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HomeMy WebLinkAboutMinutes - City Council - 2005-09-13 - Special Meeting 209 City Council, Special Meeting Council Chambers 777 Cypress Avenue Redding, California September 13,2005,3 :00 p.m. The meeting was called to order by Mayor Mathena with the following Council Members present: Dickerson, Murray, Pohlmeyer, and Stegall. I Also present were City Manager Warren, Assistant City Manager Perry, Assistant City Manager Starman, Deputy City Manager Bachman, City Attorney Duvernay, Finance Officer Strong, City Clerk Strohmayer and Assistant City Clerk Sherman. COOPERATIVE PLANNING AGREEMENT WITH THE COUNTY OF SHASTA (T-01O-700 & T-01O-650) City Manager Warren recalled that in January of 1997, Local Agency F ormation Commission (LAFCO) Executive Officer Julie Howard, produced a document entitled "Striking A Balance." This document served as a comparative analysis of services, costs, revenue and taxes exchanged between the City of Redding and Shasta County (County) and also discussed annexations and alternatives. In June 1999, Ms. Howard authored a second document entitled "The Knighton/Island Proiect: A Services Contract and Land Use Compact" which discussed voter-approved propositions and legislative actions which limit revenues on which local government rely to meet service demands. Mr. Warren said that the proposed Cooperative Planning Agreement (Agreem,ent) before the City Council is a result of the work performed by Ms. Howard and he suggested that, if approved, the agreement be entitled The Howard Cooperative Planning Agreement in recognition of the late Ms. Howard and her strides and forward thinking in this field. I Mr. Warren related that over the years, the City and County have struggled to reach consensus on a tax sharing and planning agreement that is equitable, practical while meeting the goals of both agencies. Unfortunately, he said, little progress has been made in this area. Recent discussions surrounding annexation of property for the Stillwater Business Park (Stillwater), however, prompted him and Assistant City Manager Starman to again meet with representatives from Shasta County to discuss and develop the proposed Agreement. Mr. Warren pointed out that the main purposes of the proposed agreement are to ensure that the property necessary for development of the Stillwater is annexed into the SHASTEC Redevelopment Proj ect Area, that planning issues such as the Chum Creek Bottom and other unincorporated areas of the County within the City's sphere of influence are jointly agreed to, that certain impact and public facilities fees (currently non-existent in the County) are implemented, and that the County's interest in sharing hotel and sales tax be addressed. Mr. Warren said this proposed Agreement can serve as a stepping stone to improved relations and cooperation between the two agencies. City Manager Warren reviewed the eleven (11) points ofthe proposed Agreement: I Item Nos. 1 through 3 of the proposed Agreement are designed to help "de-fiscalize" land use decisions by setting the percentage of sales tax without regard to where the major retail business is to be located (City or County). In this way, he said competition between the City and County is eliminated and decisions can be based on best land use policies rather than fiscal advantage. Item No.4 discusses the length ofthe agreement (10 years) and sets the associated penalty (1.5 times any revenue received during the period in which the agreement is in place) should either agency terminate or breach the Agreement. Item No. 5 relates to the important planning issues surrounding the Chum Creek Bottom area comprised of small agricultural parcels surrounded by residential uses. The County agrees to adhere to these principles in its General Plan and Zoning Ordinance. Further, the County would also continue to solicit input from residents in the area as comm~rcial development is considered at the Knighton RoadlI-5 interchange. Item No.6 focuses on financial issues and sets the formula for a property tax split on annexations at 50% for each jurisdiction. Previously the County typically retained 100% of 9/13/2005 210 the base property tax before annexation, and the City kept 100% of the increment after annexation. The new 50/50 split may be in favor of the County but if the City or County determines that funds are insufficient to pay for services, a Mello-Roos fee can be implemented to address the shortfall. Item No. 7 sets the ground work for annexing the Stillwater Business Park into the SHASTEC Redevelopment Project' area in order to utilize the tax increment ne~ded to pay for the infrastructure. While the Business Park will benefit both jurisdictions, the County is sacrificing the "pass-throughs" or property tax to its General Fund in order to facilitate the project. Item Nos. 8 & 9 concerns planning and fiscal issues. The City and County would jointly complete a study necessary to determine the impacts of growth in the unincorporated areas of the County and within City limits. The County would collect the fee for development in the unincorporated area that impacted the City and vice-versa. I Item No. 10 addresses planning issues that stem from anticipated growth within the City's Sphere of Influence and the application of certain City standards. The County will adopt existing City standards for improvements such as curb, gutter, sidewalks, stre~ts, u;tilities, parking, and landscaping. Item No. 11 suggests that the City and County work in conjunction with the cities of Anderson and Shasta Lake to create an Advisory Committee to work onjoint planning issues in urban areas including preservation of open space and regional traffic impact fees. Assistant City Manager Starman provided an overview of revenue projections over the next ten years using various tax sharing scenarios with and without the proposed Agreement and with and without an Auto Mall within the City limits. He explained how the formulas were developed but pointed to the bottom line that indicates the City stands to lose $4.5 million in sales tax revenue and the County would re~eive $4.5 million if the proposed Agreement is approved. Mr. Warren emphasized that nothing would happen in the immediate future because large developments take time, but this Agreement could serve as an insurance policy that the City and County would be partners over the next ten years, at least, ~nd no longer compete with each other. It removes the incentive to vie for development to occur in the City or County. I Deputy City Manager Bachman discussed the City's Ten Year Financial Plan (Plan) and the many variables that direct revenue and expenditure projections. Over the past five years, he explained, the combined sales tax and Transient Occupancy Tax (TOT) has grown 6.6% per year, but the Plan did not contemplate the auto dealers leaving the City. Should the auto dealers leave the City, the Plan would be affected but only after that occurred which may be several years from now. Mr. Warren recommended that the City Council approve, in concept, the proposed Cooperative Planning Agreement between the City of Redding and the Cqunty of'Shasta and authorize the City Manager and City Attorney to retain neutral, outside counsel to finalize the document and return to City Council for final consideration. In response to Council Member Pohlmeyer, Mr. Starman said it would be necessary to adjust the amount of money going to the County should Anderson or Cottonwood incorporate. He emphasized that staff would ensure that the language was clear and understood by all I involved parties. Council Member Stegall observed that the agreement did not provide a mechanism for either party to bring forward problems or issues and how those would be resolved. Mr. Starman responded that staff could add a section to the agreement that either party could request and amendment to the agreement that would have to be agreed upon by both agencies. Mayor Mathena favored an agreement with a five-year term and automatic renewal for an additional five years. Mr. Warren explained that a five-year term does not provide adequate time to realize the benefits of the Agreement. He s,aid, as an example, if a major development was brewing four years from now in an unincorporated area, the County would have no incentive to renew 09/13/2005 211 '" the Agreement past the five year mark because by the time the development was complete, the County would be in a position to receive all the tax revenue. Council Member Murray concurred stating that a longer term tends to render the Agreement less political by removing it from the from the spotlight for a longer period of time. Council Member Dickerson concurred stating that it is important to lock in the Agreement for at least ten years to determine if it is working and how effectively. I Council Member Stegall expressed concern with the potential oflocking future City Councils into this Agreement. City Attorney Duvernay said this is a cooperative agreement, and it reserves the right for future City Councils and County Supervisors to enforce or not. However, there are consequences to either agency should they breach the Agreement. Mr. Duvernay stated that he is aware of similar agreements that have terms of fifty (50) years. Council Member Pohlmeyer believed ten years to be an appropriate term, but shared the concerns of Council Member Stegall. He said, however, that he did not want either party to break the agreement and supported the penalty provision. He concurred that a provision should be added that would allow disputes to be recognized and resolved. In response to Council Member Pohlmeyer, Mr. Warren emphasized that the City and County will be partners and as development occurs, the resulting revenue will be shared. Infrastructure costs and services issues can be discussed on a case-by-case basis and if the City is in a better position to provide services, it will be repaid from the resulting revenue. Mr. Warren explained that if the Council and Board of Supervisors approves the proposed agreement in concept, staff will contact outside Counsel for finalization and return within sixty (60) days for final consideration. I City Attorney Duvernay pointed out that when the agreement is considered, a 4/5th vote of the City Council and Board of Supervisors is required for approval. Dave Scott, CEO for the Shasta County Economic Development Council commended City Council and staff for bringing the proposed agreement forward and hoped that the spirit of cooperation would keep the document and its intent moving forward. He encouraged its adoption. Mayor Mathena commented that while the proposed cooperative agreement is very important to both entities, it will provide long-lasting benefits to all the citizens in Shasta County. MOTION: Made by Council Member Pohlmeyer, seconded by Council Member Stegall, approving in concept the above described Howard Cooperative Planning Agreement between the City of Redding and the County of Shasta and authorizing the City Manager and the City Attorney to retain neutral, outside counsel to finalize the document and, provided the Agreement is approved by the Shasta County Board of Supervisors, return to the City Council for final consideration. The Vote: Unanimous Ayes. There being no further business, at the hour of 4:18 p.m., Mayor Mathena declared the meeting adjourned. I APPROVED ATTEST: ~~ . t vf CIty Clerk 9/13/2005