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Home My WebLink AboutC27010 and C27020 HOA's Funding of Landscape Maintenance Utility Costs CITY OF PALM DESERT DEVELOPMENT SERVICES STAFF REPORT REQUEST: Discussion of Various Homeowner Association Requests Relative to the funding of Landscape Maintenance and Utility Costs SUBMITTED BY: Stephen Aryan, Assistant to the City Manager Martin Alvarez, Redevelopment Manager DATE: July 12, 2007 ATTACHMENTS: 1. Landscape Maintenance Maps (x2) 2. Photographs 3. Miscellaneous Correspondence Recommendation: By Minute Motion: 1. Deny a request by Kings Point Village Homeowners for the City to take over financial responsibility for the maintenance of the medians located on the west side of Highway 74/Shadow Mountain Drive. 2. Approve a request by the Silver Spur Ranchers Association to fund the landscape medians and traffic circle of Silver Spur Trail, by means of a Landscape and Lighting Assessment District, and authorize staff to initiate the balloting process. 3. Approve staff's recommendation to initiate the balloting process to determine whether or not Sandcastles property owners wish to modify their current assessment levy to include landscape maintenance and utility costs. Executive Summary: Over the last year, staff received requests from local Homeowner Associations (HOA) related to certain common area maintenance. These requests are for the City to either assume maintenance �esponsibility for currently HOA maintained medians or to fund such maintenance via the formation of an assessment district. Soon after the first request by the Silver Spur Ranchers Association, staff was approached about other neighborhoods, either directly or through third-party complaints, concerning the maintenance and/or appearance of their perimeter and median landscape. Staff does not recommend that the City assume all financial responsibility for currently maintained landscape medians and perimeters, but does not object to requests where such maintenance is financed via a Landscape Assessment District. Landscape Maintenance Discussion July 12, 2007 Page 2 of 4 Discussion: Over the last year, staff received requests from local Homeowner Associations (HOA) related to certain common area maintenance. These HOA's have requested that the City assume maintenance responsibility for medians currently maintained by them, either through direct financial contribution or via the formation of an Assessment District. Staff researched the different types of common area maintenance within the City and their respective funding sources. A map was prepared outlining the following different maintenance areas and who is financially responsible for each: ❖ Public Medians-City Maintained ❖ Public Medians-Home Owner Association Maintained ❖ Homeowner Associations ❖ Landscape and Lighting Assessment Districts Kings Point Villa The Kings Point Homeowners Association requests that the City of Palm Desert assume all financial responsibility for an island median located on the west side of Highway 74/Shadow Mountain Drive. Staff received approximately 37 written requests from these property owners and their property management company. Staff is recommending not approving this request because it would set a precedent for other associations to make similar requests. Furthermore, if the City were to take over all privately maintained medians, they would have to be replaced with a water efficient design at a cost of approximately $2 million. The annual fiscal impact for the City to maintain both publicly and privately maintained medians citywide is as follows: . - . . . . . � . : � � . . . Cit Mainfained Medians 2,453,000 square feet $1,226,500 Privatel Maintained Medians 254,000 square feet $127,000 TOTAL 2,707,000 s uare feet $1,353,500 Silver Spur Ranchers Association The Silver Spur Ranchers Association is requesting funding the medians and traffic circle of Silver Spur Trail by means of a Landscape and Lighting Assessment District, instead of the current Homeowners Association (HOA) financing mechanism. The 233 Silver Spur property owners are currently assessed $100 per year; however, there is very limited interest in serving on the HOA Board. The existing Board's only option is to retain a management company to oversee administration of landscape maintenance. The Board estimates that this action will increase their existing dues from $100 to $254 per year. The option that the Board and many residents prefer is to form a landscape and lighting assessment district, which City Staff initially estimates will cost each property owner approximately $200 per year (subject to an annual 3% cost of living adjustment). Landscape Maintenance Discussion July 12, 2007 Page 3 of 4 Staff supports this request as the existing landscaping would also be replaced with a water efficient design and the Silver Spur property owners would incur the cost of this enhancement, the balloting process, and ongoing maintenance/utilities. Sandcastles In a related issue, staff has also received complaints on the condition of the landscaping perimeter at the Sandcastles neighborhood. The current Sandcastles Assessment District consists of 41 single-family units formed while under Riverside County's jurisdiction and only maintains street lighting (no landscape maintenance provided). The City of Palm Desert annexed this area in 1989 and the DistricYs administration was transferred from the County to the City. The City did not install the existing landscaping at this area or ever have a water meter to service it. This landscaping was most likely provided, irrigated, and maintained by a resident who may no longer reside within this neighborhood. Therefore, the City currently does not provide any maintenance or utilities at this location. The City Attorney reviewed this issue in 2006 and determined that the City is responsible for the maintenance of the perimeter landscaping. The City owns the landscaping areas and the Property Maintenance Ordinance does not require property owners to maintain areas they do not directly have frontage on. Staff brought this issue before the City Council on January 12, 2006, and presented the following three options: Option No. 1: Leave the landscape perimeter as is and have the City provide periodic maintenance. Option No. 2: Renovate the perimeter to a drought tolerant design that includes decomposed granite and bou/ders, while retaining the existing pa/m trees. Option No.3: Propose a modification to the assessment district levy to include the maintenance and utility cost of the perimeter landscaping. The City Council unanimously approved staff's recommendation of Option No. 3. Staff sent out an informal resident survey to determine if a majority of the residents favor the aforementioned modification to their assessment district. If the survey results were positive, staff would return to the City Council for authorization to proceed with the district balloting processing and subsequent renovation. The survey response was as follows: Yes 36.59% No 21.95% Unresponsive 41.46% As fewer than 50% of survey results were positive, the balloting did not proceed and no further action was taken concerning this matter. However, almost half of those balloted did not return a response. As the City is receiving complaints on this matter, staff recommends initiating the formal balloting process, to ascertain if property owners would modify their current assessment to include landscape maintenance and utility costs. Landscape Maintenance Discussion July 12, 2007 Page 4 of 4 Submitted By: . . �_ Stephe Y. Aryan artin Alvarez Assistant to the Cit anager Redevelopment Manager Reviewed By: Homer Croy Spe cer ight ACM for Develop nt Services Lan scape anag �ITY C�UNCIL CT ON: Approved By: APPROVED�,�� D NrED RECEIVED OTHER „ t+'�ETING DP.T� " Ax�s• NOES• ENTt Carlos L. O a �S�AIN: City Manag r VERIFIED BY: �riginal on Fi].e h City Clerk' s Offi�E * 1. By Minute Motion, direct that the City's Landscape Manager work with Kings Point Village Homeowners Association (KPVHOA) representative to develop a mutually agreeable plan to convert the medians located on the west side of Highway 74/Shadow Mountain Drive to water efficient, drought-tolerant landscaping and return to the City Council with a recommendation, with the understanding that the KPVHOA would assume responsibility for maintenance of the medians once converted. Approved 5=0. 2. By Minute Motion: a) Approve a request by the Silver Spur Ranchers Association to fund the landscaped medians and traffic circle of Silver Spur Trail by means of a Landscape and Lighting Assessment District, and authorize staff to initiate the balloting process; b) approve staff's recommendation to initiate the balloting process to determine whether or not Sandcastles property owners wish to modify their current assessment levy to include landscape maintenance and utility costs. Approved 5_0. 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P.O. BOX 680 PALM DESERT, CA 9?�.�1 DATE: April 13, 2007 Carlos Ortega City Manager City of Palm Desert 83-510 Fred Waring Drive Palm Desert, California 92260-2578 Dear Mr. Ortega, Since our meeting with you last year, time has allowed us to properly prepare this Formal Request that asks the City to consider the transformation of our H.O.A. to a Special Landscape and Lighting Tax Assessment District. The Silver Spur Ranch includes 233 lots on thirteen named streets. These streets also provided access to several homes which are not part of the Silver Spur Ranch. The streets are public with no access gates and are maintained by the City. The Silver Spur Ranchers homeowners association is now 50 years old and its primary reason for existence is to maintain the medians and circle of Silver Spur Trail. The Association does not own the medians, the circle or any other property, for that matter. Unlike most developments there are no recreational or"common area" facilities. The 233 property owners are currently assessed $100 per year($23,000). The budget expends less than $15,000 per year to cover grounds maintenance, repairs and utilities. The balance of the budget includes necessary administrative expenses (insurance and legal fees) required for an organizational structure. - On April 12, 2007, members of the Board of Directors of the Silver Spur Ranch, Inc. met with city representatives Stephen Aryan and Martin Alvarez to discuss the proposal to dissolve the homeowners association and request that the City of Palm Desert to assume the responsibility of maintaining the traffic circle and three medians on Silver Spur Trail which includes lighting and landscaping. At the time of the meeting, it was recommended by Martin Alvarez that the board submit formal request for your consideration in pursuing a Special Tax Assessment District and provide you with a summary of what we have competed to date in this process. • November, 2006 through May 2006, the members of the Board of directors discussed and explored ideas to solve the problems of complying with the new mandates of the Davis- Stirling Act. We discovered that due to lack of participation by the homeowners, we would have to choose from one of three possible outcomes; hire a management company to run the daily activities, ask the City of Palm Desert to assume the maintenance responsibilities of the medians or simply abandon the HOA. • June, 2006. Board members met with Spence Knight and Martin Alvarez to explore the feasibility of the City of Palm Desert establishing an assessment district and determining the cost to homeowners of using the city to provide maintenance of the medians. • November, 2006. A survey was mailed to all the homeowners to obtain feedback as to the direction the board should pursue. The choices were to negotiate with the City or hire a management company to assume the duties of running the H.O.A. A majority of the members responding favored going with the City. • January, 2007. A formal election ballot was mailed to all homeowners following all the guidelines of the Davis-Stirling Common Interest Development Act. • February 25, 2007. All the ballots were tabulated and certified at our annual association meeting. A majority of those responding approved the motion to dissolve the Association and negotiate with the City. • March, 2007. Members of the board of directors met with attorneys Jeffrey French and Ronal Green who advised us to proceed with negotiations with the city and provided written documentation that our election process was valid and conducted in accordance to Civil Code and the Davis-Stirling Common Interest Development Act. For the above reasons, the Board of Directors asks that the City of Palm Desert create a Special Landscape and Lighting Tax Assessment District for the three medians and circle on Silver Spur Trail. We welcome any further opportunities to discuss this request with the City. If you have any questions or would like additional information, please contact any one of the individuals listed below. Sincerely, Members of the Board of Directors SILVER SPUR RANCHERS ASSOCIATION Robert Baker Warren Kossub Richard Osborne Member, Special Committee Member, Special Committee Member, Special Committee �_:��— /i�3 2 � ?� 7 - 3 h-i ; Treasure ��6 - y�yi Attached are the substantiating documents used to give us the authority to make this formal request to initiate a Special Tax Assessment District. 1. The original survey 2. The survey results 3. Official Ballot 4. Statement of Findings 1. The Original Survey The Future• The board has voted to accept one of the following two choices for the future of our organization. Please read carefully, discuss with your neighbors and come to any regularly scheduled board meeting to have your questions and concerns addressed. Option #1: We will hire a management company to take over the day to day operations of the organization and comply with all the new laws and accounting practices. The amount of paper work required for each officer of the board will be so extensive that none of us will want to do it on a voluntary basis. We will still need a board of directors including a president, vice president, a secretary and a treasurer to direct the management company, The management company will pay the bills, collect the dues, comply with the legal paper work, provide escrow companies with documentations for each sale of a property in the ranch, etc. Our research has indicated that the cost af a property management company will be approximately $12 per household per month or and additional $144 per year in addition to your dues. Also, to comply with the new reserve requirements, we will probably add another$10 to the dues so that your total annual dues will be $254 starting in November of 2007 with an annual 3%to 5% CPI (Consumer Price Index) increase. Option #2: Our second option is to request that the City of Palm Desert assume all maintenance and liability for the medians, circle and street light. If the city council agrees, a property tax assessment district would be formed, similar to the utility under grounding assessment. The City of Palm Desert already owns the circle and the medians on Silver Spur Trail. The Coachella Valley Water Company owns the land at the main entrance where the sign is. The association does not own anything! We have had several meetings with city staffand we have received encouragement to proceed with this survey. Included in the City's 10 year forecast is an upgrade in the landscaping, water and electrical. The medians and circle would eventually reflect the design of the newly established Magnesia Falls Drive. Upon the completion of this action with the city, the nonprofit corporation know as Silver Spur Ranchers Association, Inc. would file for dissolution with the State of California. Any assets remaining would be placed in an account with the City of Palm Desert for the exclusive use of the Silver Spur Ranch. The initial analysis from the staff of the City of Palm Desert would cost each homeowner approximately $200 per year. This cost is subject to a 3%to 5%CPI increase annually. In order to proceed with this option we require a strong majority vote from the property owners. The survev: Below is a survey which does not represent a final action on our part. A formal vote on the issue will be conducted after a11 inputs have been collected from you. If you have any questions, please contact your board member or e-mail the web site at: 1. continued Silverspurranchers.org �your choice anct return to : Silver Spur Ranchers Association P.O. Box 680 Palm Desert, CA 92261 � Option#1 - Management Company with a volunteer board of directors � If you checked option #1, check this box if you would like to be considered to be a member of the board of directors. � Option#2—City of Palm Desert Comments: 2. The Survey Results SILVER SPUR RANC�RS ASSOCIATTON, INC P.O. BOX 680 PALM DESERT, CA 92261 Excerpt from the minutes of the regular Board of Directors meeting held on January 18, 2007. The survey results for the future direction of the Silver Spur Ranchers' Association were counted and officiated by Inspector of Elections, Richard Osborne and volunteers Suzie O'Hare and Bob Bennett. Total survev votes returned: 131 Proceed for the city to take over: 83% Management company option: 17% Karen Zak introduced a motion for the Board to proceed with a formal secret ballot. Bob Baker seconded the motion. All members approved. A secret ballot and the annual meeting notification will be mailed by January 24, 2007. 1. continued Silverspurranchers.org �your choice and return lo : Silver Spur Ranchers Association P.O. Box 680 Palm Desert, CA 92261 � Option#1 - Management Company with a volunteer board of directors � If you checked option#1, check this box if you would like to be considered to be a member of the board of directors. � Option#2— City of Palm Desert Comments: 3. Official Ballot SIL�� S�U� �NC�I�:�S �lFS50CI�TIOR INC. �.0. $OX �$0 ��L1�I D�:S�Ef�T, C� 9�E61 OFFICIAL MAILED ABSENTEE SECRET BALLOT AFTER VOTING, PLEASE PLACE 1N THE (SMALL) ENVELOPE AND SEAL. TI�N PLACE THE (SMALL) ENVELOPE IN TI-IE LARGE RETURN ENVELOPE. IN THE UPPER LEFT HAND CORNER OF THE LARGE ENVELOPE, PLEASE SIGN AND PRINT YOUR NAME AND IDENTIFY YOUR UNIT'S ADDRESS. In order to be considered, this original official mailed secret ballot must be received at 75100 Saint Charles P{ace. Suite #3, Palm Desert, CA 92211 no later than Friday, February 23, 2007. You may also bring this ballot in the small sealed envelope to the this address or to the annual meeting, held at Ironwood Park on Sunday, February 25 at noon. Please vote for only one choice: Check this box to authorize the Board of Directors to discontinue the Silver Spur Ranchers Homeowners Association, Inc.; dissolve the corporation of the same name and turn the responsibility of the maintenance of the circle and the medians over to the City of Palm Desert. The estimated financial obligation for each member will be about $200 per year. Check this box to authorize the Board of Directors to engage a property management company to perform the necessary services of managing the Silver Spur Ranchers Homeowners Association's financial and maintenance obligations. The estimated financial obligation for each member will be about $300 per year. Pursuant to the outcome of this official ballot the Board of Directors of the Silver Spur Ranchers Homeowners Association will implement the directive of the qualified members. PLEASE DO N T WRITE YOUR NAME ON OR SIGN THIS PAGE 4. Statentent of findings SILV�R SPUR RANC�RS ASSOCIATTON, INC P.O. BOX 680 PALM DESERT, CA 92261 Statement of Findings Date: February 25, 2007 Association: Silver Spur Ranchers Association I Karen Baker, acting as Inspector of Elections for: Silver Spur Ranchers Association, declare the following to be the results of the election held on this day: February 25, 2007 The motion to dissolve the Cor�oration and turn over the maintenance to the City of Palm Desert is: Approved yes 92 no 10 IRS Revenue Ruling 70-604: N/A I Karen Baker, acting as Inspector of Elections for the Silver Spur Ranchers Association, declare these results to be accurate in compliance with cc 1363.03 Karen Baker � � '�,��i �tE��/�'� I��% .��_`�r MAR 1 � 2(��1 March 13. 200� MONARCH MANAGEMENT fi'��`,�Y MANA E�T Carlos Ortega City Munuger City of Pulm Desert 73510 Pred Waring D�•ive Palm Desert, CA 92260 RF: I.sland Median at Hwy. 74 and Shndow Mou�ituin Drive Deur Mr. Ortega: This letter is being sent to you just.for follow up on behalf of'the Kings Point HomeoN�ners Association rrt the suggestion �rMr. Tony Bagato of the Ciry's Planning Department in hopes tltat your ciecision to not taken over the maintenance wil/be reconsidered.. For 27 years our association has paid for rhe care and maintenance of an island median at the intersection of Highway 74 and Shadow Mountairi Drive, whic,h is owned by the City of Pa/m Desert. This arrangement — City ownership with association maintenance — dates way back to the initial plan development, but we as an association find it an increasingly unfuir financia/fiurden. Accordingly, we ask thut the City take orer the maintenance of its own properry. tlere's why: y Cu�-rently, the Ciry(or CalTrans)is u�ili�ing the properry, which our association hus perid to scalp and reseed,fo��the storage of tools, machine�y, eyuipment and a port-u-potty for the street light project at Highway 74 rrnd Shadow Mountuin. ➢ For years, workers and membeis of the generul public fi-om uround the areu stop there for lunch 6�•eaks under the shade of trees (which we water and pay to have trimmed). At times, an entire fumily hus spreud out a picnic the�•e, no doubt nssuming t/iat this is public property maintained by the City. ➢ School kids are pickecl up und dropped off there by tlte bus. They eat, play and pructice their instruments on the median leaving behind trash.for our associutio�r to deul with. ➢ ,4s costs of trimming, scalping, watering and seeding increuse, they must be borne►iot by the Ciry, but by the homeowners of our association. This results in higher costs to oa�r homeowners, whic•h in turn, mukes the units less afforduble ja� moderately income people. It would seem to us thut it is in the City's interest to maintuin and prnmote us many affordable living units us possible. Sinc��i:e a:Krngs Point [�%1.1!�s do nnl t�tiliz�the prnpertv and r•eullv huve no contro/ove�• what happens vn it, we respectJully ask, in all.fairne.s.s, that the City consider taking over the maintenance of this tract that the public and the Ciry seem to enjoy and use. Thunk you fo�•your consideration of this mutter. Respectfully, For the Board of Directors Kings Point Villas Homeowner.s Assocition � �� Liz Weber, CACM Association Manager• CC.• Board of Directors, File 42-600 Carol(ne Court, Suite iO1, Palm Desert, CA 92211 • Tel; (760J 776-5100 • Fax: (760) 776-5111 •�e�em�iEz of�� ona2e�i �zou�i of c�{�i�iaEec� �om�.aniEs� I�INGS POII�TT VILLAS ISLAND MEDIAN f � �� 4;°a"v�+ 5e k. �i � � �: � �a `g.�� ` j y �. . ,r a �' xt'" i . �.� ��;; p ' `�. � �'.� f �:� 4�; �c'N� 3 � �yq �. � 1 � '� '� . b�j, x .� � � � +( �'1 � d � �k � fF g r ��3 a �,�t��r o�.� � � �� ,� � � . `�# �. u �,� � �S°� & �; �� ` z� +�� .,, �• . � � ��st � ,`� � � ._.:,.`� � a,�. �< : ,¢� `� o , �'� ��x: � ; � �� , f�� -i P l;� �4 k � 'w V�� i��' } � '+��k� �� `�•� ,� �tS�� . � , t 7, ,� � ��, r, � � �in `� ��,:. .�+� "v` � �; s ' .� � . �tF ; � � . � ��, �, � �;, �# � � y �« ,� ,� � � �� ,s�� s, ,� �� ;;� i` �' f ..'�' # °� ;�"r�> .� �Y � �` ."s �?ti� � ,�r �� ,•,,,- + ��,�� .� "� „�„m�.��..,.,r��C `�,.. � � �� 4 w �� `�,""g".a u:m �: ��a 1: ��,.r,� �s ,a� . `�' r�"a��^` ��'.� �„'i�;,. � ��-.,�' ' u�..R.,�M�_ ��,,_._. ..:.�x,:.w.,.,.:..��_ .� ,<. .__ .. �g �ti�� , � �IP ��df��Y��s��t�' �-�� , s a� �'r" llii�i �i i�u w � �s.�..., v v� ,`��'aa��:�.�,a�m; � li i �� # � t �`� � ,�r fi�'.�` 2�'k�n ��': � . . �. s : "w �r:...,,w:�w`�, .. ,.�� Pw ��h , „ �,,,,,u . ,�„ .,.� �,�� ,: � s, . .�sz.°„ ' ,�.,Y,, h�;�..,�r .�i''� �,....,�,w.,....._:.;'_ � � .... . , . _. .. %� ..... . __. . ..... . - �, "'° � � �, I � ��; �`�, �d{ "�". >,�, b �'-'��.� :� p .a ��. .!�r.��,e,�4��'!�r � � �� Y ". pfi'9w .yS�� y5 ��4 � .t� �;„�" c,� t�"w.°✓" �'., .,a,3 �" . ,. $- . 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