LAFCO: Levels of Service and Funding the Santa Paula Annexation to County Fire

By Sheryl Hamlin

At approximately one hour and ten minutes into the meeting, Commissioner Zaragosa asked Kai Luoma, the LAFCO Executive Director, the following: What is LAFCO being asked to do today? Is it financing? MOU? (1:17:16 on video.)

Mr. Luoma answered that Levels of Service (LOS) must be maintained and that the “enhanced level of service” service can be paid for. Nothing, Luoma said, came before his office indicating that annexation would be detrimental to Santa Paula. “Can the Ventura County Fire Protection District provide the Level of Service and is there sufficient funding to pay for it?,” clarified Zaragosa. Mr. Luoma reiterated that this statement was the essence of the decision to be made by LAFCO on November 15, 2017.

After two hours of discussion, the commissioners all stated cautious approval to the idea of regionalization, but in a 4-3 vote rejected the staff motion to approve at this meeting and subsequently approved a commission initiated motion to continue the Santa Paula annexation (4-1-2) until January 2018, at which time ideally the MOA (Memorandum of Agreement) between Santa Paula and the Ventura County Fire Protection District (VCFPD) will be complete, as well as concerns allayed by the City of Ventura about effects on its LOS due to the loss of station #26. The attorney reassured the commission that there may be multiple continuations in the event the MOA is not complete.

It was the lack of this MOA (MOU) that appeared several times during the discussion.

The language in the LAFCO staff motion gave both parties one year to work out the MOA, but had the commissioners accepted the motion for annexation, the citizen protest period would have started immediately.

Commissioner Freeman said it was putting the citizens at a disadvantage to decide about a protest vote without the full set of documentation, which includes the MOA. Commissioner Parvin said she did not want surprises from the MOA. Commission La Pena, who represents the city with the highest payment to VCFPD, said there was no harm in having everyone come together and perhaps there was time to recompute the funding formula, which had also been suggested by the City of Moorpark (letter not in public packet) and by Sheryl Hamlin (57:00:00 on video).

Which Comes First the Level of Service (LOS) or the Funding?

Kai Luoma discussed the LOS resulting from annexation saying that two stations in Santa Paula would provide an acceptable LOS for the entire city including EA1. It was stated that the downtown station would be rebuilt and the station near Von’s would be used temporarily until the new station could be sited.

Mr. Luoma clarified a point which had been shared erroneously about the LOS. The VCFPD goal stated the response would be 8.5 minutes or less 90% of the time, but actually, he said it is less than 5 minutes. He also said that the SPFD response time was “very good” at 5 minutes 46 seconds.

There was discussion about East Area 1. Mr. Luoma stated that the two stations could service the entire city including East Area 1, but it was acknowledged that the EA1 Development Agreement must be modified to reflect the transfer of funds for the public safety development fee to the county as well as to change the station requirement.

Though not discussed with respect to the timeline, presumably, the modification of the EA1 Development Agreement will require a hearing at the Santa Paula Planning Commission followed by the Santa Paula City Council.

The LAFCO/VCFPD staff cost model shown below indicates a slight shortfall after ten years with breakeven after 13 years.


LAFCO Cost Projections

Note that it was stated several times that the RDA monies in 2025 which will be recombined with the Santa Paula Tax Rate Allocation (TRA) pool and the shutdown of county fire station #26 on Telegraph made the financial situation “viable”. Chief Lorenzen specifically said “the speakers are right” at one point in the discussion about costs.

To this point, Chief Lorenzen made an interesting statement about the .1650 rate saying that he did not know how or why he picked the number, but based on the number of people who thought it was too low and the number of people who thought it was too high, he must have found “the sweet spot”. Apparently, there is no methodology for determiming the slice VCFPD will take of the pie. Chart below shows the pie after the .1650 piece for VCFPD


Source Ventura County Assessor TRA Reports

Speakers

Martin Hernandez from Santa Paula City Council said he had a lot of experience with elected officials, land use issues, public finance and it took all of this get to this point, after eight public meetings. He thanked all the staff and firefighters for the hard work saying that maintining public safety is the priority.

Vice Mayor Ginger Gherardi said this is not a finance issue, but about public safety. The city lost a fire engine destroyed protecting county property. Fire knows no boundary so it is in everyone’s interest to move toward annexation.

Mark Watkins, City of Ventura, City Manager, said he concurs with the Moorpark letter. The annexation does not just affect Santa Paula. He said the effects of the extra calls on Ventura’s service must be studied and presented to the Ventura City Council.

David Endaya, Ventura City Fire Chief, said with 24 years in the mutual aid system, he knows that firefighters do not stop at boundaries, But station Number 26 resoonded 91 times to issues in Ventura, so is looking for how these calls will be serviced in the future. He questioned why in 2016 the dialogue with Ventura was not started. To this Chief Lorenzen said the joint applicants could have engaged Ventura more thoroughly.

Chief Lorenzen spoke about costs in a response to comments about the huge reserves of the VCFPD. He said they are not making a profit. Although there is nearly $100 million in the reserve fund, these funds are pre-allocated. Having these funds allows VCFPD to avoid borrowing for capital improvements, he said. He reiterated that the Santa Paula deal was weak without the Redevelopment Agency (RDA) monies coming into the TRA pie in 2026. Responding to the concerns about the high tax allocation rates mentioned by Moorpark, Thousand Oaks and Santa Paula, he said he did not know the mechanism for renegotiating a Tax Rate Allocation once established.

Mary Ann Krause, former mayor and council member, provided a new view of the annexation. She reminded that the three existing stations serviced the unincorporated areas around Santa Paula. By losing one station, Santa Paula was paying to underwrite the unincorporated areas. She felt the .l650 was too high.

Mike Tracy, Ventura City Council, speaking for himself, said he was concerned about the closure of station #26 and its effects on the City of Ventura. Ventura passed a sales tax to reopen a previously closed station.

Gabriel Zamora presented a PowerPoint. He was given ten minutes in exchange for limiting the opposition presentation to one speaker. When asked for a show of hands, there were several dozen hands raised. The theme of the presentation was inadequate and incomplete information about Santa Paula itself presented to LAFCO. The costs shown in the chart below indicate monies that will go to VCFPD reserves, but will they be spent in Santa Paula? To download the presentation, click here.

Mayor La Pena asked if Santa Paula is in more dire straits in a few years, what if the city cannot pay the county? Staff reminded her of the Tax Rate Allocation pool from which monies are taken directly before being sent to Santa Paula, so as long as people are paying property taxes, VCFPD will be paid. Commissioner Zamora said it was a good presentation but better given to the Santa Paula Council.


Zamora Presentation

Richard Rudman spoke in support of annexation saying that the 1000 signatures gathered by Mr. Zamora’s group were obtained under false pretenses due to the inaccuracies in the VCSTAR articles.

Mayor Crosswhite, speaking as herself, said the process was troubling with respect to timing of the documents. Before the city approved the tax sharing agreement, the key terms of the MOU were discussed and the application to LAFCO. Accurate financial information was not available before the tax sharing agreement was approved, nor is there a 5, 10, 20 year forecast for the entire city. Nor has council met in open or closed session to discuss the items in the MOU, citing specifically the $4 million Limoneira public safety payment, the insurance settlement for the Santa Clara Wastewater explosion and the East Area 1 land. But, she says, she still has an open mind.

Chris Mahon, Union Representative, spoke in support of annexation saying he represented both agencies. They are very close, he said, to the final MOU. Several items are open, but none major. He said Santa Paula would need to increase spending 157% to match the services it will receive from VCFPD.

Laura Espinosa, former council member, cited sections of the LFACO handbook about environmental justice, racial and income inequalities, which she said all exist in Santa Paula. All policy, she said, affects Santa Paula’s financial viability eventually. She said the proposal appears to be motivated by other factors. When her time was up, someone from the audience volunteered to give her his time, but he did not fill out a speaker card.

Discussion

A commissioner question about the 79% was directed to the city of Santa Paula. Mr. Rock approached and tried to clarify that it was actually 47 to 48% if the Property Tax Swap for VLF is added to the mix. He said Santa Paula considers the VLF swap property tax. Read about this here. Rock also insisted there was no budget shortfall in Santa Paula. Read about this here.

A commissioner asked LAFCO staff if all LAFCO laws were complied in this analysis including Proposition 218. Mr. Luoma answered affirmatively, but he said he was unaware of 218 issues until today. (Hamlin statement at 57:00 in video).

Although not discussed, Proposition 218 has strict rules on “benefits received” reflecting the actual costs of the benefits. Read about this here.

Public Safety in East Area 1 was discussed. Mr. Luoma said that the requirements change came from the city. VCFPD does not need the EA1 station to meet the LOS, he said.

There was discussion about the timeline and the continuation. The final vote was discussed in the first paragraph of this article.

To watch the video, click here.

For more information on author click sherylhamlin dot com


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