For City Council Meeting [October 22, 2019]
TO: Honorable Mayor and City Council
APPROVAL: Rod Foster, City Administrator
FROM: Sean Grayson, Acting Public Works Director
Title
Request City Council to Adopt (1) Resolution No. 7567 Stating Intention of the City Council of the City of Rialto to Establish City of Rialto Community Facilities District No. 2019-2 (Foothill/Spruce) and to Authorize the Levy of Special Taxes within said District, and (2) Resolution No. 7568 of the City Council of the City of Rialto to Incur Bonded Indebtedness in the Amount of Not to Exceed $7,000,000 within Proposed City of Rialto Community Facilities District No. 2019-2 (Foothill/Spruce), setting a Public Hearing for December 10, 2019.
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BACKGROUND:
Mello-Roos Districts
Community facilities district (CFD) financing is a commonly used method of financing infrastructure and services for new development when requested by a developer. Commonly referred to as a "Mello-Roos District," this land-secured financing permits the City to issue bonds to pay for public infrastructure and service costs associated with development. Debt service on the bonds is paid from special taxes levied on real property within the CFD boundary. The bonds are issued on a tax-exempt basis at the federal and state level, providing low cost financing for a portion of the overall project costs, with some or all of this benefit and cost passed along to the homebuyers or property owners.
City Council Policy
The Mello-Roos Act provides that prior to initiating the CFD proceedings, the City Council must adopt a statement of local goals and policies concerning the use of the Mello-Roos Act. On November 1, 2005, the City Council adopted a policy for new development and annexations, which requires all new residential development to mitigate for all capital and operating costs imposed upon the City by that development. The policy also establishes general standards for the establishment of community facilities dis...
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