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I I I II Mr. Euphrat said, "The legal community believes that this kind of automatic inflation will probably withstand scrutiny and challenges in courts. But it is quite possible that '-- somewhere in Califomia some community will put in an inflation factor, some property owners will say 'no' you can't do that, it is counter to Proposition 218, it will be litigated, and then we will find out if we can do the automatic equation. If it turns out that the court says 'no' you can't, which could be twenty-five years from now, then you won't be able to make the increase without a vote. Then you will have to deal with it then." In response to Councilman Leipzig's questions regarding a legal challenge, Mr. Euphrat said, "These legal issues are always litigated very narrowly. . .. In a broader sense in trying to respond to your question... I believe it would not throw out the maximum budget of $155,000, merely the increases. It would push you back to the $155,000." He added that the results of the election would be based only on the ballots returned, weighted by the assessed dollar value, and only a simple majority was required. In response to Councilman Leipzig's questions regarding the benefits of an Assessment District in this case, City Manager Everett said that early on, because of the complexities of Proposition 218, the City proposed that the owners associations assume the responsibility of the higher level landscape maintenance that they wanted. He said the Associations did not want that responsibility and said they preferred an Assessment District. In response to mayor Pro Tern Howard's questions, Mr. Euphrat said the formulae for - these kinds of Districts were in uncharted territory because of Proposition 218. He described the negotiations that established the percentages for each of the components, commercial, residential and the owners associations, the concept of general benefit and open space. Mayor Pro Tern Howard expressed her support for bike trails that would go through the District and connect to other areas. In response to Mayor Pro Tern Howard's questions, Superintendent Hover said staff had identified three different levels oflandscape maintenance, and services such as picking up litter, was included, in even the lowest level maintenance. In response to Councilman Ruskin's questions regarding the general benefit area, City Manager Everett said City staff, the owners associations and developers agreed that the 12% for general benefit was reasonable and could be defended if challenged. He added that Proposition 218 had not been challenged in court, but the City did the best it could to meet the criteria contained in that law. Mayor Pro Tern Howard called upon anyone in the audience who wished to speak to this Issue. --- ADJOURNED REGULAR COUNCIL MEETING MINUTE BOOK NO. 55 JUNE9,1997 MINUTES Page No. 397 PAGE 11