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Always Advocating Alan – Scams, Shams and Property Tax

| Opinion | January 31, 2019

Trust is defined in Webster’s Dictionary as the “assured reliance on the character, ability, strength, or truth of someone or something.” We all want to believe that we can trust our civic leaders to be factual and act in our best interest. But, when our trust is violated, it takes a long time to gain our confidence again.

Currently, our city is experiencing such a conundrum relating to the Lighting and Landscaping ballot initiative. This issue was responsible for generating massive backlash against the prospect of raising Lighting District fees five-fold for a large segment of our residents. Fortunately, the Santa Clarita City Council realized the extent of the problem and reacted by cancelling the ballot initiative.

Yet, the assessment increase was not the entire issue. Within last the November 13, 2018 City Council Meeting (Agenda Item 8) staff report was the statement, “The maintenance of 13 (Santa Clarita) parks were funded through a Landscape Maintenance District (LMD) assessment and the remaining 22 parks were funded through the General fund. … This two-tiered funding … created an inequity… To correct this disparity, park related maintenance costs were shifted from local LMD zones to the Area Wide Zone that covers nearly the entire city.”

The city later published a Frequently Asked Questions (FAQ) webpage to clarify their position, which stated, “This is a combined Landscaping and Lighting District. In many cases we are able to provide an offsetting reduction in the assessment for landscape maintenance to offset the change in the assessment for streetlights.”

But, are those statements true? In order to answer the question accurately, I first have to share the definitions of the terms I will be using. The reason is that the city uses the same term in several different (and in some cases, inaccurate) ways. Therefore, if I am not precise in my language, a city spokesperson will simply use the term in a different fashion and lead the discussion in another direction.

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For example, on the city website you can find a page titled “Special Districts.” But the city does not establish or administer Special Districts. “Special Districts” are defined as encompassing “autonomous local governments with governing boards” such as the Sanitation District. The city has instead established “Benefit Assessment Districts,” which may place a “charge upon real property … for a special benefit conferred upon real property,” such as LMDs. Information about our local LMDs is described in the Santa Clarita Landscaping and Lighting Engineers Report. In generating the document, the city has chosen to use terminology from the “Landscaping and Lighting Act of 1972,” which allows the grouping of LMDs, calling them a single district with zones. But, the city labeling the totality of their LMDs as one district does not change the fact that they are individual “Benefit Assessment Districts” which must be managed separately.

In addition, the prospect of an LMD and the General Fund (or ad-valorem tax revenue) paying a portion of a governmental service cost is very common. Engineers Reports are required to determine the percentage of “Special Benefit” to be paid by the Benefit Assessment District, as well as the percentage of “General Benefit” provided to the population at large, which is to be paid by the appropriate governmental agency. To understand the “inequity” described in the November 13 staff report, I posed the question to the city’s communication manager five weeks ago, and have not yet received an answer.

So, I took it upon myself to raise the issue at the last city council meeting. I wanted to know that if staff had indicated some LMDs were being charged more than their share, shouldn’t the council agendize the issue and enact an appropriate reduction? Mr. Striplin, the City Manager, answered my query by indicating the city’s LMDs are in compliance with Proposition 218, once a year LMD assessment changes are presented to the City Council for ratification, and Mr. Hernandez would meet with me to share the way the LMDs are structured.

Now, here come those pesky terms again. When discussing how much your property will be charged, listed on your ballot was the “Current Maximum Assessment Rate,” which can be charged per Equivalent Benefit Unit (EBU), and the “Current Assessment Rate,” which is the maximum your property can be charged based on the property’s Land Use Designation. But the “Applied Rate” that indicates what your property will actually be charged is not listed. To find it, you need to check the Landscaping and Lighting Engineer’s Report. If you do, you should find the “Applied Rate” equal to, or less than, the “Current Maximum Assessment Rate” per EBU. Confusing? It appears to have been designed to be that way.

What Mr. Hernandez shared with me was that only the “Maximum Assessment Rates” were being lowered as a part of the ballot process. He also indicated that many of the current LMDs “Applied Assessments” are less than the maximum rate. When I responded by asking if any residents would have received an actual reduction as a result of the now cancelled ballot process, he replied: “I do not know.”

Well, those answers sent me back to peel another layer off of this onion. Using the Property Owner Assessment Ballot sent to residents of zone T4 in Valencia Meadows, I observed the following:

The T4 “Current Maximum Assessment Rate” is stated as $229.19, and the Current Assessment Rate” for this parcel is also shown as $229.19, because this ballot is for a Single-Family Dwelling, equal to 1 EBU. The proposed new “Maximum Assessment Rate” of $157.70, is stated to represent a decrease of $71.49. Sound like they would be paying less? Well, guess again. The T4 “Applied Rate” on this year’s property tax bill was set on June 26, 2018, in Agenda Item 15. The Current “Applied Rate” for Zone T4 is $144.00. Doing the math, Zone T4 would not actually get a $74.49 reduction to offset any other cost. They were not getting any payment reduction at all. If the council sets their new “Applied Rate” to the ballot proposed “Maximum Rate” this year, they will be getting a $13.70 increase. In fact, of the 13 zones, referenced as having a disparity in the November 13 Staff Report, only three are paying the Maximum Assessment Rate.

So, why were the LMDs listed on the Ballot if no real property tax bill reductions were going to take place? Was it done to ensure more yes votes and influence the election outcome? I do not know how you feel about this situation, but from my perspective, trust in City Hall just took a steep nose dive.

What concerns me even more, is after bringing up this issue at the last city council meeting, our five city council members allowed the City Manager to answer my questions using misdirection, and then sat with a “deer in headlights look” without saying a word. I have to wonder, did the council know about the way this issue was being misrepresented and did nothing about it, or were they blindsided? Plus, even with the ballot being cancelled, there are still open issues with the Lighting Benefit Assessment District.

Yet, through it all, I am still an optimist. Here’s to hoping that the city council, along with senior staff, recognize the importance of maintaining the public trust, understand the necessity to take swift corrective action, make known the mitigations implemented, and most importantly, apologize to the public.

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