AgdaPkt 2011-06-20 - Laserfiche WebLink

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6.2.A. - Page 1 To the Honorable Mayor and City Cou nci I From the City Manager J u ne 20, 2011 SUBJECT Property Tax Exchange for the Properties Located at 1250, 1252, and 1254 Edgewood Road RECOMMENDATION Approve, by resolution, a property tax exchange with the County of San Mateo for the properties located at 1250, 1252, and 1254 Edgewood Road. BAC KG RO U N D The State of California Revenue and Taxation Code requires that a city annexing unincorporated lands from a county agree upon an exchange of property taxes with the county, prior to the Local Agency Formation Commission (LAFCO) approving the annexation. Staff has negotiated an agreement with the County of San Mateo under which the City will receive 19.25% (15.40% after deducting payments made to the Educational Revenue Augmentation Fund) of the property taxes generated by these parcels. The proportion of the general 1% property taxes received under this agreement is slightly less than the citywide average (22%) that the City receives of the general property taxes. This is caused by the fact that each of the taxing entities (primarily school districts) receive a higher percent of property taxes (and will continue to receive higher property taxes) in unincorporated areas due to the absence of a municipality which would receive a portion of the 1% general property taxes. On January 10, 2011 the City Council approved an ordinance to prezone these properties which is a prerequisite to annexing these parcels into the City. Future Action It is expected that the County of San Mateo Board of Supervisors will approve this agreement at a board meeting in the near future. The property owners filed the annexation applications with the Local Agency Formation Commission (LAFCO) in March 2011. This matter is expected to be placed on the agenda at the LAFCO meeting that is scheduled for July 2011. If the annexation is approved at that meeting the jurisdictional change is effective on date of recordation (usually a few days following approval) while the tax rate change would be effective July 1, 2012.