HomeMy WebLinkAbout14 - Newport Coast & Ridge - Santa Ana Heights - Bay Knolls ReorganizationITEM 14
TO: Members of the Newport Beach City Council
FROM: Dave Kiff, Deputy City Manager
SUBJECT: Public Hearing on the Adoption of Resolution of Application
Requesting Initiation of Proceedings to Reorganize Territory (Newport
Coast & Ridge/Santa Ana Heights/Bay Knolls) and Rescinding
Resolution 99 -71
ACTIONS:
1- Hold public hearing.
2 —Adopt Resolution 2000 -_ to rescind Resolution 99 -71 and adopt anew
Resolution of Application requesting LAFCO's initiation of proceedings to
reorganize the territory known as Bay Knolls, Santa Ana Heights, and Newport
Coast and Newport Ridge.
SUMMARY: A public hearing and the adoption of a Resolution of Application allows the City to
file a reorganization application with the Local Agency Formation Commission
(LAFCO) that would lead to the eventual:
• Annexation of the unincorporated areas known as Bay Knolls, Santa Ana Heights
(east of Irvine Avenue), and Newport Coast and Newport Ridge to the City;
• Detachment of certain areas of Bay Knolls from the City of Costa Mesa;
The proposed action would rescind and replace Resolution 99 -71 (adopted by the
Council on October 25,1999) and is the first step in the reorganization process as
outlined in California Law (Government Code §56000 et seq.). A new resolution is
required because the City has made the following changes to the proposed
Reorganization outlined in Resolution 99 -71:
• Proposed the retention of the Irvine Ranch Water District as the provider of
water, wastewater, and reclaimed water in the Newport Coast and Ridge;
• Added the coastal portion of Crystal Cove State Park (within the City s Sphere of
Influence) to the proposed Resolution; and
• Made minor, non - substantive modifications to the reorganization areas based on
the completion of the metes and bounds for each of the three areas.
BACKGROUND Please refer to the October 25, 1999 and September 12, 2000 Staff Reports on this
matter (available on the Internet at www.ci.newport- beach.ca.us and the City Clerk's
Office) for additional background and color maps that address each of the three
annexation areas.
Newport Beach City Council
Page 2
WHATSNEW- The following information is provided as an update to the City Council, city
residents, and residents of the affected organization areas since the Council last
heard this matter on September 12, 2000:
• Newport Coast. As the Council is aware, various Council members and various
members of the City staff have met over a period of 21/2 years with up to seven
members of the Newport Coast Committee of 2000 (NCC2K). NCC2K's
annexation team consists of representatives of Newport Coast -area homeowners
associations, including the Newport Coast Master Association.
We are close to an agreement on annexation terms with the NCC2K - close
enough to bring this matter back before the Council for refinement of special
"Terms and Conditions" as outlined in draft form in Exhibit C of this document.
Late - but minor - modifications to these draft Terms and Conditions are
anticipated prior to Tuesday's meeting and will be discussed as a part of the Staff
presentation on Tuesday evening.
The major difference between the Terms and Conditions presented at the City
Council's September 12, 2000 meeting and the draft Terms and Conditions
attached in Exhibit C of this report is the more formal designation of the NCC2K
as an integral part of the proposed Newport Coast Advisory Committee
(NCAC), a committee that will advise the City on the distribution of
infrastructure buyback funds and in the development of a Newport Coast Civic
Center. Staff believes that this more formal designation is fully appropriate
given the complex nature of the items that the NCAC will address prior to and
after annexation.
• Santa Ana Heights. Santa Ana Heights (SAH) - a community of commercial,
residential, residential/ equestrian, and John Wayne Airport (JWA) impacted
areas - is viewed by the City Council as a valuable addition to Newport Beach.
But its number of pre- Proposition 13 assessed values and its status as a
redevelopment project area will limit SAH's property tax contributions through
at least 2035.
PAC Views. Some Santa Ana Heights residents and business owners - acting in
their capacity as the redevelopment area's Project Area Advisory Committee
(PAC) - have asked that the City address seven issues prior to annexation. They
include:
Opportunities to "partner" with the City to limit any expansion of JWA.
- A promise that the City would not hike property taxes or apply a special
assessment district to Santa Ana Heights.
The City's affirmation of the Santa Ana Heights Specific Plan.
Keeping the PAC as a "functioning community organization."
A retention of the same response times for fire and emergency medical
services as provided today by the Orange County Fire Authority (OCFA).
Services equal to those provided to Newport Beach "at no additional costs."
Early discussions with City staff regarding ongoing maintenance of projects
outlined within the Specific Plan.
Page 3
City staff believes that these issues should be discussed within the reorganization
process, especially after the City and the County complete a property tax sharing
agreement for all three areas under the proposed reorganization. However, we
can make it clear today that our full intention is to annex Santa Ana Heights
while:
— Working together to preserve and extend the 1985 JWA Settlement
Agreement.
— Not raising taxes or applying a special assessment district to Santa Ana
Heights.
Affirming the Specific Plan (your City Council did this on August 29, 2000),
including actively communicating with SAH about the maintenance of any
and all municipal services or projects in the Specific Plan.
— Working with any SAH -based community organization, including the PAC,
just as we do today with Newport Beach -area homeowners associations.
— Retaining or improving fire and emergency medical response times.
Providing the same scope of quality municipal services to Santa Ana
Heights as we do to Newport Beach today except refuse collection paid for
via property taxes.
West Santa Ana Heights. A second issue of note beyond the SAH PAC's request
is a concurrent annexation filing by residents within West Santa Ana Heights
(west of Irvine Avenue, north of Mesa, South of the Santa Ana/ Delhi Channel,
and East of Santa Ana Avenue). The City has not taken a formal position on
adding this area to the City's reorganization application, but we have met several
times with West SAH proponents. At the time of the City's LAFCO hearing,
LAFCO may refer to the concurrent filing and recommend that the City add
West Santa Ana Heights to our application. A LAFCO action to this effect may
require later direction by your City Council.
• Bay Knolls. No new issues have arisen relating to Bay Knolls since the Council's
October 1999 action. We have received several calls from persons in the Costa
Mesa Sphere of Influence inquiring as to whether or not the City would be
interested in adding their street or neighborhood to the City's application, but we
have not offered to change the proposed map and legal description of this area.
Conclusion. If the Council adopts the Resolution of Application, we will move
forward and complete our annexation application with an anticipated filing with
Orange County LAFCO (see Exhibit D for a full description of the LAFCO process)
shortly thereafter. At the same time, we will work promptly to inform the residents
of Newport Beach and of the annexation areas as to the advantages and
disadvantages of this reorganization.
It is important to note that this reorganization is one of the largest and most complex
in the City's history. It involves a multitude of regulatory agencies and service
providers as well as a resident base that is understandably cautious about any
change in the structure of their local government. The Council, the City's residents,
and the communities within the reorganization areas have our assurance that this
process will be pursued in the most open and communicative manner possible,
allowing appropriate input and comment by all parties affected by this action.
Page 4
EXHIBITS: Exhibit A:
Map of Proposed Reorganization Areas (refer to 9/12 Staff Report)
Exhibit B:
Proposed Plan of Service for Reorganization Areas (refer to 9/12 Staff
Report)
Exhibit C:
Proposed LAFCO Terms and Conditions for Newport Coast /Ridge
Exhibit D:
Summary of LAFCO Process
Exhibit E:
Resolution 2000 -_ Rescinding Resolution 99 -71 and Resolution of
Application to Initiate Proceedings to Reorganize Territory (refer to
9/12 Staff Report for copies of color maps that serve as separate exhibits
to Resolution 2000 -_).
Page 5
Exhibit C
NEWPORT COAST REORGANIZATION
TERMS AND CONDITIONS
Draft Form as revised September 12, 2000
1 — Newport Coast Advisory Committee. At the date of the Conducting Authority hearing on the Newport
Coast and Newport Ridge ( "NEWPORT COAST') reorganization ( "REORGANIZATION #00 -_ "), the City of
Newport Beach ( "CITY") shall establish the Newport Coast Advisory Committee ( "NCAC "). The NCAC shall
consist of seven (7) members, four (4) of whom shall be appointed by the Newport Coast Committee of 2000
(or a subsequent body so designated by the Newport Coast Master HOA) and three (3) of whom shall be
appointed by the City Manager after consultation by the City Council. Should Reorganization #00 -_ not be
certified by LAFCO, the City shall disband the NCAC.
2 — Infrastructure Buyback. City will partially reimburse owners of improved residential lots in Newport
Coast by purchasing specific municipal infrastructure facilities funded through County Assessment Districts in
the Newport Coast. Upon receipt of first payment from January 24, 2000 Settlement Agreement
( "SETTLEMENT AGREEMENT') between IRWD and City, City will segregate $1,200,000 in separate interest -
bearing account. City shall apportion and pay the First Buyback Payment ( "FIRST BUYBACK PAYMENT') at
a time and in a legal manner of apportionment to be determined by the Newport Coast Advisory Committee
after consultation with the City Attorney. First Buyback Payment shall equal $1,200,000 plus interest between
date of segregation and date of expenditure. On the first anniversary of the First Buyback Payment and each
year thereafter for thirteen (13) additional consecutive years, City shall pay thirteen (13) separate "Secondary
Buyback Payments" of exactly $1,200,000 in a manner of apportionment similar to the apportionment of the
First Buyback Payment. Revenue from the First Buyback Payment and any Secondary Buyback Payment
shall only be apportioned to owners of improved residential lots.
3 -- Expert Review of ADs #88 -1 and #92 -1. City will hire and/or direct in -house staff to diligently examine
documents associated with County Assessment Districts #88 -1 and #92 -1 and to resolve outstanding issues
regarding these Districts to a satisfactory conclusion within 12 months of certification of Reorganization #00-
_. Examination effort shall be overseen by the City Council and the NCAC.
4 -- Civic Center. City shall allocate up to the entirety of a $7 million Newport Coast Civic Center Account
( "CIVIC CENTER ACCOUNT') for a Civic Center in the Newport Coast not to exceed 22,000 square feet.
Center's primary location shall be adjacent to or within Newport Ridge Park depending upon community input.
An alternative site may be at the top of Ridge Park Road (within new park not yet constructed). Upon
formation of NCAC, City shall make funds available immediately for planning and design, with construction
anticipated in FY 2002 -03. NCAC shall direct and approve final design of Center as long as design does not
impair City's ability to operate and maintain Center. Center may contain gym, library, meeting rooms,
ancillary rooms. Center shall be a City -owned and operated asset with a Newport Coast resident -based
reservation preference system developed by the NCAC. Preference system shall not allow arbitrary
cancellation of properly - scheduled events. If by June 2003, the Civic Center has not been planned and the
City Council after consultation with the NCAC deems that the Center is not wanted by the Newport Coast
Community, revenue remaining in the Civic Center Account shall be added to the Infrastructure Buyback
provisions of Condition #2 and shall be returned over a period of three (3) years between June 2003 and June
2006.
5 -- Remainder of Account. If Civic Center is constructed and revenue remains in the Civic Center Account,
such revenue shall be added to the Infrastructure Buyback provisions of Condition #2 and shall be returned to
owners of improved residential lots within six (6) months of issuance of Certificate of Occupancy for Civic
Center.
Page 6
6 -- One Council District. Upon effective date of reorganization, City shall draw Council boundaries after
reorganization such that Newport Coast is placed within a single City Council district upon reorganization
through the first regularly scheduled City Council election (November 2002) following reorganization.
7 -- Retention of IRWD. City agrees to retain IRWD as the Newport Coast's provider of water, sewer, and
reclaimed water service. City shall enforce and follow the terms of the Settlement Agreement as it relates to
rate protection and IRWD's Improvement District levies ( #140/240 and #160/260).
8 — Fire and Emergency Medical Services. Upon effective date of reorganization, City shall provide the
identical Fire and EMS service to the Newport Coast that it provides to the remainder of the City. Such
service shall include the placement of a Paramedic Assessment Unit at the Newport Coast Fire Station
(Station #52) immediately following City's takeover of services.
9 — Law Enforcement Services. Upon effective date of reorganization, City shall provide the identical law
enforcement services to the Newport Coast that it provides to the remainder of the City. City shall, upon
consultation with the NCAC, provide specific on -site but temporary law enforcement services to the Coast as
requested, using facilities at the civic center or fire department for events such as crime prevention
presentations, fingerprinting small children, signing up alarm accounts, distributing material and more.
10 — Public and Private Parks. Not more than two months after the formation of the NCAC, the NCAC shall
determine which park facilities shall remain "private" and administered and maintained by Newport Coast
HOAs. Upon receipt of this determination from the NCAC, City shall accept any Irrevocable Offer of
Dedication associated with all Newport Coast parks and, where portions of such parks shall remain private,
shall lease back private portions to area HOAs in a manner acceptable to the City Attorney. City shall offer
these leases for the longest feasible term at $1 per year. Leases shall assign all liability obligations to
Lessees (HOAs). City or its contractor shall maintain public portions of parks to highest City standards.
11 — Public Common Areas, Slopes, and Medians. Prior to issuance of LAFCO's Certificate of Completion
for Reorganization #00 -_, City, County, and NCAC shall determine which slopes, medians, and common
areas outside of gated communities shall be the City's obligation to maintain. City shall maintain these areas
to City's highest standards.
12 — Curbside Residential Refuse Collection. Upon effective date of annexation, City will pay for curbside
residential trash collection (but not for collection from commercial, hotel, timeshare, or multi - family uses) for
as long as similar refuse collection is provided "free" to residences in Newport Beach's pre -1996 city
boundaries. Any future change to Measure Q (1996) that directs all residents to pay for trash collection City-
wide shall apply to the Newport Coast as well, thus nullifying "free" refuse collection per this Condition.
13 -- Aviation Committee Appointment. Upon certification of reorganization, City Council shall appoint one
or more Newport Coast representatives to the City's Aviation Committee.
14 -- SCE Encouragement. Upon certification of reorganization, City shall use its "best efforts" to encourage
Southern California Edison to bury underground power lines (TBD) in the Newport Coast.
City of Newport Beach
T
Gives voluntary notice to
affected entities of public
hearing on reorganization
T
At noticed public herding,
adopts Resolution of
Application to Initiate
Reorganization, prepares
IAFCO Application, Metes
and Bounds, Enwranmen-
tal Documentation and
Plan of Service.
Negotiates Tax
Exchange Agreements
City Council Adopts Tax
Exchange Agreement
Notices Public Hearing in
Newspaper at least 15
days prior to hearing.
T
Holds Public Hearing at
City Hall to measure
protest.
Exhibit D
Summary of LAFCO Reorganization Process
A Graphical Description
® CounfY of Orenge
If less than 25%
protest, adopts
Resolution ordering
reorganization.
If between 25% and 49%
'protest, schedule an election for
registered voters within the
reorganization area.
If Question passes,
adopts Resolution
ordering reorganization.
City begins providing
services as of the effective
date of the reorganization.
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amount Ofpmpertytax
affextedbypmposed
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Page 7
......................................................
Residents In Ares to be
Reorganized
May rile written protest
against the reorganization
up and the close of the
Cdys hearing
May vote on the Question
'shall (area) be annexed to
the City of Newport
Beach ?"
Residents begin receiving
services from
City of Newport Beach.
Page 8
Exhibit E
RESOLUTION NO. 2000-
A RESOLUTION RESCINDING RESOLUTION 99 -71 AND
A RESOLUTION OF APPLICATION
REQUESTING THE LOCAL AGENCY FORMATION COMMISSION
TO INITIATE PROCEEDINGS
FOR THE REORGANIZATION OF TERRITORY
WHEREAS, the City of Newport Beach desires to initiate proceedings pursuant to the
Cortese -Knox Local Government Reorganization Act of 1985, commencing with Section 56000 of
the California Government Code, for a reorganization which would concurrently:
(1) Annex territory to the City of Newport Beach; and
(2) Detach territory from the City of Costa Mesa;
WHEREAS, this reorganization shall be known as the "Newport Coast /Bay
Knolls /Santa Ana Heights Annexation' and include three distinct "areas" that shall be known
as follows:
Area A - Bay Knolls
Area B - Santa Ana Heights
Area C - Newport Coast and Ridge
WHEREAS, notice of intent to adopt this resolution of application has been given by
mail to affected and interested agencies and printed in the Daily Pilot on September 11, 2000;
and
WHEREAS, the principal reasons for the proposed reorganization are as follows:
(a) the City anticipates that it can provide more efficient municipal services, especially
in the areas of law enforcement and community recreational services, to the Areas
than currently provided; and
(b) the annexation of the Areas, with limited exception, is an anticipated result of the
City's review of service provision to the property within its Sphere of Influence;
(c) the City seeks to assist the County of Orange and Orange County LAFCO in
improving and simplifying the service delivery, jurisdiction, and governance of
several unincorporated "islands' adjacent to the City.
Page 9
WHEREAS, the following agencies would be affected by the proposed jurisdictional
changes:
AGENCY NATURE OF CHANGE
City of Newport Beach Annexation
City of Costa Mesa Detachment
WHEREAS, the territory included within the boundaries of the reorganization - which
may be completed in separate and distinct phases — is inhabited and a description of the
ultimate boundaries of the territory after all phases are complete is set forth in:
Area A - Exhibit A
Area B - Exhibit B
Area C - Exhibit C
and attached hereto and by this reference incorporated herein; and
WHEREAS, spheres of influence will be concurrently amended for the City of Newport
Beach and the City of Costa Mesa; and
WHEREAS, it is desired that the proposed reorganization be subject to terms and
conditions established by the Local Agency Formation Commission, including the terms and
conditions proposed within Exhibit D to this Resolution (Terms and Conditions for Newport
Coast/ Ridge); and
WHEREAS, the City of Newport Beach will or has prepare(d) environmental documents
for the reorganization in compliance with the California Environmental Quality Act and State
CEQA Guidelines in conjunction with, where applicable, the adoption of a General Plan
Amendment and Prezoning for the Areas; and
WHEREAS, on October 25, 1999, the Newport Beach City Council adopted Resolution
99 -71 which authorized City staff to proceed with a reorganization application before the Local
Agency Formation Commission and the City has since determined that Resolution 99 -71 should
be repealed and another Resolution of Application adopted based on changes to the
reorganization area as first proposed within Resolution 99-71; now, therefore be it
RESOLVED that the City Council of the City of Newport Beach hereby adopts and
approves this Resolution of Application, and the Local Agency Formation Commission of
Orange County is hereby requested to taking proceedings for the reorganization of territory as
illustrated in Exhibits A, B, and C (the "Newport Coast /Bay Knolls /Santa Ana Heights
Annexation "), according to the terms and conditions established by LAFCO and in the manner
provided by the Cortese -Knox Local Government Reorganization Act of 1985; and also be it
Page 10
RESOLVED that the City Council of the City of Newport Beach hereby rescinds and
replaces Resolution 99 -71 as adopted October 25,1999.
ADOPTED this 26th Day of September, 2000.
JOHN E. NOYES
MAYOR
ATTEST:
LaVONNE HARKLESS
CITY CLERK
ITEM 20
/ . �►
NEWPORT BEACH CITY COUNCIL
September 12, 2000 Regular Meeting
TO: Members of the Newport Beach City Council coo We d MUM
FROM: Dave Kiff, Deputy City Manager ZO e-[ -a -00
SUBJECT: Newport Coast & Ridge/Santa Ana Heights/Bay Knolls Reorganization
RB0OMM0,ZDED Direct staff to place Resolution 2000 -_ on the Council's September 26, 2000
ACTION: Agenda. Resolution 2000 7_ as proposed would rescind Resolution 99 -71 and adopt
a new Resolution of Application requesting LAFCO's initiation of proceedings to
reorganize the territory known as Bay Knolls, Santa Ana Heights, and Newport
Coast and Newport Ridge.
SUMMARY: The adoption of a Resolution of Application on September 26, 2000 allows the City to
file a reorganization application with the Local Agency Formation Commission
(LAFCO) that would lead to the eventual:
• • Annexation of the unincorporated areas known as Bay Knolls, Santa Ana Heights
(east of Irvine Avenue), and Newport Coast and Newport Ridge to the City;
• Detachment of certain areas of Bay Knolls from the City of Costa Mesa;
The action on September 26, 2000 would rescind and replace Resolution 99 -71
(adopted by the Council on October 25,1999) and is the first step in the
reorganization process as outlined in California Law (Government Code §56000 et
seq.). A new resolution is required because the City has made the following changes
to the proposed Reorganization outlined in Resolution 99 -71:
• Proposed the retention of the Irvine Ranch Water District as the provider of
water, wastewater, and reclaimed water in the Newport Coast and Ridge;
• Added the coastal portion of Crystal Cove State Park (within the City's Sphere of
Influence) to the proposed Resolution; and
• Made minor, non - substantive modifications to the reorganization areas based on
the completion of the metes and bounds for each of the three areas.
BACKGROUND Please refer to the October 25,1999 Staff Report on this matter (available on the
Internet at www.city.newport- beach.ca.us and the City Clerk's Office) for additional
background about each of the annexation areas.
• WHATSNEW. There are several issues that have arisen and either remain challenges or have been
addressed since the Council last heard this issue in October 1999. They are as
follows:
Newport Beach City Council
Page 2
• Newport Coast. As the Council is aware, various Council members and various •
members of the City staff have met over a period of 2V2 years with up to seven
members of the Newport Coast Committee of 2000 (NCC2K). NCC2K's
annexation team consists of representatives of Newport Coast -area homeowners
associations, including the Newport Coast Master Association.
A year ago - as negotiations were settling in to two or three key issues — the City
Manager wrote to the NCC2K team to tell them that he would not direct the
filing of an application with LAFCO according to the October 25,1999 proposed
annexation unless the City and the NCC2K annexation team were able to reach
agreement on annexation terms and conditions.
Unfortunately, the adoption of a new - and different - Resolution of Application
is our recognition that we did not reach consensus with the NCC2K annexation
team on all matters. It is also a clear invitation to interested persons in the
Newport Coast to, at the time of the City Council's public hearing on the new
Resolution of Application voice their concerns, opinions, or questions about the
new proposal. As such, we have notified the NCC2K of the public hearing on
September 12, 2000 and have provided them with this staff report in advance.
The City's Offer. Newport Coast residents pay extraordinarily high taxes and tax
rates that fund a wide range of infrastructure. For example, Newport Coast
residents paid for (and pay for) the widening of Pacific Coast Highway and all or
portions of Newport Coast Drive — both are major arterials that many non-
residents use. Newport Coast residents pay into a Mello -Roos District for
schools, two IRWD improvement bonds, one of two multi- million dollar County •
Assessment Districts, and dues to two HOAs in addition to their Basic 1% Levy.
As such, a tax bill (1999 Tax Year) from a home with an assessed value of
$500,000 in the Newport Coast would look like this:
WHAT A NEWPORT COAST PROPERTY TAX BILL LOOKS LIKE
This portion of bill
is based on the
value of a panel.
This porfion of fhb
bill is a'per
parcel' levied
without regard to
parcel value.
AMOUNTS LEVIED BY TAXING AGENCIES
SERVICE AGENCY
AMOUNT
BASIC LEVY
5,000.00
MWD-CMWD -0RIG AR
44.45
SPL ASMNT DIST DEBT
IRWD #140 WAT BD
1.10
IRWD IMP #240 VR
1.10
SPL ASMNT USER FEES
MWD WATER
11.80
ASMNT 8007
5,807.72
MELLO -R R7
1,003.00
NET VALUES AND TAXES 500,000
11,866.97
Please note that a home in Newport Beach proper with the same $500,000
assessed value typically will have a tax burden of 1.028%.
Early in our discussions with the NCC2K annexation team, NCC2K consistently
asked for some type of tax relief. In Fall 1997, however, the City Council stated
its resistance to any type of relief on the Mello -Roos or relief using any portion of
the City's share of the Basic Levy. We looked instead to an alternative that is
Page 3
• contained in the Terms and Conditions within this Staff Report's Exhibit C.
Item #1 on Exhibit C is the lone remaining issue of some disagreement between
the City and the NCC2K annexation team. NCC2K sought $18 MN in
Infrastructure Buybacks paid out over 10 years - the City offers $18 MN paid out
over 15 years.
City staff and the Council Members who served at various times on the City's
Annexation Subcommittee believe that the City's proposed Terms and
Conditions for the residents of the Newport Coast are fair and appropriate.
Adoption of the proposed Resolution would carry the City's proposed Terms
and Conditions to LAFCO.
The Negotiations. Admittedly, the Terms and Conditions have changed in
various ways since talks began in February 1998. Throughout the 21/2 years of
talks, I was the only City representative who attended each annexation meeting.
Council Members O'Neil, Thomson, Debay, Ridgeway, former Council Member
Edwards, City Manager Bludau, Chiefs McDonell and Riley, and others joined
the meetings over time. The art of negotiating specific Terms and Conditions
subject to later approval by a public deliberative body is difficult to accomplish.
I believe, however, that all City participants have acted in good faith. We were
forced to change draft offers (sometimes to NCC21Cs benefit, sometimes to
NCC2K's detriment), yet each time we stressed that the drafts required the
ratification of the full Council. I believe, too, that our counterparts with the
NCC2K annexation team have also acted in good faith. As such, the City
• Manager and I hold the NCC2K Team in high personal and professional regard.
While we remain somewhat apart on the issue identified above, the City
Manager and I are confident in recommending the offer outlined in Exhibit C be
formally included by the City in any Terms and Conditions adopted by LAFCO
for the Newport Coast and Ridge.
• Santa Ana Heights. Santa Ana Heights (SAH) - a community of commercial,
residential, residential /equestrian, and John Wayne Airport (JWA) impacted
areas - is viewed by the City Council as a valuable addition to Newport Beach.
But its number of pre - Proposition 13 assessed values and its status as a
redevelopment project area will limit SAH's property tax contributions through
at least 2035.
PAC Views. Some Santa Ana Heights residents and business owners - acting in
their capacity as the redevelopment areas Project Area Advisory Committee
(PAC) - have asked that the City address seven issues prior to annexation. They
include:
- Opportunities to "partner' with the City to limit any expansion of JWA.
- A promise that the City would not hike property taxes or apply a special
assessment district to Santa Ana Heights.
- The City's affirmation of the Santa Ana Heights Specific Plan.
- Keeping the PAC as a "functioning community organization."
- A retention of the same response times for fire and emergency medical
• services as provided today by the Orange County Fire Authority (OCFA).
- Services equal to those provided to Newport Beach "at no additional costs."
Page 4
— Early discussions with City staff regarding ongoing maintenance of projects •
outlined within the Specific Plan.
City staff believes that these issues should be discussed within the reorganization
process, especially after the City and the County complete a property tax sharing
agreement for all three areas under the proposed reorganization. However, we
can make it dear today that our full intention is to annex Santa Ana Heights
while:
— Working together to preserve and extend the 1985 JWA Settlement
Agreement.
— Not raising taxes or applying a special assessment district to Santa Ana
Heights.
— Affirming the Specific Plan (your City Council did this on August 29, 2000),
including actively communicating with SAH about the maintenance of any
and all municipal services or projects in the Specific Plan.
— Working with any SAH -based community organization, including the PAC,
just as we do today with Newport Beach -area homeowners' associations.
— Retaining or improving fire and emergency medical response times.
— Providing the same scope of quality municipal services to Santa Ana
Heights as we do to Newport Beach today except refuse collection paid for
via property taxes.
West Santa Ana Heights. A second issue of note beyond the SAH PAC's request
is a concurrent annexation filing by residents within West Santa Ana Heights
(west of Irvine Avenue, north of Mesa, South of the Santa Ana /Delhi Channel, •
and East of Santa Ana Avenue). The City has not taken a formal position on
adding this area to the City's reorganization application, but we have met several
times with West SAH proponents. At the time of the City's LAFCO hearing,
LAFCO may refer to the concurrent filing and recommend that the City add
West Santa Ana Heights to our application. A LAFCO action to this effect may
require later direction by your City Council.
• Bay Knolls. No new issues have arisen relating to Bay Knolls since the Council's
October 1999 action. We have received several calls from persons in the Costa
Mesa Sphere of Influence inquiring as to whether or not the City would be
interested in adding their street or neighborhood to the City's application, but we
have not offered to change the proposed map and legal description of this area.
Conclusion. If the Council adopts the Resolution of Application on September 26,
2000, staff will move forward and complete our annexation application with an
anticipated filing with Orange County LAFCO (see Exhibit D for a full description of
the LAFCO process) shortly threafter. At the same time, we will work promptly to
inform the residents of Newport Beach and of the annexation areas as to the
advantages and disadvantages of this reorganization.
It is important to note that this reorganization is one of the largest and most complex
in the City's history. It involves a multitude of regulatory agencies and service
providers as well as a resident base that is understandably cautious about any
change in the structure of their local government. The Council, the City's residents,
Page 5
• and the communities within the reorganization areas have our assurance that this
process will be pursued in the most open and communicative manner possible,
allowing appropriate input and comment by all parties affected by this action.
EX HUM Exhibit A. Map of Proposed Reorganization Areas
Exhibit B: Proposed Plan of Service for Reorganization Areas
Exhibit C: Proposed LAFCO Terms and Conditions for Newport Coast/ Ridge
Exhibit D: Summary of LAFCO Process
Exhibit E: DRAFT Resolution Rescinding Resolution 99 -71 and Resolution of
Application to Initiate Proceedings to Reorganize Territory
•
•
Page 6
•
Exhibit B
PROPOSED
PLAN OF SERVICE
AREA A - BAY KNOLLS
SERVICE
CURRENT PROVIDER
PROPOSED PROVIDER
EFFECTIVE DATE
Public Safety
Police Protection
OC Sheriff
Newport Beach PD
March 1, 2001
Fire Protection
OC Fire Authority
Newport Beach Fire
March 1, 201
Paramedic /Ambulance
OC Fire Authority
Newport Beach Fire
March 1, 2001
Animal Control
County of Orange
Newport Beach PD
March 1, 201
Utilities
Sewerage
Collection
Costa Mesa San District
Costa Mesa San District
N/A
Treatment/ Disposal
OC Sanitation District
OC Sanitation District
N/A
Reclamation
N/A
N/A
N/A
Water
Wholesale /Retail
Mesa Consolidated /IRWD
Mesa Consolidated /IRWD
N/A
Improvement District
N/A
N/A
N/A
Solid Waste
Costa Mesa San District
Costa Mesa San District
N/A
Public Works
LlghtingandLandscaping Assessment District
Assessment District
N/A
Flood Control
OC Flood Control
OC Flood Control
N/A
Street Maintenance
County of Orange
City of Newport Beach
March 1, 2001
Street Sweeping
City of Newport Beach
City of Newport Beach
N/A
.
CommunityDeaeloprnent
Redevelopment
OC RDA
OC RDA
N/A
Community Services
Parks
None
City of Newport Beach
March 1, 201
Recreation Programs
None
City of Newport Beach
March 1, 201
Library Service
OCPL
City of Newport Beach
Much 1, 2001
•
SERVICE
Public Safely
Police Protection
Fire Protection
Paramedic /Ambulance
Animal Control
Utilities
Sewerage
Collection
Treatment/ Disposal
Reclamation
Water
Wholesale /Retail
Improvement District
Solid Waste
Public Works
Lighting and Landscaping
Flood Control
Street Maintenance
Street Sweeping
Cornm atity Development
Redevelopment
Community Sennoes
Parks
Recreation Programs
Library Service
Page 7
PROPOSED PLAN OF SERVICE
AREA B - SANTA ANA HEIGHTS
CURRENT PROVIDER
PROPOSED PROVIDER
EFFECTIVE DATE
OC Sheriff
Newport Beach PD
March 1, 2001
OC Fire Authority
Newport Beach Fire
March 1, 2001
OC Fire Authority
Newport Beach Fire
March 1, 2001
County of Orange
Newport Beach PD
March 1, 2001
IRWD
IRWD
N/A
OC Sanitation District
OC Sanitation District
N/A
N/A
N/A
N/A
IRWD
IRWD -
N/A
N/A
N/A
N/A
Waste Management Inc
Waste Management Inc.
N/A
N/A
N/A
N/A
OC Flood Control
OC Flood Control
N/A
County of Orange
City of Newport Beach
Much 1, 2001
City of Newport Beach
City of Newport Beach
N/A
OC RDA
OC RDA
N/A
None
City of Newport Beach
- Much 1, 2001
None
City of Newport Beach
March 1, 2001
OCPL
City of Newport Beach
March 1, 2001
C1
E
•
•
SERVICE
Public Safety
Police Protection
Fire Protection
Paramedic /Ambulance
Animal Control
Utilities
Sewerage
Collection
Treatment /Disposal
Reclamation
Water
Wholesale /Retail
Improvement District
Solid Waste
Public Works
Lighting and Landscaping
Flood Control
Street Maintenance
Street Sweeping
Community Development
Redevelopment
Commrnrity Services
Parks
Recreation Programs
Library Service
PROPOSED PLAN OF SERVICE
AREA C - NEWPORT COAST AND RIDGE
CURRENT PROVIDER
OC Sheriff
OC Fire Authority
OC Fire Authority
County of Orange
IRWD
IRWD
IRWD
IRWD
IRWD
Waste Management, Inc
County of Orange
OC Flood Control
County of Orange, HOAs
City of Newport Beach
N/A
HOAs, NC Master Assn.
None
OCPL
PROPOSED PROVIDER
Newport Beach PD
Newport Beach Fire
Newport Beach Fire
Newport Beach PD
IRWD
IRWD
IRWD
IRWD
IRWD
Waste Management, Inc
City of Newport Beach
OC Flood Control
City of Newport Beach, HOAs
City of Newport Beach
N/A
City of Newport Beach
City of Newport Beach
City of Newport Beach
Page 8
b — � f
_� alt . VV
March 1, 2001
March 1, 2001
March 1, 2001
March 1, 2001
N/A
N/A
N/A
N/A
N/A
N/A
March 1, 2001
N/A
March 1, 2001
N/A
N/A
March 1, 200
March 1, 2001
March 1, 2001
Page 9
%.i
0
Exhibit C
Proposed LAFCO Terms and Conditions for Newport Coast/Ridge
lAssessment
Districts
rchse ofCoast Infrastructure. City vrill purchase specific intrasWcture In the Newport Coast (TBD) that, in effect,
es Newport Coast and Newport Ridge owners of improved residential lots for payments made for same facilities.
7:u,mbuars
Amount = $1,200,000 per year for 15 years + remainder of NC Infrastructure Fund upon completion of Certificate of Occupancy
of Community Center.
z
Expert Review of ADs 88.1 and 92.1. City will hire and/or direct in -house staff to examine documents associated with ADs 88.1
and 92 -1 to a satisfactory conclusion. Effort to be overseen by City Council and Newport Coast Advisory Committee. Budget to
be determined.
114C infrastructure
3
Fund
Civic Center. City shall allocate up to the entirety of a $7 MN "NC Infrastructure Fund" for a civic center in the Newport Coast.
Primary location to be adjacent to or within Newport Ridge Park depending upon community input. Secondary site at top of ridge
(within new park not yet constructed). Funds available immediately for planning and design, construction anticipated in 2002 -03.
Square footage can be up to 22,000 sf. Can contain gym, library, meeting rooms, ancillary rooms. Center shall be a City-owned
and operated asset with reservation preference ( "preference" does not imply or allow bumping previously - soeduled events) by
residents of the Newport Coast/Ridge. If by June 2006, the Community Center has not been planned and the City Council deems
that a Center is not wanted by the Newport Coast Community, all revenue remaining in the Fund shall be used per #1 above.
4
Remainder of Fund. Upon issuance of a Certificate of Occupancy of the Community Center, the revenue remaining in Fund
shall be used to purchase additional Coast infrastructure per #1 above.
lCouncil
District Representation I
One Council District. City shall place Coast and Ridge in a single councilmanic district upon annexation through the first
5
regularly scheduled Council election (November 2002) following annexation.
Water
and Sewer Service
of IRWD. City agrees to retain IRWD as the Coast and Ridge's provider of water, sewer, and reclaimed water service.
6
ty sll enforce and follow the January 2000 Settlement Agreement with IRWD as it relates to rate protection and IRWD's
Improvement District levies ( #1401240 and #1601260).
Fire
7
and Life Safety Service
City Standards. City shall provide the identical Fire and EMS service to the Newport Coast that it provides to the remainder of
the City (similar to that provided to the Coast today by the OC Fire Authority). Includes placement of a Paramedic Assessment
Un(t in NC Fire Station.
113olice
Service
City Standards. City shall provide the identical Police Service to the Newport Coast that it provides to the remainder of the City.
g
City shall, upon consultation with the Newport Coast Advisory Committee, provide specific on -site but temporary law enforcement
services to the Coast as requested, using facilities at the civic center or fire department for events such as crime prevention
presentations, fingerprinting small children, signing up alarm accounts, distributing material, etc.
9
Slope
Full City Maintenance of All Public Areas. City and/or City's contractor shall maintain — to highest City standards — all public
portions of parks, all Coast slopes not within the County/NCCP open space area nor within HOA common areas, and all medians.
ys- City will pay for curbside residential trash collection (no commercial, hotel, timeshare, or multi - family) for as long as
collection is provided "free" to residences in Newport Beach's pre-1996 city boundaries. Any change to Measure 0
Esucyh,tsh
hat directs all residents to pay for trash collection City-wide would apply to the Coast/Ridge as well.
lRepresentation
on Aviation Committee I
Aviation Appointment(s). Upon annexation, City shall appoint one or more Newport Coast representatives to the City's Aviation
11
Committee.
Electrical
Transmission Lines
12
SCE Encouragement. City shall use its "best efforts" to encourage Southem California Edison to bury underground power lines
In the Coast and Ridge.
%.i
0
•
Exhibit D
Summary of LAFCO Reorganization Process
A Graphical Description
Cry of Newport Beach
T
Gives; voluntary notlae to
affected entities of public
hearing on reorganization.
T
At noticed pubic hardalg,
adopts Resolution of
Application to Initiate
Reorganhatlon, prepares
tAFCA Application, Metes
and Bounds, ErnWnmen-
Ian Documentation and
Plan of Service.
Negotiates Tax
Exchange Agreements
Cry Council Adopts Tax
bchange Agreement
Notices Public Hearing in
Newspaper at least 15
days prior to hearing.
T
Holds Public Hearing at
City Hall to measure
protest.
If less than 25%
protest, adapts
Resoluton ordering
reorganizadon
If between 25% and 49%
protest, schedule an
election for Coast residents
on the reorganization.
If Question passes,
adopts Resolution
ordering reorganization.
City begins providing
services as of the effective
date of the reorganzation.
County of Orange
AzMdnrC &O*ra1W
AsseWrcakrdvfe
amorntdfpmpeRyfex
abEelcNbypropased
anxrabbry yerem er
a/fcrfedagerzdes
A4ga�fe 73vFxdwnge
Agrtv°mentz
AV&orsweMSOis
Adapa ra ardange
AgreavzerR
CounyyRemrder
mceArs C&&'%aye of
Canofabi017 bOrff4000
A6es5arandAUdder
Carbo/kynaxioe
.SGlHnenl dBmnMary
OAWspV
Page 10
_ ___ ..... .. .... ...�______......,
ReWents In Area to be
Reog IWd
May file written protest
against the reorganization
up urd the close of the
Ctys hearing
May vote on the Question
"shall (area) be anneved to
the City of Newport
Beach?'
Residents begin receiving `
services from 1
Cry of Newport Beach. I
Page 11
Exhibit E
DRAFT
RESOLUTION NO. 2000-
A RESOLUTION RESCINDING RESOLUTION 99 -71 AND
A RESOLUTION OF APPLICATION
REQUESTING THE LOCAL AGENCY FORMATION COMMISSION
TO INITIATE PROCEEDINGS
FOR THE REORGANIZATION OF TERRITORY
WHEREAS, the City of Newport Beach desires to initiate proceedings pursuant to the
Cortese -Knox Local Government Reorganization Act of 1985, commencing with Section 56000 of
the California Government Code, for a reorganization which would concurrently:
(1) Annex territory to the City of Newport Beach; and
(2) Detach territory from the City of Costa Mesa; .
WHEREAS, this reorganization shall be known as the "Newport Coast /Bay
Knolls /Santa Ana Heights Annexation" and include three distinct "areas" that shall be known
as follows:
Area A - Bay Knolls
Area B - Santa Ana Heights
Area C - Newport Coast and Ridge
WHEREAS, notice of intent to adopt this resolution of application has been given by
mail to affected and interested agencies; and
WHEREAS, the principal reasons for the proposed reorganization are as follows:
(a) the City anticipates that it can provide more efficient municipal services, especially
in the areas of law enforcement and community recreational services, to the Areas
than currently provided; and
(b) the annexation of the Areas, with limited exception, is an anticipated result of the
City's review of service provision to the property within its Sphere of Influence;
(c) the City seeks to assist the County of Orange and Orange County LAFCO in
improving and simplifying the service delivery, jurisdiction, and governance of
several unincorporated "islands" adjacent to the City.
0
•
•
•
Page 12
WHEREAS, the following agencies would be affected by the proposed jurisdictional
changes:
AGENCY
City of Newport Beach
City of Costa Mesa
NATURE OF CHANGE
Annexation
Detachment
WHEREAS, the territory included within the boundaries of the reorganization - which
may be completed in separate and distinct phases — is inhabited and a description of the
ultimate boundaries of the territory after all phases are complete is set forth in:
Area A - Exhibit A
Area B - Exhibit B
Area C - Exhibit C
and attached hereto and by this reference incorporated herein, and
WHEREAS, spheres of influence will be concurrently amended for the City of Newport
Beach and the City of Costa Mesa; and
WHEREAS, it is desired that the proposed reorganization be subject to terms and
conditions established by the Local Agency Formation Commission, including the terms and
conditions proposed within Exhibit D to this Resolution (Term Sheet for Newport
Coast /Ridge); and
WHEREAS, the City of Newport Beach will or has prepare(d) environmental documents
for the reorganization in compliance with the California Environmental Quality Act and State
CEQA Guidelines in conjunction with, where applicable, the adoption of a General Plan
Amendment and Prezoning for the Areas; and
WHEREAS, on October 25, 1999, the Newport Beach City Council adopted Resolution
99 -71 which authorized City staff to proceed with a reorganization application before the Local
Agency Formation Commission and the City has since determined that Resolution 99 -71 should
be repealed and another Resolution of Application adopted based on changes to the
reorganization area as first proposed within Resolution 99 -71; now, therefore be it
RESOLVED that the City Council of the City of Newport Beach hereby adopts and
approves this Resolution of Application, and the Local Agency Formation Commission of
Orange County is hereby requested to taking proceedings for the reorganization of territory as
illustrated in Exhibits A, B, and C (the "Newport Coast /Bay Knolls /Santa Ana Heights
Annexation "), according to the terms and conditions established by LAFCO and in the manner
provided by the Cortese -Knox Local Government Reorganization Act of 1985; and also be it
Page 13
RESOLVED that the City Council of the City of Newport Beach hereby rescinds and •
replaces Resolution 99 -71 as adopted October 25,1999.
ADOPTED this 261h Day of September, 2000.
JOHN E. NOYES
MAYOR
ATTEST:
LaVONNE HARKLESS
CITY CLERK
0
0
E
;N4
Legend
Detach from Costa Mesa,
Annex to Newport Beach
Proposed Annexation Area
City Boundary
Page
Exhibit C
NEWPORT COAST REORGANIZATION
TERMS AND CONDITIONS
Draft Form as revised September 4226, 2000
1 — Newport Coast Advisory Committee. At the date of the Conducting Authority hearing on the Newport
Coast and Newport Ridge ( "NEWPORT COAST") reorganization ( "REORGANIZATION #00 -_ "), the City of
Newport Beach ( "CITY") shall establish the Newport Coast Advisory Committee ( "NCAC "). The NCAC shall
consist of seven (7) members, four (4) of whom shall be appointed by the Newport Coast Committee of 2000
and three (3) of whom shall be
appointed by the City Manager after consultation by-with the City Council. Should Reorganization #00 -_ not
be certified by LAFCO, the City shall disband the NCAC.
2— Infrastructure Buyback. City will partially reimburse owners of improved residential lots in Newport
Coast by purchasing specific municipal infrastructure facilities funded through County Assessment Districts in
the Newport Coast Upon receipt of first payment from January 24, 2000 Settlement Agreement
( "SETTLEMENT AGREEMENT') between IRWD and City, City will segregate $1,200,000 in a separate
interest - bearing account. City shall apportion and pay the First Buyback Payment ( "FIRST BUYBACK
PAYMENT') as soon as possible at a time and in a legal manner of apportionment to be determined by the
Newport Coast Advisory Committee after consultation with the City Attorney. First Buyback Payment shall
equal $1,200,000 plus interest between date of segregation and date of expenditure On the 1 ". 2m. 3`0. 4."
5`h. 61h. 71". 81°. 9 �. 101". 1 11h. 12`°. 13'h. and 14'" anniversaries of the First Buyback
Paymentt City shall pay $1.200.000 ( "Anniversary Payments ") as soon as possible and in aag eask yeaF
tt+eFeatteF ieF1
a manner of apportionment similar to the apportionment of the
First Buyback Payment Revenue Revenue from the First Buyback Payment and any Seeendary
Bey6aekAnn versary Payment shall only be apportioned to owners of improved residential lots.
4 •• Civic Center. City shall allocate up to the entirety of a $7 million Newport Coast Civic Center Account
( "CIVIC CENTER ACCOUNT') for a Civic Center in the Newport Coast not to exceed 22,000 square feet.
Center's primary location shall be adjacent to or within Newport Ridge Park depending upon community input.
An alternative site may be at the top of Ridge Park Road (within new park not yet constructed). Upon
formation of NCAC, City shall make funds available immediately for planning and design, with construction
anticipated in FY 2002 -03. Funds in Civic Center Account shall only be used for actual costs of construchOLI,
including perm tt nq and design and shall not include City administrativg overhead, furniture. fixtures. and
equipment (FF &E). or other indirect incidental costs NCAC shall direct and approve final design of Center as
long as design does not impair City's ability to operate and maintain Center. Center may contain amon
other things a gym, library, meeting rooms, and ancillary rooms. Center shall be a City-owned and operated
asset with a Newport Coast resident -based reservation preference system developed by the NCAC
Preference system shall not allow arbitrary cancellation of properly - scheduled events. If by June 2003, the
Civic Center has not been planned and the City Council after consultation with the NCAC deems that the
Center is not wanted by the Newport Coast Community, revenue remaining in the Civic Center Account shall
be added to the Infrastructure Buyback provisions of Condition #2 and shall be returned over a period of three
(3) years between June 2003 and June 2006.
8 — Fire and Emergency Medical Services. Upon effective date of reorganization. City shall provide the
identical Fire and EMS service to the Newport Coast that it provides to the remainder of the City Such
service shall include the placement of a Paramedic Assessment Unit (including a full -time paramedic) at the
Newport Coast Fire Station (Station #52) immediately following City's takeover of services
I'dge 6
9 — Law Enforcement Services. Upon effective date of reorganization, 6%;y shall City shall add one
additional patrol beat and related staffing In addition City will realign beat structure such that Newport Coast
becomes a part of two separate patrol beats (such beats shall include portions of current City as well) to
enhance coverage in Newport Coast Response times and staffing levels in Newport Coast shall be
consistent with those enioved by remainder of City
City shall, upon consultation with the NCAC,
provide specific on -site but temporary law enforcement services to the Coast as requested. using facilities at
the civic center or fire department for events such as crime prevention presentations, fingerprinting small
children, signing up alarm accounts, distributing material and more.
10 — Public and Private Parks. Not more than two months after the formation of the NCAC, the NCAC shall
determine which park facilities shall remain "private" and administered and maintained by Newport Coast
HOAs Upon receipt of this determination from the NCAC. City shall accept any Irrevocable Offer of
Dedication associated with all Newport Coast parks and, where portions of such parks shall remain private,
shall lease back private portions to area HOAs in a manner acceptable to the City Attorney. City shall offer
these leases for the longest feasible term at $1 per year. Leases shall assign all liability obligations to
Lessees (HOAs) City or its contractor shall maintain facilities to standards in place today in the Newport
Coast City will use current landscape maintenance companies subject to City's competitive bid eresess
practices --4 is tiigties, Gily
11 — Public Common Areas, Slopes, and Medians City shall maintain all slopes, medians. parkways and
Common areas outside of gated communities unless such areas are retained as private by the NCAC PROF 10
ity shall maintain facilities to standards in place today in the Newport Coast. City will
use current landscape maintenance companies subject to City's competitive bid practices RraiRiaia -these
aFea&4o- C+Fy-s-k hest standaFdS
15 — Athletic Fields The NCC2K has expressed a desire for a lighted athletic field to be permitted within the
Newport Coast The NCAC will recommend a location for this field that minimizes homeowner impact All
lighting must meet City standards