REPORT TO COUNCIL
SUBJECT
Title
Approve the Fiscal Year (FY) 2025/26 Preliminary Engineer’s Report for the Downtown Parking District Assessment, Adopt a Resolution of Intention to Levy and Collect an Assessment for the Downtown Parking Maintenance District for FY 2025/26, and Set the Date of June 17, 2025 for the Public Hearing on the Proposed Assessment
Report
BACKGROUND
The operation and maintenance of certain downtown parking areas are supported by an assessment district (the Downtown Parking Maintenance District, hereinafter called the “District”). On July 28, 2009, in response to property owner’s approval by ballot, the City Council adopted Resolution No. 398-09 (RTC No. 09-196), ordering the formation of the District. Council also confirmed the final Engineer’s Report to levy an assessment for FY 2009/10 and for each fiscal year thereafter by adjusting the annual assessment rate based upon the previous year’s change in the Consumer Price Index (“CPI”) for All Urban Consumers for the San Francisco-Oakland-San Jose area, as determined by the United States Department of Labor.
On June 25, 2024, the City Council approved the current (FY 2024/25) assessment rates (RTC No. 24-0384), as shown in Table 1 below:
|
Table 1 - FY 2024/25 Assessment Rates per Benefit Zone |
|
Benefit Zone No. |
Assessment Rate Per Deficit Parking Space |
Total Deficit Parking Spaces |
Total Assessment Revenue |
Less County Administration (1%) |
Net Assessment Revenue |
|
1 |
$0.00 |
56.80 |
$0.00 |
$0.00 |
$0.00 |
|
2 |
$212.56 |
172.38 |
$36,641.09 |
($366.41) |
$36,274.68 |
|
3 |
$92.29 |
2,165.86 |
$199,887.22 |
($1,998.87) |
$197,888.35 |
|
4 |
$27.80 |
500.81 |
$13,922.52 |
($139.23) |
$13,783.29 |
|
Total |
|
2,895.85 |
$250,450.83 |
($2,504.51) |
$247,946.32 |
The benefit zones are shown on the District diagram in the Engineer’s Report (Attachment 1, Appendix A). Property owners in Benefit Zone 1 (commonly known as CityLine Sunnyvale, formerly known as Town Center) are not assessed because the CityLine Sunnyvale developer is required to maintain the new parking facilities as well as the existing parking structure adjacent to Target. Additionally, property owners in Benefit Zone 1, south of Iowa Avenue, are able to use the available parking facilities, even though the CityLine Sunnyvale developer pays for the maintenance and operation of those parking facilities. Benefit Zones 2, 3, and 4 have a different assessment rate based upon the City’s operation and maintenance costs for the public parking lots within each benefit zone.
In FY 2024/25 the assessment rates per deficit parking space of each benefit zone were levied at 100% of the maximum assessment rate per deficit parking space.
EXISTING POLICY
Council Resolution No. 6643, dated September 1, 1964, authorized the City to levy an annual assessment on all lands and improvements within the District to pay debt service, operations, maintenance, and improvement costs.
ENVIRONMENTAL REVIEW
Adoption of the subject Resolution of Intention is not a project within the meaning of the California Environmental Quality Act (CEQA) as CEQA does not apply to governmental funding mechanisms or other government fiscal activities, which do not involve any commitment to any specific project which may result in a potentially significant impact on the environment (CEQA Guideline Section 15378(b)(4)).
DISCUSSION
Francisco & Associates, Inc., the Assessment Engineer, has prepared the preliminary Engineer’s Report (Attachment 1) for the FY 2025/26 assessment.
Each fiscal year the maximum annual assessment rates are calculated by adjusting the previous year’s maximum assessment rate by changes to the CPI for San Francisco-Oakland-San Jose Area as determined by the U.S. Department of Labor. The increase in CPI applied to FY 2025/26 rates is +2.6890%. This year proposed assessment is the maximum assessment.
The District is also anticipating an additional revenue of $43,200 in FY 2025/26 from electric car charging stations that are installed in some of the parking spaces within the District. This revenue will be deposited in the reserve fund. Reserve funds are used to pay for longer-term capital projects and any deficits in the operating budget.
The number of deficit parking spaces for each parcel is determined based upon the difference between the number of parking spaces needed per the City’s Parking Demand Guidelines and the number of existing parking spaces located on the parcels within the District. The assessment for each parcel is based upon an assessment rate multiplied by each parcel’s corresponding deficit parking spaces.
The County Tax Collector requires all individual assessments to be levied in even pennies so that the property tax bill can be split evenly in two payments. This results in having the Total Deficit Parking Space multiplied by the FY 2025/26 Assessment per Deficit Parking Space off by pennies from the FY 2025/26 Assessment Revenue. Individual assessment roll calculations are in Appendix B of the preliminary Engineer’s Report (Attachment 1).
A public hearing process is required by state law to provide the City authority to levy and collect the FY 2025/26 assessment for the District. Adoption of the Resolution of Intention (Attachment 2) will approve the preliminary Engineer’s Report, authorize publication of the Notice of Public Hearing, and set a public hearing date for June 17, 2025.
|
Table 2 - FY 2025/26 Proposed Assessment Rates per Benefit Zone |
|
Benefit Zone No. |
Assessment Rate Per Deficit Parking Space |
Total Deficit Parking Spaces |
Total Assessment Revenue |
Less County Administration (1%) |
Net Assessment Revenue |
|
1 |
$0.00 |
56.80 |
$0.00 |
$0.00 |
$0.00 |
|
2 |
$218.27 |
172.38 |
$37,625.38 |
($376.25) |
$37,249.13 |
|
3 |
$94.78 |
2,146.77 |
$203,470.86 |
($2,034.71) |
$201,436.15 |
|
4 |
$28.55 |
500.81 |
$14,298.13 |
($142.98) |
$14,155.14 |
|
Total |
|
2,876.76 |
$255,394.37 |
($2,553.94) |
$252,840.42 |
While CityLine Sunnyvale is part of the Downtown Parking Maintenance District, it is obligated to provide all its parking space requirements within the Project, so no effect on the District is anticipated.
FISCAL IMPACT
The planned FY 2025/26 operating budget for the maintenance and administration of the District is $239,414. As shown on Table 2 above, approval of the recommended FY 2025/26 assessment is expected to generate a total revenue of $255,394.37. The City is expected to receive a net assessment revenue of $252,840.43 after County administrative fees are subtracted. The anticipated difference of $13,426.43 between the planned expenditure and the net assessment revenue will be deposited in the reserve fund. The reserve fund is also expected to recognize revenue from the electric car charging station within the District in the amount of $43,200. The projected reserve fund balance on June 30, 2025 is $919,741. Reserve funds are used to pay for longer-term capital projects and any deficits in the operating budget.
Due to timing of the Final Engineer’s Report and the development of the FY 2025/26 Recommended Budget, the revenue and expenditure figures may be different from the figures presented in the final FY 2025/26 Recommended Budget.
PUBLIC CONTACT
Public contact was made by posting the Council meeting agenda on the City's official-notice bulletin board at City Hall, at the Sunnyvale Public Library and in the Department of Public Safety Lobby. In addition, the agenda and this report are available at the City Hall reception desk located on the first floor of City Hall at 456 W. Olive Avenue (during normal business hours), and on the City's website.
On or around March 20, 2025, informational letters were mailed to each property owner explaining the proposed assessment methodology and assessment rate per deficit parking space, with specific information pertaining to the assessment methodology, the demand for on-site private parking, the number of on-site private parking spaces, and any respective deficit was provided for each parcel within the District.
RECOMMENDATION
Recommendation
Approve the Fiscal Year (FY) 2025/26 preliminary Engineer’s Report for the Downtown Parking District Assessment, adopt a Resolution of Intention to Levy and Collect an Assessment for the Downtown Parking Maintenance District for FY 2025/26, and set the date of June 17, 2025 for the public hearing on the levy of the proposed Assessment.
Staff
Prepared by: Sherine Nafie, City Property Administrator
Reviewed by: Chip Taylor, Director, Public Works
Reviewed by: Matthew Paulin, Director of Finance
Approved by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. Fiscal Year 2025/26 Preliminary Engineer’s Report
2. Resolution of Intention