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Home My WebLink About09 - Petition Certification and Request for Funding for Proposed Underground Assessment District No. 117CITY OF NEWPORT BEACH - City Council Staff Report June 9, 2015 Agenda Item No. 9 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: David A. Webb, Public Works Director- (949) 644 -3330, dawebb @newportbeachca.gov PREPARED BY: Michael J. Sinacori, Assistant City Engineer PHONE: (949) 644 -3342 TITLE: Petition Certification and Request for Funding for Proposed Underground Assessment District No. 117 (Area Bounded by: Bayside Drive, Avocado Avenue, Coast Highway, and Carnation Avenue) ABSTRACT: Residents within an 11 -block area of Corona del Mar have now submitted a Petition to the City of Newport Beach signed by at least 60% of the affected property owners requesting formation of Underground Utility Assessment District Number 117. The next step in the assessment district process would be to advance funds to SCE and AT &T for the design and bidding of the proposed underground system in order to determine a not -to- exceed cost estimate to complete the proposed undergrounding project. Once the not - to- exceed cost is determined, the City retains an assessment engineer to prepare an Engineer's Report and circulate ballots for a property owner vote on the assessment. At the request of the petition applicants, staff will also pursue an option to possibly expedite the process by developing and soliciting a property owner vote in the coming months that would be based on a conservative estimate developed at the completion of the schematic level design. RECOMMENDATION: a) Adopt Resolution No. 2015 -49, A Resolution of the City Council of the City of Newport Beach, California, Accepting Petition of Assessment District No. 117; and b) Approve Budget Amendment No. 15BA -050 authorizing an advance from the General Fund in the amount of $450,000 to Assessment District No. 117 and appropriating $270,000 to Account No. 74117- 9810 for electrical utility design by SCE, $30,000 to Account No. 74117 -9811 for phone system design by AT &T and $150,000 to Account No. 74117 -9812 for assessment engineering services. Funds remaining in this fiscal year will be carried forward to FY 16 per Council Policy F -3. FUNDING REQUIREMENTS: Upon approval of the Council directed Budget Amendment, sufficient funds would be available in the following accounts: ME Account Description AD 117 Electrical Design (SCE) AD 117 Phone Design (AT &T) AD 117 Assessment Engineering Account Number Amount 74117 -9810 $270,000 74117 -9811 $ 30,000 74117 -9812 $150,000 Total $450,000 If the district is not successful in formation, funds advanced to this district cannot be recovered from the proposed district property owners. The advance would then be expensed against future General Fund resources. DISCUSSION: The property owners of Proposed Underground Assessment District No. 117 ( "AD 117 ") have submitted a Petition to the City requesting a Special Assessment District be formed, pending approval of a district wide vote, to finance the undergrounding of overhead utilities within the proposed district. The boundaries of the proposed AD 117 are shown on Attachment A. One of the initial steps in the District formation process is the circulation of the Petition for Special Assessment Proceedings. Proponents of AD 117 circulated the Petition to property owners within the proposed district and have now submitted the petition signatures to the City. The submitted signatures represent just over 60 percent (60 %) of the assessable land within the proposed District. The City's guidelines require a minimum of 60 percent (60 %) in favor of the District in order to proceed with the formation of a District. Penco Engineering, Inc. has now reviewed and certified that owners representing just 60 percent (60 %) of the assessable property within proposed AD 117 had signed the Petition in support of undergrounding overhead utilities. Following certification of the Petition, the next step in the formation process is typically for the City to fund the necessary design costs of Southern California Edison (SCE) and AT &T for the new underground systems. SCE has submitted a design contract requesting $270,000 (10% of the estimated construction cost) and AT &T has submitted a design request of $30,000. These costs would be reimbursed to the City by AD 177 following successful district formation. However, these funds will not be recovered if AD 117 is not formed. At the request of the proponents in AD 117, City staff has discussed and developed a possible alternative path to expedite the district formation process as well as reduce the financial risk to the City, and that builds on the momentum that occurs during the signature gathering time of the Petition. Under this alternative, City staff would retain an Assessment Engineer to prepare the Engineer's Report and prepare ballots for the property owners to vote on the undergrounding proposal based on a conservative estimate developed at the completion of the schematic level design at around 5 to 6 months rather than waiting for the completion of all the necessary design work (which has been ranging around 18 -24 months). If the vote for AD 117 is successful, formation would be complete and the City would then proceed with final design. It is estimated to take approximately an additional year after a successful early vote to complete the design and bid the work. No bonds would be sold or assessment levied until after the final invoices are received from SCE, AT &T and Time Warner to ensure that the proposed assessment funds approved by the property owners are sufficient to fund the undergrounding project. I f the vote for AD 117 is unsuccessful, the City will review the options available and could reduce its financial risk by stopping all further work and recouping unspent Edison and AT &T design fees. Further details, discussions, and decisions will be presented at a later date for City Council approval to move this concept forward. As shown on the District 117 boundary map, Begonia Park and Old School Park are within the District 117 boundary. For the purposes of the Petition certification, the area of the Parks is not a part of the 60% petition calculation. City Council Policy L -28 discusses the assessment and voting process for City owned land such as Parks. Per the policy, City Council will have the discretion on a case by case basis to either vote for an assessment, against an assessment or not to vote. In the future, when staff brings forward the assessment district proceedings, which includes the approval of the assessment engineer's report and setting of the protest hearing, City Council will determine how to vote for its City owned land. At that time, costs to underground the Parks will be presented for consideration. Regardless of a City vote, if the Assessment District is approved through a majority vote, the City would be required to financially participate s -2 for its share of the undergrounding associated with the Parks. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this project exempt from the California Environmental Quality Act ( "CEQA ") pursuant to Section 15302 (replacement of existing facilities involving negligible expansion of capacity) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential to have a significant effect on the environment. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). The Notice Inviting Bids was advertised in the City's official publication and in construction industry publications. ATTACHMENTS: Description Attachment A - Proposed Assessment Boundary Mao Attachment B - Resolution Attachment C - Budget Amendment NFJ 7 2315 �O / 2319 m 232 / 2329 40- I 2340 ryA3A >rjri rf YZrit >I�j , i ra'J ✓Gn'1r;h' >r9i1j9 �1r1'r, 11 r1 'r9'r1 m { (n 0 m - 0 A m m T 2384 A 88 ` -I I --I a a G n m E m J z BEGONIA AVENUE m v a BEGONIA AVOCADO 2310 AVENUE m mw m `. N Nnm 2245 zzoo NgNm v N n 2200 C zz9s I 42o trz zzol m 1 2215 zzoo a a a a'o zzo4 zzo\ N m N ` 1 zzts n ? `�, zzoe 22221 2223 m 2216 2211 YO 0 2212 222) 2224 2215 2216 \ 2231 2228 a19 '� 2220 N 223s ACACIA AVENUE ACACIA 7 2315 �O / 2319 m 232 / 2329 40- I 2340 ryA3A >rjri rf YZrit >I�j , i ra'J ✓Gn'1r;h' >r9i1j9 �1r1'r, 11 r1 'r9'r1 m { (n 0 m - 0 A m m T 2384 A 88 ` -I I --I a a G n m E m J z BEGONIA AVENUE m v a BEGONIA 2306 v v N 2310 2229 m mw m `. N Nnm 2245 NgNm v N n 2330 C v w m 0 z Z Q D BEGONIA moo 2229 m mw m ag 2245 Z v N n 2330 C v m a a a a'o N m N D ➢ D BEGONIA moo 2229 m mw m ag 2245 Z v N n C v m a a a a'o N m N m z m m moo 2229 2245 v N v v N m z m m I I Im I� I AVENUE m R. m 2301 O2305 = i N v N N 2325 0 2333 :Co 23a5 I ° m AVENUE 1 D v� 1 a o 0 0 0 o m G v$m v 2401 o m m 2 Z 2411 /S m f9'!p Yq 4 >'19'79 u m 0 n o :GONIA PARK mCARNATION JAVENUE 1 1, 1,1.9 ijrh r, '� 14 Yy'ry OLD BOUNDARY OF PROPOSED SCHOOL ASSESSMENT DISTRICT PARK DAHLIA AVENUE DAHLIA AVENUE PROPOSED ASSESSEMENT DISTRICT NO.117 (FINAL) AREA BOUNDED BY BAYSIDE DR., AVOCADO AVENUE, COAST HWY., AND CARNATION AVENUE. ® POLES TO BE REMOVED DISTANCE: 6,600 L.F. 0 POLES TO REMAIN IN PLACE PARCELS: 214 GUY WIRE TO BE REMOVED OVERHEAD LINES TO BE REMOVED OVERHEAD LINES TO REMAIN IN PLACE 2421 v 2435/T 2229 2245 I I Im I� I AVENUE m R. m 2301 O2305 = i N v N N 2325 0 2333 :Co 23a5 I ° m AVENUE 1 D v� 1 a o 0 0 0 o m G v$m v 2401 o m m 2 Z 2411 /S m f9'!p Yq 4 >'19'79 u m 0 n o :GONIA PARK mCARNATION JAVENUE 1 1, 1,1.9 ijrh r, '� 14 Yy'ry OLD BOUNDARY OF PROPOSED SCHOOL ASSESSMENT DISTRICT PARK DAHLIA AVENUE DAHLIA AVENUE PROPOSED ASSESSEMENT DISTRICT NO.117 (FINAL) AREA BOUNDED BY BAYSIDE DR., AVOCADO AVENUE, COAST HWY., AND CARNATION AVENUE. ® POLES TO BE REMOVED DISTANCE: 6,600 L.F. 0 POLES TO REMAIN IN PLACE PARCELS: 214 GUY WIRE TO BE REMOVED OVERHEAD LINES TO BE REMOVED OVERHEAD LINES TO REMAIN IN PLACE 2421 v 2435/T ATTACHMENT B RESOLUTION NO. 2015- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH ACCEPTING PETITION OF ASSESSMENT DISTRICT NO. 117 WHEREAS, the owners of certain real property situated in the City of Newport Beach (the "City ") have filed with the City Clerk several signed counterparts of a petition, requesting the implementation of a project for the undergrounding of certain existing, overhead utility facilities, together with appurtenant work and improvements, as described therein, the cost of which is to be specifically assessed against each parcel of land benefiting from such improvements as shown on an exhibit map attached to the petition; and WHEREAS, the petition satisfies the requirements for instituting proceedings for the conversion of existing overhead electric and communication facilities to underground locations in accordance with Section 5896.5 of the Streets and Highways Code of the State of California; and WHEREAS, the City Clerk has also received a certificate to the effect that the petition has been signed by persons owning lands constituting more than sixty percent (60 %) in area of the land subject to assessment within the proposed assessment district; and WHEREAS, this City Council finds that the owners of more than sixty percent (60 %) in area of the land proposed to be assessed for the proposed improvements, including the owners of more than five of the subject parcels, have signed such petition 1 9 -5 and that the petition contains the matters required by Sections 2804 and 2804.5 of the Streets and Highways NOW, THEREFORE, the City Council of the City of Newport Beach resolves as follows: Section 1: PETITION ACCEPTED. The petition, as filed with the City Clerk, is hereby found to be legally sufficient and is accepted. Section 2: DETERMINATION TO UNDERTAKE PROCEEDINGS. The special assessment proceedings shall be undertaken by the terms of the petition, pursuant to the Municipal Improvement Act of 1913 and without further compliance with the Special Assessment Investigation, Limitation and Majority Protest Act of 1931 (commencing with Section 2800 of the Streets and Highways Code). Section 3: PUBLIC INTEREST AND CONVENIENCE SERVED. This City Council hereby finds and determines that the public interest and convenience will be served by the taking of such proceedings. Section 3: This action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(3) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3 because the activity is not a project as defined in Section 15378 and has no potential for resulting in physical change to the environment, directly or indirectly. 2 9 -6 Section 4: ACTION IS FINAL. This action is "final' within the meaning of Streets and Highways Code Section 3012. Section 5: This resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting the resolution. ADOPTED this day of 2015. Leilani I. Brown, City Clerk Edward D. Selich, Mayor Attachment: Assessment Engineer Certificate of Sufficiency of Petition 3- 9 -7 CERTIFICATE OF SUFFICIENCY OF PETITION STATE OF CALIFORNIA COUNTY OF ORANGE CITY OF NEWPORT BEACH The undersigned hereby CERTIFIES as follows: That I am the duly appointed PROJECT MANAGER AND ASSESSMENT ENGINEER of the CITY OF NEWPORT BEACH, CALIFORNIA. That on the 291h day of May 2015, I reviewed a Petition for the formation of an Assessment District for certain public works of improvement, together with appurtenances, appurtenant work and acquisition, where necessary, in a special assessment district known and designated as ASSESSMENT DISTRICT AD -117 (hereinafter referred to as the "Assessment District'), a copy of which is on file in the Office of the City Clerk. My examination revealed that said Petition has been signed by property owners representing more than sixty (60 %) percent of the assessable area of lands within the boundaries of the proposed Assessment District, all as prescribed by Sections 2864 and 2864.5 of the Streets and Highways Code of the State of California ( "Special Assessment Investigation, Limitation and Majority Protest Act of 1931 "). The undersigned hereby further specifically certifies as follows: 1. I caused said Petition to be examined and my examination revealed that said Petition was signed by not less than five (5) owners of assessable land in the proposed Assessment District as shown by the last equalized assessment roll used by the City, owning lands constituting sixty (60 %) of the area of all assessable lands within the proposed Assessment District. 2. The Petition was signed by the owners of more than sixty (60 %) percent of the assessable area of property within the boundaries of the Assessment District. Executed this 291h day of May 2015, at Newport Beach, California. PENCO ENGINEERING, INC. M. COOPER, RCE 31572 ASSEfSMENT ENGINEER CITY FNEWPORTBEACH STATE OF CALIFORNIA mi ATTACHMENT C City of Newport Beach BUDGET AMENDMENT 2014 -15 EFFECT ON BUDGETARY FUND BALANCE: Increase Revenue Esbmates X Increase Expenditure Appropriations AND Transfer Budget Appropriations SOURCE: from existing budget appropriations from additional estimated revenues X from unappropriated fund balance EXPLANATION: NO. BA- 15BA -050 AMOUNT: $aso,000.00 Increase in Budgetary Fund Balance Decrease in Budgetary Fund Balance X e No effect on Budgetary Fund Balance This budget amendment is requested to provide for the following: To authorize an advance from the General Fund in the amount of $450,000 to initiate the work associated with Assess District #117. If the District is not successful in formation, funds advanced to this district cannot be recovered from the proposed district property owners and would therefore be expensed against future General Fund Resources. ACCOUNTING ENTRY: BUDGETARY FUND BALANCE Amount Fund Account Description Debit Credit 4117 3605 Assessment District #117 - Fund Balance $450,000.00 REVENUE ESTIMATES (3601) Fund /Division Account Description EXPENDITUREAPPROPR/AT/ONS (3603) Signed: - ljppJf v/�y l Fi Aproval: Finance Direo (o Date Signed: — / S s tilg�A �l 3 Administrat' Approval: City Manage'Fj Date Signed: City Council Approval: City Clerk Date C Description Division Number 74117 Assessment District #117 Account Number 9810 Electrical Utility Design $270,000.00 Division Number 74117 Assessment District #117 Account Number 9811 Phone System Design $30,000.00 Division Number 74117 Assessment District #117 Account Number 9812 Engineering Services $150,000.00 Signed: - ljppJf v/�y l Fi Aproval: Finance Direo (o Date Signed: — / S s tilg�A �l 3 Administrat' Approval: City Manage'Fj Date Signed: City Council Approval: City Clerk Date C