the development of the original undeveloped properties within the District or have been installed as part of the overall development of properties within the area known as Shepherd Lane. The District is being formed to ensure and preserve the on going maintenance and operation of these improvements and it has been determined that each parcel within the District receives similar and proportional benefit from the collective improvements installed as part of the property development. The specific location, description and benefits of the improvements are discussed in the following sections. B. District Improvements and Services GENERAL PROVISIONS OF THE LAW As generally defined by the 1972 Act and applicable to this District, improvements and the associated assessments may include one or any combination of the following: 1) The installation or planting of landscaping; 2) The installation or construction of statuary, fountains, and other ornamental structures and facilities; MuniFinandal Page 3 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District 3) The installation or construction of any facilities which are appurtenant to any of the foregoing or which are necessary or convenient for the maintenance or servicing thereof; 4) The maintenance or servicing, or both, of any of the foregoing including the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including, but not limited to: a) Repair, removal, or replacement of all or any part of any improvements; b) Grading, clearing, removal of debris, the installation or construction of curbs, gutters, walls, sidewalks, or paving, or water, irrigation, drainage, or electrical facilities; c) Providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; d) The removal of trimmings, rubbish, debris, and other solid waste; e) The cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti; f) Electric current or energy, gas, or other agent for the lighting or operation of any other improvements; and, g) Water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. 5) Incidental expenses associated with the improvements including, but not limited to: a) The cost of preparation of the report, including plans, specifications, estimates, diagram, and assessment; b) The costs of printing, advertising, and the publishing, posting and mailing of notices; c) Compensation payable to the County for collection of assessments; d) Compensation of any engineer or attorney employed to render services; e) Any other expenses incidental to the construction, installation, or maintenance and servicing of the improvements; and, f) Costs associated with any elections held for the approval of a new or increased assessment. LOCATION AND EXTENT OF IMPROVEMENTS The purpose of the District is to ensure the ongoing maintenance, operation and servicing of local landscape and street lighting improvements installed as a result of MuniFinamral Page 4 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District property development in the Shepherd Lane area. These improvements may include, but are not limited to all streetlight facilities as well as landscaping material and facilities associated with properties in the District including ground cover, shrubs, trees and plants; irrigation and drainage systems; ornamental lighting structures, masonry walls or other fencing, entryway monument, and associated appurtenant facilities located within the: • Parkway landscaping along Shepherd Lane adjacent to the residential subdivision. Specifically for this District, this landscaped areas includes the parkway area on the west side of Shepherd Lane which extends the length of Tract 30269; • Perimeter/parkway landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. Although these perimeter/parkway-landscaping areas may not have been installed directly as a condition of this residential subdivision, this landscaping is an integral part of the overall development of properties within the Shepherd Lane area and directly benefits all property development within the area. Therefore, each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Streetlights within the residential subdivision and/or adjacent to the subdivision on Jeri Lane, Shepherd Lane and the west side of Portola Avenue installed as part of the residential subdivision; and, • Any extension or expansion of the proposed landscaped areas within or adjacent to the subdivision that may be installed as part of the development of properties within the District and will be maintained by the District. These improvements may include, but are not limited to open space areas, monuments or other landscaped easements. MuniFinancial Page 5 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District III. METHOD OF APPORTIONMENT Pursuant to the 1972 Act the costs (assessments) of the District are apportioned by a formula or method that fairly distributes the net amount to be assessed among all parcels in proportion to benefits received from the improvements. Furthermore, the provisions of Article XIIID of the California Constitution (Proposition 218) require the agency to separate the general benefit from special benefit, whereas only special benefits maybe assessed. A. Improvement Benefit Findings The annual assessments outlined in the budget section of this Report are proposed to cover the estimated costs to provide the necessary services, operation, administration, and maintenance required each year to maintain street lighting facilities associated with the District and keep the landscaping improvements in a healthy, vigorous, and satisfactory condition. It has been determined that each assessable parcel within the District receives similar and proportional special benefits from the improvements. The fact that improvements are part of the specific property development plans and requirements for development of properties within the District, and each parcel's close and relatively similar proximity to the improvements makes each parcel's special benefit from the improvements similar and proportionate. All the lots and parcels that receive special benefit from the improvements are included within the District. GENERAL BENEFITS The improvements to be provided and maintained by the District are a direct result of property development within the District and the Shepherd Lane area and these improvements would otherwise not be required or necessary. Developers typically install local improvements or develop in areas where landscape improvements exist to enhance the marketability and value of properties within their development and/or as conditions of development. In any case, local landscape and lighting improvements associated with the development clearly benefit the properties being developed. If new improvements are installed as part of the development, they are installed either to enhance the property being developed or as a condition of development and not for the benefit of surrounding properties outside the District. Although local development improvements (by virtue of their location) may be visible to surrounding properties, any benefit to surrounding properties is incidental and cannot be considered a direct and special benefit. Furthermore, most developments within the City typically have various landscaping and lighting improvements specifically associated with their development and these improvements are funded by properties within those developments. Therefore, it has been determined that the improvements associated with this District and the ongoing operation and maintenance of those improvements provide no identifiable MuniFinamial Page 6 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District or measurable general benefit to properties outside the Shepherd Lane area or to the public at large. SPECIAL BENEFITS All the improvements funded through the District provide a special aesthetic appeal to each property and enhance the quality of life for property owners within the District as well as the marketability of those properties. All landscaping and lighting improvements associated with the District are part of the overall development plan for properties within the District and the Shepherd Lane area and specifically installed for the benefit and development of those properties. The special benefits associated with parkway, perimeter, entryway, and other property -specific landscaped areas and associated amenities are specifically: 1. Enhanced desirability of properties through association with the improvements. 2. Improved aesthetic appeal of properties within the District providing a positive representation of the development and properties within the development. 3. Enhanced adaptation of the urban environment within the natural environment from adequate green space and landscaping. 4. Environmental enhancement through improved erosion resistance, dust and debris control and reduced noise and air pollution. 5. Increased sense of pride in ownership of property within the District resulting from well -maintained improvements associated with the properties. 6. Reduced vandalism and criminal activity resulting from well -maintained surroundings and amenities. 7. The special enhancements of the perceived value of property that results from the above benefits. The special benefits of street lighting are the convenience, safety, and security of property, improvements, and goods. Specifically: 1. Enhanced deterrence of crime and the aid to police protection. 2. Increased nighttime safety on streets through enhanced visibility. 3. Improved sense of security and safety for pedestrians, motorists and property owners. 4. Improved ingress and egress to property. 5. Reduced vandalism, other criminal acts and damage to improvements or property. 6. Reduced personal property loss. MuniFinancial Page 7 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District 7. The special enhancements of the perceived value of property that results from the above benefits B. Description of the Method of Apportionment The assessments outlined in this section represent the proportionate special benefit to each property within the District and the basis of calculating each parcel's proportionate share of the annual costs associated with the District improvements. The costs associated with the maintenance and operation of all District improvements shall be collected through annual assessments from each parcel receiving special benefit. The funds collected shall be dispersed and used for only the services and operation provided to the District. The method of apportionment for the District calculates the receipt of special benefit from the respective improvements based on the actual or proposed land use of the parcels within the District. The special benefit received by each lot or parcel is equated to the overall land use of the parcel based on the parcel's actual land use or proposed planned development, and is reliant upon the special benefit received from the improvements planned within the District. To identify and determine the special benefit to be received by each parcel and their proportionate share of the improvements it is necessary to consider the entire scope of the planned improvements within the Shepherd Lane area as well as individual property development within the District. Upon review of the proposed improvements it has been determined that each parcel within the proposed District benefits from the landscaping and lighting improvements installed as a condition of property development as well as perimeter landscaping associated with similar developments in the Shepherd Lane area. Based on these improvements and the planned property development within the proposed District, a maximum assessment can be established. All costs associated with the improvements shall be fairly distributed among the parcels based upon the special benefit received by each parcel. Additionally, in compliance with Article XIIID, Section 4, of the State Constitution each parcel's assessment may not exceed the reasonable cost of the proportional special benefit conferred to that parcel. The benefit formula used to determine the assessment obligation is therefore based upon both the improvements that benefit the parcels within the District as well as the proposed land use of each property as compared to other parcels that benefit from those specific improvements. MuniFinanaal Page 8 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District EQUIVALENT BENEFIT UNITS: The Equivalent Benefit Unit (EBU) method of apportioning benefit is typically seen as the most appropriate and equitable assessment methodology for districts formed under the 1972 Act, as the benefit to each parcel from the improvements are apportioned as a function of land use type and development or development potential. To assess benefits equitably, it is necessary to relate the different type of properties within the District to the improvements and to each other. The Equivalent Benefit Unit method of assessment apportionment utilizes the single-family home site as the basic unit of assessment. A single-family home site equals one Equivalent Benefit Unit (EBU). Every other land use within the District is converted to EBU's based on an assessment formula that equates the property's specific development status, type of development (land use), and size or development plans for the property, as compared to a single-family home site. Although this particular District (Olive Court subdivision) will be comprised of only subdivided residential lots, it is anticipated that this subdivision will eventually be one of several subdivisions and developments that will be included in Zone 16 (Shepherd Lane) of the Palm Desert Consolidated District. Therefore, the following provides an overview of the EBU's applied to various other land use classifications within the Consolidated District. EBU APPLICATION BY LAND USE: Single Family Residential — This land use is defined as a fully subdivided residential home site with or without a structure. This land use is assessed 1.00 EBU per lot or parcel. This is the base value that all other land use types are compared and weighted against (i.e. Equivalent Benefit Unit). Multifamily Residential — This land use is defined as a fully subdivided residential parcel that has more than one residential unit developed on the property. Engineering studies have consistently shown that apartment and other multiple - family dwelling units generate lower traffic volumes, water consumption, and typically impact public infrastructure between 60 to 80 percent as much as a single- family residence largely due to lower occupancy of apartment dwelling units versus single family residential units. Therefore, assessments for the multiple residential units shall be prorated with a value of 0.70 EBU per unit. Condominiums — This land use includes residential developments designated as condominiums by the City and may include one to four residential units per parcel. Engineering studies have shown that on average, condominiums generate lower traffic volumes, water consumption, and typically impact public infrastructure less than a detached single-family residence, but more than apartments or other multifamily dwelling units. Therefore, assessments for condominiums shall be prorated with a value of 0.80 EBU per unit. MuniFinan ial Page 9 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District Approved -Residential Development — This land use is defined as any property not fully subdivided, but for which a Final Tract Map has been approved with a specific number of residential lots to be developed on the parcel. This land use type is assessed at 1.00 EBU per planned residential lot. (If the parcel is actually subdivided at the time annual assessments are submitted to the County for Collection, the resulting parcels shall be assessed based on their resulting development status change). Proposed -Residential Development — This land use is defined as any property not fully subdivided and for which a Tentative Tract Map has been submitted or approved with a specific number of proposed residential lots, but a Final Tract Map has not been approved. This land use type is assessed at 0.75 EBU per proposed residential lot. (If the parcel is actually subdivided or a Final Tract Map is approved prior to the annual assessments being submitted to the County for Collection, the resulting land use change or new parcels shall be assessed based on their resulting development status change). Vacant Undeveloped Property — This land use is defined as any property identified as vacant land that is currently undeveloped with no specific development plans, but may be developed or subdivided in the future (No tract map or development plan has been submitted and/or approved). This land use is assessed at 1.00 EBU per parcel. Developed Non -Residential — This land use is defined as property that is developed, but not as residential property as defined by the previous land use designations. The average residential density within the City is approximately six (6) residential units per acre. Therefore, the proportionate benefit assigned to Developed Non -Residential properties shall be 6.00 EBU per gross acre. Parcels designated as Developed Non -Residential are assigned a minimum of 1.00 EBU Exempt Parcels — This land use identifies properties that are not assessed within the District. This land use classification may include but is not limited to lots or parcels that will not be developed such as sliver parcels, dedicated easements, open space areas, dedicated landscaped areas or common areas. Similarly, properties not designated by a County Assessor's Parcel Number (APN) such as streets, utility easements or rights -of -way receive no special benefit and are considered Exempt. These Exempt properties are not assessed for District improvements. If the County designates an Exempt property by an APN, that parcel shall be assigned 0.00 EBU. Properties that are identified as non-taxable by the County Assessor's Office such as government owned or utility owned properties are not exempt from District assessments unless: the property has limited or restricted development potential; the property clearly receives no benefit from the improvements; or the property provides additional or substantially similar improvements (such is the case with public schools, parks and open space areas). MuniFinayxial Page 10 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District The following table provides a listing by land use type, the Equivalent Benefit Unit factor applied to that land use type and the multiplying factor used to calculate each parcel's individual EBU as outlined in the preceding description. Land Use Designations and Equivalent Benefit Units Property Type Equivalent Benefit Unit Multiplier Single Family Residential 1.000 Unit/Lot/Parcel Multifamily Residential 0.700 Unit Condominiums 0.800 Unit Approved -Residential Development 1.000 Unit/Lots Proposed -Residential Development 0.750 Unit/Lots Vacant Undeveloped Property 1.000 Parcel Developed Non -Residential 6.000 Acreage Exempt 0.000 Parcel The benefit formula applied to various parcels is based on the preceding Equivalent Benefit Unit (EBU) discussion and table. Each parcel's EBU correlates the parcel's special benefit received as compared to all other parcels benefiting from the improvements. The following formula is used to calculate each parcel's EBU (proportional benefit). Parcel Type EBU x Acres/Lots/Units = Parcel EBU The total number of Equivalent Benefit Units (EBU's) is the sum of all individual EBU's applied to parcels that receive a special benefit the improvement. An assessment amount per EBU (Rate) for the District improvements is established annually by taking the total cost of the improvement and dividing that amount by the total number of EBU's of all benefiting parcels. This Rate is then applied back to each parcel's individual EBU to determine the parcel's proportionate benefit and assessment obligation. Total Balance to Levy / Total EBU = Levy per EBU Levy per EBU x Parcel EBU = Parcel Levy Amount MuniFinaal Page 11 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District C. Assessment Range Formula Any new or increase in assessments require certain noticing and meeting requirements by law. Prior to the passage of Proposition 218, legislative changes in the Brown Act defined the definition of "new or increased assessment" to exclude certain conditions. These conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition and conditions were later confirmed through SB919 (Proposition 218 implementing legislation). The purpose of establishing an assessment range formula is to provide for reasonable increases and inflationary adjustments to annual assessments without requiring costly noticing and mailing procedures, which could add to the District costs and assessments. As part of the District formation, balloting of property owners is required, pursuant to Proposition 218. The ballots presented to the property owners in connection with this Report includes an Assessment Rate to be approved, as well as the approval of an assessment range formula. The assessment range formula shall be applied to all future assessments within the District. Generally, if the proposed annual assessment (levy per unit or rate) for the current fiscal year is less than or equal to the "Maximum Assessment" (or "Adjusted Maximum Assessment"), then the proposed annual assessment is not considered an increased assessment. The Maximum Assessment is equal to the initial Assessment approved by property owners adjusted annually by the following criteria: 1. Beginning in the second fiscal year, (Fiscal Year 2005/2006) and each fiscal year thereafter, the Maximum Assessment will be recalculated annually; and, 2. The new adjusted Maximum Assessment for the year represents the prior year's Maximum Assessment adjusted by three percent (3.0%). The Maximum Assessment is adjusted annually and is calculated independent of the District's annual budget and proposed annual assessment. Any proposed annual assessment (rate per levy unit) less than or equal to this Maximum Assessment is not considered an increased assessment, even if the proposed assessment is significantly greater than the assessment applied in the prior fiscal year. The Maximum Assessment will be recalculated and adjusted annually. However, the City Council may reduce or freeze the Maximum Assessment at any time by amending the Engineer's Annual Report. Although the Maximum Assessment will normally increase each year, the actual District assessments may fluctuate or remain virtually unchanged. The Maximum Assessment adjustment is designed to establish a reasonable limit on District assessments. The Maximum Assessment calculated each year does not require or facilitate an increase to the annual assessment and neither does it restrict assessments to the adjustment maximum amount. If the budget and assessments for the fiscal MuniFinancial Page 12 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District year does not require an increase, or the increase is less than the adjusted Maximum Assessment, then the required budget and assessment may be applied without additional property owner balloting. If the budget and assessments calculated requires an increase greater than the adjusted Maximum Assessment then the assessment is considered an increased assessment. To impose an increased assessment the City Council must comply with the provisions of Proposition 218 (Article XIIID Section 4c of the California Constitution), which requires a public hearing and certain protest procedures including mailed notice of the public hearing and property owner protest balloting. Property owners through the balloting process must approve the proposed assessment increase. If the new proposed assessment is approved, then a new Maximum Assessment is established for the District. If the proposed assessment is not approved, the City Council may not levy an assessment greater than the adjusted Maximum Assessment previously established for the District. MuniFinanacial Page 13 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District IV. DISTRICT BUDGET A. Calculation of the Maximum Assessment The Maximum Assessment Rate per EBU presented to the property owners for approval is based on the estimated expenses and benefit units planned for the District (Olive Court) at build out. The following budget reflects these assumptions: ZONE 16 OLIVE COURT Total General Special Budget Benefit Benefit DIRECT COSTS Maintenance Costs $1,728 $0 $1,728 Landscape Utilities 540 0 540 Landscape Extras (Repairs/Materials/Equipment) 770 0 770 Tree Pruning 450 0 450 Street Lighting 150 0 150 Special District Services 0 0 0 Annual Direct Costs (Subtotal) $3,638 0 $3,638 Renovation/Capital Improvement Expenditures 0 0 0 Total Direct Costs $3,638 0 $3,638 ADMINISTRATION COSTS District Administration 948 0 948 County Administration Fee 25 0 25 County Per Parcel Fee 3 0 3 Administration Costs (Subtotal) $976 0 $976 LEVY BREAKDOWN Total Direct and Admin. Costs 4,614 0 4,614 Reserve Collection/ (Transfers) 461 0 461 Other Revenues/General Fund Contribution 0 0 0 Capital Improvement Project Collection/ (Transfers) 0 0 0 Balance to Levy $5,075 0 $5,075 DISTRICT STATISTICS Total Parcels 16 Total Parcels Levied 16 Total Equivalent Dwelling Units 16.00 Levy per EDU $317.22 RESERVE INFORMATION Beginning Reserve Balance 0 Reserve Account Activity 461 Anticipated Reserve Balance 461 ASSESSMENT INFORMATION Maximum Assessment Rate FY 2004/05 CPI Applied : 0.00% $317.22 MuniFinamial Page 14 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District District Budget For Fiscal Year 2004/2005 Upon the successful formation of the proposed Olive Court/Shepherd Lane Landscaping and Lighting District, the District and parcels therein will be concurrently annexed into the Palm Desert Consolidated District as part of Zone 16 (Shepherd Lane) for Fiscal Year 2004/2005. The actual budget and assessment rate to be applied for Fiscal Year 2004/2005 (first levy of assessments) will be reviewed and adopted by the City Council as part of the annual levy process for the Consolidated District for Fiscal Year 2004/2005. Although it is anticipated that the proposed expenses (budget) and proposed assessment rate per Equivalent Benefit Unit (EBUi) outlined in the preceding table (Calculation of the Maximum Assessment) will be applied for Fiscal Year 2004/2005, the assessment rate approved and adopted by the City Council may be less than the maximum rate outlined in this report. MuniFinancial Page 15 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District APPENDIX A- DISTRICT ASSESSMENT DIAGRAM The District consists of all lots and parcels within the Olive Court subdivision Tract 30269 located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally east of the Monterey Avenue. The tract map and Assessor's Parcel Map shown on the following pages identify the parcels within the Olive Court/Shepherd Lane Landscaping and Lighting District, as they existed on the County Assessor's Roll when this Report was prepared and the Resolution of Intention was adopted. The District is inclusive of Assessor's Parcel Map — Book 653, Page 37, (Assessor's Parcel Number 653-790-001 through 016). The parcels identified on the Assessor's Parcel Map and the Tract Map contained herein define the boundaries and constitute the Assessment Diagram for the District and by reference includes all subsequent parcels and Assessor's Parcel Maps and parcel numbers related thereto. MuniFinan ial Page 16 FlY 1.4 • Mittel -Q1104 .071213.9 Engineer's Report Fiscal Year 2004/2005 Olive Court/Shepherd Lane Landscaping and Lighting District APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL Parcel identification for each lot or parcel within the District, shall be the parcel as shown on the Riverside County Secured Roll for the year in which this Report is prepared and reflective of the Assessor's Parcel Map(s). As of the resolution of Intention, the Olive Court/Shepherd Lane Landscaping and Lighting District is inclusive of Assessor's Parcel Numbers (APN's) identified on the Assessor's Parcel Maps - Book 653, Page 37, (Assessor's Parcel Number 653-790-001 through 016). A listing of parcels assessed within this District identifying the proposed Maximum Assessment Amount for the first fiscal year is included in the following listing. APN 653-790-001 653-790-002 653-790-003 653-790-004 653-790-005 653-790-006 653-790-007 653-790-008 653-790-009 653-790-010 653-790-011 653-790-012 653-790-013 653-790-014 653-790-015 653-790-016 Parcel Description Tract 30269 Lot 1 Tract 30269 Lot 2 Tract 30269 Lot 3 Tract 30269 Lot 4 Tract 30269 Lot 5 Tract 30269 Lot 6 Tract 30269 Lot 7 Tract 30269 Lot 8 Tract 30269 Lot 9 Tract 30269 Lot 10 Tract 30269 Lot 11 Tract 30269 Lot 12 Tract 30269 Lot 13 Tract 30269 Lot 14 Tract 30269 Lot 15 Tract 30269 Lot 16 Total Assessment Proposed Assessment 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 317.22 $5,075.52 MuniFinancial Page 19 CITY OF PALM DESERT ENGINEER'S REPORT PALM COURT LANDSCAPING AND LIGHTING DISTRICT FORMATION Fiscal Year 2004/2005 Corporate Office 27368 Via Industria Suite 110 Temecula, CA 92590 Tel: (909) 587-3500 Tel: (800) 755-MUNI (6864) Fax: (909) 587-3510 Intent Meeting: Public Hearing: May 13, 2004 July 8, 2004 MuniFinancjal Regional Antelope Valley, CA Los Angeles, CA Oakland, CA Orange County, CA www.muni.com gfices Phoenix, AZ San Diego, CA Sacramento, CA Seattle, WA ENGINEER'S REPORT AFFIDAVIT Formation of and establishment of Annual Assessments for the: Palm Court Landscaping and Lighting District City of Palm Desert Riverside County, State of California This Report identifies all the parcels within the District and all relevant zones therein, as they existed at the time of the passage of the Resolution of Intention. Reference is hereby made to the Riverside County Assessor's maps for a detailed description of the lines and dimensions of parcels within the District. The undersigned respectfully submits the enclosed Report as directed by the City Council. Dated this day of , 2004. MuniFinancial Assessment Engineer On Behalf of the City of Palm Desert By: Brian Jewett, Principal Consultant Financial Consulting Services By: Richard Kopecky R.C.E.# 16742 TABLE OF CONTENTS I. OVERVIEW 1 A. INTRODUCTION 1 B. GENERAL DESCRIPTION OF THE DISTRICT 2 II. PLANS AND SPECIFICATIONS 3 A. DESCRIPTION OF THE DISTRICT 3 B. DISTRICT IMPROVEMENTS AND SERVICES 4 GENERAL PROVISIONS 4 LOCATION AND EXTENT OF THE IMPROVEMENTS 5 III. METHOD OF APPORTIONMENT 6 A. IMPROVEMENT BENEFIT FINDINGS 6 GENERAL BENEFITS 6 SPECIAL BENEFITS 6 B. APPORTIONMENT CALCULATIONS 8 C. ASSESSMENT RANGE FORMULA 9 IV. DISTRICT BUDGET 11 APPENDIX A - DISTRICT DIAGRAMS 12 APPENDIX B - ASSESSMENT ROLL 14 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District I. OVERVIEW A. INTRODUCTION The City of Palm Desert ("City") proposes to form the Palm Court Landscaping and Lighting District ("District") for Fiscal Year 2004/2005. The City Council on behalf of the City proposes to levy and collect special assessments on the County tax rolls to provide funding for the costs and expenses required for on -going maintenance of the landscaping and lighting improvements within the District. All improvements associated with the District have been installed as part of the development of the properties within the District. Upon successful formation of the District and approval of the assessments, the territory within the District will be concurrently annexed into the existing Palm Desert Consolidated Landscaping and Lighting District ("Consolidated District") as a new sub -zone within Zone 6 (Hovley Lane). The District will be formed, annexed into the Consolidated District, and levied pursuant to the Landscape and Lighting Act of 1972, Part 2 of Dizision 15 of the California Streets and Highzeux Cale (the Act), and in compliance with the substantive and procedural requirements of the Califomiaa Constitution Article XIIID. This Engineer's Report ("Report") describes the District and assessments to be levied against properties within the District commencing with Fiscal Year 2004/2005. The assessments described herein are based on the estimated cost to maintain the improvements that will provide a direct and special benefit to properties within the District. All improvements to be maintained and funded through annual assessments were constructed and installed in connection with the development of these properties. The annual costs and assessments described herein include all estimated direct expenditures, incidental expenses, deficits, surpluses, revenues, and reserves associated with the maintenance and servicing of the improvements. Each parcel shall be assessed proportionately for only those improvements provided and for which the parcel receives special benefit. The word "parcel," for the purposes of this Report, refers to an individual property assigned its own Assessment Number by the County of Riverside Assessor's Office. The County of Riverside Auditor/Controller uses Assessment Numbers and specific Fund Numbers to identify properties assessed on the tax roll for special district benefit assessments. At a noticed Public Hearing, the City Council will consider all public comments and written protests presented. Upon conclusion of the Public Hearing, the City Council will tabulate property owner protest ballots received to determine whether majority protest exists, and by resolution confirm the results of the protest ballot tabulation. Proceedings for the formation of the assessment district shall be abandoned if majority protest exists. If tabulation of the property owner protest ballots indicates approval of the assessments and the assessment range MuniFimial Page 1 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District formula presented, by resolution the City Council will approve the Engineer's Report as submitted or amended (amendments may not increase the assessments approved by the property owner balloting procedure). Following approval of the Report, the City Council will by resolution, order the formation of the District, the annexation of the territory into the Consolidated District, and confirm the levy and collection of assessments pursuant to the Act. In such case, the assessments as approved may be submitted to the Riverside County Auditor/Controller to be included on the property tax roll for each parcel for Fiscal Year 2004/2005, or reviewed and confirmed at the annual public hearing for the Consolidated District. B. GENERAL DESCRIPTION OF THE DISTRICT The District consists of all lots and parcels within Tract 25373 known as the Palm Court at Hovley Lane West. Tract 25373 is a single-family residential development located on Palm Court, on the north side of Hovley Lane West between Monterey Avenue, and Portola Avenue within the City of Palm Desert, County of Riverside. The assessable parcels within the District (Twenty single-family residential lots) receive special benefit from the installation and maintenance of street lighting facilities and landscaped areas within or adjacent to the development, installed as part of the development and subdivision of the original undeveloped property. The improvements have been installed by the developer as part of the development plan and the District is being formed to ensure and preserve the on going maintenance and operation of these improvements. The improvements include parkway landscaping along Hovley Lane West on the perimeter of the development including a masonry wall and entryway monument and a single streetlight installed at the entrance to the development. The specific location, description and benefits of the improvements are discussed in the following sections. MuniFinancial Pa e2 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District IL PLANS AND SPECIFICATIONS A. DESCRIPTION OF THE DISTRICT The District consists of all lots and parcels located within the residential development known as the Palm Court at Hovley Lane West (Tract 25373). The District is generally located east of Monterey Avenue, west of Portola Avenue, on the north side of Hovley Lane West and incorporates all the single-family residential parcels of Tract 25373. The District boundary includes all lots within Tract 25373 totaling approximately 4.75 acres described as: • Twenty (20) subdivided single-family residential lots (Lots 1-20) on Palm Court, (Assessor's Parcel Numbers 622-311-027 through 046); • Two landscape rights-of-way/easements (Parkway landscape areas) adjacent to the development on the north side of Hovley Lane West, identified as Lot "C" (0.02 acres) and Lot "D" (0.02 acres); • Public street rights -of way on Hovley Lane West (Lot "A") and Palm Court (Lot "B"). Refer to the Assessment Diagram for details of the District boundary. The improvements that provide a special benefit to properties within the District generally include, but are not limited to: • Parkway and perimeter landscaping adjacent to the development on the north side of Hovley Lane West; • Street Lighting located at the entrance to the development at the corner of Hovley Lane West and Palm Court; • Entryway monument, block walls, irrigation systems, drainage systems and electrical facilities associated with the landscaping and lighting improvements identified above. The estimated annual cost to provide and maintain the improvements within the District have been allocated to each property in proportion to special benefits received. The Method of Apportionment described in this Report utilizes commonly accepted assessment engineering practices and have been established pursuant to the 1972 Act and the provisions of the Ca4fornia Constitution A aide XIIID (Proposition 218). MuniFinan ial Page 3 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District DISTRICT IMPROVEMENTS AND SERVIC'F.S GENERAL PROVISIONS As generally defined by the 1972 Act and applicable to this District, improvements and the associated assessments may include one or any combination of the following: 1) The installation or planting of landscaping; 2) The installation or construction of statuary, fountains, and other ornamental structures and facilities; 3) The installation or construction of public lighting facilities, including, but not limited to, street lights and traffic signals; 4) The installation or construction of any facilities which are appurtenant to any of the foregoing or which are necessary or convenient for the maintenance or servicing thereof; 5) The maintenance or servicing, or both, of any of the foregoing including the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including, but not limited to: a) Repair, removal, or replacement of all or any part of any improvements; b) Grading, clearing, removal of debris, the installation, repair or construction of curbs, gutters, walls, sidewalks, or paving, or water, irrigation, drainage, or electrical facilities; c) Providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; d) The removal of trimmings, rubbish, debris, and other solid waste; e) The cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti. f) Electric current or energy, gas, or other agent for the lighting or operation of any other improvements. g) Water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. 6) Incidental expenses associated with the improvements including, but not limited to: a) The cost of preparation of the report, including plans, specifications, estimates, diagram, and assessment; b) The costs of printing, advertising, and the publishing, posting and mailing of notices; c) Compensation payable to the County for collection of assessments; d) Compensation of any engineer or attorney employed to render services; MuniFin ncal Page 4 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District e) Any other expenses incidental to the construction, installation, or maintenance and servicing of the improvements; and, f) Costs associated with any elections held for the approval of a new or increased assessment. LOCATION AND EXTENT OF THE IMPROVEMENTS The purpose of the District is to ensure the on going maintenance, operation and servicing of local landscaping and lighting improvements installed as a result of property development. The landscape improvements may include but are not limited to all material and facilities within the District including ground cover, shrubs, trees and plants; irrigation and drainage systems; ornamental lighting structures, masonry walls or other fencing, entryway monument, and associated appurtenant facilities located within the following areas: • Parkway and perimeter landscaping adjacent to the development on the north side of Hovley Lane West, identified as Lots "C' and "D" (0.04 acres) of Tract Map No. 25373. The street lighting improvements may include but are not limited to all material, facilities and electric current necessary to provide street lighting within the District in the following locations: • A single streetlight located at the entrance to the development at the corner of Hovley Lane West and Palm Court. MuniFinancial Page 5 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District III. METHOD OF APPORTIONMENT Pursuant to the 1972 Act the costs (assessments) of the District are apportioned by a formula or method that fairly distributes the net amount to be assessed among all parcels in proportion to benefits received from the improvements. Furthermore, the provisions of the California Constitution A rtide XIIID (Proposition 218) require the agency to separate the general benefit from special benefit, whereas only special benefits may be assessed. A. IMPROVEMENT BENEFIT FINDINGS The annual assessment outlined in the Budget section of this Report represents the estimated annual cost to provide all necessary service, operation, administration, and maintenance required to keep the landscaping and lighting improvements in a healthy, vigorous, and satisfactory condition. It has been determined that each assessable parcel within the District receives similar and proportional special benefits from the improvements. The fact that all proposed improvements are part of the overall property development plan within the District, and each parcel's close and relatively similar proximity to the improvements makes each parcel's special benefit from the improvements similar and proportionate. All the lots and parcels that receive special benefit from the improvements are included within the District and shall be assessed for the improvements. GENERAL BENEFITS The improvements associated with this District are a direct result of property development within the District and would otherwise not be required or necessary. Developers typically install local improvements to enhance the marketability and value of properties within the development and/or as conditions of development. In either case, the improvements are clearly installed for the benefit of the properties being developed and not for the benefit of surrounding properties. Although local improvements (by virtue of their location) may be visible to surrounding properties, any benefit to surrounding properties is incidental and cannot be considered a direct and special benefit to those properties. Furthermore, most developments within the City of Palm Desert typically have various landscaping and lighting improvements specifically associated with those developments and these improvements are funded by properties within those developments. Therefore, by comparison it has been determined that the improvements for this District and the on -going operation and maintenance of those improvements are clearly a direct and special benefit to properties within the District and provide no measurable general benefit to properties outside the District or to the public at large. SPECIAL BENEFITS MuniFinanaal Page 6 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District All the improvements funded through the District provide a special aesthetic value to each property and enhance the quality of life for property owners within the District. All the improvements associated with the District are part of the overall development plan for these properties and were specifically installed for the benefit and development of the properties. The special benefits associated with parkway, perimeter, entryway, and other specified landscaped areas and associated amenities are specifically 1. Enhanced desirability of properties through association with the improvements. 2. Improved aesthetic appeal of properties by providing a positive representation of the development and properties within the District. 3. Enhanced adaptation of the urban environment within the natural environment from adequate green space and landscaping. 4. Environmental enhancement through improved erosion resistance, dust and debris control and reduced noise and air pollution. 5. Increased sense of pride in property ownership resulting from well - maintained improvements associated with the properties. 6. Reduced vandalism and criminal activity resulting from well -maintained surroundings and amenities. 7. The special enhancements to the value of property, which results from the above benefits. The special benefits of street lighting are the convenience, safety, and security of property, improvements, and goods. Specifically 1. Enhanced deterrence of crime and the aid to police protection. 2. Increased nighttime safety on streets through enhanced visibility. 3. Improved sense of security and safety for pedestrians, motorists and property owners. 4. Improved ingress and egress to property. 5. Reduced vandalism, other criminal acts and damage to improvements or property. 6. Reduced personal property loss. 7. The special enhancement to the value of property, which results from the above benefits. MuniFirarnial Page 7 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District APPORTIONMENT CALCULATIONS The assessments outlined in this section represent the proportionate special benefit to each property within the District and the basis of calculating each parcel's proportionate share of the annual costs associated with the District improvements. The costs associated with the maintenance and operation of all District improvements shall be collected through annual assessments from each parcel receiving special benefit. The funds collected shall be dispersed and used for only the services and operation provided to the District. The basis of determining each parcel's special benefit utilizes a weighting formula commonly known as an Equivalent Benefit Unit (EBU). The single-family residential lot (parcel) is used as the base unit for calculation of assessments and is defined as one (1.00) EBU. All other property types are typically assigned an EBU that reflects their proportional special benefit from the improvements as compared to the single-family residential lot (weighted comparison). Parcels that will not be developed such as sliver parcels, dedicated easements, open space areas, dedicated landscaped areas or common areas and properties not designated by a County Assessor's Parcel Number (APN) such as streets, utility easements or rights -of -way receive no special benefit and are considered Exempt and are not assessed for District improvements. If the County assigns an APN to any parcel identified as Exempt, that parcel shall be assigned 0.00 EBU. Any property that is identified as non-taxable by the County Assessor's Office such as government owned or utility owned property is not exempt from District assessments unless: • The property has restricted development or limited land use potential and clearly receive no benefit from the installation and maintenance of the improvements; or • The property provides additional or substantially similar improvements being provided by the District (such is the case with parks and open space areas or possibly schools and common areas). In the Palm Court Landscaping and Lighting District, all parcels have been identified as either single-family residential parcel (subdivided residential lots) or Exempt. All the single-family residential parcels benefit from the improvements and shall proportionately share in the cost of maintaining the improvements. It has been determined that each residential parcel receives equal special benefit from all the improvements. Therefore, the most equitable and reasonable apportionment of benefit is an equal distribution of costs, regardless of the parcel's acreage or development status. An assessment amount per EBU (Rate) for the District improvements is established by taking the total cost of the improvement and dividing that amount by the total number of EBU's of the benefiting parcels. This Rate is then applied MuniFinanial Page 8 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District back to each parcel's individual EBU to determine the parcel's proportionate benefit and assessment obligation. Total Balance to Levy / Total EBU = Levy per EBU Levy per EBU x Parcel EBU = Parcel Levy Amount Refer to the District Budget for a breakdown of the annual budget and assessments. C. ASSESSMENT RANGE FORMULA Any new or increase in assessments require certain noticing and meeting requirements by law. Prior to the passage of Proposition 218, legislative changes in the Brown Act defined the definition of "new or increased assessment" to exclude certain conditions. These conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition and conditions were later confirmed through SB919 (Proposition 218 implementing legislation). The purpose of establishing an assessment range formula is to provide for reasonable increases and inflationary adjustment to annual assessments without requiring costly noticing and mailing procedures, which could add to the District costs and assessments. As part of the District formation, balloting of property owners is required, pursuant to Proposition 218. The ballots presented to the property owners in connection with this Report includes an Assessment Rate to be approved, as well as the approval of an assessment range formula. The assessment range formula shall be applied to all future assessments within the District. Generally, if the proposed annual assessment (levy per unit or rate) for the current fiscal year is less than or equals to the "Maximum Assessment" (or "Adjusted Maximum Assessment"), then the proposed annual assessment is not considered an increased assessment. The Maximum Assessment is equal to the initial Assessment approved by property owners adjusted annually by the following criteria: 1. Beginning in the second fiscal year (Fiscal Year 2005-2006) and each fiscal year thereafter, the Maximum Assessment will be recalculated annually. 2. The new adjusted Maximum Assessment for the year represents the prior year's Maximum Assessment adjusted by three percent (3.0%). The Maximum Assessment is adjusted annually and is calculated independent of the District's annual budget and proposed annual assessment. Any proposed annual assessment (rate per levy unit) less than or equal to this Maximum Assessment is not considered an increased assessment, even if the proposed assessment is greater than the assessment applied in the prior fiscal year. The MuniFinancial Page 9 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District Maximum Assessment will be recalculated and adjusted annually. However, the City Council may reduce or freeze the Maximum Assessment at any time by amending the Engineer's Annual Report. Although the Maximum Assessment will normally increase each year, the actual District assessments may remain virtually unchanged. The Maximum Assessment adjustment is designed to establish a reasonable limit on District assessments. The Maximum Assessment calculated each year does not require or facilitate an increase to the annual assessment and neither does it restrict assessments to the adjustment maximum amount. If the budget and assessments for the fiscal year does not require an increase, or the increase is less than the adjusted Maximum Assessment, then the required budget and assessment may be applied without additional property owner balloting. If the budget and assessments calculated requires an increase greater than the adjusted Maximum Assessment then the assessment is considered an increased assessment. To impose an increased assessment the City Council must comply with the provisions of Proposition 218 (Article XIIID Section 4c of the California Constitution). Proposition 218 requires a public hearing and certain protest procedures including mailed notice of the public hearing and property owner protest balloting. Property owners through the balloting process must approve the proposed assessment increase. If the proposed assessment is approved, then a new Maximum Assessment is established for the District. If the proposed assessment is not approved, the City Council may not levy an assessment greater than the adjusted Maximum Assessment previously established for the District. MuniFi,umzal Page 10 Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District IV. DISTRICT BUDGET ZONE 6 PALM COURT Total General Special Budget Benefit Benefit DIRECT COSTS Maintenance Costs Landscape Utilities Landscape Extras (Repairs/Materials/Equipment) Tree Pruning Street Lighting Special District Services Annual Direct Costs (Subtotal) Renovation/Capital Improvement Expenditures Total Direct Costs ADMINISTRATION COSTS $1,728 $0 $1,728 540 0 540 770 0 770 450 0 450 150 0 150 0 0 0 $3,638 0 $3,638 0 $3,638 0 0 0 $3,638 District Administration 1,026 0 1,026 County Administration Fee 25 0 25 County Per Parcel Fee 4 0 4 Administration Costs (Subtotal) $1,055 0 $1,055 LEVY BREAKDOWN Total Direct and Admin. Costs 4,693 0 4,693 Reserve Collection/ (Transfers) 469 0 469 Other Revenues/General Fund Contribution 0 0 0 Capital Improvement Project Collection/ (Transfers) 0 0 0 Balance to Levy $5,162 0 $5,162 DISTRICT STATISTICS Total Parcels 20 Total Parcels Levied 20 Total Equivalent Dwelling Units 20.00 Levy per EDU $258.12 RESERVE INFORMATION Beginning Reserve Balance 0 Reserve Account Activity 469 Anticipated Reserve Balance 469 ASSESSMENT INFORMATION Maximum Assessment Rate FY 2004/05 CPI Applied : 0.00% $258.12 MuniFinancial Engineer's Report Fiscal Year 2004/2005 Palm Court Landscaping and Lighting District APPENDIX A - DISTRICT DIAGRAMS The District consists of all lots and parcels located within the residential development known as the Palm Court (Tract 25373). The District is generally located east of Monterey Avenue, north of Hovley Lane West, west of Portola Avenue and incorporates all the single-family residential parcels of Tract 25373 located on Palm Court. The Boundary Diagram for Palm Court Landscaping and Lighting District is defined by the boundaries of Tract 25373 as identified on the Riverside County Assessor's Parcel Map. The following page (APN map) identifies the parcels within the District and constitutes the Assessment Diagram for the Palm Court Landscaping and Lighting District. M uniF inancial Page 12 M 4' a :q„ £, 47000 W as•u a®u . OS'£l. OSYL Ot •tA IL -an K140/0alrru.'2 i4 yo ot•S6 •OS'`I. o . OS't4 aOQ, a10L St Si 0f 1,11700 OS•PL 0S'OL ©/s era 107 sn•aar owP IL O 9 107 18•£B£ !s fc 91. 0f ® ;. Of £b'O7 W7Ai ono-, xma bt Of tl O ®j 1'e 7w$• t W L 3 E, \ of j a Y oii°;» 1 1 Y o g ®N tl z ® o$ .®0 o` mg o? ®" o 3 ©1 o% W.®t 13. d g ®, o ®t,, N A OP a ,11 0 a ,t9 Engineer's Report Palm Court Landscaping and Lighting District APPENDIX B ASSESSMENT ROLL Parcel identification for each lot or parcel within the District, shall be the parcel as shown on the Riverside County Secured Roll for the year in which this Report is prepared and reflective of the Riverside County Assessor's Parcel Maps. A listing of parcels assessed within this District, along with the assessment amounts is included in the following table. Proposed APN Parcel Description Assessment 622-311-027 Tract 25373 Lot 1 258.12 622-311-028 Tract 25373 Lot 2 258.12 622-311-029 Tract 25373 Lot 3 258.12 622-311-030 Tract 25373 Lot 4 258.12 622-311-031 Tract 25373 Lot 5 258.12 622-311-032 Tract 25373 Lot 6 258.12 622-311-033 Tract 25373 Lot 7 258.12 622-311-034 Tract 25373 Lot 8 258.12 622-311-035 Tract 25373 Lot 9 258.12 622-311-036 Tract 25373 Lot 10 258.12 622-311-037 Tract 25373 Lot 11 258.12 622-311-038 Tract 25373 Lot 12 258.12 622-311-039 Tract 25373 Lot 13 258.12 622-311-040 Tract 25373 Lot 14 258.12 622-311-041 Tract 25373 Lot 15 258.12 622-311-042 Tract 25373 Lot 16 258.12 622-311-043 Tract 25373 Lot 17 258.12 622-311-044 Tract 25373 Lot 18 258.12 622-311-045 Tract 25373 Lot 19 258.12 622-311-046 Tract 25373 Lot 20 258.12 Hovley Lane Tract 25373 Lot A 0.00 Palm Court Tract 25373 Lot B 0.00 Easement Tract 25373 Lot C 0.00 Easement Tract 25373 Lot D 0.00 Total Assessment $5,162.40 MuniFinancial CITY OF PALM DESERT ENGINEER'S REPORT THE BOULDERS LANDSCAPING AND LIGHTING DISTRICT FORMATION Fiscal Year 2004/2005 Intent Meeting: Public Hearing: May 13, 2004 July 8, 2004 MuniFinancial Corporate Office Regional Offices 27368 Via Industria Suite 110 Temecula, CA 92590 Tel: (909) 587-3500 Tel: (800) 755-MUNI (6864) Fax: (909) 587-3510 Antelope Valley, CA Phoenix, AZ Los Angeles, CA San Diego, CA Oakland, CA Sacramento, CA Orange County, CA Seattle, WA www.muni.com TABLE OF CONTENTS I. OVERVIEW 1 A. INTRODUCTION 1 B. GENERAL DESCRIPTION OF THE DISTRICT 2 II. PLANS AND SPECIFICATIONS 3 A. DESCRIPTION OF THE DISTRICT 3 B. DISTRICT IMPROVEMENTS AND SERVICES 3 GENERAL PROVISIONS OF THE LAW 3 LOCATION AND EXTENT OF IMPROVEMENTS 4 III. METHOD OF APPORTIONMENT 6 A. IMPROVEMENT BENEFIT FINDINGS 6 GENERAL BENEFITS 6 SPECIAL BENEFITS 7 B. DESCRIPTION OF THE METHOD OF APPORTIONMENT8 EQUIVALENT BENEFIT UNITS: 9 EBU APPLICATION BY LAND USE: 9 C. ASSESSMENT RANGE FORMULA 12 IV. DISTRICT BUDGET 14 A. CALCULATION OF THE MAXIMUM ASSESSMENT 14 B. DISTRICT BUDGET FOR FISCAL YEAR 2004/2005 15 APPENDIX A - DISTRICT ASSESSMENT DIAGRAM 16 APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL 19 ENGINEER'S REPORT AFFIDAVIT Formation of and Establishment of Annual Assessments for the: The Boulders Landscaping and Lighting District City of Palm Desert Riverside County, State of California This Report identifies all the parcels within the District and all relevant zones therein, as they existed at the time of the passage of the Resolution of Intention. Reference is hereby made to the Riverside County Assessor's maps for a detailed description of the lines and dimensions of parcels within the District. The undersigned respectfully submits the enclosed Report as directed by the City Council. Dated this day of , 2004. MuniFinancial Assessment Engineer On Behalf of the City of Palm Desert By: Brian Jewett, Principal Consultant Financial Consulting Services By: Richard Kopecky R. C. E. # .16742 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District I. OVERVIEW A. Introduction The City of Palm Desert ("City") proposes to form The Boulders Landscaping and Lighting District ("District") for Fiscal Year 2004/2005. The City Council on behalf of the City proposes to levy and collect special assessments on the County tax rolls to provide funding for the costs and expenses required for maintenance of the landscaping and lighting improvements associated with the District. Upon successful formation of the District and approval of the assessments, the territory within the District will be concurrently annexed into the existing Palm Desert Consolidated Landscaping and Lighting District ("Consolidated District") as The Boulders sub - zone of Zone 16 (Shepherd Lane). The District will be formed, annexed into the Consolidated District, and levied pursuant to the Landscape and Lighting Act of 1972, Part 2 of Division 15 of the California Streets and Highways Code (the Act), and in compliance with the substantive and procedural requirements of the California Constitution Article XIIID. This Engineer's Report ("Report") describes the District and assessments to be levied against properties within the District commencing with Fiscal Year 2004/2005. The assessments described herein are based on the estimated cost to maintain the improvements that will provide a direct and special benefit to properties within the District. Improvements to be maintained and funded through annual assessments shall be constructed and installed in connection with the development of these properties. The annual costs and assessments described herein include all estimated direct expenditures, incidental expenses, deficits, surpluses, revenues, and reserves associated with the maintenance and servicing of the improvements. The word "parcel," for the purposes of this Report, refers to an individual property assigned its own Assessment Number by the County of Riverside Assessor's Office. The County of Riverside Auditor/Controller uses Assessment Numbers and specific Fund Numbers to identify properties assessed on the tax roll for special district benefit assessments. At a noticed Public Hearing, the City Council will consider all public comments and written protests presented. Upon conclusion of the Public Hearing, the City Council will tabulate property owner protest ballots received to determine whether majority protest exists, and by resolution confirm the results of the protest ballot tabulation. Proceedings for the formation of the assessment district shall be abandoned if majority protest exists. If tabulation of the property owner protest ballots indicates approval of the assessments and the assessment range formula presented, by resolution the City Council will approve the Engineer's Report as submitted or amended (amendments may not increase the assessments approved by the property owners). Following approval of the Report, the City Council will by resolution, order MunxFinancial Page 1 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District the formation of the District, the annexation of the territory into the Consolidated District, and confirm the levy and collection of assessments pursuant to the Act. In such case, the assessments as approved may be submitted to the Riverside County Auditor/Controller to be included on the property tax roll for each parcel for Fiscal Year 2004/2005, or reviewed and confirmed at the annual public hearing for the Consolidated District along with all other assessments within the Consolidated District. B. General. Description of the District The District consists of all lots, parcels and properties within the residential subdivision known as The Boulders within the development area known as Shepherd Lane located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally west of the Monterey Avenue. The improvements and services that provide a special benefit to properties within the District generally include, but are not limited to: • Parkway landscaping on Shepherd Lane adjacent to the residential development installed as part of the development of properties therein; • Perimeter landscaping for the Shepherd Lane residential developments. Tract 30030 is one of several residential subdivisions within the area known as Shepherd Lane, that includes parkway/perimeter landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. These improvements benefit all property development within the Shepherd Lane area and each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Any entryways, open space areas or other landscaped areas associated with the development of properties within the District that will be maintained by the District; • Street lights within and adjacent to the residential subdivision. The estimated annual cost to provide and maintain the improvements associated with the District have been allocated to each property in proportion to special benefits received. The Method of Apportionment described in this Report utilizes commonly accepted assessment engineering practices and has been established pursuant to the 1972 Act and the provisions of Article XIIID of the California Constitution (Proposition 218). MuruFinancial Page 2 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District II. PLANS AND SPECIFICATIONS A. Description of the District The District consists of all lots and parcels within the residential subdivision known as The Boulders (Tract 30030) located on the west side of Shepherd Lane at the intersection of Alpine Lane. This tract is generally located west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive and generally east of the Monterey Avenue. Refer to the Assessment Diagram for details of the District boundary. The proposed District includes all parcels of land that have been approved for residential development within Tract 30030. • Tract No. 30030 (Alpine Lane) — Sixteen (16) single-family residential parcels (lots 1-16) identified on the County Assessor's Map as APN Book 653, Page 76, Parcels 019 through 034. This tract includes two landscape easements identified as the parkway landscaping on the west side of Shepherd Lane adjacent to the tract north and south of Alpine Lane. The parcels to be assessed receive special benefit from the installation and maintenance of street lighting and parkway landscaping adjacent to the development and perimeter landscaping associated with the development of all properties within the Shepherd Lane area. The improvements to be funded through District assessments have either been installed as a condition of the development of the original undeveloped properties within the District or have been installed as part of the overall development of properties within the area known as Shepherd Lane. The District is being formed to ensure and preserve the on going maintenance and operation of these improvements and it has been determined that each parcel within the District receives similar and proportional benefit from the collective improvements installed as part of the property development. The specific location, description and benefits of the improvements are discussed in the following sections. B. District Improvements and Services GENERAL PROVISIONS OF THE LAW As generally defined by the 1972 Act and applicable to this District, improvements and the associated assessments may include one or any combination of the following: 1) The installation or planting of landscaping; 2) The installation or construction of statuary, fountains, and other ornamental structures and facilities; 3) The installation or construction of any facilities which are appurtenant to any of the foregoing or which are necessary or convenient for the maintenance or servicing thereof; MuntFinandal Page 3 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District 4) The maintenance or servicing, or both, of any of the foregoing including the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including, but not limited to: a) Repair, removal, or replacement of all or any part of any improvements; b) Grading, clearing, removal of debris, the installation or construction of curbs, gutters, walls, sidewalks, or paving, or water, irrigation, drainage, or electrical facilities; c) Providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; d) The removal of trimmings, rubbish, debris, and other solid waste; e) The cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti; f) Electric current or energy, gas, or other agent for the lighting or operation of any other improvements; and, g) Water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. 5) Incidental expenses associated with the improvements including, but not limited to: a) The cost of preparation of the report, including plans, specifications, estimates, diagram, and assessment; b) The costs of printing, advertising, and the publishing, posting and mailing of notices; c) Compensation payable to the County for collection of assessments; d) Compensation of any engineer or attorney employed to render services; e) Any other expenses incidental to the construction, installation, or maintenance and servicing of the improvements; and, f) Costs associated with any elections held for the approval of a new or increased assessment. LOCATION AND EXTENT OF IMPROVEMENTS The purpose of the District is to ensure the ongoing maintenance, operation and servicing of local landscape and street lighting improvements installed as a result of property development in the Shepherd Lane area. These improvements may include, but are not limited to all streetlight facilities as well as landscaping material and facilities associated with properties in the District including ground cover, shrubs, trees and plants; irrigation and drainage systems; ornamental lighting structures, Mural inancial Page 4 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District masonry walls or other fencing, entryway monument, and associated appurtenant facilities located within the: • Parkway landscaping along Shepherd Lane adjacent to the residential subdivision. Specifically for this District, this landscaped areas includes the parkway area on the west side of Shepherd Lane which extends the length of Tract 30030; • Perimeter/parkway landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. Although these perimeter/parkway-landscaping areas may not have been installed directly as a condition of this residential subdivision, this landscaping is an integral part of the overall development of properties within the Shepherd Lane area and directly benefits all property development within the area. Therefore, each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Streetlights within the residential subdivision and/or adjacent to the subdivision on Alpine Lane, Shepherd Lane and the west side of Portola Avenue installed as part of the residential subdivision; and, • Any extension or expansion of the proposed landscaped areas within or adjacent to the subdivision that may be installed as part of the development of properties within the District and will be maintained by the District. These improvements may include, but are not limited to open space areas, monuments or other landscaped easements. MunrFinanciad Page 5 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District III. METHOD OF APPORTIONMENT Pursuant to the 1972 Act the costs (assessments) of the District are apportioned by a formula or method that fairly distributes the net amount to be assessed among all parcels in proportion to benefits received from the improvements. Furthermore, the provisions of Article XIIID of the California Constitution (Proposition 218) require the agency to separate the general benefit from special benefit, whereas only special benefits may be assessed. A. Improvement Benefit Findings The annual assessments outlined in the budget section of this Report are proposed to cover the estimated costs to provide the necessary services, operation, administration, and maintenance required each year to maintain street lighting facilities associated with the District and keep the landscaping improvements in a healthy, vigorous, and satisfactory condition. It has been determined that each assessable parcel within the District receives similar and proportional special benefits from the improvements. The fact that improvements are part of the specific property development plans and requirements for development of properties within the District, and each parcel's close and relatively similar proximity to the improvements makes each parcel's special benefit from the improvements similar and proportionate. All the lots and parcels that receive special benefit from the improvements are included within the District. GENERAL BENEFITS The improvements to be provided and maintained by the District are a direct result of property development within the District and the Shepherd Lane area and these improvements would otherwise not be required or necessary. Developers typically install local improvements or develop in areas where landscape improvements exist to enhance the marketability and value of properties within their development and/or as conditions of development. In any case, local landscape and lighting improvements associated with the development clearly benefit the properties being developed. If new improvements are installed as part of the development, they are installed either to enhance the property being developed or as a condition of development and not for the benefit of surrounding properties outside the District. Although local development improvements (by virtue of their location) may be visible to surrounding properties, any benefit to surrounding properties is incidental and cannot be considered a direct and special benefit. Furthermore, most developments within the City typically have various landscaping and lighting improvements specifically associated with their development and these improvements are funded by properties within those developments. Therefore, it has been determined that the improvements associated with this District and the ongoing operation and maintenance of those improvements provide no identifiable MunlFinancial Page 6 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District or measurable general benefit to properties outside the Shepherd Lane area or to the public at large. SPECIAL BENEFITS All the improvements funded through the District provide a special aesthetic appeal to each property and enhance the quality of life for property owners within the District as well as the marketability of those properties. All landscaping and lighting improvements associated with the District are part of the overall development plan for properties within the District and the Shepherd Lane area and specifically installed for the benefit and development of those properties. The special benefits associated with parkway, perimeter, entryway, and other property -specific landscaped areas and associated amenities are specifically: 1. Enhanced desirability of properties through association with the improvements. 2. Improved aesthetic appeal of properties within the District providing a positive representation of the development and properties within the development. 3. Enhanced adaptation of the urban environment within the natural environment from adequate green space and landscaping. 4. Environmental enhancement through improved erosion resistance, dust and debris control and reduced noise and air pollution. 5 . Increased sense of pride in ownership of property within the District resulting from well -maintained improvements associated with the properties. 6. Reduced vandalism and criminal activity resulting from well -maintained surroundings and amenities. 7. The special enhancements of the perceived value of property that results from the above benefits. The special benefits of street lighting are the convenience, safety, and security of property, improvements, and goods. Specifically: 1. Enhanced deterrence of crime and the aid to police protection. 2. Increased nighttime safety on streets through enhanced visibility. 3. Improved sense of security and safety for pedestrians, motorists and property owners. 4. Improved ingress and egress to property. 5. Reduced vandalism, other criminal acts and damage to improvements or property. 6. Reduced personal property loss. MuniFinancial Page 7 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District 7. The special enhancements of the perceived value of property that results from the above benefits B. Description of the Method of Apportionment The assessments outlined in this section represent the proportionate special benefit to each property within the District and the basis of calculating each parcel's proportionate share of the annual costs associated with the District improvements. The costs associated with the maintenance and operation of all District improvements shall be collected through annual assessments from each parcel receiving special benefit. The funds collected shall be dispersed and used for only the services and operation provided to the District. The method of apportionment for the District calculates the receipt of special benefit from the respective improvements based on the actual or proposed land use of the parcels within the District. The special benefit received by each lot or parcel is equated to the overall land use of the parcel based on the parcel's actual land use or proposed planned development, and is reliant upon the special benefit received from the improvements planned within the District. To identify and determine the special benefit to be received by each parcel and their proportionate share of the improvements it is necessary to consider the entire scope of the planned improvements within the Shepherd Lane area as well as individual property development within the District. Upon review of the proposed improvements it has been determined that each parcel within the proposed District benefits from the landscaping and lighting improvements installed as a condition of property development as well as perimeter landscaping associated with similar developments in the Shepherd Lane area. Based on these improvements and the planned property development within the proposed District, a maximum assessment can be established. All costs associated with the improvements shall be fairly distributed among the parcels based upon the special benefit received by each parcel. Additionally, in compliance with Article XIIID, Section 4, of the State Constitution each parcel's assessment may not exceed the reasonable cost of the proportional special benefit conferred to that parcel. The benefit formula used to determine the assessment obligation is therefore based upon both the improvements that benefit the parcels within the District as well as the proposed land use of each property as compared to other parcels that benefit from those specific improvements. Mu (Financial Page 8 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District EQUIVALENT BENEFIT UNITS: The Equivalent Benefit Unit (EBU) method of apportioning benefit is typically seen as the most appropriate and equitable assessment methodology for districts formed under the 1972 Act, as the benefit to each parcel from the improvements are apportioned as a function of land use type and development or development potential. To assess benefits equitably, it is necessary to relate the different type of properties within the District to the improvements and to each other. The Equivalent Benefit Unit method of assessment apportionment utilizes the single-family home site as the basic unit of assessment. A single-family home site equals one Equivalent Benefit Unit (EBU). Every other land use within the District is converted to EBU's based on an assessment formula that equates the property's specific development status, type of development (land use), and size or development plans for the property, as compared to a single-family home site. Although this particular District (The Boulders subdivision) will be comprised of only subdivided residential lots, it is anticipated that this subdivision will eventually be one of several subdivisions and developments that will be included in Zone 16 (Shepherd Lane) of the Palm Desert Consolidated District. Therefore, the following provides an overview of the EBU's applied to various other land use classifications within the Consolidated District. EBU APPLICATION BY LAND USE: Single Family Residential — This land use is defined as a fully subdivided residential home site with or without a structure. This land use is assessed 1.00 EBU per lot or parcel. This is the base value that all other land use types are compared and weighted against (i.e. Equivalent Benefit Unit). Multifamily Residential — This land use is defined as a fully subdivided residential parcel that has more than one residential unit developed on the property. Engineering studies have consistently shown that apartment and other multiple- family dwelling units generate lower traffic volumes, water consumption, and typically impact public infrastructure between 60 to 80 percent as much as a single- family residence largely due to lower occupancy of apartment dwelling units versus single family residential units. Therefore, assessments for the multiple residential units shall be prorated with a value of 0.70 EBU per unit. Condominiums — This land use includes residential developments designated as condominiums by the City and may include one to four residential units per parcel. Engineering studies have shown that on average, condominiums generate lower traffic volumes, water consumption, and typically impact public infrastructure less than a detached single-family residence, but more than apartments or other multifamily dwelling units. Therefore, assessments for condominiums shall be prorated with a value of 0.80 EBU per unit. Munrfinancial Page 9 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District Approved -Residential Development — This land use is defined as any property not fully subdivided, but for which a Final Tract Map has been approved with a specific number of residential lots to be developed on the parcel. This land use type is assessed at 1.00 EBU per planned residential lot. (If the parcel is actually subdivided at the time annual assessments are submitted to the County for Collection, the resulting parcels shall be assessed based on their resulting development status change). Proposed -Residential Development — This land use is defined as any property not fully subdivided and for which a Tentative Tract Map has been submitted or approved with a specific number of proposed residential lots, but a Final Tract Map has not been approved. This land use type is assessed at 0.75 EBU per proposed residential lot. (If the parcel is actually subdivided or a Final Tract Map is approved prior to the annual assessments being submitted to the County for Collection, the resulting land use change or new parcels shall be assessed based on their resulting development status change). Vacant Undeveloped Property — This land use is defined as any property identified as vacant land that is currently undeveloped with no specific development plans, but may be developed or subdivided in the future (No tract map or development plan has been submitted and/or approved). This land use is assessed at 1.00 EBU per parcel. Developed Non -Residential — This land use is defined as property that is developed, but not as residential property as defined by the previous land use designations. The average residential density within the City is approximately six (6) residential units per acre. Therefore, the proportionate benefit assigned to Developed Non -Residential properties shall be 6.00 EBU per gross acre. Parcels designated as Developed Non -Residential are assigned a minimum of 1.00 EBU. Exempt Parcels — This land use identifies properties that are not assessed within the District. This land use classification may include but is not limited to lots or parcels that will not be developed such as sliver parcels, dedicated easements, open space areas, dedicated landscaped areas or common areas. Similarly, properties not designated by a County Assessor's Parcel Number (APN) such as streets, utility easements or rights -of -way receive no special benefit and are considered Exempt. These Exempt properties are not assessed for District improvements. If the County designates an Exempt property by an APN, that parcel shall be assigned 0.00 EBU. Properties that are identified as non-taxable by the County Assessor's Office such as government owned or utility owned properties are not exempt from District assessments unless: the property has limited or restricted development potential; the property clearly receives no benefit from the improvements; or the property provides additional or substantially similar improvements (such is the case with public schools, parks and open space areas). Munifinancial Page 10 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District The following table provides a listing by land use type, the Equivalent Benefit Unit factor applied to that land use type and the multiplying factor used to calculate each parcel's individual EBU as outlined in the preceding description. Land Use Designations and Equivalent Benefit Units Equivalent Benefit Unit Property Type Multiplier Single Family Residential 1.000 Unit/Lot/Parcel Multifamily Residential 0.700 Unit Condominiums 0.800 Unit Approved -Residential Development 1.000 Unit/Lots Proposed -Residential Development 0.750 Unit/Lots Vacant Undeveloped Property 1.000 Parcel Developed Non -Residential 6.000 Acreage Exempt 0.000 Parcel The benefit formula applied to various parcels is based on the preceding Equivalent Benefit Unit (EBU) discussion and table. Each parcel's EBU correlates the parcel's special benefit received as compared to all other parcels benefiting from the improvements. The following formula is used to calculate each parcel's EBU (proportional benefit). Parcel Type EBU x Acres/Lots/Units = Parcel EBU The total number of Equivalent Benefit Units (EBU's) is the sum of all individual EBU's applied to parcels that receive a special benefit the improvement. An assessment amount per EBU (Rate) for the District improvements is established annually by taking the total cost of the improvement and dividing that amount by the total number of EBU's of all benefiting parcels. This Rate is then applied back to each parcel's individual EBU to determine the parcel's proportionate benefit and assessment obligation. Total Balance to Levy / Total EBU = Levy per EBU Levy per EBU x Parcel EBU = Parcel Levy Amount Mun'Financial Page 11 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District C. Assessment Range Formula Any new or increase in assessments require certain noticing and meeting requirements by law. Prior to the passage of Proposition 218, legislative changes in the Brown Act defined the definition of "new or increased assessment" to exclude certain conditions. These conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition and conditions were later confirmed through SB919 (Proposition 218 implementing legislation). The purpose of establishing an assessment range formula is to provide for reasonable increases and inflationary adjustments to annual assessments without requiring costly noticing and mailing procedures, which could add to the District costs and assessments. As part of the District formation, balloting of property owners is required, pursuant to Proposition 218. The ballots presented to the property owners in connection with this Report includes an Assessment Rate to be approved, as well as the approval of an assessment range formula. The assessment range formula shall be applied to all future assessments within the District. Generally, if the proposed annual assessment (levy per unit or rate) for the current fiscal year is less than or equal to the "Maximum Assessment" (or "Adjusted Maximum Assessment"), then the proposed annual assessment is not considered an increased assessment. The Maximum Assessment is equal to the initial Assessment approved by property owners adjusted annually by the following criteria: 1. Beginning in the second fiscal year, (Fiscal Year 2005/2006) and each fiscal year thereafter, the Maximum Assessment will be recalculated annually; and, 2. The new adjusted Maximum Assessment for the year represents the prior year's Maximum Assessment adjusted by three percent (3.0%). The Maximum Assessment is adjusted annually and is calculated independent of the District's annual budget and proposed annual assessment. Any proposed annual assessment (rate per levy unit) less than or equal to this Maximum Assessment is not considered an increased assessment, even if the proposed assessment is significantly greater than the assessment applied in the prior fiscal year. The Maximum Assessment will be recalculated and adjusted annually. However, the City Council may reduce or freeze the Maximum Assessment at any time by amending the Engineer's Annual Report. Although the Maximum Assessment will normally increase each year, the actual District assessments may fluctuate or remain virtually unchanged. The Maximum Assessment adjustment is designed to establish a reasonable limit on District assessments. The Maximum Assessment calculated each year does not require or facilitate an increase to the annual assessment and neither does it restrict assessments to the adjustment maximum amount. If the budget and assessments for the fiscal MuniFinancial Page 12 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District year does not require an increase, or the increase is less than the adjusted Maximum Assessment, then the required budget and assessment may be applied without additional property owner balloting. If the budget and assessments calculated requires an increase greater than the adjusted Maximum Assessment then the assessment is considered an increased assessment. To impose an increased assessment the City Council must comply with the provisions of Proposition 218 (Article XIIID Section 4c of the California Constitution), which requires a public hearing and certain protest procedures including mailed notice of the public hearing and property owner protest balloting. Property owners through the balloting process must approve the proposed assessment increase. If the new proposed assessment is approved, then a new Maximum Assessment is established for the District. If the proposed assessment is not approved, the City Council may not levy an assessment greater than the adjusted Maximum Assessment previously established for the District. Muninancial Page 13 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District IV. DISTRICT BUDGET A. Calculation of the Maximum Assessment The Maximum Assessment Rate per EBU presented to the property owners for approval is based on the estimated expenses and benefit units planned for the District (The Boulders) at build out. The following budget reflects these assumptions: DIRECT COSTS Maintenance Costs $1,728 $0 $1,728 Landscape Utilities 540 0 540 Landscape Extras (Repairs/Materials/Equipment) 770 0 770 Tree Pruning 450 0 450 Street Lighting 150 0 150 Special District Services 0 0 0 Annual Direct Costs ('Subtotal) $3,638 0 $3,638 Renovation/Capital Improvement Expenditures 0 0 0 Total Direct Costs ADMINISTRATION COSTS District Administration 948 0 948 County Administration Fee 25 0 25 County Per Parcel Fee 3 0 3 Administration Costs (Subtotal) $976 0 $976 LEVY BREAKDOWN Total Direct and Admin. Costs 4,614 0 4,614 Reserve Collection/ (Transfers) 461 0 461 Other Revenues/General Fund Contribution 0 0 0 Capital Improvement Project Collection/ (Transfers) 0 0 0 Balance to Levy $5,075 0 $5,075 DISTRICT STATISTICS Total Parcels 16 Total Parcels Levied 16 Total Equivalent Dwelling Units 16.00 Levy per EDU $317.22 RESERVE INFORMATION Beginning Reserve Balance 0 Reserve Account Activity 461 Anticipated Reserve Balance 461 ASSESSMENT INFORMATION Maximum Assessment Rate FY 2004/05 $317.22 CPI Applied : 0.00% ZONE 16 THE BOULDERS Total General Special Budget Benefit Benefit $3,638 0 $3,638 MuurFjnancial Page 14 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District B. District Budget For Fiscal Year 2004/2005 Upon the successful formation of the proposed Boulders Landscaping and Lighting District, the District and parcels therein will be concurrently annexed into the Palm Desert Consolidated District as part of Zone 16 (Shepherd Lane) for Fiscal Year 2004/2005. The actual budget and assessment rate to be applied for Fiscal Year 2004/2005 (first levy of assessments) will be reviewed and adopted by the City Council as part of the annual levy process for the Consolidated District for Fiscal Year 2004/2005. Although it is anticipated that the proposed expenses (budget) and proposed assessment rate per Equivalent Benefit Unit (EBU) outlined in the preceding table (Calculation of the Maximum Assessment) will be applied for Fiscal Year 2004/2005, the assessment rate approved and adopted by the City Council may be less than the maximum rate outlined in this report. MurztF'inancial Page 15 Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District APPENDIX A,- DISTRICT ASSESSMENT DIAGRAM The District consists of all lots and parcels within The Boulders subdivision Tract 30030 located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally east of the Monterey Avenue. The tract map and Assessor's Parcel Map shown on the following pages identify the parcels within The Boulders Landscaping and Lighting District, as they existed on the County Assessor's Roll when this Report was prepared and the Resolution of Intention was adopted. The District is inclusive of Assessor's Parcel Map — Book 653, Page 76, Parcels 019 through 034. The parcels identified on the Assessor's Parcel Map and the Tract Map contained herein define the boundaries and constitute the Assessment Diagram for the District and by reference includes all subsequent parcels and Assessor's Parcel Maps and parcel numbers related thereto. MuniFinancial Page 16 11 i i V 1 0 R V b Qx IOfI SHEPHERD mN � if" i`_i� �19�01dg1� O LANE AVENUE i 1 Z 1 TR. NO. i 68- q svaxss taw 0 ES pa mtr WNW CIONWWW WNW) RS 98/60 M.B. 280/50- 33 s. +osarnv soa� sifter NW a Engineer's Report Fiscal Year 2004/2005 The Boulders Landscaping and Lighting District APPENDIX B 2004/2005 PROPOSED ASSESSMENT ROLL Parcel identification for each lot or parcel within the District, shall be the parcel as shown on the Riverside County Secured Roll for the year in which this Report is prepared and reflective of the Assessor's Parcel Map(s). As of the resolution of Intention, The Boulders Landscaping and Lighting District is inclusive of Assessor's Parcel Numbers (APN's) identified on the Assessor's Parcel Maps - Book 653, Page 76, and Parcels 019 through 034. A listing of parcels assessed within this District identifying the proposed Maximum Assessment Amount for the first fiscal year is included in the following listing. APN 653-760-019 653-760-020 653-760-021 653-760-022 653-760-023 653-760-024 653-760-025 653-760-026 653-760-027 653-760-028 653-760-029 653-760-030 653-760-031 653-760-032 653-760-033 653-770-034 Land Use Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Single Family Residential Tract TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 TR# 30030 Proposed Maximum EBU at Levy Lot Build Out Balloted 1 1.00 $317.22 2 1.00 $317.22 3 1.00 $317.22 4 1.00 $317.22 5 1.00 $317.22 6 1.00 $317.22 7 1.00 $317.22 8 1.00 $317.22 9 1.00 $317.22 10 1.00 $317.22 11 1.00 $317.22 12 1.00 $317.22 13 1.00 $317.22 14 1.00 $317.22 15 1.00 $317.22 16 1.00 $317.22 16.00 $5,075.52 MunrFinancial Page 19 CITY OF PALM DESERT ENGINEER'S REPORT COLLEGE VIEW ESTATES II / SHEPHERD LANE LANDSCAPING AND LIGHTING DISTRICT FORMATION Fiscal Year 2004/2005 Intent Meeting: Public Hearing: May 13, 2004 July 8, 2004 `''�` MuniFinancial Corporate Regional Offices 27368 Via Industria Suite 110 Temecula, CA 92590 Tel: (909) 587-3500 Tel: (800) 755-MUNI (6864) Fax: (909) 587-3510 Antelope Valley, CA Phoenix, AZ Los Angeles, CA San Diego, CA Oakland, CA Sacramento, CA Orange County, CA Seattle, WA www.muni.com ENGINEER'S REPORT AFFIDAVIT Formation of and Establishment of Annual Assessments for the: College View Estates II/Shepherd Lane Landscaping and Lighting District City of Palm Desert Riverside County, State of California This Report identifies all the parcels within the District and all relevant zones therein, as they existed at the time of the passage of the Resolution of Intention. Reference is hereby made to the Riverside County Assessor's maps for a detailed description of the lines and dimensions of parcels within the District. The undersigned respectfully submits the enclosed Report as directed by the City Council. Dated this day of , 2004. MuniFinancial Assessment Engineer On Behalf of the City of Palm Desert By: Brian Jewett, Principal Consultant Financial Consulting Services By. Richard Kopecky R.C.E.# 16742 TABLE OF CONTENTS I. OVERVIEW 1 A. INTRODUCTION 1 B. GENERAL DESCRIPTION OF THE DISTRICT 2 II. PLANS AND SPECIFICATIONS 3 A. DESCRIPTION OF THE DISTRICT 3 B. DISTRICT IMPROVEMENTS AND SERVICES 3 GENERAL PROVISIONS OF THE LAW 3 LOCATION AND EXTENT OF IMPROVEMENTS 5 III. METHOD OF APPORTIONMENT 6 A. IMPROVEMENT BENEFIT FINDINGS 6 GENERAL BENEFITS 6 SPECIAL BENEFITS 6 B. DESCRIPTION OF THE METHOD OF APPORTIONMENT7 EQUIVALENT BENEFIT UNITS: 9 EBU APPLICATION BY LAND USE: 9 C. ASSESSMENT RANGE FORMULA 12 IV. DISTRICT BUDGET 14 A. CALCULATION OF THE MAXIMUM ASSESSMENT ERROR! BOOKMARK NOT DEFINED. B. DISTRICT BUDGET FOR FISCAL YEAR 2004/2005 14 APPENDIX A - DISTRICT ASSESSMENT DIAGRAM 15 APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL 18 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District I. OVERVIEW A. Introduction The City of Palm Desert ("City") proposes to form the College View Estates II/Shepherd Lane Landscaping and Lighting District ("District") for fiscal year 2004/2005. The City Council on behalf of the City proposes to levy and collect special assessments on the County tax rolls to provide funding for the costs and expenses required for maintenance of the landscaping improvements within the District. Upon successful formation of the District and approval of the assessments, the territory within the District will be concurrently annexed into the existing Palm Desert Consolidated Landscaping and Lighting District ("Consolidated District") as the College View Estates II sub -zone of Zone 16 (Shepherd Lane). The District will be formed, annexed into the Consolidated District, and levied pursuant to the Landscape and Lighting Act of 1972, Part 2 of Dizision 15 of the California Streets and Higbwi s Cade (the Act), and in compliance with the substantive and procedural requirements of the California Constitution Article XIIID. This Engineer's Report ("Report") describes the District and assessments to be levied against properties within the District commencing with fiscal year 2004/2005. The assessments described herein are based on the estimated cost to maintain the improvements that will provide a direct and special benefit to properties within the District. Improvements to be maintained and funded through annual assessments shall be constructed and installed in connection with the development of these properties. The annual costs and assessments described herein include all estimated direct expenditures, incidental expenses, deficits, surpluses, revenues, and reserves associated with the maintenance and servicing of the improvements. The word "parcel," for the purposes of this Report, refers to an individual property assigned its own Assessment Number by the County of Riverside Assessor's Office. The County of Riverside Auditor/Controller uses Assessment Numbers and specific Fund Numbers to identify properties assessed on the tax roll for special district benefit assessments. At a noticed Public Hearing, the City Council will consider all public comments and written protests presented. Upon conclusion of the Public Hearing, the City Council will tabulate property owner protest ballots received to determine whether majority protest exists, and by resolution confirm the results of the protest ballot tabulation. Proceedings for the formation of the assessment district shall be abandoned if majority protest exists. If tabulation of the property owner protest ballots indicates approval of the assessments and the assessment range formula presented, by resolution the City Council will approve the Engineer's Report as submitted or amended (amendments may not increase the assessments approved by the property owners). Following approval of the Report, the City Council will by resolution, order the formation of the District, the annexation of the territory into the Consolidated MuniFinanaal Pam 1 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District District, and confirm the levy and collection of assessments pursuant to the Act. In such case, the assessments as approved may be submitted to the Riverside County Auditor/Controller to be included on the property tax roll for each parcel for fiscal year 2004/2005, or reviewed and confirmed at the annual public hearing for the Consolidated District along with all other assessments within the Consolidated District. B. General Description of the District The District consists of all lots, parcels and properties within the residential subdivision known as College View Estates II within the development area known as Shepherd Lane located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally west of the Monterey Avenue. The improvements and services that provide a special benefit to properties within the District generally include, but are not limited to: • Parkway/perimeter landscaping on both sides of Shepherd Lane and the west side of Portola Avenue adjacent to the residential subdivision, installed as part of the development of properties therein; • Any entryways, open space areas or other landscaped areas associated with the development of properties within the District that will be maintained by the District; • Street lights within and adjacent to the residential subdivision. The estimated annual cost to provide and maintain the improvements within the District have been allocated to each property in proportion to special benefits received. The Method of Apportionment described in this Report utilizes commonly accepted assessment engineering practices and has been established pursuant to the 1972 Act and the provisions of Article XIIID of the California Constitution (Proposition 218). MuniFinanrial Page 2 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District II. PLANS AND SPECIFICATIONS A. Description of the District The District consists of all lots and parcels within the residential subdivision known as College View Estates II (Tract 30087) located at Shepherd Lane and the future Scholar Lane. This tract is located west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive and generally east of the Monterey Avenue. Refer to the Assessment Diagram for details of the District boundary. The proposed District includes all parcels of land that have been approved or planned for residential development within Tract 30087. • Tract No. 30087 (lots 9-24) — Sixteen (16) planned single-family residential lots on the west side of Shepherd Lane at the future Scholar Lane, (Currently identified on the County roll as APN Book 653, Page 370, Assessor's Parcel Numbers 653-781-001 through 653-781-016). • Tract No. 30087 (lots 1-8 & 25-32) — Sixteen (16) planned single-family residential lots on the east side of Shepherd Lane at the future Scholar Lane; (Currently identified on the County roll as APN Book 653, Page 370, Assessor's Parcel Number 653-780-001 through 023). The parcels to be assessed receive special benefit from the installation and maintenance of street lighting and parkway/perimeter landscaping adjacent to and associated with the development of properties within the District. The improvements to be maintained by the District have been installed as a condition of the development of the original undeveloped properties within the District. The District is being formed to ensure and preserve the on going maintenance and operation of these improvements and it has been determined that each parcel within the District receives similar and proportional benefit from the collective improvements installed as part of the property development. The specific location, description and benefits of the improvements are discussed in the following sections. B. District Improvements and Services GENERAL PROVISIONS OF THE LAW As generally defined by the 1972 Act and applicable to this District, improvements and the associated assessments may include one or any combination of the following: 1) The installation or planting of landscaping; 2) The installation or construction of statuary, fountains, and other ornamental structures and facilities; MuniFinancial Page 3 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District 3) The installation or construction of any facilities which are appurtenant to any of the foregoing or which are necessary or convenient for the maintenance or servicing thereof; 4) The maintenance or servicing, or both, of any of the foregoing including the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including, but not limited to: a) Repair, removal, or replacement of all or any part of any improvements; b) Grading, clearing, removal of debris, the installation or construction of curbs, gutters, walls, sidewalks, or paving, or water, irrigation, drainage, or electrical facilities; c) Providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; d) The removal of trimmings, rubbish, debris, and other solid waste; e) The cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti; f) Electric current or energy, gas, or other agent for the lighting or operation of any other improvements; and, g) Water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. 5) Incidental expenses associated with the improvements including, but not limited to: a) The cost of preparation of the report, including plans, specifications, estimates, diagram, and assessment; b) The costs of printing, advertising, and the publishing, posting and mailing of notices; c) Compensation payable to the County for collection of assessments; d) Compensation of any engineer or attorney employed to render services; e) Any other expenses incidental to the construction, installation, or maintenance and servicing of the improvements; and, f) Costs associated with any elections held for the approval of a new or increased assessment. MuniFinancial Page 4 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District LOCATION AND EXTENT OF IMPROVEMENTS The purpose of the District is to ensure the ongoing maintenance, operation and servicing of local landscape and street lighting improvements installed as a result of property development. These improvements may include but are not limited to all streetlight facilities as well as landscaping material and facilities within the District including ground cover, shrubs, trees and plants; irrigation and drainage systems; ornamental. lighting structures, masonry walls or other fencing, entryway monument, and associated appurtenant facilities located within the: • Parkway/Perimeter landscaping along the west side of Portola Avenue adjacent to the residential subdivision (generally between Frank Sinatra Dive and Gerald Ford Drive); • Parkway landscaping along both sides of Shepherd Lane adjacent to the residential subdivision (generally between Frank Sinatra Dive and Gerald Ford Drive); • Streetlights within the residential subdivision and/or adjacent to the subdivision on both the east and west sides of Shepherd Lane and the west side of Portola Avenue installed as part of the residential subdivision; and, • Any extension or expansion of the proposed landscaped areas within or adjacent to the subdivision that may be installed as part of the development of properties within the District and will be maintained by the District. These improvements may include, but are not limited to open space areas, monuments or other landscaped easements. MuniFinancal Page 5 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District III. METHOD OF APPORTIONMENT Pursuant to the 1972 Act the costs (assessments) of the District are apportioned by a formula or method than fairly distributes the net amount to be assessed among all parcels in proportion to benefits received from the improvements. Furthermore, the provisions of Article XIIID of the California Constitution (Proposition 218) require the agency to separate the general benefit from special benefit, whereas only special benefits may be assessed. A. Improvement Benefit Findings The annual assessments outlined in the Budget section of this Report are proposed to cover the estimated costs to provide the necessary services, operation, administration, and maintenance required each year to maintain street lighting facilities associated with the District and keep the landscaping improvements in a healthy, vigorous, and satisfactory condition. It has been determined that each assessable parcel within the District receives similar and proportional special benefits from the improvements. The fact that improvements are part of the specific property development plans and requirements for development of properties within the District, and each parcel's close and relatively similar proximity to the improvements makes each parcel's special benefit from the improvements similar and proportionate. All the lots and parcels that receive special benefit from the improvements are included within the District. GENERAL BENEFITS The improvements to be provided and maintained by the District are a direct result of property development within the District and would otherwise not be required or necessary. Developers typically install local improvements to enhance the marketability and value of properties within the development and/or as conditions of development. In either case, the improvements are clearly installed for the benefit of the properties being developed and not for the benefit of surrounding properties outside the District boundaries. Although local development improvements (by virtue of their location) may be visible to surrounding properties, any benefit to surrounding properties is incidental and cannot be considered a direct and special benefit. Furthermore, most developments within the City typically have various landscaping and lighting improvements specifically associated with their development and these improvements are funded by properties within those developments. Therefore, it has been determined that the District improvements and the ongoing operation and maintenance of those improvements provide no identifiable or measurable general benefit to properties outside the District or to the public at large. SPECIAL BENEFITS MuniFinancial Page 6 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District All the improvements funded through the District provide a special aesthetic value to each property and enhance the quality of life for property owners within the District as well as the marketability of those properties. All landscaping and lighting improvements associated with the District are part of the overall development plan for properties within the District and specifically installed for the benefit and development of those properties. The special benefits associated with parkway, perimeter, entryway, and other property -specific landscaped areas and associated amenities are specifically: 1. Enhanced desirability of properties through association with the improvements. 2. Improved aesthetic appeal of properties within the District providing a positive representation of the development and properties within the development. 3. Enhanced adaptation of the urban environment within the natural environment from adequate green space and landscaping. 4. Environmental enhancement through improved erosion resistance, dust and debris control and reduced noise and air pollution. 5. Increased sense of pride in ownership of property within the District resulting from well -maintained improvements associated with the properties. 6. Reduced vandalism and criminal activity resulting from well -maintained surroundings and amenities. 7. The special enhancements of the perceived value of property that results from the above benefits. The special benefits of street lighting are the convenience, safety, and security of property, improvements, and goods. Specifically: 1. Enhanced deterrence of crime and the aid to police protection. 2. Increased nighttime safety on streets through enhanced visibility. 3. Improved sense of security and safety for pedestrians, motorists and property owners. 4. Improved ingress and egress to property. 5. Reduced vandalism, other criminal acts and damage to improvements or property. 6. Reduced personal property loss. 7. The special enhancements of the perceived value of property that results from the above benefits B. Description of the Method of Apportionment MuniFinanaal Page 7 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District The assessments outlined in this section represent the proportionate special benefit to each property within the District and the basis of calculating each parcel's proportionate share of the annual costs associated with the District improvements. The costs associated with the maintenance and operation of all District improvements shall be collected through annual assessments from each parcel receiving special benefit. The funds collected shall be dispersed and used for only the services and operation provided to the District. The method of apportionment for the District calculates the receipt of special benefit from the respective improvements based on the actual or proposed land use of the parcels within the District. The special benefit received by each lot or parcel is equated to the overall land use of the parcel based on the parcel's actual land use or proposed planned development, and is reliant upon the special benefit received from the improvements planned within the District. To identify and determine the special benefit to be received by each parcel and their proportionate share of the improvements it is necessary to consider the entire scope of the planned improvements as well as individual property development within the District. Upon review of the proposed improvements it has been determined that each parcel benefits from all the improvements and based on the planned property development a maximum assessment can be established. All costs associated with the improvements shall be fairly distributed among the parcels based upon the special benefit received by each parcel. Additionally, in compliance with Article XIIID, Section 4, of the State Constitution each parcel's assessment may not exceed the reasonable cost of the proportional special benefit conferred to that parcel. The benefit formula used to determine the assessment obligation is therefore based upon both the improvements that benefit the parcels within the District as well as the proposed land use of each property as compared to other parcels that benefit from those specific improvements. In order to establish a reasonable, fair and consistent method of apportioning benefit to each parcel within the District, both the initial and future improvements have been considered. It has been determined that all parcels within the District (including existing residential lots, approved residential lots and vacant land with potential residential or commercial development) receive proportional special benefit from the approved and future improvements associated with the District. Therefore, the following benefit nexus and method of calculation shall be applied each fiscal year to apportion each parcel's proportional special benefit and distribution of the District's costs and expenses based on the land use (development status) of each respective parcel. MuniFinancial Page 8 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District EQUIVALENT BENEFIT UNITS: The Equivalent Benefit Unit (EBU) method of apportioning benefit is typically seen as the most appropriate and equitable assessment methodology for districts formed under the 1972 Act, as the benefit to each parcel from the improvements are apportioned as a function of land use type and development or development potential. To assess benefits equitably, it is necessary to relate the different type of properties within the District to the improvements and to each other. The Equivalent Benefit Unit method of assessment apportionment utilizes the single-family home site as the basic unit of assessment. A single-family home site equals one Equivalent Benefit Unit (EBU). Every other land use within the District is converted to EBU's based on an assessment formula that equates the property's specific development status, type of development (land use), and size or development plans for the property, as compared to a single-family home site. Although this particular District (College View Estates II subdivision) will be comprised of only subdivided residential lots, it is anticipated that this subdivision will eventually be one of several subdivisions and developments that will be included in Zone 16 (Shepherd Lane) of the Palm Desert Consolidated District. Therefore, the following provides an overview of the EBU's applied to various other land use classifications within the Consolidated District. EBU APPLICATION BY LAND USE: Single Family Residential — This land use is defined as a fully subdivided residential home site with or without a structure. This land use is assessed 1.00 EBU per lot or parcel. This is the base value that all other land use types are compared and weighted against (i.e. Equivalent Benefit Unit). Multifamily Residential — This land use is defined as a fully subdivided residential parcel that has more than one residential unit developed on the property. Engineering studies have consistently shown that apartment and other multiple - family dwelling units generate lower traffic volumes, water consumption, and typically impact public infrastructure between 60 to 80 percent as much as a single- family residence largely due to lower occupancy of apartment dwelling units versus single family residential units. Therefore, assessments for the multiple residential units shall be prorated with a value of 0.70 EBU per unit. Condominiums — This land use includes residential developments designated as condominiums by the City and may include one to four residential units per parcel. Engineering studies have shown that on average, condominiums generate lower traffic volumes, water consumption, and typically impact public infrastructure less than a detached single-family residence, but more than apartments or other multifamily dwelling units. Therefore, assessments for condominiums shall be prorated with a value of 0.80 EBU per unit. MuniFinanaal Page 9 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District Approved -Residential Development — This land use is defined as any property not fully subdivided, but for which a Final Tract Map has been approved with a specific number of residential lots to be developed on the parcel. This land use type is assessed at 1.00 EBU per planned residential lot. (If the parcel is actually subdivided at the time annual assessments are submitted to the County for Collection, the resulting parcels shall be assessed based on their resulting development status change). Proposed -Residential Development — This land use is defined as any property not fully subdivided and for which a Tentative Tract Map has been submitted or approved with a specific number of proposed residential lots, but a Final Tract Map has not been approved. This land use type is assessed at 0.75 EBU per proposed residential lot. (If the parcel is actually subdivided or a Final Tract Map is approved prior to the annual assessments being submitted to the County for Collection, the resulting land use change or new parcels shall be assessed based on their resulting development status change). Vacant Undeveloped Property — This land use is defined as any property identified as vacant land that is currently undeveloped with no specific development plans, but may be developed or subdivided in the future (No tract map or development plan has been submitted and/or approved). This land use is assessed at 1.00 EBU per parcel. Developed Non -Residential — This land use is defined as property that is developed, but not as residential property as defined by the previous land use designations. The average residential density within the City is approximately six (6) residential units per acre. Therefore, the proportionate benefit assigned to Developed Non -Residential properties shall be 6.00 EBU per gross acre. Parcels designated as Developed Non -Residential are assigned a minimum of 1.00 EBU. Exempt Parcels — This land use identifies properties that are not assessed within the District. This land use classification may include but is not limited to lots or parcels that will not be developed such as sliver parcels, dedicated easements, open space areas, dedicated landscaped areas or common areas. Similarly, properties not designated by a County Assessor's Parcel Number (APN) such as streets, utility easements or rights -of -way receive no special benefit and are considered Exempt. These Exempt properties are not assessed for District improvements. If the County designates an Exempt property by an APN, that parcel shall be assigned 0.00 EBU. Properties that are identified as non-taxable by the County Assessor's Office such as government owned or utility owned properties are not exempt from District assessments unless: the property has limited or restricted development potential; the property clearly receives no benefit from the improvements; or the property provides additional or substantially similar improvements (such is the case with public schools, parks and open space areas). MuniFinanaal Page 10 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District The following table provides a listing by land use type, the Equivalent Benefit Unit factor applied to that land use type and the multiplying factor used to calculate each parcel's individual EBU as outlined in the preceding description. Land Use Designations and Equivalent Benefit Units Property Type Equivalent Benefit Unit Multiplier Single Family Residential 1.000 Unit/Lot/Parcel Multifamily Residential 0.700 Unit Condominiums 0.800 Unit Approved -Residential Development 1.000 Unit/Lots Proposed -Residential Development 0.750 Unit/Lots Vacant Undeveloped Property 1.000 Parcel Developed Non -Residential 6.000 Acreage Exempt 0.000 Parcel The benefit formula applied to various parcels is based on the preceding Equivalent Benefit Unit (EBU) discussion and table. Each parcel's EBU correlates the parcel's special benefit received as compared to all other parcels benefiting from the improvements. The following formula is used to calculate each parcel's EBU (proportional benefit). Parcel Type EBU x Acres/Lots/Units = Parcel EBU The total number of Equivalent Benefit Units (EBU's) is the sum of all individual EBU's applied to parcels that receive a special benefit the improvement. An assessment amount per EBU (Rate) for the District improvements is established annually by taking the total cost of the improvement and dividing that amount by the total number of EBU's of all benefiting parcels. This Rate is then applied back to each parcel's individual EBU to determine the parcel's proportionate benefit and assessment obligation. Total Balance to Levy / Total EBU = Levy per EBU Levy per EBU x Parcel EBU = Parcel Levy Amount MuniFinanaal Page 11 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District C. Assessment Range Formula Any new or increase in assessments require certain noticing and meeting requirements by law. Prior to the passage of Proposition 218, legislative changes in the Brown Act defined the definition of "new or increased assessment" to exclude certain conditions. These conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition and conditions were later confirmed through SB919 (Proposition 218 implementing legislation). The purpose of establishing an assessment range formula is to provide for reasonable increases and inflationary adjustments to annual assessments without requiring costly noticing and mailing procedures, which could add to the District costs and assessments. As part of the District formation, balloting of property owners is required, pursuant to Proposition 218. The ballots presented to the property owners in connection with this Report includes an Assessment Rate to be approved, as well as the approval of an assessment range formula. The assessment range formula shall be applied to all future assessments within the District. Generally, if the proposed annual assessment (levy per unit or rate) for the current fiscal year is less than or equal to the "Maximum Assessment" (or "Adjusted Maximum Assessment"), then the proposed annual assessment is not considered an increased assessment. The Maximum Assessment is equal to the initial Assessment approved by property owners adjusted annually by the following criteria: 1. Beginning in the second fiscal year, (fiscal year 2005/2006) and each fiscal year thereafter, the Maximum Assessment will be recalculated annually, and, 2. The new adjusted Maximum Assessment for the year represents the prior year's Maximum Assessment adjusted by three percent (3.0) The Maximum Assessment is adjusted annually and is calculated independent of the District's annual budget and proposed annual assessment. Any proposed annual assessment (rate per levy unit) less than or equal to this Maximum Assessment is not considered an increased assessment, even if the proposed assessment is significantly greater than the assessment applied in the prior fiscal year. The Maximum Assessment will be recalculated and adjusted annually. However, the City Council may reduce or freeze the Maximum Assessment at any time by amending the Engineer's Annual Report. Although the Maximum Assessment will normally increase each year, the actual District assessments may fluctuate or remain virtually unchanged. The Maximum Assessment adjustment is designed to establish a reasonable limit on District assessments. The Maximum Assessment calculated each year does not require or facilitate an increase to the annual assessment and neither does it restrict assessments to the adjustment maximum amount. If the budget and assessments for the fiscal MuniFinan ial Page 12 MuniFinanrial Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District year does not require an increase, or the increase is less than the adjusted Maximum Assessment, then the required budget and assessment may be applied without additional property owner balloting. If the budget and assessments calculated requires an increase greater than the adjusted Maximum Assessment then the assessment is considered an increased assessment. To impose an increased assessment the City Council must comply with the provisions of Proposition 218 (Article XIIID Section 4c of the California Constitution), which requires a public hearing and certain protest procedures including mailed notice of the public hearing and property owner protest balloting. Property owners through the balloting process must approve the proposed assessment increase. If the new proposed assessment is approved, then a new Maximum Assessment is established for the District. If the proposed assessment is not approved, the City Council may not levy an assessment greater than the adjusted Maximum Assessment previously established for the District. Page 13 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District IV. DISTRICT BUDGET A. District Budget For Fiscal Year 2004/2005 The following budget reflects the proposed expenses and assessment rate per Equivalent Benefit Unit to be applied for fiscal year 2004/2005. DIRECT COSTS Maintenance Costs Landscape Utilities ADMINISTRATION COSTS District Administration 1,535 230 1,304 County Administration Fee 25 4 21 County Per Parcel Fee 6 1 5 Administration Costs (Subtotal) $1,566 235 $1,331 ZONE 16 COLLEGE VIEW ESTATES I Total General Budget Benefit Special Benefit $5,722 858 $4,864 1,788 268 1,520 800 120 680 885 133 752 300 45 255 0 0 Landscape Extras (Repairs/Materials/Equipment) Tree Pruning Street Lighting Special District Services Annual Direct Costs (Subtotal) $9,495 1,424 $8,071 Renovation/Capital Improvement Expenditures 0 0 Total Direct Costs $9,495 1,424 $8,071 LEVY BREAKDOWN Total Direct and Admin. Costs 11,061 1,659 9,402 Reserve Collection/ (Transfers) 1,106 - 1,106 Other Revenues/General Fund Contribution 0 0 Capital Improvement Project Collection/ (Transfers) 0 0 Balance to Levy $12,167 1,659 $10,508 DISTRICT STATISTICS Total Parcels 32 Total Parcels Levied 32 Total Equivalent Dwelling Units 32.00 Levy per EDU RESERVE INFORMATION Beginning Reserve Balance Reserve Account Activity Anticipated Reserve Balance ASSESSMENT INFORMATION Maximum Assessment Rate FY 2004/05 CPI Applied : 0.00% $328.38 0 1,106 1,106 $328.38 MuniFinancial Page14 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District APPENDIX A - DISTRICT ASSESSMENT DIAGRAM The District consists of all lots and parcels within the College View Estates II subdivision Tract 30087 located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally east of the Monterey Avenue. The current tract map and Assessor's Parcel Map shown on the following pages identify the parcels within the College View Estates II/Shepherd Lane Landscaping and Lighting District, as they existed on the County Assessor's Roll when this Report was prepared and the Resolution of Intention was adopted. The District is inclusive of Assessor's Parcel Map Book 653; Page 37, Assessor's Parcel Numbers 653-781-001 through 653-781-016; and Assessor's Parcel Number 653-780-001 through 023. The parcels identified on the Assessor's Parcel Map and the Tract Map contained herein define the boundaries and constitute the Assessment Diagram for the District and by reference includes all subsequent parcels and Assessor's Parcel Maps and parcel numbers related thereto. MuniFinanciaal Page 15 77471 1ll+j° liiii! ppp. 7 ��4a�i7pRit k•1 •i1 hi ._ W- _141."--4--0---/frlri-) 'It a ..... 1 k - i„d , - k to 41 it ti I b A i k R I h 4 I I i 4 � k k ' I' w I b h IL_HTH ri -t s-,._ - e / • �-j y ii fit_ -3. ; wf h. i e Al,I I.�`.... �qpl4 I Pi 1 h 1 : i . I ,00l 0 I v 10 I 1 . Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL Parcel identification for each lot or parcel within the District, shall be the parcel as shown on the Riverside County Secured Roll for the year in which this Report is prepared and reflective of the Assessor's Parcel Map(s). As of the resolution of Intention, the College View Estates II/Shepherd Lane Landscaping and Lighting District is inclusive of Assessor's Parcel Numbers (APN's) identified on the Assessor's Parcel Maps Book 653; Pages 37, Assessor's Parcel Numbers 653-781-001 through 653-781-016 and Assessor's Parcel Number 653-780-001 through 023. A listing of parcels assessed within this District identifying the proposed Maximum Assessment Amount and Assessment Amount_ for fiscal year 2004/2005 is included in the following listing. Both the proposed Maximum Assessment Amount and Assessment Amount for fiscal year 2004/2005 are based on the current land use of the property. Proposed APN Parcel Description Assessment 653-780-001 Tract 30087 Lot 1 328.38 653-780-002 Tract 30087 Lot 2 328.38 653-780-003 Tract 30087 Lot 3 328.38 653-780-004 Tract 30087 Lot 4 328.38 653-780-005 Tract 30087 Lot 5 328.38 653-780-006 Tract 30087 Lot 6 328.38 653-780-007 Tract 30087 Lot 7 328.38 653-780-008 Tract 30087 Lot 8 328.38 653-780-009 Tract 30087 Lot 25 328.38 653-780-010 Tract 30087 Lot 26 328.38 653-780-011 Tract 30087 Lot 27 328.38 653-780-012 Tract 30087 Lot 28 328.38 653-780-013 Tract 30087 Lot 29 328.38 653-780-014 Tract 30087 Lot 30 328.38 653-780-015 Tract 30087 Lot 31 328.38 653-780-016 Tract 30087 Lot 32 328.38 MuniFinanrial Page 18 Engineer's Report Fiscal Year 2004/2005 College View Estates II/Shepherd Lane Landscaping and Lighting District Proposed APN Parcel Description Assessment 653-781-001 Tract 30087-Lot 9 328.38 653-781-002 Tract 30087 Lot 10 328.38 653-781-003 Tract 30087 Lot 11 328.38 653-781-004 Tract 30087 Lot 12 328.38 653-781-005 Tract 30087 Lot 13 328.38 653-781-006 Tract 30087 Lot 14 328.38 653-781-007 Tract 30087 Lot 15 328.38 653-781-008 Tract 30087 Lot 16 328.38 653-781-009 Tract 30087 Lot 17 328.38 653-781-010 Tract 30087 Lot 18 328.38 653-781-011 Tract 30087 Lot 19 328.38 653-781-012 Tract 30087 Lot 20 328.38 653-781-013 Tract 30087 Lot 21 328.38 653-781-014 Tract 30087 Lot 22 328.38 653-781-015 Tract 30087 Lot 23 328.38 653-781-016 Tract 30087 Lot 24 328.38 Total Assessment $10,508.16 MuniFinan ial Page 19 CITY OF PALM DESERT ENGINEER'S REPORT PETUNIA I / SHEPHERD LANE LANDSCAPING AND LIGHTING DISTRIC1 FORMATION Fiscal Year 2004/2005 Intent Meeting: Public Hearing: Corporate Offiz 27368 Via Industria Suite 110 Temecula, CA 92590 Tel: (909) 587-3500 Tel: (800) 755-MUNI (6864) Fax: (909) 587-3510 May 13, 2004 July 8, 2004 MuniFinancial Regional Antelope Valley, CA Los Angeles, CA Oakland, CA Orange County, CA www.muni.com Offices Phoenix, AZ San Diego, CA Sacramento, CA Seattle, WA ENGINEER'S REPORT AFFIDAVIT Formation of and Establishment of Annual Assessments for the: Petunia I/Shepherd Lane Landscaping and Lighting District City of Palm Desert Riverside County, State of California This Report identifies all the parcels within the District and all relevant zones therein, as they existed at the time of the passage of the Resolution of Intention. Reference is hereby made to the Riverside County Assessor's maps for a detailed description of the lines and dimensions of parcels within the District. The undersigned respectfully submits the enclosed Report as directed by the City Council. Dated this day of , 2004. MuniFinancial Assessment Engineer On Behalf of the City of Palm Desert By: Brian Jewett, Principal Consultant Financial Consulting Services By: Richard Kopecky R C. E. # 16742 TABLE OF CONTENTS I. OVERVIEW 1 A. INTRODUCTION 1 B. GENERAL DESCRIPTION OF THE DISTRICT 2 II. PLANS AND SPECIFICATIONS 3 A. DESCRIPTION OF THE DISTRICT 3 B. DISTRICT IMPROVEMENTS AND SERVICES 4 GENERAL PROVISIONS OF THE LAW 4 LOCATION AND EXTENT OF IMPROVEMENTS 5 III. METHOD OF APPORTIONMENT 6 A. IMPROVEMENT BENEFIT FINDINGS 6 GENERAL BENEFITS 6 SPECIAL BENEFITS B. DESCRIPTION OF THE METHOD OF APPORTIONMENT8 EQUIVALENT BENEFIT UNITS: 9 EBU APPLICATION BY LAND USE: 9 C. ASSESSMENT RANGE FORMULA 12 IV. DISTRICT BUDGET 14 A. CALCULATION OF THE MAXIMUM ASSESSMENT 14 B. DISTRICT BUDGET FOR FISCAL YEAR 2004/2005 15 APPENDIX A - DISTRICT ASSESSMENT DIAGRAM 16 APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL 20 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District OVERVIEW A. Introduction The City of Palm Desert ("City") proposes to form the Petunia I/Shepherd Lane Landscaping and Lighting District ("District") for Fiscal Year 2004/2005. The City Council on behalf of the City proposes to levy and collect special assessments on the County tax rolls to provide funding for the costs and expenses required for maintenance of the landscaping and lighting improvements associated with the District. Upon successful formation of the District and approval of the assessments, the territory within the District will be concurrently annexed into the existing Palm Desert Consolidated Landscaping and Lighting District ("Consolidated District") as the Petunia I sub -zone of Zone 16 (Shepherd Lane). The District will be formed, annexed into the Consolidated District, and levied pursuant to the Landscape and Lighting Act of 1972, Part 2 of Dizision 15 j the CaWorn a Streets and Highuu1s Cade (the Act), and in compliance with the substantive and procedural requirements of the California Constitution Article XIIID. This Engineer's Report ("Report") describes the District and assessments to be levied against properties within the District commencing with Fiscal Year 2004/2005. The assessments described herein are based on the estimated cost to maintain the improvements that will provide a direct and special benefit to properties within the District. Improvements to be maintained and funded through annual assessments shall be constructed and installed in connection with the development of these properties. The annual costs and assessments described herein include all estimated direct expenditures, incidental expenses, deficits, surpluses, revenues, and reserves associated with the maintenance and servicing of the improvements. The word "parcel," for the purposes of this Report, refers to an individual property assigned its own Assessment Number by the County of Riverside Assessor's Office. The County of Riverside Auditor/Controller uses Assessment Numbers and specific Fund Numbers to identify properties assessed on the tax roll for special district benefit assessments. At a noticed Public Hearing, the City Council will consider all public comments and written protests presented. Upon conclusion of the Public Hearing, the City Council will tabulate property owner protest ballots received to determine whether majority protest exists, and by resolution confirm the results of the protest ballot tabulation. Proceedings for the formation of the assessment district shall be abandoned if majority protest exists. If tabulation of the property owner protest ballots indicates approval of the assessments and the assessment range formula presented, by resolution the City Council will approve the Engineer's Report as submitted or amended (amendments may not increase the assessments approved by the property owners). Following approval of the Report, the City Council will by resolution, order MuniFinathd Page 1 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District the formation of the District, the annexation of the territory into the Consolidated District, and confirm the levy and collection of assessments pursuant to the Act. In such case, the assessments as approved may be submitted to the Riverside County Auditor/Controller to be included on the property tax roll for each parcel for Fiscal Year 2004/2005, or reviewed and confirmed at the annual public hearing for the Consolidated District along with all other assessments within the Consolidated District. B. General Description of the District The District consists of all lots, parcels and properties within the residential subdivision known as Petunia I within the development area known as Shepherd Lane located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally west of the Monterey Avenue. The improvements and services that provide a special benefit to properties within the District generally include, but are not limited to: • Parkway landscaping on Shepherd Lane adjacent to the residential development installed as part of the development of properties therein; • Perimeter landscaping for the Shepherd Lane residential developments. Tract 30025 is one of several residential subdivisions within the area known as Shepherd Lane, that includes parkway/perimeter landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. These improvements benefit all property development within the Shepherd Lane area and each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Any entryways, open space areas or other landscaped areas associated with the development of properties within the District that will be maintained by the District; • Street lights within and adjacent to the residential subdivision. The estimated annual cost to provide and maintain the improvements associated with the District have been allocated to each property in proportion to special benefits received. The Method of Apportionment described in this Report utilizes commonly accepted assessment engineering practices and has been established pursuant to the 1972 Act and the provisions of Article XIIID of the California Constitution (Proposition 218). MuniFinanaal Page 2 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District II. PLANS AND SPECIFICATIONS A. Description of the District The District consists of all lots and parcels within the residential subdivision known as Petunia I (Tract 30025) located on the west and east sides 'of Shepherd Lane at the intersection of Petunia Place. This tract is generally located west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive and generally east of the Monterey Avenue. Refer to the Assessment Diagram for details of the District boundary. The proposed District includes all parcels of land that have been approved for residential development within Tract 30025. • Tract No. 30025 (East Petunia Place) — Sixteen (16) single-family residential parcels (lots 17-32) currently identified on the County Assessor's Map as APN Book 653, Page 77, (Assessor's Parcel Number 653-771-001 through 016). This portion of the tract includes three landscape easements identified as the parkway landscaping on the east side of Shepherd Lane adjacent to the tract north and south of East Petunia Place and the parkway landscaping easement on the west side of Portola Avenue adjacent to the tract. • Tract No. 30025 (West Petunia Place) — Sixteen (16) single-family residential parcels (lots 1-16) currently identified on the County Assessor's Map as APN Book 653, Page 77, (Assessor's Parcel Number 653-770-023 through 038). This portion of the tract includes two landscape easements identified as the parkway landscaping on the west side of Shepherd Lane adjacent to the tract north and south of West Petunia Place. The parcels to be assessed receive special benefit from the installation and maintenance of street lighting and parkway landscaping adjacent to the development and perimeter landscaping associated with the development of all properties within the Shepherd Lane area. The improvements to be funded through District assessments have either been installed as a condition of the development of the original undeveloped properties within the District or have been installed as part of the overall development of properties within the area known as Shepherd Lane. The District is being formed to ensure and preserve the on going maintenance and operation of these improvements and it has been determined that each parcel within the District receives similar and proportional benefit from the collective improvements installed as part of the property development. The specific location, description and benefits of the improvements are discussed in the following sections. MuniFinamzal Page 3 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District B. District Improvements and Services GENERAL PROVISIONS OF THE LAW As generally defined by the 1972 Act and applicable to this District, improvements and the associated assessments may include one or any combination of the following: 1) The installation or planting of landscaping; 2) The installation or construction of statuary, fountains, and other ornamental structures and facilities; 3) The installation or construction of any facilities which are appurtenant to any of the foregoing or which are necessary or convenient for the maintenance or servicing thereof; 4) The maintenance or servicing, or both, of any of the foregoing including the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including, but not limited to: a) Repair, removal, or replacement of all or any part of any improvements; b) Grading, clearing, removal of debris, the installation or construction of curbs, gutters, walls, sidewalks, or paving, or water, irrigation, drainage, or electrical facilities; c) Providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; d) The removal of trimmings, rubbish, debris, and other solid waste; e) The cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti; f) Electric current or energy, gas, or other agent for the lighting or operation of any other improvements; and, g) Water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. 5) Incidental expenses associated with the improvements including, but not limited to: MuniFinanecial a) The cost of preparation of the report, including plans, specifications, estimates, diagram, and assessment; b) The costs of printing, advertising, and the publishing, posting and mailing of notices; c) Compensation payable to the County for collection of assessments; Page 4 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District d) Compensation of any engineer or attorney employed to render services; e) Any other expenses incidental to the construction, installation, or maintenance and servicing of the improvements; and, f) Costs associated with any elections held for the approval of a new or increased assessment. LOCATION AND EXTENT OF IMPROVEMENTS The purpose of the District is to ensure the ongoing maintenance, operation and servicing of local landscape and street lighting improvements installed as a result of property development in the Shepherd Lane area. These improvements may include, but are not limited to all streetlight facilities as well as landscaping material and facilities associated with properties in the District including ground cover, shrubs, trees and plants; irrigation and drainage systems; ornamental lighting structures, masonry walls or other fencing, entryway monument, and associated appurtenant facilities located within the: • Parkway landscaping along Shepherd Lane adjacent to the residential subdivision. Specifically for this District, this landscaped areas includes the parkway area on both the east and west sides of Shepherd Lane which extends the length of Tract 30025; • Perimeter/parkway landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. Although these perimeter/parkway-landscaping areas may not have been installed directly as a condition of this residential subdivision, this landscaping is an integral part of the overall development of properties within the Shepherd Lane area and directly benefits all property development within the area. Therefore, each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Streetlights within the residential subdivision and/or adjacent to the subdivision on West Petunia Place, East Petunia Place, Shepherd Lane and the west side of Portola Avenue installed as part of the residential subdivision; and, • Any extension or expansion of the proposed landscaped areas within or adjacent to the subdivision that may be installed as part of the development of properties within the District and will be maintained by the District. These improvements may include, but are not limited to open space areas, monuments or other landscaped easements. MuniFinan jal Page 5 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District III. METHOD OF APPORTIONMENT Pursuant to the 1972 Act the costs (assessments) of the District are apportioned by a formula or method that fairly distributes the net amount to be assessed among all parcels in proportion to benefits received from the improvements. Furthermore, the provisions of Article XIIID of the California Constitution (Proposition 218) require the agency to separate the general benefit from special benefit, whereas only special benefits may be assessed. A. Improvement Benefit Findings The annual assessments outlined in the budget section of this Report are proposed to cover the estimated costs to provide the necessary services, operation, administration, and maintenance required each year to maintain street lighting facilities associated with the District and keep the landscaping improvements in a healthy, vigorous, and satisfactory condition. It has been determined that each assessable parcel within the District receives similar and proportional special benefits from the improvements. The fact that improvements are part of the specific property development plans and requirements for development of properties within the District, and each parcel's close and relatively similar proximity to the improvements makes each parcel's special benefit from the improvements similar and proportionate. All the lots and parcels that receive special benefit from the improvements are included within the District. GENERAL BENEFITS The improvements to be provided and maintained by the District are a direct result of property development within the District and the Shepherd Lane area and these improvements would otherwise not be required or necessary. Developers typically install local improvements or develop in areas where landscape improvements exist to enhance the marketability and value of properties within their development and/or as conditions of development. In any case, local landscape and lighting improvements associated with the development clearly benefit the properties being developed. If new improvements are. installed as part of the development, they are installed either to enhance the property being developed or as a condition of development and not for the benefit of surrounding properties outside the District. Although local development improvements (by virtue of their location) may be visible to surrounding properties, any benefit to surrounding properties is incidental and cannot be considered a direct and special benefit. Furthermore, most developments within the City typically have various landscaping and lighting improvements specifically associated with their development and these improvements are funded by properties within those developments. Therefore, it has been determined that the improvements associated with this District and the ongoing operation and maintenance of those improvements provide no identifiable MuniFinamzal Page 6 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District or measurable general benefit to properties outside the Shepherd Lane area or to the public at large. SPECIAL BENEFITS All the improvements funded through the District provide a special aesthetic appeal to each property and enhance the quality of life for property owners within the District as well as the marketability of those properties. All landscaping and lighting improvements associated with the District are part of the overall development plan for properties within the District and the Shepherd Lane area and specifically installed for the benefit and development of those properties. The special benefits associated with parkway, perimeter, entryway, and other property -specific landscaped areas and associated amenities are specifically: 1. Enhanced desirability of properties through association with the improvements. 2. Improved aesthetic appeal of properties within the District providing a positive representation of the development and properties within the development. 3. Enhanced adaptation of the urban environment within the natural environment from adequate green space and landscaping. 4. Environmental enhancement through improved erosion resistance, dust and debris control and reduced noise and air pollution. 5. Increased sense of pride in ownership of property within the District resulting from well -maintained improvements associated with the properties. 6. Reduced vandalism and criminal activity resulting from well -maintained surroundings and amenities. 7. The special enhancements of the perceived value of property that results from the above benefits. The special benefits of street lighting are the convenience, safety, and security of property, improvements, and goods. Specifically: 1. Enhanced deterrence of crime and the aid to police protection. 2. Increased nighttime safety on streets through enhanced visibility. 3. Improved sense of security and safety for pedestrians, motorists and property owners. 4. Improved ingress and egress to property. 5. Reduced vandalism, other criminal acts and damage to improvements or property. 6. Reduced personal property loss. MuniFinancial Pam 7 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District 7. The special enhancements of the perceived value of property that results from the above benefits B. Description of the Method of Apportionment The assessments outlined in this section represent the proportionate special benefit to each property within the District and the basis of calculating each parcel's proportionate share of the annual costs associated with the District improvements. The costs associated with the maintenance and operation of all District improvements shall be collected through annual assessments from each parcel receiving special benefit. The funds collected shall be dispersed and used for only the services and operation provided to the District. The method of apportionment for the District calculates the receipt of special benefit from the respective improvements based on the actual or proposed land use of the parcels within the District. The special benefit received by each lot or parcel is equated to the overall land use of the parcel based on the parcel's actual land use or proposed planned development, and is reliant upon the special benefit received from the improvements planned within the District. To identify and determine the special benefit to be received by each parcel and their proportionate share of the improvements it is necessary to consider the entire scope of the planned improvements within the Shepherd Lane area as well as individual property development within the District. Upon review of the proposed improvements it has been determined that each parcel within the proposed District benefits from the landscaping and lighting improvements installed as a condition of property development as well as perimeter landscaping associated with similar developments in the Shepherd Lane area. Based on these improvements and the planned property development within the proposed District, a maximum assessment can be established. All costs associated with the improvements shall be fairly distributed among the parcels based upon the special benefit received by each parcel. Additionally, in compliance with Article XIIID, Section 4, of the State Constitution each parcel's assessment may not exceed the reasonable cost of the proportional special benefit conferred to that parcel. The benefit formula used to determine the assessment obligation is therefore based upon both the improvements that benefit the parcels within the District as well as the proposed land use of each property as compared to other parcels that benefit from those specific improvements. MuniFinancial Page 8 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District EQUIVALENT BENEFIT UNITS: The Equivalent Benefit Unit (EBU) method of apportioning benefit is typically seen as the most appropriate and equitable assessment methodology for districts formed under the 1972 Act, as the benefit to each parcel from the improvements are apportioned as a function of land use type and development or development potential. To assess benefits equitably, it is necessary to relate the different type of properties within the District to the improvements and to each other. The Equivalent Benefit Unit method of assessment apportionment utilizes the single-family home site as the basic unit of assessment. A single-family home site equals one Equivalent Benefit Unit (EBU). Every other land use within the District is converted to EBU's based on an assessment formula that equates the property's specific development status, type of development (land use), and size or development plans for the property; as compared to a single-family home site. Although this particular District (Petunia I subdivision) will be comprised of only subdivided residential lots, it is anticipated that this subdivision will eventually be one of several subdivisions and developments that will be included in Zone 16 (Shepherd Lane) of the Palm Desert Consolidated District. Therefore, the following provides an overview of the EBU's applied to various other land use classifications within the Consolidated District. EBU APPLICATION BY LAND USE: Single Family Residential — This land use is defined as a fully subdivided residential home site with or without a structure. This land use is assessed 1.00 EBU per lot or parcel. This is the base value that all other land use types are compared and weighted against (i.e. Equivalent Benefit Unit). Multifamily Residential — This land use is defined as a fully subdivided residential parcel that has more than one residential unit developed on the property. Engineering studies have consistently shown that apartment and other multiple - family dwelling units generate lower traffic volumes, water consumption, and typically impact public infrastructure between 60 to 80 percent as much as a single- family residence largely due to lower occupancy of apartment dwelling units versus single family residential units. Therefore, assessments for the multiple residential units shall be prorated with a value of 0.70 EBU per unit. Condominiums - This land use includes residential developments designated as condominiums by the City and may include one to four residential units per parcel. Engineering studies have shown that on average, condominiums generate lower traffic volumes, water consumption, and typically impact public infrastructure less than a detached single-family residence, but more than apartments or other multifamily dwelling units. Therefore, assessments for condominiums shall be prorated with a value of 0.80 EBU per unit. MuniFinathal Page 9 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District Approved -Residential Development — This land use is defined as any property not fully subdivided, but for which a Final Tract Map has been approved with a specific number of residential lots to be developed on the parcel. This land use type is assessed at 1.00 EBU per planned residential lot. (If the parcel is actually subdivided at the time annual assessments are submitted to the County for Collection, the resulting parcels shall be assessed based on their resulting development status change). Proposed -Residential Development — This land use is defined as any property not fully subdivided and for which a Tentative Tract Map has been submitted or approved with a specific number of proposed residential lots, but a Final Tract Map has not been approved. This land use type is assessed at 0.75 EBU per proposed residential lot. (If the parcel is actually subdivided or a Final Tract Map is approved prior to the annual assessments being submitted to the County for Collection, the resulting land use change or new parcels shall be assessed based on their resulting development status change). Vacant Undeveloped Property — This land use is defined as any property identified as vacant land that is currently undeveloped with no specific development plans, but may be developed or subdivided in the future (No tract map or development plan has been submitted and/or approved). This land use is assessed at 1.00 EBU per parcel. Developed Non -Residential — This land use is defined as property that is developed, but not as residential property as defined by the previous land use designations. The average residential density within the City is approximately six (6) residential units per acre. Therefore, the proportionate benefit assigned to Developed Non -Residential properties shall be 6.00 EBU per gross acre. Parcels designated as Developed Non -Residential are assigned a minimum of 1.00 EBU. Exempt Parcels — This land use identifies properties that are not assessed within the District. This land use classification may include but is not limited to lots or parcels that will not be developed such as sliver parcels, dedicated easements, open space areas, dedicated landscaped areas or common areas. Similarly, properties not designated by a County Assessor's Parcel Number (APN) such as streets, utility easements or rights -of -way receive no special benefit and are considered Exempt. These Exempt properties are not assessed for District improvements. If the County designates an Exempt property by an APN, that parcel shall be assigned 0.00 EBU Properties that are identified as non-taxable by the County Assessor's Office such as government owned or utility owned properties are not exempt from District assessments unless: the property has limited or restricted development potential; the property clearly receives no benefit from the improvements; or the property provides additional or substantially similar improvements (such is the case with public schools, parks and open space areas). MuniFinancral Page 10 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District The following table provides a listing by land use type, the Equivalent Benefit Unit factor applied to that land use type and the mukiplying factor used to calculate each parcel's individual EBU as outlined in the preceding description. Land Use Designations and Equivalent Benefit Units Property Type Equivalent Benefit Unit Multiplier Single Family Residential 1.000 Unit/Lot/Parcel Multifamily Residential 0.700 Unit Condominiums 0.800 Unit Approved -Residential Development 1.000 Unit/Lots Proposed -Residential Development 0.750 Unit/Lots Vacant Undeveloped Property 1.000 Parcel Developed Non -Residential 6.000 Acreage Exempt 0.000 Parcel The benefit formula applied to various parcels is based on the preceding Equivalent Benefit Unit (EBU) discussion and table. Each parcel's EBU correlates the parcel's special benefit received as compared to all other parcels benefiting from the improvements. The following formula is used to calculate each parcel's EBU (proportional benefit). Parcel Type EBU x Acres/Lots/Units = Parcel EBU The total number of Equivalent Benefit Units (EBU's) is the sum of all individual EBU's applied to parcels that receive a special benefit the improvement. An assessment amount per EBU (Rate) for the District improvements is established annually by taking the total cost of the improvement and dividing that amount by the total number of EBU's of all benefiting parcels. This Rate is then applied back to each parcel's individual EBU to determine the parcel's proportionate benefit and assessment obligation. Total Balance to Levy / Total EBU = Levy per EBU Levy per EBU x Parcel EBU = Parcel Levy Amount MuniFin n ial Page 11 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District C. Assessment Range Formula Any new or increase in assessments require certain noticing and meeting requirements by law. Prior to the passage of Proposition 218, legislative changes in the Brown Act defined the definition of "new or increased assessment" to exclude certain conditions. These conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition and conditions were later confirmed through SB919 (Proposition 218 implementing legislation). The purpose of establishing an assessment range formula is to provide for reasonable increases and inflationary adjustments to annual assessments without requiring costly noticing and mailing procedures, which could add to the District costs and assessments. As part of the District formation, balloting of property owners is required, pursuant to Proposition 218. The ballots presented to the property owners in connection with this Report includes an Assessment Rate to be approved, as well as the approval of an assessment range formula. The assessment range formula shall be applied to all future assessments within the District. Generally, if the proposed annual assessment (levy per unit or rate) for the current fiscal year is less than or equal to the "Maximum Assessment" (or "Adjusted Maximum Assessment"), then the proposed annual assessment is not considered an increased assessment. The Maximum Assessment is equal to the initial Assessment approved by property owners adjusted annually by the following criteria: 1. Beginning in the second fiscal year, (Fiscal Year 2005/2006) and each fiscal year thereafter, the Maximum Assessment will be recalculated annually; and, 2. The new adjusted Maximum Assessment for the year represents the prior year's Maximum Assessment adjusted by three percent (3.0%). The Maximum Assessment is adjusted annually and is calculated independent of the District's annual budget and proposed annual assessment. Any proposed annual assessment (rate per levy unit) less than or equal to this Maximum Assessment is not considered an increased assessment, even if the proposed assessment is significantly greater than the assessment applied in the prior fiscal year. The Maximum Assessment will be ` recalculated and adjusted annually. However, the City Council may reduce or freeze the Maximum Assessment at any time by amending the Engineer's Annual Report. Although the Maximum Assessment will normally increase each year, the actual District assessments may fluctuate or remain virtually unchanged. The Maximum Assessment adjustment is designed to establish a reasonable limit on District assessments. The Maximum Assessment calculated each year does not require or facilitate an increase to the annual assessment and neither does it restrict assessments MuniFinancial Page 12 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District to the adjustment maximum amount. If the budget and assessments for the fiscal year does not require an increase, or the increase is less than the adjusted Maximum Assessment, then the required budget and assessment may be applied without additional property owner balloting. If the budget and assessments calculated requires an increase greater than the adjusted Maximum Assessment then the assessment is considered an increased assessment. To impose an increased assessment the City Council must comply with the provisions of Proposition 218 (Article XIIID Section 4c of the California Constitution), which requires a public hearing and certain protest procedures including mailed notice of the public hearing and property owner protest balloting. Property owners through the balloting process must approve the proposed assessment increase. If the new proposed assessment is approved, then a new Maximum Assessment is established for the District. If the proposed assessment is not approved, the City Council may not levy an assessment greater than the adjusted Maximum Assessment previously established for the District. M uniF inancial Page 13 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District IV. DISTRICT BUDGET A. Calculation of the Maximum Assessment The Maximum Assessment Rate per EBU presented to the property owners for approval is based on the estimated expenses and benefit units planned for the District (Petunia I) at build out. The following budget reflects these assumptions: ZONE 16 PETUNIA I Total General Special Budget Benefit Benefit DIRECT COSTS Maintenance Costs $4,637 696 $3,941 Landscape Utilities 1,449 217 1,232 Landscape Extras (Repairs/Materials/Equipment) 800 120 680 Tree Pruning 885 133 752 Street Lighting 300 45 255 Special District Services 0 0 Annual Direct Costs (Subtotal) $8,071 1,211 $6,860 Renovation/Capital Improvement Expenditures 0 0 Total Direct Costs ADMINISTRATION COSTS District Administration 1,535 230 1,304 County Administration Fee 25 4 21 County Per Parcel Fee 6 1 5 Administration Costs (Subtotal) $1,566 235 $1,331 LEVY BREAKDOWN Total Direct and Admin. Costs 9,637 1,446 8,191 Reserve Collection/ (Transfers) 964 - 964 Other Revenues/General Fund Contribution 0 - 0 Capital Improvement Project Collection/ (Transfers) 0 - 0 Balance to Levy $10,601 1,446 $9,155 DISTRICT STATISTICS Total Parcels Total Parcels Levied Total Equivalent Dwelling Units Levy per EDU RESERVE INFORMATION Beginning Reserve Balance Reserve Account Activity Anticipated Reserve Balance $8,071 1,211 $6,860 ASSESSMENT INFORMATION Maximum Assessment Rate FY 2004/05 CPI Applied: 0.00% 32 32 32.00 $286.10 0 964 964 $286.10 MuniFinancial Par 14 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District B. District Budget For Fiscal Year 2004/2005 MuniFinanaal Upon the successful formation of the proposed Petunia I/Shepherd Lane Landscaping and Lighting District, the District and parcels therein will be concurrently annexed into the Palm Desert Consolidated District as part of Zone 16 (Shepherd Lane) for Fiscal Year 2004/2005. The actual budget and assessment rate to be applied for Fiscal Year 2004/2005 (first levy of assessments) will be reviewed and adopted by the City Council as part of the annual levy process for the Consolidated District for Fiscal Year 2004/2005. Although it is anticipated that the proposed expenses (budget) and proposed assessment rate per Equivalent Benefit Unit (EBL) outlined in the preceding table (Calculation of the Maximum Assessment) will be applied for Fiscal Year 2004/2005, the assessment rate approved and adopted by the City Council may be less than the maximum rate outlined in this report. Page 15 Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District APPENDIX A - DISTRICT ASSESSMENT DIAGRAM The District consists of all lots and parcels within the Petunia I subdivision Tract 30025 located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally east of the Monterey Avenue. The current tract map and Assessor's Parcel Maps shown on the following pages identify the parcels within the Petunia I/Shepherd Lane Landscaping and Lighting District, as they existed on the County Assessor's Roll when this Report was prepared and the Resolution of Intention was adopted. The District is inclusive of portions of Assessor's Parcel Map — Book 653, Page 77, (Assessor's Parcel Numbers 653-770-023 through 038 and 653-771-001 through 016). The parcels identified on the Assessor's Parcel Map and the Tract Map contained herein define the boundaries and constitute the Assessment Diagram for the District and by reference includes all subsequent parcels and Assessor's Parcel Maps and parcel numbers related thereto. MuniFimncial Page 16 MuniFinancial Engineer's Report Fiscal Year 2004/2005 Petunia I/Shepherd Lane Landscaping and Lighting District APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL Parcel identification for each lot or parcel within the District, shall be the parcel as shown on the Riverside County Secured Roll for the year in which this Report is prepared and reflective of the Assessor's Parcel Map(s). As of the resolution of Intention, the Petunia I/Shepherd Lane Landscaping and Lighting District is inclusive of Assessor's Parcel Numbers (APN's) identified on the Assessor's Parcel Maps - Book 653, Page 77, (Assessor's Parcel Numbers 653-770-023 through 038 and 653-771-001 through 016). A listing of parcels assessed within this District identifying the proposed Maximum Assessment Amount for the first fiscal year is included in the following listing. Proposed Maximum EBU at Levy APN Tract Lot Build Out Balloted 653-770-023 1'R# 30025 1 1.00 $286.10 653-770-024 TR# 30025 2 1.00 $286.10 653-770-025 TR# 30025 3 1.00 $286.10 653-770-026 TR# 30025 4 1.00 $286.10 653-770-027 TR# 30025 5 1.00 $286.10 653-770-028 TR# 30025 6 1.00 $286.10 653-770-029 1'R# 30025 7 1.00 $286.10 653-770-030 1'R# 30025 8 1.00 $286.10 653-770-031 TR# 30025 9 1.00 $286.10 653-770-032 TR# 30025 10 1.00 $286.10 653-770-033 TR# 30025 11 1.00 $286.10 653-770-034 TR# 30025 12 1.00 $286.10 653-770-035 TR# 30025 13 1.00 $286.10 653-770-036 TR# 30025 14 1.00 $286.10 653-770-037 TR# 30025 15 1.00 $286.10 653-770-038 TR# 30025 16 1.00 $286.10 Proposed Maximum EBU at Levy APN Tract Lot Build Out Balloted 653-771-001 TR# 30025 17 1.00 $286.10 653-771-002 TR# 30025 18 1.00 $286.10 653-771-003 TR# 30025 19 1.00 $286.10 653-771-004 TR# 30025 20 1.00 $286.10 653-771-005 TR# 30025 21 1.00 $286.10 653-771-006 TR# 30025 22 1.00 $286.10 653-771-007 TR# 30025 23 1.00 $286.10 653-771-008 TR# 30025 24 1.00 $286.10 653-771-009 TR# 30025 25 1.00 $286.10 653-771-010 TR# 30025 26 1.00 $286.10 653-771-011 TR# 30025 27 1.00 $286.10 653-771-012 TR# 30025 28 1.00 $286.10 653-771-013 TR# 30025 29 1.00 $286.10 653-771-014 TR# 30025 30 1.00 $286.10 653-771-015 1'R# 30025 31 1.00 $286.10 653-771-016 TR# 30025 32 1.00 $286.10 Total Assessment 32.00 $9,155.20 MuniFinancial Page 20 CITY OF PALM DESERT ENGINEER'S REPORT PETUNIA II / SHEPHERD LANE LANDSCAPING AND LIGHTING DISTRICT FORMATION Fiscal Year 2004/2005 27368 Via Industria Suite 110 Temecula, CA 92590 Tel: (909) 587-3500 Tel: (800) 755-MUNI (6864) Fax: (909) 587-3510 Intent Meeting: Public Hearing: May 13, 2004 July 8, 2004 MunuFinancial Regional Antelope Valley, CA Los Angeles, CA Oakland, CA Orange County, CA www.muni.com Offices Phoenix, AZ San Diego, CA Sacramento, CA Seattle, WA ENGINEER'S REPORT AFFIDAVIT Formation of and Establishment of Annual Assessments for the: Petunia II/Shepherd Lane Landscaping and Lighting District City of Palm Desert Riverside County, State of California This Report identifies all the parcels within the District and all relevant zones therein, as they existed at the time of the passage of the Resolution of Intention. Reference is hereby made to the Riverside County Assessor's maps for a detailed description of the lines and dimensions of parcels within the District. The undersigned respectfully submits the enclosed Report as directed by the City Council. Dated this day of , 2004. MuniFinancial Assessment Engineer On Behalf of the City of Palm Desert By: Brian Jewett, Principal Consultant Financial Consulting Services By: Richard Kopecky R. C. E. # 16742 TABLE OF CONTENTS I. OVERVIEW 1 A. INTRODUCTION 1 B. GENERAL DESCRIPTION OF THE DISTRICT 2 II. PLANS AND SPECIFICATIONS 3 A. DESCRIPTION OF THE DISTRICT 3 B. DISTRICT IMPROVEMENTS AND SERVICES 3 GENERAL PROVISIONS OF THE LAW 3 LOCATION AND EXTENT OF IMPROVEMENTS 4 III. METHOD OF APPORTIONMENT 6 A. IMPROVEMENT BENEFIT FINDINGS 6 GENERAL BENEFITS 6 SPECIAL BENEFITS 7 B. DESCRIPTION OF THE METHOD OF APPORTIONMENT8 EQUIVALENT BENEFIT UNITS: 9 EBU APPLICATION BY LAND USE: 9 C. ASSESSMENT RANGE FORMULA 12 IV. DISTRICT BUDGET 14 A. CALCULATION OF THE MAXIMUM ASSESSMENT 14 B. DISTRICT BUDGET FOR FISCAL YEAR 2004/2005 15 APPENDIX A - DISTRICT ASSESSMENT DIAGRAM 16 APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL 19 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District OVERVIEW A. Introduction The City of Palm Desert ("City") proposes to form the Petunia II/Shepherd Lane Landscaping and Lighting District ("District") for Fiscal Year 2004/2005. The City Council on behalf of the City proposes to levy and collect special assessments on the County tax rolls to provide funding for the costs and expenses required for maintenance of the landscaping and lighting improvements associated with the District. Upon successful formation of the District and approval of the assessments, the territory within the District will be concurrently annexed into the existing Palm Desert Consolidated Landscaping and Lighting District ("Consolidated District") as the Petunia II sub -zone of Zone 16 (Shepherd Lane). The District will be formed, annexed into the Consolidated District, and levied pursuant to the Landscape and Lighting A ct'f 1972, Part 2 geDizision 15 I the California Stets and Highwr)5 Cale (the Act), and in compliance with the substantive and procedural requirements of the California Constitution Article XIIID. This Engineer's Report ("Report") describes the District and assessments to be levied against properties within the District commencing with Fiscal Year 2004/2005. The assessments described herein are based on the estimated cost to maintain the improvements that will provide a direct and special benefit to properties within the District. Improvements to be maintained and funded through annual assessments shall be constructed and installed in connection with the development of these properties. The annual costs and assessments described herein include all estimated direct expenditures, incidental expenses, deficits, surpluses, revenues, and reserves associated with the maintenance and servicing of the improvements. The word "parcel," for the purposes of this Report, refers to an individual property assigned its own Assessment Number by the County of Riverside Assessor's Office. The County of Riverside Auditor/Controller uses Assessment Numbers and specific Fund Numbers to identify properties assessed on the tax roll for special district benefit assessments. At a noticed Public Hearing, the City Council will consider all public comments and written protests presented. Upon conclusion of the Public Hearing, the City Council will tabulate property owner protest ballots received to determine whether majority protest exists, and by resolution confirm the results of the protest ballot tabulation. Proceedings for the formation of the assessment district shall be abandoned if majority protest exists. If tabulation of the property owner protest ballots indicates approval of the assessments and the assessment range formula presented, by resolution the City Council will approve the Engineer's Report as submitted or amended (amendments may not increase the assessments approved by the property owners). Following approval of the Report, the City Council will by resolution, order MuniFjn nci l Page 1 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District the formation of the District, the annexation of the territory into the Consolidated District, and confirm the levy and collection of assessments pursuant to the Act. In such case, the assessments as approved may be submitted to the Riverside County Auditor/Controller to be included on the property tax roll for each parcel for Fiscal Year 2004/2005, or reviewed and confirmed at the annual public hearing for the Consolidated District along with all other assessments within the Consolidated District. B. General Description of the District The District consists of all lots, parcels and properties within the residential subdivision known as Petunia II within the development area known as Shepherd Lane located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally west of the Monterey Avenue. The improvements and services that provide a special benefit to properties within the District generally include, but are not limited to: • Parkway landscaping on Shepherd Lane adjacent to the residential development installed as part of the development of properties therein; • Perimeter landscaping for the Shepherd Lane residential developments. Tract 30275 is one of several residential subdivisions within the area known as Shepherd Lane, that includes parkway/perimeter landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. These improvements benefit all property development within the Shepherd Lane area and each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Any entryways, open space areas or other landscaped areas associated with the development of properties within the District that will be maintained by the District; • Street lights within and adjacent to the residential subdivision. The estimated annual cost to provide and maintain the improvements associated with the District have been allocated to each property in proportion to special benefits received. The Method of Apportionment described in this Report utilizes commonly accepted assessment engineering practices and has been established pursuant to the 1972 Act and the provisions of Article XIIID of the California Constitution (Proposition 218). MuniFinanc al Page 2 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District II. PLANS AND SPECIFICATIONS A. Description of the District The District consists of all lots and parcels within the residential subdivision known as Petunia II (Tract 30275) located on the east side of Shepherd Lane at the intersection of "A" Street. This tract is generally located west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive and generally east of the Monterey Avenue. Refer to the Assessment Diagram for details of the District boundary. The proposed District includes all parcels of land that have been approved for residential development within Tract 30275. • Tract No. 30275 ("A" Street) — Sixteen (16) single-family residential parcels (lots 1-16) identified on the County Assessor's Map as APN Book 653, Page 37, (Assessor's Parcel Number 653-780-017 through 032). This tract includes two landscape easements identified as the parkway landscaping on the east side of Shepherd Lane adjacent to the tract north and south of "A" Street and parkway landscaping easement on the west side of Portola Avenue adjacent to the tract. The parcels to be assessed receive special benefit from the installation and maintenance of street lighting and parkway landscaping adjacent to the development and perimeter landscaping associated with the development of all properties within the Shepherd Lane area. The improvements to be funded through District assessments have either been installed as a condition of the development of the original undeveloped properties within the District or have been installed as part of the overall development of properties within the area known as Shepherd Lane. The District is being formed to ensure and preserve the on going maintenance and operation of these improvements and it has been determined that each parcel within the District receives similar and proportional benefit from the collective improvements installed as part of the property development. The specific location, description and benefits of the improvements are discussed in the following sections. B. District Improvements and Services GENERAL PROVISIONS OF THE LAW As generally defined by the 1972 Act and applicable to this District, improvements and the associated assessments may include one or any combination of the following: 1) The installation or planting of landscaping; 2) The installation or construction of statuary, fountains, and other ornamental structures and facilities; MuniFinancial Page 3 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District 3) The installation or construction of any facilities which are appurtenant to any of the foregoing or which are necessary or convenient for the maintenance or servicing thereof; 4) The maintenance or servicing, or both, of any of the foregoing including the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including, but not limited to: a) Repair, removal, or replacement of all or any part of any improvements; b) Grading, clearing, removal of debris, the installation or construction of curbs, gutters, walls, sidewalks, or paving, or water, irrigation, drainage, or electrical facilities; c) Providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; d) The removal of trimmings, rubbish, debris, and other solid waste; e) The cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti; f) Electric current or energy, gas, or other agent for the lighting or operation of any other improvements; and, g) Water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. 5) Incidental expenses associated with the improvements including, but not limited to: a) The cost of preparation of the report, including plans, specifications, estimates, diagram, and assessment; b) The costs of printing, advertising, and the publishing, posting and mailing of notices; c) Compensation payable to the County for collection of assessments; d) Compensation of any engineer or attorney employed to render services; e) Any other expenses incidental to the construction, installation, or maintenance and servicing of the improvements; and, f) Costs associated with any elections held for the approval of a new or increased assessment. LOCATION AND EXTENT OF IMPROVEMENTS The purpose of the District is to ensure the ongoing maintenance, operation and servicing of local landscape and street lighting improvements installed as a result of MuniFinarnral Page 4 MuniFinanaal Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District property development in the Shepherd Lane area. These improvements may include, but are not limited to all streetlight facilities as well as landscaping material and facilities associated with properties in the District including ground cover, shrubs, trees and plants; irrigation and drainage systems; ornamental lighting structures, masonry walls or other fencing, entryway monument, and associated appurtenant facilities located within the: • Parkway landscaping along Shepherd Lane adjacent to the residential subdivision. Specifically for this District, this landscaped areas includes the parkway area on the east side of Shepherd Lane which extends the length of Tract 30275; Perimeter/parkway landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. Although these perimeter/parkway-landscaping areas may not have been installed directly as a condition of this residential subdivision, this landscaping is an integral part of the overall development of properties within the Shepherd Lane area and directly benefits all property development within the area. Therefore, each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Streetlights within the residential subdivision and/or adjacent to the subdivision on "A" Street, Shepherd Lane and the west side of Portola Avenue installed as part of the residential subdivision; and, • Any extension or expansion of the proposed landscaped areas within or adjacent to the subdivision that may be installed as part of the development of properties within the District and will be maintained by the District. These improvements may include, but are not limited to open space areas, monuments or other landscaped easements. Page 5 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District III. METHOD OF APPORTIONMENT Pursuant to the 1972 Act the costs (assessments) of the District are apportioned by a formula or method that fairly distributes the net amount to be assessed among all parcels in proportion to benefits received from the improvements. Furthermore, the provisions of Article XIIID of the California Constitution (Proposition 218) require the agency to separate the general benefit from special benefit, whereas only special benefits maybe assessed. A. Improvement Benefit Findings The annual assessments outlined in the budget section of this Report are proposed to cover the estimated costs to provide the necessary services, operation, administration, and maintenance required each year to maintain street lighting facilities associated with the District and keep the landscaping improvements in a healthy, vigorous, and satisfactory condition. It has been determined that each assessable parcel within the District receives similar and proportional special benefits from the improvements. The fact that improvements are part of the specific property development plans and requirements for development of properties within the District, and each parcel's close and relatively similar proximity to the improvements makes each parcel's special benefit from the improvements similar and proportionate. All the lots and parcels that receive special benefit from the improvements are included within the District. GENERAL BENEFITS The improvements to be provided and maintained by the District are a direct result of property development within the District and the Shepherd Lane area and these improvements would otherwise not be required or necessary. Developers typically install local improvements or develop in areas where landscape improvements exist to enhance the marketability and value of properties within their development and/or as conditions of development. In any case, local landscape and lighting improvements associated with the development clearly benefit the properties being developed. If new improvements are installed as part of the development, they are installed either to enhance the property being developed or as a condition of development and not for the benefit of surrounding properties outside the District. Although local development improvements (by virtue of their location) may be visible to surrounding properties, any benefit to surrounding properties is incidental and cannot be considered a direct and special benefit. Furthermore, most developments within the City typically have various landscaping and lighting improvements specifically associated with their development and these improvements are funded by properties within those developments. Therefore, it has been determined that the improvements associated with this District and the ongoing operation and maintenance of those improvements provide no identifiable MuniFinamzal Page 6 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District or measurable general benefit to properties outside the Shepherd Lane area or to the public at large. SPECIAL BENEFITS All the improvements funded through the District provide a special aesthetic appeal to each property and enhance the quality of life for property owners within the District as well as the marketability of those properties. All landscaping and lighting improvements associated with the District are part of the overall development plan for properties within the District and the Shepherd Lane' area and specifically installed for the benefit and development of those properties. The special benefits associated with parkway, perimeter, entryway, and other property -specific landscaped areas and associated amenities are specifically: 1. Enhanced desirability of properties through association with the improvements. 2. Improved aesthetic appeal of properties within the District providing a positive representation of the development and properties within the development. 3. Enhanced adaptation of the urban environment within the natural environment from adequate green space and landscaping. 4. Environmental enhancement through improved erosion resistance, dust and debris control and reduced noise and air pollution. 5. Increased sense of pride in ownership of property within the District resulting from well -maintained improvements associated with the properties. 6. Reduced vandalism and criminal activity resulting from well -maintained surroundings and amenities. 7. The special enhancements of the perceived value of property that results from the above benefits. The special benefits of street lighting are the convenience, safety, and security of property, improvements, and goods. Specifically: 1. Enhanced deterrence of crime and the aid to police protection. 2. Increased nighttime safety on streets through enhanced visibility. 3. Improved sense of security and safety for pedestrians, motorists and property owners. 4. Improved ingress and egress to property. 5. Reduced vandalism, other criminal acts and damage to improvements or property. 6. Reduced personal property loss. MuniFinandal Page 7 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District 7. The special enhancements of the perceived value of property that results from the above benefits B. Description of the Method of Apportionment The assessments outlined in this section represent the proportionate special benefit to each property within the District and the basis of calculating each parcel's proportionate share of the annual costs associated with the District improvements. The costs associated with the maintenance and operation of all District improvements shall be collected through annual assessments from each parcel receiving special benefit. The funds collected shall be dispersed and used for only the services and operation provided to the District. The method of apportionment for the District calculates the receipt of special benefit from the respective improvements based on the actual or proposed land use of the parcels within the District. The special benefit received by each lot or parcel is equated to the overall land use of the parcel based on the parcel's actual land use or proposed planned development, and is reliant upon the special benefit received from the improvements planned within the District. To identify and determine the special benefit to be received by each parcel and their proportionate share of the improvements it is necessary to consider the entire scope of the planned improvements within the Shepherd Lane area as well as individual property development within the District. Upon review of the proposed improvements it has been determined that each parcel within the proposed District benefits from the landscaping and lighting improvements installed as a condition of property development as well as perimeter landscaping associated with similar developments in the Shepherd Lane area. Based on these improvements and the planned property development within the proposed District, a maximum assessment can be established. All costs associated with the improvements shall be fairly distributed among the parcels based upon the special benefit received by each parcel. Additionally, in compliance with Article XIIID, Section 4, of the State Constitution each parcel's assessment may not exceed the reasonable cost of the proportional special benefit conferred to that parcel. The benefit formula used to determine the assessment obligation is therefore based upon both the improvements that benefit the parcels within the District as well as the proposed land use of each property as compared to other parcels that benefit from those specific improvements. MuniFinandal Page 8 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District EQUIVALENT BENEFIT UNITS: The Equivalent Benefit Unit (EBU) method of apportioning benefit is typically seen as the most appropriate and equitable assessment methodology for districts formed under the 1972 Act, as the benefit to each parcel from the improvements are apportioned as a function of land use type and development or development potential. To assess benefits equitably, it is necessary to relate the different type of properties within the District to the improvements and to each other. The Equivalent Benefit Unit method of assessment apportionment utilizes the single-family home site as the basic unit of assessment. A single-family home site equals one Equivalent Benefit Unit (EBU). Every other land use within the District is converted to EBU's based on an assessment formula that equates the property's specific development status, type of development (land use), and size or development plans for the property, as compared to a single-family home site. Although this particular District (Petunia II subdivision) will be comprised of only subdivided residential lots, it is anticipated that this subdivision will eventually be one of several subdivisions and developments that will be included in Zone 16 (Shepherd Lane) of the Palm Desert Consolidated District. Therefore, the following provides an overview of the EBU's applied to various other land use classifications within the Consolidated District. EBU APPLICATION BY LAND USE: Single Family Residential — This land use is defined as a fully subdivided residential home site with or without a structure. This land use is assessed 1.00 EBU per lot or parcel. This is the base value that all other land use types are compared and weighted against (i.e. Equivalent Benefit Unit). Multifamily Residential — This land use is defined as a fully subdivided residential parcel that has more than one residential unit developed on the property. Engineering studies have consistently shown that apartment and other multiple - family dwelling units generate lower traffic volumes, water consumption, and typically impact public infrastructure between 60 to 80 percent as much as a single- family residence largely due to lower occupancy of apartment dwelling units versus single family residential units. Therefore, assessments for the multiple residential units shall be prorated with a value of 0.70 EBU per unit. Condominiums — This land use includes residential developments designated as condominiums by the City and may include one to four residential units per parcel. Engineering studies have shown that on average, condominiums generate lower traffic volumes, water consumption, and typically impact public infrastructure less than a detached single-family residence, but more than apartments or other multifamily dwelling units. Therefore, assessments for condominiums shall be prorated with a value of 0.80 EBU per unit. MuniFinarnral Page 9 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District Approved -Residential Development — This land use is defined as any property not fully subdivided, but for which a Final Tract Map has been approved with a specific number of residential lots to be developed on the parcel. This land use type is assessed at 1.00 EBU per planned residential lot. (If the parcel is actually subdivided at the time annual assessments are submitted to the County for Collection, the resulting parcels shall be assessed based on their resulting development status change). Proposed -Residential Development — This land use is defined as any property not fully subdivided and for which a Tentative Tract Map has been submitted or approved with a specific number of proposed residential lots, but a Final Tract Map has not been approved. This land use type is assessed at 0.75 EBU per proposed residential lot. (If the parcel is actually subdivided or a Final Tract Map is approved prior to the annual assessments being submitted to the County for Collection, the resulting land use change or new parcels shall be assessed based on their resulting development status change). Vacant Undeveloped Property — This land use is defined as any property identified as vacant land that is currently undeveloped with no specific development plans, but may be developed or subdivided in the future (No tract map or development plan has been submitted and/or approved). This land use is assessed at 1.00 EBU per parcel. Developed Non -Residential — This land use is defined as property that is developed, but not as residential property as defined by the previous land use designations. The average residential density within the City is approximately six (6) residential units per acre. Therefore, the proportionate benefit assigned to Developed Non -Residential properties shall be 6.00 EBU per gross acre. Parcels designated as Developed Non -Residential are assigned a minimum of 1.00 EBU. Exempt Parcels — This land use identifies properties that are not assessed within the District. This land use classification may include but is not limited to lots or parcels that will not be developed such as sliver parcels, dedicated easements, open space areas, dedicated landscaped areas or common areas. Similarly, properties not designated by a County Assessor's Parcel Number (APN) such as streets, utility easements or rights -of -way receive no special benefit and are considered Exempt. These Exempt properties are not assessed for District improvements. If the County designates an Exempt property by an APN, that parcel shall be assigned 0.00 EBU Properties that are identified as non-taxable by the County Assessor's Office such as government owned or utility owned properties are not exempt from District assessments unless: the property has limited or restricted development potential; the property clearly receives no benefit from the improvements; or the property provides additional or substantially similar improvements (such is the case with public schools, parks and open space areas). MuniFinan iai Page 10 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District The following table provides a listing by land use type, the Equivalent Benefit Unit factor applied to that land use type and the multiplying factor used to calculate each parcel's individual EBU as outlined in the preceding description. Land Use Designations and Equivalent Benefit Units Equivalent Benefit Unit Property Type Multiplier Single Family Residential 1.000 Unit/Lot/Parcel Multifamily Residential 0.700 Unit Condominiums 0.800 Unit Approved -Residential Development 1.000 Unit/Lots Proposed -Residential Development 0.750 Unit/Lots Vacant Undeveloped Property 1.000 Parcel Developed Non -Residential 6.000 Acreage Exempt 0.000 Parcel The benefit formula applied to various parcels is based on the preceding Equivalent Benefit Unit (EBU) discussion and table. Each parcel's EBU correlates the parcel's special benefit received as compared to all other parcels benefiting from the improvements. The following formula is used to calculate each parcel's EBU (proportional benefit). Parcel Type EBU x Acres/Lots/Units = Parcel EBU The total number of Equivalent Benefit Units (EBU's) is the sum of all individual EBU's applied to parcels that receive a special benefit the improvement. An assessment amount per EBU (Rate) for the District improvements is established annually by taking the total cost of the improvement and dividing that amount by the total number of EBU's of all benefiting parcels. This Rate is then applied back to each parcel's individual EBU to determine the parcel's proportionate benefit and assessment obligation. Total Balance to Levy / Total EBU = Levy per EBU Levy per EBU x Parcel EBU = Parcel Levy Amount MuniFinamzal Page 11 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District C. Assessment Range Formula Any new or increase in assessments require certain noticing and meeting requirements by law. Prior to the passage of Proposition 218, legislative changes in the Brown Act defined the definition of "new or increased assessment" to exclude certain conditions. These conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition and conditions were later confirmed through SB919 (Proposition 218 implementing legislation). The purpose of establishing an assessment range formula is to provide for reasonable increases and inflationary adjustments to annual assessments without requiring costly noticing and mailing procedures, which could add to the District costs and assessments. As part of the District formation, balloting of property owners is required, pursuant to Proposition 218. The ballots presented to the property owners in connection with this Report includes an Assessment Rate to be approved, as well as the approval of an assessment range formula. The assessment range formula shall be applied to all future assessments within the District. Generally, if the proposed annual assessment (levy per unit or rate) for the current fiscal year is less than or equal to the "Maximum Assessment" (or "Adjusted Maximum Assessment"), then the proposed annual assessment is not considered an increased assessment. The Maximum Assessment is equal to the initial Assessment approved by property owners adjusted annually by the following criteria: 1. Beginning in the second fiscal year, (Fiscal Year 2005/2006) and each fiscal year thereafter, the Maximum Assessment will be recalculated annually, and, 2. The new adjusted Maximum Assessment for the year represents the prior year's Maximum Assessment adjusted by three percent (3.0%). The Maximum Assessment is adjusted annually and is calculated independent of the District's annual budget and proposed annual assessment. Any proposed annual assessment (rate per levy unit) less than or equal to this Maximum Assessment is not considered an increased assessment, even if the proposed assessment is significantly greater than the assessment applied in the prior fiscal year. The Maximum Assessment will be recalculated and adjusted annually. However, the City Council may reduce or freeze the Maximum Assessment at any time by amending the Engineer's Annual Report. Although the Maximum Assessment will normally increase each year, the actual District assessments may fluctuate or remain virtually unchanged. The Maximum Assessment adjustment is designed to establish a reasonable limit on District assessments. The Maximum Assessment calculated each year does not require or facilitate an increase to the annual assessment and neither does it restrict assessments to the adjustment maximum amount. If the budget and assessments for the fiscal MuniFinan ial Page 12 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District year does not require an increase, or the increase is less than the adjusted Maximum Assessment, then the required budget and assessment may be applied without additional property owner balloting. If the budget and assessments calculated requires an increase greater than the adjusted Maximum Assessment then the assessment is considered an increased assessment. To impose an increased assessment the City Council must comply with the provisions of Proposition 218 (Article XIIID Section 4c of the California Constitution), which requires a public hearing and certain protest procedures including mailed notice of the public hearing and property owner protest balloting. Property owners through the balloting process must approve the proposed assessment increase. If the new proposed assessment is approved, then a new Maximum Assessment is established for the District. If the proposed assessment is not approved, the City Council may not levy an assessment greater than the adjusted Maximum Assessment previously established for the District. MuniFinancial Page 13 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District IV. DISTRICT BUDGET A. Calculation of the Maximum Assessment The Maximum Assessment Rate per EBU presented to the property owners for approval is based on the estimated expenses and benefit units planned for the District (Petunia II) at build out. The following budget reflects these assumptions: ZONE 16 PETUNIA II Total General Special Budget Benefit Benefit DIRECT COSTS Maintenance Costs $2,534 380 $2,154 Landscape Utilities 792 119 673 Landscape Extras (Repairs/Materials/Equipment) 770 116 655 Tree Pruning 450 68 383 Street Lighting 150 23 128 Special District Services 0 0 Annual Direct Costs (Subtotal) $4,696 704 $3,992 Renovation/Capital Improvement Expenditures 0 - 0 Total Direct Costs ADMINISTRATION COSTS District Administration 948 142 806 County Administration Fee 25 4 21 County Per Parcel Fee 3 0 3 Administration Costs (Subtotal) $976 146 $830 LEVY BREAKDOWN Total Direct and Admin. Costs 5,672 851 4,821 Reserve Collection/ (Transfers) 567 567 Other Revenues/General Fund Contribution 0 0 Capital Improvement Project Collection/ (Transfers) 0 - 0 Balance to Levy $6,239 851 $5,388 DISTRICT STATISTICS Total Parcels 16 Total Parcels Levied 16 Total Equivalent Dwelling Units 16.00 Levy per EDU RESERVE INFORMATION Beginning Reserve Balance Reserve Account Activity Anticipated Reserve Balance ASSESSMENT INFORMATION Maximum Assessment Rate FY 2004/05 CPI Applied : $4,696 704 0.00% $3,992 $336.78 0 567 567 $336.78 MuniFinanaal Page 14 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District District Budget For Fiscal Year 2004/2005 Upon the successful formation of the proposed Petunia II/Shepherd Lane Landscaping and Lighting District, the District and parcels therein will be concurrently annexed into the Palm Desert Consolidated District as part of Zone 16 (Shepherd Lane) for Fiscal Year 2004/2005. The actual budget and assessment rate to be applied for Fiscal Year 2004/2005 (first levy of assessments) will be reviewed and adopted by the City Council as part of the annual levy process for the Consolidated District for Fiscal Year 2004/2005. Although it is anticipated that the proposed expenses (budget) and proposed assessment rate per Equivalent Benefit Unit (EBU) outlined in the preceding table (Calculation of the Maximum Assessment) will be applied for Fiscal Year 2004/2005, the assessment rate approved and adopted by the City Council may be less than the maximum rate outlined in this report. MuniFinan ial Page 15 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District APPENDIX A - DISTRICT ASSESSMENT DIAGRAM The District consists of all lots and parcels within the Petunia II subdivision Tract 30275 located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally east of the Monterey Avenue. The tract map and Assessor's Parcel Map shown on the following pages identify the parcels within the Petunia II/Shepherd Lane Landscaping and Lighting District, as they existed on the County Assessor's Roll when this Report was prepared and the Resolution of Intention was adopted. The District is inclusive of Assessor's Parcel Map — Book 653, Page 37, (Assessor's Parcel Number 653-780-017 through 032). The parcels identified on the Assessor's Parcel Map and the Tract Map contained herein define the boundaries and constitute the Assessment Diagram for the District and by reference includes all subsequent parcels and Assessor's Parcel Maps and parcel numbers related thereto. MuniFinan ial Page 16 Engineer's Report Fiscal Year 2004/2005 Petunia II/Shepherd Lane Landscaping and Lighting District .APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL Parcel identification for each lot or parcel within the District, shall be the parcel as shown on the Riverside County Secured Roll for the year in which this Report is prepared and reflective of the Assessor's Parcel Map(s). As of the resolution of Intention, the Petunia II/Shepherd Lane Landscaping and Lighting District is inclusive of Assessor's Parcel Numbers (APN's) identified on the Assessor's Parcel Maps — Book 653, Page 37, (Assessor's Parcel Number 653-780-017 through 032). A listing of parcels assessed within this District identifying the proposed Maximum Assessment Amount for the first fiscal year is included in the following listing. MuniFinancial Proposed APN Parcel Description Assessment 653-780-017 Tract 30275 Lot 1 653-780-018 Tract 30275 Lot 2 653-780-019 Tract 30275 Lot 3 653-780-020 Tract 30275 Lot 4 653-780-021 Tract 30275 Lot 5 653-780-022 Tract 30275 Lot 6 653-780-023 Tract 30275 Lot 7 653-780-024 Tract 30275 Lot 8 653-780-025 Tract 30275 Lot 9 653-780-026 Tract 30275 Lot 10 653-780-027 Tract 30275 Lot 11 653-780-028 Tract 30275 Lot 12 653-780-029 Tract 30275 Lot 13 653-780-030 Tract 30275 Lot 14 653-780-031 Tract 30275 Lot 15 653-780-032 Tract 30275 Lot 16 Total Assessment 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 336.78 $5,388.48 Page 19 CITY OF PALM DESERT ENGINEER'S REPORT SUNDANCE EAST/ SHEPHERD LANE LANDSCAPING AND LIGHTING DISTRICT FORMATION Fiscal Year 2004/2005 Intent Meeting: Public Hearing: May 13, 2004 July 8, 2004 MuniFinancial Corporate Office Regional Offices Antelope Valley, CA Phoenix, AZ Los Angeles, CA San Diego, CA Oakland, CA Sacramento, CA Orange County, CA Seattle, WA 27368 Via Industria Suite 110 Temecula, CA 92590 Tel: (909) 587-3500 Tel: (800) 755-MUNI (6864) Fax: (909) 587-3510 www.muni.com ENGINEER'S REPORT AFFIDAVIT Formation of and Establishment of Annual Assessments for the: Sundance East/Shepherd Lane Landscaping and Lighting District City of Palm Desert Riverside County, State of California This Report identifies all the parcels within the District and all relevant zones therein, as they existed at the time of the passage of the Resolution of Intention. Reference is hereby made to the Riverside County Assessor's maps for a detailed description of the lines and dimensions of parcels within the District. The undersigned respectfully submits the enclosed Report as directed by the City Council. Dated this day of , 2004. MuniFinancial Assessment Engineer On Behalf of the City of Palm Desert By: Brian Jewett, Principal Consultant Financial Consulting Services By: Richard Kopecky R.C.E.# 16742 TABLE OF CONTENTS I. OVERVIEW 1 A. INTRODUCTION 1 B. GENERAL DESCRIPTION OF THE DISTRICT 2 II. PLANS AND SPECIFICATIONS 3 A. DESCRIPTION OF THE DISTRICT 3 B. DISTRICT IMPROVEMENTS AND SERVICES 3 GENERAL PROVISIONS OF THE LAW 3 LOCATION AND EXTENT OF IMPROVEMENTS 4 III. METHOD OF APPORTIONMENT 6 A. IMPROVEMENT BENEFIT FINDINGS 6 GENERAL BENEFITS 6 SPECIAL BENEFITS 7 B. DESCRIPTION OF THE METHOD OF APPORTIONMENT 8 EQUIVALENT BENEFIT UNITS: 9 EBU APPLICATION BY LAND USE: 9 C. ASSESSMENT RANGE FORMULA 12 IV. DISTRICT BUDGET 14 A. CALCULATION OF THE MAXIMUM ASSESSMENT 14 B. DISTRICT BUDGET FOR FISCAL YEAR 2004/2005 15 APPENDIX A - DISTRICT ASSESSMENT DIAGRAM 16 APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL 19 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District I. OVERVIEW A. Introduction The City of Palm Desert ("City") proposes to form the Sundance East/Shepherd Lane Landscaping and Lighting District ("District") for Fiscal Year 2004/2005. The City Council on behalf of the City proposes to levy and collect special assessments on the County tax rolls to provide funding for the costs and expenses required for maintenance of the landscaping and lighting improvements associated with the District. Upon successful formation of the District and approval of the assessments, the territory within the District will be concurrently annexed into the existing Palm Desert Consolidated Landscaping and Lighting District ("Consolidated District") as the Sundance East sub -zone of Zone 16 (Shepherd Lane). The District will be formed, annexed into the Consolidated District, and levied pursuant to the Landscape and Lighting Act cf 1972, Part 2 of Dizision 15 of the California Streets and Higlrrau)s Cade (the Act), and in compliance with the substantive and procedural requirements of the California Constitution Article XIIID. This Engineer's Report ("Report") describes the District and assessments to be levied against properties within the District commencing with Fiscal Year 2004/2005. The assessments described herein are based on the estimated cost to maintain the improvements that will provide a direct and special benefit to properties within the District. Improvements to be maintained and funded through annual assessments shall be constructed and installed in connection with the development of these properties. The annual costs and assessments described herein include all estimated direct expenditures, incidental expenses, deficits, surpluses, revenues, and reserves associated with the maintenance and servicing of the improvements. The word "parcel," for the purposes of this Report, refers to an individual property assigned its own Assessment Number by the County of Riverside Assessor's Office. The County of Riverside Auditor/Controller uses Assessment Numbers and specific Fund Numbers to identify properties assessed on the tax roll for special district benefit assessments. At a noticed Public Hearing, the City Council will consider all public comments and written protests presented. Upon conclusion of the Public Hearing, the City Council will tabulate property owner protest ballots received to determine whether majority protest exists, and by resolution confirm the results of the protest ballot tabulation. Proceedings for the formation of the assessment district shall be abandoned if majority protest exists. If tabulation of the property owner protest ballots indicates approval of the assessments and the assessment range formula presented, by resolution the City Council will approve the Engineer's Report as submitted or amended (amendments may not increase the assessments approved by the property owners). Following approval of the Report, the City Council will by resolution, order MuniFinandal Page 1 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District the formation of the District, the annexation of the territory into the Consolidated District, and confirm the levy and collection of assessments pursuant to the Act. In such case, the assessments as approved may be submitted to the Riverside County Auditor/Controller to be included on the property tax roll for each parcel for Fiscal Year 2004/2005, or reviewed and confirmed at the annual public hearing for the Consolidated District along with all other assessments within the Consolidated District. B. General Description of the District The District consists of all lots, parcels and properties within the residential subdivision known as Sundance East within the development area known as Shepherd Lane located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally west of the Monterey Avenue. The improvements and services that provide a special benefit to properties within the District generally include, but are not limited to: • Parkway landscaping on Shepherd Lane adjacent to the residential development installed as part of the development of properties therein; • Perimeter landscaping for the Shepherd Lane residential developments. Tract 30503 is one of several residential subdivisions within the area known as Shepherd Lane, that includes parkway/perimeter landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. These improvements benefit all property development within the Shepherd Lane area and each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Any entryways, open space areas or other landscaped areas associated with the development of properties within the District that will be maintained by the District; • Street lights within and adjacent to the residential subdivision. The estimated annual cost to provide and maintain the improvements associated with the District have been allocated to each property in proportion to special benefits received. The Method of Apportionment described in this Report utilizes commonly accepted assessment engineering practices and has been established pursuant to the 1972 Act and the provisions of Article XIIID of the California Constitution (Proposition 218). MuniFinancial Page 2 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and T fighting District II. PLANS AND SPECIFICATIONS A. Description of the District The District consists of all lots and parcels within the residential subdivision known as Sundance East (Tract 30503) located on the east side of Shepherd Lane at the intersection of Chinook Circle East. This tract is generally located west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive and generally east of the Monterey Avenue. Refer to the Assessment Diagram for details of the District boundary. The proposed District includes all parcels of land that have been approved for residential development within Tract 30503. • Tract No. 30503 (Chinook Circle East) — Sixteen (16) single-family residential parcels (lots 1-16) identified on the County Assessor's Map as APN Book 653, Page 77, (Assessor's Parcel Numbers 653-771-018 through 033). This tract includes two landscape easements identified as the parkway landscaping on the east side of Shepherd Lane adjacent to the tract north and south of Chinook Circle East and parkway landscaping easement on the west side of Portola Avenue adjacent to the tract. The parcels to be assessed receive special benefit from the installation and maintenance of street lighting and parkway landscaping adjacent to the development and perimeter landscaping associated with the development of all properties within the Shepherd Lane area. The improvements to be funded through District assessments have either been installed as a condition of the development of the original undeveloped properties within the District or have been installed as part of the overall development of properties within the area known as Shepherd Lane. The District is being formed to ensure and preserve the on going maintenance and operation of these improvements and it has been determined that each parcel within the District receives similar and proportional benefit from the collective improvements installed as part of the property development. The specific location, description and benefits of the improvements are discussed in the following sections. B. District Improvements and Services GENERAL PROVISIONS OF THE LAW As generally defined by the 1972 Act and applicable to this District, improvements and the associated assessments may include one or any combination of the following: 1) The installation or planting of landscaping; 2) The installation or construction of statuary, fountains, and other ornamental structures and facilities; MuniFinanaal Page 3 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District 3) The installation or construction of any facilities which are appurtenant to any of the foregoing or which are necessary or convenient for the maintenance or servicing thereof; The maintenance or servicing, or both, of any of the foregoing including the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including, but not limited to: a) Repair, removal, or replacement of all or any part of any improvements; b) Grading, clearing, removal of debris, the installation or construction of curbs, gutters, walls, sidewalks, or paving, or water, irrigation, drainage, or electrical facilities; c) Providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; d) The removal of trimmings, rubbish, debris, and other solid waste; e) The cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti; f) Electric current or energy, gas, or other agent for the lighting or operation of any other improvements; and, Water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. 5) Incidental expenses associated with the improvements including, but not limited to: a) The cost of preparation of the report, including plans, specifications, estimates, diagram, and assessment; b) The costs of printing, advertising, and the publishing, posting and mailing of notices; c) Compensation payable to the County for collection of assessments; d) Compensation of any engineer or attorney employed to render services; e) Any other expenses incidental to the construction, installation, or maintenance and servicing of the improvements; and, f) Costs associated with any elections held for the approval of a new or increased assessment. g) LOCATION AND EXTENT OF IMPROVEMENTS The purpose of the District is to ensure the ongoing maintenance, operation and servicing of local landscape and street lighting improvements installed as a result of MuniFinamral Page 4 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District property development in the Shepherd Lane area. These improvements may include, but are not limited to all streetlight facilities as well as landscaping material and facilities associated with properties in the District including ground cover, shrubs, trees and plants; irrigation and drainage systems; ornamental lighting structures, masonry walls or other fencing, entryway monument, and associated appurtenant facilities located within the: • Parkway landscaping along Shepherd Lane adjacent to the residential subdivision. Specifically for this District, this landscaped areas includes the parkway area on the east side of Shepherd Lane which extends the length of Tract 30503; • Perimeter/parkway landscaping on the west side of Portola Avenue between Frank Sinatra Dive and Gerald Ford Drive, as well as landscaping on the north side of Frank Sinatra Drive and the south side of Gerald Ford Drive on either side of Shepherd Lane. Although these perimeter/parkway-landscaping areas may not have been installed directly as a condition of this residential subdivision, this landscaping is an integral part of the overall development of properties within the Shepherd Lane area and directly benefits all property development within the area. Therefore, each residential subdivision is assessed a proportional share of the costs associated with these landscaped areas; • Streetlights within the residential subdivision and/or adjacent to the subdivision on Chinook Circle East, Shepherd Lane and the west side of Portola Avenue installed as part of the residential subdivision; and, • Any extension or expansion of the proposed landscaped areas within or adjacent to the subdivision that may be installed as part of the development of properties within the District and will be maintained by the District. These improvements may include, but are not limited to open space areas, monuments or other landscaped easements. MuniFinandal Page 5 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District III. METHOD OF APPORTIONMENT Pursuant to the 1972 Act the costs (assessments) of the District are apportioned by a formula or method that fairly distributes the net amount to be assessed among all parcels in proportion to benefits received from the improvements. Furthermore, the provisions of Article XIIID of the California Constitution (Proposition 218) require the agency to separate the general benefit from special benefit, whereas only special benefits may be assessed. A. Improvement Benefit Findings The annual assessments outlined in the budget section of this Report are proposed to cover the estimated costs to provide the necessary services, operation, administration, and maintenance required each year to maintain street lighting facilities associated with the District and keep the landscaping improvements in a healthy, vigorous, and satisfactory condition. It has been determined that each assessable parcel within the District receives similar and proportional special benefits from the improvements. The fact that improvements are part of the specific property development plans and requirements for development of properties within the District, and each parcel's close and relatively similar proximity to the improvements makes each parcel's special benefit from the improvements similar and proportionate. All the lots and parcels that receive special benefit from the improvements are included within the District. GENERAL BENEFITS The improvements to be provided and maintained by the District are a direct result of property development within the District and the Shepherd Lane area and these improvements would otherwise not be required or necessary. Developers typically install local improvements or develop in areas where landscape improvements exist to enhance the marketability and value of properties within their development and/or as conditions of development. In any case, local landscape and lighting improvements associated with the development clearly benefit the properties being developed. If new improvements are installed as part of the development, they are installed either to enhance the property being developed or as a condition of development and not for the benefit of surrounding properties outside the District. Although local development improvements (by virtue of their location) may be visible to surrounding properties, any benefit to surrounding properties is incidental and cannot be considered a direct and special benefit. Furthermore, most developments within the City typically have various landscaping and lighting improvements specifically associated with their development and these improvements are funded by properties within those developments. Therefore, it has been determined that the improvements associated with this District and the ongoing operation and maintenance of those improvements provide no identifiable MuniFinancial Page 6 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District or measurable general benefit to properties outside the Shepherd Lane area or to the public at large. SPECIAL BENEFITS All the improvements funded through the District provide a special aesthetic appeal to each property and enhance the quality of life for property owners within the District as well as the marketability of those properties. All landscaping and lighting improvements associated with the District are part of the overall development plan for properties within the District and the Shepherd Lane area and specifically installed for the benefit and development of those properties. The special benefits associated with parkway, perimeter, entryway, and other property -specific landscaped areas and associated amenities are specifically: 1. Enhanced desirability of properties through association with the improvements. 2. Improved aesthetic appeal of properties within the District providing a positive representation of the development and properties within the development. 3. Enhanced adaptation of the urban environment within the natural environment from adequate green space and landscaping. 4. Environmental enhancement through improved erosion resistance, dust and debris control and reduced noise and air pollution. 5. Increased sense of pride in ownership of property within the District resulting from well -maintained improvements associated with the properties. 6. Reduced vandalism and criminal activity resulting from well -maintained surroundings and amenities. 7. The special enhancements of the perceived value of property that results from the above benefits. The special benefits of street lighting are the convenience, safety, and security of property, improvements, and goods. Specifically: 1. Enhanced deterrence of crime and the aid to police protection. 2. Increased nighttime safety on streets through enhanced visibility. 3. Improved sense of security and safety for pedestrians, motorists and property owners. 4. Improved ingress and egress to property. 5. Reduced vandalism, other criminal acts and damage to improvements or property. 6. Reduced personal property loss. MuniFinancial Page 7 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District 7. The special enhancements of the perceived value of property that results from the above benefits B. Description of the Method of Apportionment The assessments outlined in this section represent the proportionate special benefit to each property within the District and the basis of calculating each parcel's proportionate share of the annual costs associated with the District improvements. The costs associated with the maintenance and operation of all District improvements shall be collected through annual assessments from each parcel receiving special benefit. The funds collected shall be dispersed and used for only the services and operation provided to the District. The method of apportionment for the District calculates the receipt of special benefit from the respective improvements based on the actual or proposed land use of the parcels within the District. The special benefit received by each lot or parcel is equated to the overall land use of the parcel based on the parcel's actual land use or proposed planned development, and is reliant upon the special benefit received from the improvements planned within the District. To identify and determine the special benefit to be received by each parcel and their proportionate share of the improvements it is necessary to consider the entire scope of the planned improvements within the Shepherd Lane area as well as individual property development within the District. Upon review of the proposed improvements it has been determined that each parcel within the proposed District benefits from the landscaping and lighting improvements installed as a condition of property development as well as perimeter landscaping associated with similar developments in the Shepherd Lane area. Based on these improvements and the planned property development within the proposed District, a maximum assessment can be established. All costs associated with the improvements shall be fairly distributed among the parcels based upon the special benefit received by each parcel. Additionally, in compliance with Article XIIID, Section 4, of the State Constitution each parcel's assessment may not exceed the reasonable cost of the proportional special benefit conferred to that parcel. The benefit formula used to determine the assessment obligation is therefore based upon both the improvements that benefit the parcels within the District as well as the proposed land use of each property as compared to other parcels that benefit from those specific improvements. MuniFinanaal Page 8 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District EQUIVALENT BENEFIT UNITS: The Equivalent Benefit Unit (EBU) method of apportioning benefit is typically seen as the most appropriate and equitable assessment methodology for districts formed under the 1972 Act, as the benefit to each parcel from the improvements are apportioned as a function of land use type and development or development potential. To assess benefits equitably, it is necessary to relate the different type of properties within the District to the improvements and to each other. The Equivalent Benefit Unit method of assessment apportionment utilizes the single-family home site as the basic unit of assessment. A single-family home site equals one Equivalent Benefit Unit (EBU). Every other land use within the District is converted to EBU's based on an assessment formula that equates the property's specific development status, type of development (land use), and size or development plans for the property, as compared to a single-family home site. Although this particular District (Sundance East subdivision) will be comprised of only subdivided residential lots, it is anticipated that this subdivision will eventually be one of several subdivisions and developments that will be included in Zone 16 (Shepherd Lane) of the Palm Desert Consolidated District. Therefore, the following provides an overview of the EBU's applied to various other land use classifications within the Consolidated District. EBU APPLICATION BY LAND USE: Single Family Residential — This land use is defined as a fully subdivided residential home site with or without a structure. This land use is assessed 1.00 EBU per lot or parcel. This is the base value that all other land use types are compared and weighted against (i.e. Equivalent Benefit Unit). Multifamily Residential — This land use is defined as a fully subdivided residential parcel that has more than one residential unit developed on the property. Engineering studies have consistently shown that apartment and other multiple - family dwelling units generate lower traffic volumes, water consumption, and typically impact public infrastructure between 60 to 80 percent as much as a single- family residence largely due to lower occupancy of apartment dwelling units versus single family residential units. Therefore, assessments for the multiple residential units shall be prorated with a value of 0.70 EBU per unit. Condominiums — This land use includes residential developments designated as condominiums by the City and may include one to four residential units per parcel. Engineering studies have shown that on average, condominiums generate lower traffic volumes, water consumption, and typically impact public infrastructure less than a detached single-family residence, but more than apartments or other multifamily dwelling units. Therefore, assessments for condominiums shall be prorated with a value of 0.80 EBU per unit. MuniFinandal Page 9 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District Approved -Residential Development — This land use is defined as any property not fully subdivided, but for which a Final Tract Map has been approved with a specific number of residential lots to be developed on the parcel. This land use type is assessed at 1.00 EBU per planned residential lot. (If the parcel is actually subdivided at the time annual assessments are submitted to the County for Collection, the resulting parcels shall be assessed based on their resulting development status change). Proposed -Residential Development — This land use is defined as any property not fully subdivided and for which a Tentative Tract Map has been submitted or approved with a specific number of proposed residential lots, but a Final Tract Map has not been approved. This land use type is assessed at 0.75 EBU per proposed residential lot. (If the parcel is actually subdivided or a Final Tract Map is approved prior to the annual assessments being submitted to the County for Collection, the resulting land use change or new parcels shall be assessed based on their resulting development status change). Vacant Undeveloped Property — This land use is defined as any property identified as vacant land that is currently undeveloped with no specific development plans, but may be developed or subdivided in the future (No tract map or development plan has been submitted and/or approved). This land use is assessed at 1.00 EBU per parcel. Developed Non -Residential — This land use is defined as property that is developed, but not as residential property as defined by the previous land use designations. The average residential density within the City is approximately six (6) residential units per acre. Therefore, the proportionate benefit assigned to Developed Non -Residential properties shall be 6.00 EBU per gross acre. Parcels designated as Developed Non -Residential are assigned a minimum of 1.00 EBU. Exempt Parcels — This land use identifies properties that are not assessed within the District. This land use classification may include but is not limited to lots or parcels that will not be developed such as sliver parcels, dedicated easements, open space areas, dedicated landscaped areas or common areas. Similarly, properties not designated by a County Assessor's Parcel Number (APN) such as streets, utility easements or rights -of -way receive no special benefit and are considered Exempt. These Exempt properties are not assessed for District improvements. If the County designates an Exempt property by an APN, that parcel shall be assigned 0.00 EBU. Properties that are identified as non-taxable by the County Assessor's Office such as government owned or utility owned properties are not exempt from District assessments unless: the property has limited or restricted development potential; the property clearly receives no benefit from the improvements; or the property provides additional or substantially similar improvements (such is the case with public schools, parks and open space areas). MuniFin n iai Page 10 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District The following table provides a listing by land use type, the Equivalent Benefit Unit factor applied to that land use type and the multiplying factor used to calculate each parcel's individual EBU as outlined in the preceding description. Land Use Designations and Equivalent Benefit Units Property Type Equivalent Benefit Unit Multiplier Single Family Residential 1.000 Unit/Lot/Parcel Multifamily Residential 0.700 Unit Condominiums 0.800 Unit Approved -Residential Development 1.000 Unit/Lots Proposed -Residential Development 0.750 Unit/Lots Vacant Undeveloped Property 1.000 Parcel Developed Non -Residential 6.000 Acreage Exempt 0.000 Parcel The benefit formula applied to various parcels is based on the preceding Equivalent Benefit Unit (EBU) discussion and table. Each parcel's EBU correlates the parcel's special benefit received as compared to all other parcels benefiting from the improvements. The following formula is used to calculate each parcel's EBU (proportional benefit). Parcel Type EBU x Acres/Lots/Units = Parcel EBU The total number of Equivalent Benefit Units (EBU's) is the sum of all individual EBU's applied to parcels that receive a special benefit the improvement. An assessment amount per EBU (Rate) for the District improvements is established annually by taking the total cost of the improvement and dividing that amount by the total number of EBU's of all benefiting parcels. This Rate is then applied back to each parcel's individual EBU to determine the parcel's proportionate benefit and assessment obligation. Total Balance to Levy / Total EBU = Levy per EBU Levy per EBU x Parcel EBU = Parcel Levy Amount MuniFinanecial Page 11 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District C. Assessment Range Formula Any new or increase in assessments require certain noticing and meeting requirements by law. Prior to the passage of Proposition 218, legislative changes in the Brown Act defined the definition of "new or increased assessment" to exclude certain conditions. These conditions included "any assessment that does not exceed an assessment formula or range of assessments previously adopted by the agency or approved by the voters in the area where the assessment is imposed." This definition and conditions were later confirmed through SB919 (Proposition 218 implementing legislation). The purpose of establishing an assessment range formula is to provide for reasonable increases and inflationary adjustments to annual assessments without requiring costly noticing and mailing procedures, which could add to the District costs and assessments. As part of the District formation, balloting of property owners is required, pursuant to Proposition 218. The ballots presented to the property owners in connection with this Report includes an Assessment Rate to be approved, as well as the approval of an assessment range formula. The assessment range formula shall be applied to all future assessments within the District. Generally, if the proposed annual assessment (levy per unit or rate) for the current fiscal year is less than or equal to the "Maximum Assessment" (or "Adjusted Maximum Assessment"), then the proposed annual assessment is not considered an increased assessment. The Maximum Assessment is equal to the initial Assessment approved by property owners adjusted annually by the following criteria: 1. Beginning in the second fiscal year, (Fiscal Year 2005/2006) and each fiscal year thereafter, the Maximum Assessment will be recalculated annually, and, 2. The new adjusted Maximum Assessment for the year represents the prior year's Maximum Assessment adjusted by three percent (3.0%). The Maximum Assessment is adjusted annually and is calculated independent of the District's annual budget and proposed annual assessment. Any proposed annual assessment (rate per levy unit) less than or equal to this Maximum Assessment is not considered an increased assessment, even if the proposed assessment is greater than the assessment applied in the prior fiscal year. The Maximum Assessment will be recalculated and adjusted annually. However, the City Council may reduce or freeze the Maximum Assessment at any time by amending the Engineer's Annual Report. Although the Maximum Assessment will normally increase each year, the actual District assessments may fluctuate or remain virtually unchanged. The Maximum Assessment adjustment is designed to establish a reasonable limit on District assessments. The Maximum Assessment calculated each year does not require or facilitate. an increase to the annual assessment and neither does it restrict assessments to the adjustment maximum amount. If the budget and assessments for the fiscal year does not require an increase, or the increase is less than the adjusted Maximum MuniFir naal Page 12 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District Assessment, then the required budget and assessment may be applied without additional property owner balloting. If the budget and assessments calculated requires an increase greater than the adjusted Maximum Assessment then the assessment is considered an increased assessment. To impose an increased assessment the City Council must comply with the provisions of Proposition 218 (Article XIIID Section 4c of the California Constitution), which requires a public hearing and certain protest procedures including mailed notice of the public hearing and property owner protest balloting. Property owners through the balloting process must approve the proposed assessment increase. If the new proposed assessment is approved, then a new Maximum Assessment is established for the District. If the proposed assessment is not approved, the City Council may not levy an assessment greater than the adjusted Maximum Assessment previously established for the District. MuniFinamrai Page 13 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District IV. DISTRICT BUDGET A. Calculation of the Maximum Assessment The Maximum Assessment Rate per EBU presented to the property owners for approval is based on the estimated expenses and benefit units planned for the District (Sundance East) at build out. The following budget reflects these assumptions: ZONE 16 SUNDANCE EAST Total General Special Budget Benefit Benefit DIRECT COSTS Maintenance Costs $3,341 501 $2,840 Landscape Utilities 1,044 157 887 Landscape Extras (Repairs/Materials/Equipment) 770 116 655 Tree Pruning 450 68 383 Street Lighting 150 23 128 Special District Services 0 0 Annual Direct Costs (Subtotal) $5,755 863 $4,892 Renovation/Capital Improvement Expenditures 0 0 Total Direct Costs $5,755 863 $4,892 ADMINISTRATION COSTS District Administration 948 142 806 County Administration Fee 25 4 21 County Per Parcel Fee 3 0 3 Administration Costs (Subtotal) $976 146 $830 LEVY BREAKDOWN Total Direct and Admin. Costs 6,731 1,010 5,721 Reserve Collection/ (Transfers) 673 - 673 Other Revenues/General Fund Contribution 0 0 Capital Improvement Project Collection/ (Transfers) 0 0 Balance to Levy $7,404 1,010 6,394 DISTRICT STATISTICS Total Parcels 16 Total Parcels Levied 16 Total Equivalent Dwelling Units 16.00 Levy per EDU $399.66 RESERVE INFORMATION Beginning Reserve Balance 0 Reserve Account Activity 673 Anticipated Reserve Balance 673 ASSESSMENT INFORMATION Maximum Assessment Rate FY 2004/05 CPI Applied : 0.00% $399.66 M uniF inancial Page 14 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District B. District Budget For Fiscal Year 2004/2005 Upon the successful formation of the proposed Sundance East/Shepherd Lane Landscaping and Lighting District, the District and parcels therein will be concurrently annexed into the Palm Desert Consolidated District as part of Zone 16 (Shepherd Lane) for Fiscal Year 2004/2005. The actual budget and assessment rate to be applied for Fiscal Year 2004/2005 (first levy of assessments) will be reviewed and adopted by the City Council as part of the annual levy process for the Consolidated District for Fiscal Year 2004/2005. Although it is anticipated that the proposed expenses (budget) and proposed assessment rate per Equivalent Benefit Unit (EBLI) outlined in the preceding table (Calculation of the Maximum Assessment) will be applied for Fiscal Year 2004/2005, the assessment rate approved and adopted by the City Council may be less than the maximum rate outlined in this report. MuniFinan ial Page 15 Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District APPENDIX A - DISTRICT ASSESSMENT DIAGRAM The District consists of all lots and parcels within the Sundance East subdivision Tract 30503 located along Shepherd Lane, west of Portola Avenue, south of the Gerald Ford Drive, north of Frank Sinatra Dive, and generally east of the Monterey Avenue. The tract map and Assessor's Parcel Map shown on the following pages identify the parcels within the Sundance East/Shepherd Lane Landscaping and Lighting District, as they existed on the County Assessor's Roll when this Report was prepared and the Resolution of Intention was adopted. The District is inclusive of Assessor's Parcel Map — Book 653, Page 77, (Assessor's Parcel Numbers 653-771-018 through 033). The parcels identified on the Assessor's Parcel Map and the Tract Map contained herein define the boundaries and constitute the Assessment Diagram for the District and by reference includes all subsequent parcels and Assessor's Parcel Maps and parcel numbers related thereto. MuniFimndal Page 16 cn Engineer's Report Fiscal Year 2004/2005 Sundance East/Shepherd Lane Landscaping and Lighting District APPENDIX B - 2004/2005 PROPOSED ASSESSMENT ROLL Parcel identification for each lot or parcel within the District, shall be the parcel as shown on the Riverside County Secured Roll for the year in which this Report is prepared and reflective of the Assessor's Parcel Map(s). As of the resolution of Intention, the Sundance East/Shepherd Lane Landscaping and Lighting District is inclusive of Assessor's Parcel Numbers (APN's) identified on the Assessor's Parcel Maps - Book 653, Page 77, (Assessor's Parcel Numbers 653-771-018 through 033). A listing of parcels assessed within this District identifying the proposed Maximum Assessment Amount for the first fiscal year is included in the following listing. Proposed Maximum EBU at Levy APN Land Use Tract Lot Build Out Balloted 653-700-018 Single Family Residential TR# 30503 1 1.00 $399.66 653-700-019 Single Family Residential TR# 30503 2 1.00 399.66 653-700-020 Single Family Residential TR# 30503 3 1.00 399.66 653-700-021 Single Family Residential TR# 30503 4 1.00 399.66 653-700-022 Single Family Residential TR# 30503 5 1.00 399.66 653-700-023 Single Family Residential TR# 30503 6 1.00 399.66 653-700-024 Single Family Residential TR# 30503 7 1.00 399.66 653-700-025 Single Family Residential TR# 30503 8 1.00 399.66 653-700-026 Single Family Residential TR# 30503 9 1.00 399.66 653-700-027 Single Family Residential TR# 30503 10 1.00 399.66 653-700-028 Single Family Residential TR# 30503 11 1.00 399.66 653-700-029 Single Family Residential TR# 30503 12 1.00 399.66 653-700-030 Single Family Residential TR# 30503 13 1.00 399.66 653-700-031 Single Family Residential TR# 30503 14 1.00 399.66 653-700-032 Single Family Residential TR# 30503 15 1.00 399.66 653-700-033 Single Family Residential. TR# 30503 16 1.00 399.66 16.00 $6,394.56 MuniFinancial Page 19