7-1. Finance and Insurance Committee. Board of Directors. 7/11/2017 Board Meeting. Subject. Executive Summary. Details

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1 Board of Directors Finance and Insurance Committee 7/11/2017 Board Meeting Subject Adopt CEQA determination and adopt resolution for annexation of the 51st Fringe Area Annexation to Western Municipal Water District and Metropolitan Executive Summary This action grants final approval for an annexation request by Western Municipal Water District (Western) and authorizes levying of Metropolitan s water standby charge and ad valorem tax. This annexation request consists of approximately 78.5 acres with no area in public roads, leaving a net area of 78.5 acres as the basis for the annexation charge (Attachment 1). The new water demand for this project is acre-feet per year (AFY), with a projected amount of AFY from Metropolitan and approximately AFY of reclaimed water. Western is in compliance with and meets the Best Management Practices of the California Urban Water Conservation Council (Attachment 2). The charge for this annexation, if completed in 2017, is $439,576, which includes the $5,000 processing fee. Details On May 17, 2017, Western s board of directors adopted Resolution 2944, requesting formal terms and conditions for annexation and levying of water standby charge for the proposed 51st Fringe Area Annexation. The proposed annexation would extend Metropolitan s and Western s service area to a 78.5 acre parcel. The parcel of land is located in the City of Corona south of Foothill Parkway, east of Paseo Grande, and west of Trudy Way. Western is working with Richland Developers to extend imported water, recycled water and sewer service to the proposed residential development. This request completes the full annexation of acres from the unincorporated Riverside County to the southwest area within City of Corona s sphere of influence (referred to as Annexation 117-LAFCO). The proposed development is to subdivide approximately 271 acres into 292 single family residential lots and lettered lots for open space and landscaping. The annexation charge for this annexation is $439,576, which includes a $5,000 processing fee collected at the time of the initial request; the balance is payable prior to completion. The annexation charge is calculated based on the 2017 per-acre fee of $5,536. If the annexation is completed later, the fee would be based on the thencurrent annexation rate pursuant to Section 3300 of Metropolitan s Administrative Code. Pursuant to Section 3107 of Metropolitan s Administrative Code approved on October 12, 2004, Western has submitted an acceptable Water Use Efficiency Statement of Compliance for this project (Attachment 2). The projected water demand from Metropolitan is estimated to be AFY. Completion of this annexation would be subject to such terms and conditions as may be fixed by Metropolitan s Board in granting final consent to such annexation, including the Local Agency Formation Commission conditioning approval of the proposed annexation upon a requirement that all previously established and collected taxes, benefit assessments, or property-related fees or charges be levied or fixed and collected on parcels being annexed to Metropolitan. This action adopts a resolution consenting to Western s request for annexation with a water standby charge as set forth in (Attachment 3). Upon completion of the annexation, the lands within the 51st Fringe Area Annexation will be subject to Metropolitan s ad valorem tax in the current amount of percent of the assessed value of each 7-1

2 7/11/2017 Board Meeting 7-1 Page 2 parcel and Metropolitan s water standby charge in the current amount of $9.23 per acre, or per parcel of less than one acre. Approval of Metropolitan s standby charge levied elsewhere within Western s territory is a condition to complete this annexation. Policy Metropolitan Water District Administrative Code Section 3100: Request for Annexation. Metropolitan Water District Act Chapter 1, Article 1, Section 350 through Section 356: Chapter 1 - Annexation of Territory, and Article 1 - Annexation of Public Agencies California Environmental Quality Act (CEQA) CEQA determination(s) for Option #1: Pursuant to the provisions of CEQA and the State CEQA Guidelines, the City of Corona, acting as the Lead Agency, prepared and processed the Skyline Heights Project Draft Environmental Impact Report (Draft EIR) in December 2015 for the proposed project. Subsequent to the circulation of the Draft EIR, in response to various public comments on the Draft EIR regarding impacts to the biological resources on the project site, the City prepared a revised Biological Resources section to be recirculated for public review and comment. The Recirculated Draft Environmental Impact Report (Recirculated Draft EIR) was circulated in November On February 2, 2017, the City certified and approved the Draft EIR, Draft Recirculated EIR, and Final EIR (collectively hereafter, Final EIR ). The City also approved the Findings of Fact (findings), Statement of Overriding Considerations (SOC), and a Mitigation Monitoring and Reporting Program (MMRP) on the project. Metropolitan, as Responsible Agency under CEQA, is required to certify that it has reviewed and considered the information in the certified Final EIR, and adopt the Lead Agency s findings, SOC, and MMRP prior to approval of the formal terms and conditions for the annexation. The environmental documentation is included as (Attachment 4 and Attachment 5). The CEQA determination is: Review and consider information provided in the certified Final EIR, and adopt the Lead Agency s findings, SOC, and MMRP related to the proposed actions. CEQA determination(s) for Option #2: None required Board Options Option #1 Adopt the CEQA determination to review and consider the information provided in the Lead Agency s certified Final EIR, and adopt the Lead Agency s findings, SOC, and MMRP related to the proposed action, and, Adopt resolution granting approval for the 51st Fringe Area Annexation concurrently to Western and Metropolitan and establish Metropolitan s terms and conditions for the annexation (Attachment 3), conditioned upon approval by Riverside County s Local Agency Formation Commission, and upon receipt of annexation fee of $439,576. Fiscal Impact: Receipt of annexation fees of $439,576 for the annexation area and water sales revenue from newly annexed territory Business Analysis: This annexation helps to meet Metropolitan s member agency request and provides essential benefits to the public.

3 7/11/2017 Board Meeting 7-1 Page 3 Option #2 Decline the request for the proposed 51st Fringe Area Annexation. Fiscal Impact: Unrealized annexation fee and water sales revenue from non-annexed areas Business Analysis: The subject area will not receive the direct benefits of water supplied through Metropolitan and Western. Staff Recommendation Option #1 Fidencio Mares Assistant General Manager, Chief Administrative Officer 6/23/2017 Date Jeffrey Kightlinger General Manager 6/28/2017 Date Attachment 1 Legal Description and Map Attachment 2 Water Use Efficiency Statement of Compliance Attachment 3 Resolution Fixing Terms and Conditions of Annexation Attachment 4 51st Fringe Area Environmental Documentation (Draft EIR, Recirculated EIR, Final EIR) Attachment 5 51st Fringe Area Environmental Documentation (Draft EIR Appendices) Ref# cfo

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14 7/11/2017 Board Meeting 7-1 Attachment 3, Page 1 of 4 RESOLUTION XXXX RESOLUTION OF THE BOARD OF DIRECTORS OF THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA CONSENTING TO WESTERN MUNICIPAL WATER DISTRICT S 51st FRINGE AREA ANNEXATION AND FIXING THE TERMS AND CONDITIONS OF THE ANNEXATION TO THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA WHEREAS, the Board of Directors of the Western Municipal Water District ( Western ), a county water authority situated in the county of Riverside, state of California, pursuant to Resolution No. 2944, in accordance with the provisions of the Metropolitan Water District Act (MWD Act), has applied to the Board of Directors of The Metropolitan Water District of Southern California (Metropolitan) for consent to annex thereto certain uninhabited territory situated in the county of Riverside referred to as the 51st Fringe Area Annexation, more particularly described in an application to the Riverside County Local Agency Formation Commission (LAFCO), concurrently with the annexation thereof to Western, such annexation to Metropolitan to be upon such terms and conditions as may be fixed by the Board of Directors of Metropolitan; WHEREAS, the owner of Riverside County Assessor Parcel Numbers , , and (Property) has applied for annexation into the Western and Metropolitan; WHEREAS, completion of the annexation shall be contingent upon approval by the LAFCO; conditioning its approval of the 51st Fringe Area Annexation upon a requirement that Metropolitan s existing and established taxes, benefit assessments, or property-related fees or charges in place in the service area are levied or fixed and collected on the parcels being annexed to the agency; these taxes, benefit assessments, or propertyrelated fees or charges are identified below; WHEREAS, Metropolitan has levied and collected ad valorem taxes on parcels within the territory of Western. Such charges for fiscal year 2016/17 are described in Resolution 9210, adopted by Metropolitan s Board on August 16, 2016; WHEREAS, since fiscal year , Metropolitan has levied and collected water standby charges pursuant to Section of the MWD Act on parcels within the territory of Western. Such charges for fiscal year 2016/17 are described in Resolution 9208, adopted by Metropolitan s Board on May 10, 2016;

15 7/11/2017 Board Meeting 7-1 Attachment 3, Page 2 of 4 WHEREAS, upon annexation, the parcels will be within Metropolitan s service area, Metropolitan water will be available to such parcels and such parcels will receive the benefit of the projects provided in part with proceeds of Metropolitan s water standby charges; WHEREAS, pursuant to the provisions of the California Environmental Quality Act (CEQA), City of Corona, acting as Lead Agency, certified the Skyline Heights Project (Project) Final Environmental Impact Report (Final EIR), adopted the Findings of Facts (findings), Statement of Overriding Considerations (SOC) and Mitigation Monitoring Reporting Program (MMRP), and approved the Project on February 2, 2017, for the development of the proposed annexation parcels, and Metropolitan, as Responsible Agency under CEQA, is required to review and consider the information contained in the Final EIR and MMRP, and adopt Western s findings, SOC, and MMRP, prior to approval of the formal terms and conditions for the 51st Fringe Area annexation; and WHEREAS, it appears to this Board of Directors that such application should be granted, subject to the terms and conditions hereinafter set forth. NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors of Metropolitan, acting as Responsible Agency, has reviewed and considered the information in the Final EIR, findings, SOC, and MMRP, and adopted Western s findings, SOC, and MMRP, prior to approval of the final terms and conditions for the 51st Fringe Area Annexation; and subject to the following terms and conditions, does hereby grant the application of the governing body of Western Municipal Water District for consent to annex 51st Fringe Area Annexation, to Metropolitan and does hereby fix the terms and conditions of such annexation; BE IT FURTHER RESOLVED that the Board of Directors of Metropolitan, subject to the following terms and conditions, does hereby grant the application of the governing body of Western for consent to the 51st Fringe Area Annexation to Metropolitan and does hereby fix the terms and conditions of such annexation: Section 1. The annexation of the area to Western shall be made concurrently with the annexation thereof to Metropolitan, and all necessary certificates, statements, maps, and other documents required to be filed by or on behalf of Western to effectuate the annexation shall be filed on or before December 31, Section 2. Prior to filing a request for a Certificate of Completion of the annexation proceedings with LAFCO, Western shall submit a certified copy of LAFCO s resolution approving the annexation to Western, and shall pay to Metropolitan $439,576 for its annexation fee, if the annexation is completed by December 31, If the annexation is completed during the 2018 calendar year, the annexation charge will be calculated based on the then-current rate, in accordance with Metropolitan s Administrative Code Section 3300.

16 7/11/2017 Board Meeting 7-1 Attachment 3, Page 3 of 4 Section 3. a. Metropolitan shall be under no obligation to provide, construct, operate, or maintain feeder pipelines, structures, connections, and other facilities required for the delivery of water to the area from works owned and operated by Metropolitan. b. Western shall not be entitled to demand that Metropolitan deliver water to Western for use, directly or indirectly, within the area, except for domestic or municipal use therein. c. The delivery of all water by Metropolitan, regardless of the nature and time of use of such water shall be subject to the water service regulations, including rates and charges promulgated from time to time by Metropolitan. d. Except upon the terms and conditions specifically approved by the Board of Directors of Metropolitan, water sold and delivered by Metropolitan shall not be used in any manner which intentionally or avoidably results in the direct or indirect benefit of areas outside Metropolitan, including use of such water outside Metropolitan or use thereof within Metropolitan in substitution for other water outside Metropolitan. Section 4. LAFCO has conditioned approval of the annexation upon a requirement that Metropolitan levy or fix and collect all previously established and collected taxes, benefit assessments, or property-related fees or charges on parcels being annexed to the agency. Section 5. Such charges, as recited in Sections 2 and 4, which are subject to change over time, include but are not limited to: a. Metropolitan s ad valorem tax on properties located within the territory of Western. Metropolitan shall levy the ad valorem tax in the amount, at the same time and in the same manner as ad valorem tax on other properties located within the territory of Western. Such charges for fiscal year 2016/17 are percent of the assessed value of each parcel, as described in Resolution 9210, adopted by Metropolitan s Board on August 16, b. Metropolitan s water standby charge on properties located within the territory of Western. Metropolitan shall levy the water standby charge in the amount, at the same time and in the same manner as water standby charges on other properties located within the territory of Western. Such charges for fiscal year 2016/17 are $9.23 per acre of land, or per parcel of land less than an acre, as described in Resolution 9224, adopted by Metropolitan s Board on May 9, Section 6. That the General Manager is hereby authorized and directed to take all necessary action to secure the collection of the ad valorem taxes and water standby charges by the appropriate county officials, including payment of the reasonable cost of collection.

17 7/11/2017 Board Meeting 7-1 Attachment 3, Page 4 of 4 Section 7. That the General Manager and General Counsel are hereby authorized to do all things necessary and desirable to accomplish the purposes of this resolution, including, without limitation, the commencement of defense of litigation. Section 8. That if any provision of this resolution or the application to any member agency, property or person whatsoever is held invalid, that invalidity shall not affect the other provisions or applications of this resolution which can be given effect without the invalid portion or application, and to that end the provisions of this resolution are severable. BE IT FURTHER RESOLVED that the Board Executive Secretary is directed to transmit forthwith to the governing body of Western a certified copy of this resolution. I HEREBY CERTIFY that the foregoing is a full, true and correct copy of a resolution adopted by the Board of Directors of The Metropolitan Water District of Southern California, at its meeting held on July 11, Secretary of the Board of Directors of The Metropolitan Water District of Southern California