This is the third installment of my City of Santa Clarita Lighting and Landscaping issue trilogy. Part 1 spoke to the Lighting Assessment District proposed changes and ballot, in general terms, and raised a lot of questions. As a result of that column, Ms. Lujan, the City of Santa Clarita’s Communication Manager responded, with what she titled “Clarifications,” and invited me to give her a call.
I took her up on her offer, but unfortunately, it was the end of the week, and we did not have sufficient time to address our mutual concerns. So, even though I took exception to some of the information she presented, I decided to wait a week before responding. Instead, I wrote a Part 2, which followed the issue over the last year. I studied and used information from past council meetings, Engineers Reports, and postings on the city website. The narrative I provided shows the lighting issue has been piecemealed in front of the city council for over a year. Our council members knew -or should have known – all about it.
Now, a week has passed, with “not one additional word” coming from the city. So, I believe it is appropriate to respond with my “Clarifications to their Clarifications.” Since several of the city’s comments address the same part of the issue, I decided to group them, using quotes from their response.
To start, the city’s comments stated, “The $2.8 Million is a subsidy. Ongoing assessment revenues are not adequate to support all streetlight operational and reserve funding requirements. This creates an annual funding gap of $2.8 million, which the city covers with general property tax revenues.”
While the statement is partially true, I used information from the 2006 Lighting District Engineers Report to understand how we ended up in this situation. What the “Plans and Specifications section” revealed was, prior to the incorporation of the City of Santa Clarita, street-lighting services were provided by a special benefit district administered by the County of Los Angeles named CLMD 1867, which is funded by ad valorem property tax revenue, with a rate set by Proposition 13. On July 24, 1979, County Lighting District LLA-1 was formed. LLA-1 boundaries were wholly within the City of Santa Clarita’s borders and included the boundaries of CLMD 1867 within it, as 1867 relative to the city boundaries was a smaller district.
As of July 1, 1998, all Street Light Districts within the city have been under the jurisdiction of the City “Streetlight Maintenance District No.1 (previously LLA-1) and No.2 (previously CLMD 1867) respectively. It is (and became) the city’s responsibility to prepare and levy the annual assessments necessary to maintain the streetlights within the District.”
“The ad valorem portion is handled thru the County Auditor and the State Board of Equalization and is not acted upon by the City Council.” In addition, any new development would also be required to annex into District No 1, which is not supported by ad valorem tax revenue.
The above information provides an understanding as to why the city’s two Streetlight Levy(s) are different. It has nothing to do with someone not paying their fair share. In one case, District No 1, the Levy pays their entire street lighting cost, while in District No 2, the levy makes up the difference, between the amount ad valorem revenue provides, and the remaining cost. Why? Because it was planned that way and has been managed that way from the start. In both cases, the revenue is obtained as a part of your property tax bill, with the ad valorem amount determined and provided by the County, not the City. As stated in the February 23, 2018 agenda item 11, “ad valorem revenues …. the city has ALWAYS included in its streetlighting budgets.”
As it turns out, the 2018/19 Engineers report shows the entire cost of Street Light Operations and Maintenance at $4.9 million, supported by current revenue of $5.9 million. Even if you add in the bond debt to purchase the street lights and the conversion to LEDs of $268,409 per year, there are enough funds to support the district without any further increase to either assessment levy. The city’s assessment increase justification narrative is flawed. There is no emergency.
In reference to my question about money being transferred out of Fund 359, the city responded by stating, “The $4,444,513 transferred out of the Streetlight Assessment Fund is necessary to correct budget appropriation from the Ad Valorem Fund to the Streetlight Assessment Fund.”
Interesting, but misleading. The amount “transferred out” was $4,503,503, not $4,444,513. While the $4,444,513 expenditure was authorized by the Council on Jan 23, 2018 to pay for the Tanko Lighting Contract, for conversion of Streetlights to LEDs, what happened to the remaining $58,990 which you did not account for? Also, why was $464,352 transferred out of the Ad Valorem Account and then moved into the Assessment Account? This appears to be a shell game, where the public must find the “pea.” Since the information does not provide insight into the extent of the costs or a balance associated directly with either assessment levy, but displays a composite of both, it raises more questions as to the necessity to raise Levy A (Dist. 2) or maintain the level of Levy B (Dist. 1).
The city insists, “Street lighting and landscape services are both components of the City’s Landscaping and Lighting District.” Mr. Tonoian was quoted in the Gazette on December 13, 2018, as stating, “these votes cannot currently be separated … because again, street lighting and landscape maintenance are part of the same district.”
In this case, the city is using semantics to confuse the issue. Lighting and Landscape assessment levy(s) were not even described in a single district Engineers Report until 2017, after the current city plan was conceived. Prior to that, they were in two separate documents. Even then, each assessment levy is unique, and was initiated by showing a “special benefit” to a set of properties. Votes are to be weighted within the boundaries of each assessment levy. It makes no sense from a legal perspective, or otherwise, to claim a property owner who falls within one assessment levy should be able to have their vote counted to influence a different assessment levy. It makes no legal or moral sense; it’s just nonsense. The idea of combining the vote of several separate assessment levy(s), with some getting a decrease and some being charged more, is simply a way to influence the election’s outcome.
The city further asserted, “Anticipated Operational savings will pay down these bonds and allow the city to pass along future savings by reducing the streetlight assessment in equally among all property owners.”
That is just pure spin. With the total cost of bond principal and interest repayment of $26 million, and a projected savings of $22 million over 30 years, there will be no savings to pass on. Then, long before the 30-year payment plan will reach a climax, and you can bet there will be another bond to install new more highly technical cost-saving equipment.
The city talks to LMD Assessment reductions by saying, “The Property owners within some local LMD zones, previously financed local park maintenance with funds from their LMD assessment and their property tax. This two-tiered funding created an inequity.”
I’m sure they mean property owners CURRENTLY finance park maintenance within their LMD, because this initiative has not yet been accepted. The city should provide names and locations of the 13 parks where funding for maintenance is being removed from LMD assessment roles. Then, explain how these residents were funding the parks with both assessment and general ad valorem property tax funds. Are these parks available for use by the general public? Are any of the parks inside a gated community? Because any parks not fully available to the public should not be financed with taxpayer dollars. Then tell us where the proposed maintenance funding is going to come from. Will it be a special fund, or the general fund? Until we know all the answers, we should have no problem rejecting the proposal.
The city went on to say, “No pending development projects have been included in this ballot process.”
But in the Gazette article on December 13, 2018, Ms. Lujan is quoted as saying, “Developers whose projects are not yet developed but are within the affected areas appear to get as many votes as units they’ll build.” So, Ms. Lujan, what does “no pending development projects” really mean? Please say it in plain English. Will developers get to vote based on what they are entitled to build, or what they have built?
In addition, the November 13, 2018, Agenda item 8 Staff Report tells of staff negotiating the assessment rate for Vista Canyon Ranch (LMD Zone 32), where the developer desires to include additional landscape area in their LMD. Since this project has not yet been built, how many votes is this developer getting?
Lastly, the city indicated, “Items placed on the Consent Calendar can be discussed at Council Meetings. A member of the public can speak on a consent item to get clarifications, ask questions or raise issues.”
It is a good thing we can! If it was not for James Farley, Steve Petzold, and myself rising to the podium to challenge this issue, the street light assessment election would have taken place without a word of comment, clarification or adjustment. Items raised during Public Participation, or from the consent calendar, and spoken to by the public rarely get a staff presentation, and just as rarely get their questions answered.
I recommend a NO VOTE on this issue. As taxpayers, we deserve to be told the complete story, have our questions answered, and be treated with both honesty and integrity.
On December 31, KHTS and the Signal reported, “Santa Clarita Officials To Consider Terminating Landscape, Lighting District Fee Assessment Increase,” at the January 8 City Council Meeting. While this is very encouraging news, we are not at the finish line yet. It is important for us to show up at this city council meeting to share our objections and concerns and “seal the deal” by having our city council terminate the current assessment election process.
I look forward to seeing you at 6 p.m. on January 8 at City Hall. In the meantime, rest easy and have a very happy and safe New Year.