HomeMy WebLinkAboutC32760 - Financial Analyses Potential AnnexatnsCITY OF PALM DESERT
DEPARTMENT OF COMMUNITY DEVELOPMENT
STAFF REPORT
REQUEST: APPROVE CONTRACT NO.c3276o IN THE AMOUNT OF
$29,110.00 WITH TERRA NOVA PLANNING & RESEARCH FOR
FINANCIAL ANALYSES ASSOCIATED WITH POTENTIAL
ANNEXATIONS OF AREA TO THE CITIES OF PALM DESERT
AND CATHEDRAL CITY, AND APPROPRIATE $32,021.00 FOR
SAID CONTRACT AND 10 PERCENT CONTINGENCY FROM
UNOBLIGATED GENERAL FUND RESERVES TO ACCOUNT NO.
110-4470-412-30.90
SUBMITTED BY: Lauri Aylaian, Director of Community Development
CONTRACTOR: Terra Nova Planning & Research
42635 Melanie Place, Suite 101
Palm Desert, CA 92211
DATE: May 9, 2013
CONTENTS: Contract No. �32��0
Recommendation
By Minute Motion:
1. Approve Contract No. c32�6o with Terra Nova Planning &
Research to: analyze a fiscal impact analysis and plan for municipal
services prepared by Ralph Anderson & Associates for Cathedral
City; and prepare a fiscal impact analysis for the lands currently in
the northerly portion of the Palm Desert Sphere of Influence,
including Bermuda Dunes, Sun City, and the commercial areas
between 38t" Avenue and Interstate 10;
2. Decline at this time to study the potential financial impact of
annexing any area(s) outside of the Palm Desert sphere of
influence; and
3. Appropriate $29,110 plus 10 percent contingency (totaling $32,021)
from unobligated General Fund reserves to Account No. 110-4470-
412-30.90 for the subject contract.
Staff Report
Potential Annexation Areas North of I-10
May 9, 2013
Page 6 of 6
Fiscal Analvsis
The cost of the professional services proposed under the subject contract is $29,110;
no money has been budgeted for this expenditure. Therefore, approval of the contract
will require that the Council appropriate $29,110 plus 10 percent (or $2,911 } for
contingencies fram unobligated General Fund reserves.
The information produced during the study prepared for Pa1m Desert in 2012
demonstrates that neither area (described as Scenarios A and B in the analysis) north
of Interstate 10 is financially viable under the conditions analyzed, and that annexation
woufd pose a burden on the General Fund. More particularly, at bui{d-out the annual
costs would exceed annual revenues as follows:
Scenario A(Sun City and area south of Avenue 38): -$5.5 mil{ion/year
Scenario B(Scenario A plus Classic Club and Xavier Prep area): -$3.4 million/year
Palm Desert's most recent fiscal study of Bermuda Dunes was prepared in September
2007. This study showed General Fund expenditures exceeding revenues by more than
$4.1 miHion in the initial year. The financial picture for Bermuda Dunes is further
compficated by the fact that a large capital program wou{d need to be undertaken in order
to bring the existing infrastructure up to Pa{m Desert standards.
This adverse impact on the General Fund could be mitigated to some extent by such
mechanisms as fiscalization of {and use in undeveloped areas, augmenting revenue
through assessment of a parcel tax, or creation of a community faci{ities district (CFD). To
estabfish a CFD would a{{ow the cost of the capital improvements to be spread ovsr time,
but would require appr,ova{ of 2/3 of the registered voters in the impacted area. 4n
Bermuda Dunes there are approximately 3,700 housing units and more than $42 million in
infrastructure deficiencies (as of 2007}. This could translate to assessments of such a
magnitude that it would be difficult to gain the votes needed to forma CFD.
Whether or not an annexation of Bermuda Dunes, Sun City, and the commercial lands in
the Palm Desert SOI could ever be revenue neutral is uncertain and would require
additional study.
Submitted By: �� Revie,u�d By�
' � �� "%�' �� _ , !/✓/l
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�Lauri Aylaian, Community Development Director P�lf � Gibson, Finance Director
� CITY COUNCILAC�OM
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VERIFIED BYt �� f��m
Orieina{ on File with Cih+ C{erk's O�cs
Contract No. C32760
AGREEMENT FOR PROFESSIONAL SERVICES
This AGREEMENT is made and entered into this 9th day of Mav , 2013,
("Effective Date") by and between the CITY OF PALM DESERT ("City") and Terra
Nova Planninq & Research, Inc. , a California Corporation ("Consultant")
(sometimes referred to individually or collectively as "Party" or "Parties").
WITNESSETH
WHEREAS, City desires to retain Consultant as an independent contractor to perform
certain technical and professional consulting services in connection with the
Analvses of Cathedral Citv and Palm Desert Potential Annexations project,
subject to the terms and conditions specified below, in the documents attached and
incorporated herein, and applicable federal, state and local law.
NOW, THEREFORE, in consideration of performance by the Parties of the
mutual promises, covenants, and conditions herein contained, the Parties hereto agree
as follows:
1. Consultant's Services.
1.1 Nature of Services. Consultant shall provide professional and
technical services on a non-exclusive basis, as more particularly described in Section 3,
below, and in Exhibit A, Scope of Services.
1.2 Personnel. Consultant represents that it has, or will secure at its
own expense, all personnel required to perform the services under this Agreement. All
of the services required under this Agreement will be performed by Consultant or under
its direct supervision, and all personnel engaged in the work shall be qualified, and shall
be authorized or permitted under state and local law to perform such services.
1.3 Standard of Performance. Consultant shall perform all services
under this Agreement in accordance with the standard of care generally exercised by
like professionals under similar circumstances and in a manner reasonably satisfactory
to City.
1.4 Consultant Representative. For the purposes of this Agreement,
the Consultant Representative shall be Nicole Criste, Principal ("Consultant
Representative").
1.5 Time of Commencement. The execution of this Agreement by the
Parties constitutes an authorization to proceed.
1.6 Time of Performance/Time is
commence the services contemplated under this
prosecute to completion each task listed in Section
within sixtv f60) calendar days.
of the Essence. Consultant shall
Agreement immediately and shall
3 in a timely and diligent manner
Professional Services Agreement — City — V.1
2. Services by City :
2.1 Citv Representative. For the purposes of this Agreement, the City
Representative shall be Lauri Avlaian , or such other person designated by the
City Manager ("City Representative").
2.2 Provision of Data. All information, data, reports and records and
maps as are existing and available from the City and necessary for the carryings out of
the work outlined in Exhibit "A" hereof shall be furnished to Consultant without charge
by City, and City shall cooperate in every way reasonable in the carrying out of the work
without delay.
3. Consultant's Scope of Work. Upon receipt of a fully executed
Agreement, Consultant shall immediately commence work pursuant to this Agreement.
Consultant's scope of work shall consist of preparing: a detailed review and analysis of
the Ralph Anderson & Associates "Draft Fiscal Analysis and Plan for Services for the
Cathedral City Sphere of Influence within the Unincorporated Community of Thousand
Palms"; and a fiscal impact analysis of annexation of the northern portion of Palm
Desert's sphere of influence, including Bermuda Dunes, Sun City, and the commercial
area bounded by Washington Street, 38th Avenue, and Interstate 10. The scope of work
is more particularly described in the Consultant's proposal dated 23 April 2013, and the
detailed services are described in Exhibit A appended to this Agreement.
3.1 Reportinq & Record Keeqina. To assist City in the performance of
its planning, reporting, and financial administration obligations, Consultant shall,
throughout the term of this Agreement, keep City reasonably informed of progress on
work required under this Agreement, and of any problems or delays, anticipated or
otherwise, associated with each aspect of the work. Consultant shall promptly respond
to any request by City for information, progress reports, or documentation. Consultant
shall maintain accurate records of all work performed for each Assignment under this
Agreement, including originals or copies, as applicable, of all deliverable documents
described in Exhibit A. Upon the completion of work, and if requested by the City,
Consultant shall deliver to City the originals of all documentation produced, and may
retain copies of such documentation.
3. 2 Compliance with Laws. Consultant shall at all times possess any
and all licenses and permits necessary to provide the services herein, and shall comply
with applicable federal, state and local laws, ordinances, codes and regulations in the
performance of this Agreement, and with any and all applicable City of Palm Desert
policies and guidelines.
3.3 Confidentialitv. Except as otherwise permitted or required by law,
Consultant shall maintain as confidential and shall not disclose any and/or all
information received in the course of performing pursuant to this Agreement.
Consultant shall promptly inform the City in the event Consultant receives a subpoena
or court order requiring disclosure of confidential information.
g:\planning\lauri aylaian�sphere of influence and annexation\te�ra nova - 2013 prof svcs agmt.doc 2
4. Compensation. City shall pay Consultant for the Services provided
under this Agreement on the following basis.
4.1 Not-to-Exceed Fee: City shall pay to Consultant a total amount not
to exceed $ 29,110.00 for the basic services described in Exhibit A. Payment shall
be made on a monthly basis, based upon the hourly rates defined in Exhibit B,
multiplied by the number of hours worked by each classification of personnel assigned
to the project during the previous calendar month. The not-to-exceed fee shall not be
exceeded without written agreement between the parties.
5.2 Additional Services: Additional services beyond those described in
Exhibit A shall be reimbursed on a time-spent basis at the hourly rates described in
Exhibit B. City shall not be obligated to compensate Consultant for additional services
performed without advance authorization from the City Representative.
5.3 Reimbursable Expenses: City shall pay to Consultant actual costs
plus ten percent (10%), subject to the limitation given below, for expenses incurred on
behalf of the project for long distance telephone calls, reproduction, express delivery
and courier services, postage, out-of-town travel if pre-approved in writing by the City
Representative, and other expenses directly attributable to the project and expressly
approved by the City Representative. Reimbursable expenses, including Consultant's
mark-up, shall not exceed $ 1,500.00 for this project.
5.4 Extraordinary Expenses/Costs. No claims for additional services,
expenses or costs incurred by Consultant will be allowed unless such additional
services, expenses or costs are authorized by City in writing prior to the performance or
incurrence of such services, expenses or costs. Any additional services, expenses or
costs authorized by City shall be compensated at rates mutually agreed upon by the
Parties in writing.
6. Method of Payment.
6.1 Invoices. Consultant shall submit to City invoices each month for
all services completed, and all expenses or costs incurred pursuant to this Agreement
during the preceding month. The invoices shall describe the services rendered during
the period and shall show the number of hours worked, the hourly rates charged, and
any milestone achievements. Copies of receipts for expenses or costs shall be
submitted with each invoice. City shall review such invoices and notify Consultant in
writing within fifteen (15) calendar days of any disputed amounts.
6.2 Pavment. City shall pay all undisputed portions of the invoice
within thiriy (30) calendar days after receipt of the invoice up to the maximum amounts
set forth in Section 5.
6.3 Audit of Records. At any time during regular working hours, all
records, invoices, time cards, cost control sheets and other records maintained by
Consultant shall be available for review and audit by the City.
7. Ownership of Work Product.
7.1 Propertv of Citv. All documents including reports, analyses or other
written material developed or obtained by Consultant in the performance of this
g:\planning\lauri aylaian\sphere of influence and annexation\terra nova - 2013 prof svcs agmt.doc 3
Agreement shall be and remain the property of City without restriction or limitation upon
its use or dissemination by City.
8. Conflict of InteresdProhibited Conduct and Interests
8.1 Conflict of Interest. Consultant and its officers, employees,
associates and sub consultants, if any, will comply with all conflict of interest statutes of
the State of California applicable to Consultant's services under this Agreement,
including, but not limited to, the Political Reform Act (Government Code Sections
81000, et seq.) and Government Code Section 1090.
8.2 No Solicitation. Consultant warrants that it has not employed or
retained any company or person to solicit or secure this Agreement, and that it has not
paid or agreed to pay any party any fee, commission, percentage, brokerage fee, gifts,
or any other consideration, contingent upon or resulting from the award or making of
this Agreement.
8.3 No Financial Interest - Citv. No officer, member or employee of
City during his or her tenure or one year thereafter shall have any interest, direct or
indirect, in this Agreement or the proceeds thereof. The Parties hereto covenant and
agree that to their knowledge no member of the City Council, or officer or employee of
City, has any interest, whether contractual, non-contractual, financial or otherwise, in
this Agreement, or the subject matter thereof, nor any business or financial relationship
with Consultant, and that if any such interest comes to the knowledge of either Party at
any time a full and complete disclosure of all such information will be made in writing to
the other Parry or Parties, even if such interest would not be considered a conflict of
interest under applicable laws.
8.4 No Financial Interest — Consultant. Consultant hereby covenants,
on behalf of itself, and its officers, employees, agents and representatives, that at the
time of executing this Agreement it has no interest, and that it shall not acquire any
interest in the future, direct or indirect, which would conflict in any manner or degree
with the performance of services required to be performed pursuant to this Agreement.
Consultant further covenants that in the performance of this Agreement, no person
having any such interest shall be employed by Consultant.
9. Indemnification. Other than in the performance of professional services
and to the fullest extent permitted by law, Consultant shall indemnify, defend and hold
the City, the City's elected officials, officers, employees, agents and volunteers free and
harmless from and against all tort liability, including liability for claims, suits, actions,
expenses or costs of any kind, whether actual, alleged or threatened, actual attorney's
fees, court costs, and expert witness fees incurred by City or Agency, arising out of or in
any way connected with, in whole or in part, the acts or omissions of Consultant, or any
of Consultant's officers, agents, employees or contractors, in the performance of this
Agreement, including but not limited to, claims, suits and liabilities for bodily injury,
death or property damage to any individual or entity, including employees or officials of
Consultant. The provisions of this paragraph shall not apply to claims arising out of the
sole negligence or willful misconduct of City or Agency, any of City's elected officials,
officers, employees or agents.
g:\planning\lauri aylaian\sphere of influence and annexation\terra nova - 2013 prof svcs agmt.doc 4
In addition to the foregoing, Consultant shall indemnify, protect, defend and
hold harmless the Agency and the City of Palm Desert, their officials, employees,
agents and representatives from and against any and all losses, liabilities, damages,
costs, and expenses, including attorney's fees and costs to the extent same are caused
in whole or in part by any negligent or wrongful act, error, or omission of the Consultant,
its officers, agents, employees or subconsultants (or any entity or individual that the
Consultant shall bear the legal liability thereof) in the performance of professional
services under this agreement.
10. Insurance.
Consultant will maintain insurance in conformance with the requirements set forth
below. If Consultant's existing coverage does not meet the requirements set forth here,
it will be amended to do so. Consultant acknowledges that the insurance coverage and
policy limits set forth in this section constitute the minimum amount of coverage
required. Any insurance proceeds available to City in excess of the limits and coverage
required in this agreement and which is applicable to a given loss, will be available to
City.
10.1 Workers' compensation and emplover's liabilitv. Consultant
shall provide Workers Compensation and Employer's Liability Insurance on an
approved policy form providing benefits as required by law with employer's liability limits
no less that $1,000,000 per accident or disease.
10.2 Automobile liabilitv. Consultant shall provide auto liability
coverage with a limit of no less than $1,000,000 per accident. If Consultant owns no
vehicles, this requirement may be met through a non-owned auto endorsement to the
CGL policy.
10.3 Waiver. If the Consultant does not carry Worker's
compensation coverage, or if the Consultant will not operate any vehicles at any time
within the scope of the services in the agreement, provisions for these coverages may
be waived upon review and approval of the City's Risk Manager.
11. Status as Independent Contractor. Consultant is, and shall at all times
remain as to City, a wholly independent contractor. Consultant shall have no power to
incur any debt, obligation, or liability on behalf of City. Neither City nor any of its
officials, employees or agents shall have control over the conduct of Consultant or any
of Consultant's employees, except as set forth in this Agreement.
12. Non-Assignability; Subcontracting. Consultant shall not assign or
subcontract all or any portion of this Agreement without the City's prior, written consent.
13. Non-Discrimination and Equal Employment Opportunity. In the
performance of this Agreement, Consultant shall not discriminate against any employee,
subcontractor, or applicant for employment because of race, color, creed, religion, sex,
marital status, national origin, ancestry, age, physical or mental disability, medical
condition, or sexual orientation. Consultant will take affirmative action to ensure that
subcontractors and applicants are employed, and that employees are treated during
g:\planning\lauri aylaian\sphere of influence and annexation\terra nova - 2013 prof svcs agmt.doc 'rJ
employment, without regard to their race, color, creed, religion, sex, marital status,
national origin, ancestry, age, physical or mental disability, medical condition, or sexual
orientation.
14. Cooperation. In the event any claim or action is brought against the City
relating to Consultant's performance or services rendered under this Agreement,
Consultant shall render any reasonable assistance and cooperation which City might
require.
15. Termination. The right is reserved by the City to terminate the
Agreement at any time upon seven (7) days written notice, in the event the project is to
be abandoned or indefinitely postponed, or in the event the Consultant's services, in the
sole judgment of City, are unsatisfactory or because of the Consultant's failure to
prosecute the work with diligence or within the time limits specified or because of his
disability or death. In any such case, the Consultant shall be paid the reasonable value
of the services rendered, based upon Consultant's standard hourly rates, up to the time
of the termination. The Consultant shall keep adequate records to substantiate costs
and provide copies of original time-cards in the event of termination or suspension.
16. Notices. Any notices, bills, invoices, or reports required by this
Agreement shall be given by first class U.S. mail or by personal service.
City: � John M. Wohlmuth, City Manager
City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, California 92260-2578
Tel: (760) 346-0611
Fax: (760) 341-6372
With a copy to: Lauri Aylaian, Director of Community Development
City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, California 92260-2578
Tel: (760) 346-0611
Fax: (760) 341-6372
Consultant: Nicole Sauviat Criste, Principal
Terra Nova Planning & Research, Inc.
42635 Melanie Place, Suite 101
Palm Desert, CA 92211
Tel: (760) 341-4800
17. Non-Waiver of Terms, Rights and Remedies. Waiver by either Party of
any one or more of the conditions of performance under this Agreement shall not be a
waiver of any other condition of performance under this Agreement. In no event shall
the making by City of any payment to Consultant constitute or be construed as a waiver
by City of any breach of covenant, or any default which may then exist on the part of
g:\planning\lauri aylaian\sphere of influence and annexation\terra nova - 2013 prof svcs agmt.doc 6
Consultant, and the making of any such payment by City shall in no way impair or
prejudice any right or remedy available to City with regard to such breach or default.
18. Attorney's Fees. In the event that either Party to this Agreement shall
commence any legal action or proceeding for damages for breach, or to enforce or
interpret the provisions of this Agreement, the prevailing party in such action or
proceeding shall be entitled to recover its costs of suit, including reasonable attorney's
fees and experts' costs.
19. Entire Agreement. This Agreement, and any other documents
incorporated herein by specific reference, represents the entire and integrated
agreement between Consultant and City. This Agreement supersedes all prior oral or
written negotiations, representations or agreements. No promise or representation,
whether oral or written, express or implied, that is not set forth herein, shall be binding
or have any force or effect. This Agreement may not be amended, nor any provision
waived, except in a writing signed by the Parties which expressly refers to this
Agreement.
20. Partial Invalidity. In case any provision of this Agreement should be
deemed by a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect, the validity, legality or enforceability of the remaining provisions shall not be
affected or impaired thereby.
21. Successors. This Agreement shall bind and inure to the benefit of the
respective heirs, personal representatives, successors and assigns of the parties to this
Agreement.
22. Waivers. No waiver of any breach or default of any term or provision of
this Agreement shall be deemed a waiver of any other term or provision of this
Agreement, and no waiver shall be valid unless in writing and executed by the waiving
party.
IN WITNESS WHEREOF, said parties have executed this Agreement effective
as of the Effective Date above.
CONSULTANT
By:
Its:
CITY OF PALM DESERT
City Manager
APPROVED AS TO FORM
Dave Erwin, City Attorney
g:\planning\lauri aylaian\sphere of influence and annexation\terra nova - 2013 prof svcs agmt.doc 7
EXHIBIT A
SCOPE OF SERVICES
SCOPE OF SERVICES
Consultant shall provide the following services under the terms of the Agreement:
C'adie�lr�1 C'itv F�sc�l Reta�rt Re�.•ie� �u+d Cc��av�risan
r�'c�u��rehe�isiE-ely �����fec�- th� ass�usa�tic�ns iu th� C`athedral City an��ysis. t�r��ki.cig
dc��,���i �ss�un�atio�i� by ret-eii�.� �nd c+�st c�te�oiy. �°l�is ui11 urciude a c+�u�pa�-ison �f
le�.�zls of ser�,-ice ass��u�ed. �gr c�pit� cc,sts b�s�d c�u �'atheciral �'ity�'s i���cig�et. ��rd
r���e�t�� �s:�i�i��ptic�� based on ls�rd ��se c�e�i���#i4ii�.
;+� Prepare a�ert�r repc�ri, to iuch�de ca�ax°�sc�n tabl�s ��1��re �ppr�priate, d�scribi�� th�
fmclin$5 Of CII� i'�i'2�U,�'. :�,.�'' 23�G�SSc�I"�. COI1Sit��i' V4}I�x� t�l��i'iII� �S5tiF1113i1ttTiS iil�� Ile1T'�
i1T1p�Ci�Cl �IYIC�lI1�S. c7ilE� CI�SC1i�f� s��ue. Cc���sid�r i�'Il�€�1�2'. 1� II��t��CI, CI3�IlE�S in
��s��niptics�2s ui tlie P��i I3�sert ��ial�sis ti�-c��ild ir�p�ct tl�e ot�tcorne c�f t�ie o�Y�uzal
���3lysis.
i� Prai� icie l�ti�r re�c+rt io C'ity staff for ��e�Ti��v. and �nzet u�ith sa�ne i4 re�-ieu� .
r:�in�iY�. re�ori as ne�cled t�as�d oa� s��ff c��nu�ie�tts, and g�r+���ide �ag�r af�ri �l�ctro��ic
���ies fc�r cxse �y Ciry,
P�lua I�eset-[ Fiscal Iin��3ct R�port L��d�ie �n�t Es��sion
;+� C'ourdir�.ate s�-itl� Citi� and Co��nty to secLue c�zr�•ent %�cai y��r t�utigei, l��id ��s� �iaa�s,
t�ez�ei°�1 Piar� �ic�c�un��tatio�l. �tc., �aecess�xy tQ CY112'�iCt2:i'1Z� Th� Iar�ds beui�
c�ansid�red f��• aiat�e�ation. Se�i�a�Yo B��-i11 t�e re�c��-ed frc�r�� Cl�e ai�aly5is.
;% L.T�date l��s� data frc�m Ioc�l. r�gic�n�l �nd :�t�c� �c�tuces i•e�a�di�� r���e�tue� �nd costs:
t�:� r1te5, st�ze u� lieu f�es, C'�a����ry ��s. C'ity s���re t�f re�,•ent�es. �tc.
r:�.eiei �il l�and ���e c�ata fc�r B��g��ecl� Dui�es. �4��dei ac��e��e izy l���d use. `'4'�i�a�e Cit�
Iaud t��� ��si�atic�ns lia��e bee� a��iiecl. ��e;r �,i-ill t�� ��s�d. �tiie�zz�; i�e. C�iu�ty lar�c�
t�se c�es��n�tio��s u-ill b� a�pli�d. F�r e�isTiu7g tlet�elo�a�ne�t. �ss�ua�Tfons ����arci�y�
s•�r�iu�e �s�ill t�e �-��ifie�i bv �istiui� ti�t� to tl�e �'e�test ext���t �ossil�I�, Siic�t�lci dat�
��+�t be a�-r�ilable, ass�u��atic�� �.�ill l�e u��de cc�u.sist��t ��-ith t€e "Ri�.-erside C�unt�
Gui�e" f�ai• pr���ru,� fis�ai iiup�ct st��c�iz�,
g:\planning\lauri aylaian\sphere of influence and annexation\terra nova - 2013 prof svcs agmt.doc 8
EXHIBIT A
SCOPE OF SERVICES
(continued)
i• U�date ���u��i �aer ca�it� es�i��ted r��,•�n�t�s f�°c��n �ta�e �ot�rc�s,
Y U�date eS� i°����n�aes fr�rn �c��ulty riata. a� ap�alica�le.
:� R�u� iisc3l �x1c�d�I. tast i°��tilts. �u���l c+ai�iuYi� ��t�.
:+� C:oc�rc�inat� ��itl� Pi�blic ��'s����s Director re��rc�ine i4i�I'3STI'tIC1121'� �z�al�rsis tt}�dat�.
C'c�i��z �osts fc�r �c�teaitial C FD. �nd i�e���Ic�p �er c�pita €�r i�c���s��ol�i c�st based cau
I��ud t�se as�tui��tion�. Tlu� t�sk �`-ill iucitule ���tis�� fcar ��en�r�� A a�d iYe�
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g:\planning\lauri aylaian\sphere of influence and annexation\terra nova - 2013 prof svcs agmt.doc 9
EXHIBIT B
COST BREAKDOWN AND HOURLY RATES
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g:\planning\lauri aylaian\sphere of influence and annexation\terra nova - 2013 prof svcs agmt.doc 1 �
Staff Report
Potential Annexation Areas North of 1-10
May 9, 2013
Page 2 of 6
Background
At its April 11, 2013 meeting, the City Council directed staff to prepare updated financial
analyses on several issues related to potential annexation of areas north of Interstate
10 (1-10). Staff has worked with Terra Nova Planning & Research ("Terra Nova") to
develop a detailed scope of work for these analyses, and is now returning to the Council
to confirm the scope of the studies and to request authorization to award the contract.
The proposed studies differ from those requested by the Council at the April 11, 2013,
meeting for reasons described below.
Sun City Annexation Analysis: LAFCO staff has confirmed that any annexation of land
north of 1-10 in Palm Desert's sphere of influence must also include Bermuda Dunes.
Therefore, the scope of services for the proposed contract with Terra Nova includes a
fiscal analysis of revenues and expenditures for Sun City, the commercial properties
south of Avenue 38, and Bermuda Dunes. The fiscal impact analysis will be for the
area shown in green here:
F
==?Ill.i rit$-M,
Cathedral
City Sphere
of Influence
FRANR. 111Hr*A-o.
CLAIR OR
Ruiz.±) 6 I
01 (
y
I f "
4
4
'4 Commercial
pt
Sun City
Area
1---COUW VCLU DR
•
Bermuda Dunes
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OA
V
4
'RED ITARUNO GN------._FIRED 1TA*19NG DN.
IDLES RIVE rEER AVE
Sun City, commercial area, and Bermuda Dunes
g:\planning\lauri aylaian\sphere of influence and annexation\annexation fiscal imipact analysis 5-9-13.docx
Staff Report
Potential Annexation Areas North of 1-10
May 9, 2013
Page 3 of 6
Cathedral City Proposed Annexation: Cathedral City is considering annexation of all
areas in their current sphere of influence. As part of their study, Cathedral City retained
Ralph Anderson & Associates to prepare a fiscal impact analysis and plan for municipal
services for their unincorporated sphere areas. A comprehensive review and analysis of
the Ralph Anderson report will be performed by Terra Nova under the proposed
contract with the City of Palm Desert. The goal is to gain a thorough understanding of
why the results of Cathedral City's study are so different from the results that would be
predicted from Palm Desert's earlier study of overlapping lands. The information
gleaned from this review will inform the City Council as they consider whether to
support, oppose, or take no position during public hearings on Cathedral City's
annexation proposal. The area that is the subject of Cathedral City's analysis and plan
for services is outlined in red here:
lc, a{;
Cathedral City`
Cathedral City _CA
Cathedral City proposed annexation area
g:\planning\lauri aylaian\sphere of influence and annexation\annexation fiscal imipact analysis 5-9-13.docx
Staff Report
Potential Annexation Areas North of I-10
May 9, 2013
Page 4 of 6
Annexation of Areas Outside of the Palm Desert Sphere of Influence: A 2012 study by
Terra Nova examined the fiscal impact of Palm Desert annexing Sun City plus areas to
the west that are not currently in the Palm Desert SOI. This area, generally east of Jack
Ivey Ranch and south of multi -species habitat conservation lands, is technically in
Cathedral City's SOI, but has common interests with — and ties to — Palm Desert, with
whom they share 1.8 miles of boundary along Interstate 10. The area contains the
Classic Club and Xavier Preparatory High School and is shown in yellow here:
Bermuda, Dunes,. ,„„zi�--
0 ogle, ,7 -„ -
iEuroa,a TP,tinongies -�► - ,.. +r(11)0lG'
Palm Desert's SOl is outlined in pink, bur the land ro the west (in yellow) has physical
and community ties to Palm Desert, and has also been studied for potential annexation.
On April 11, 2013, the City Council asked staff to include this area in analyses of
potential annexation of Sun City and other areas already in the Palm Desert SOI.
However, after subsequent investigation, staff recommends that this area not be
included in the analyses, and the proposed Terra Nova contract does not include this
scope of work. The reason for omitting this area from further study is that the
g:\planning\lauri aylaian\sphere of influence and annexation\annexation fiscal imipact analysis 5-9-13.docx
Staff Report
Potential Annexation Areas North of 1-10
May 9, 2013
Page 5 of 6
annexation as proposed would violate recently -enacted legislation, and modifying the
proposed annexation area to comport with State law and LAFCO directives would likely
require that Palm Desert annex all of Thousand Palms, which is a concept not
previously contemplated by the Palm Desert City Council.
The legislation that would prevent annexation of the land as configured above was
enacted under SB 244 to protect Disadvantaged Unincorporated Communities
("DUC"s). The law requires that DUCs not be left out of annexation efforts, and that they
be included if an annexation is proposed in the vicinity. Three disadvantaged
communities have been identified in Thousand Palms, including Jack Ivey Ranch, which
marks the boundary of the territory in which the Council has expressed interest.
Therefore, application for annexation of the area of interest to Palm Desert would
necessarily include Jack Ivey Ranch and, because of LAFCO's previous insistence on
keeping Thousand Palms whole, would probably include two more DUCs.
The Palm Desert City Council has not expressed interest in annexing all of Thousand
Palms, and the 2012 Terra Nova fiscal analysis of Sun City and areas extending to Jack
Ivey Ranch showed an annual deficit of $3.4 million. The cost of studying the fiscal
impact of adding one to three disadvantaged unincorporated communities (Jack Ivey
Ranch and potentially DUC 1 and DUC 2, shown below) is not warranted without a
specific request from the City Council. Therefore, the scope of the proposed contract
does not include fiscal analysis of any of the land outside of Palm Desert's sphere of
influence.
While Palm Desert previously studied annexation of land at the far east end of
Cathedral City's SOI, Jack Ivey Ranch ("DUC 3') — and possibly DUCs 1 and 2 -- would
now be required to be a part of any future application for annexation.
g:\planning\lauri aylaian\sphere of influence and annexation\annexation fiscal imipact analysis 5-9-13.docx