BOARD AGENDA MEMORANDUM
Government Code § 84308 Applies: Yes ☐ No ☒
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT:
Title
Accept the Fiscal Year 2024-25 Safe, Clean Water and Natural Flood Protection Special Tax Summary Report; and Adopt a Resolution Providing for Levy of the Special Tax Rates and Authorizing a Procedure for Correcting Special Tax Amounts for Fiscal Year 2024-2025.
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RECOMMENDATION:
Recommendation
A. Accept the Fiscal Year 2024-25 Safe, Clean Water and Natural Flood Protection Special Tax Summary Report; and
B. Adopt the Resolution PROVIDING FOR LEVY OF THE SPECIAL TAX PURSUANT TO THE SAFE, CLEAN WATER AND NATURAL FLOOD PROTECTION MEASURE IN THE COMBINED FLOOD CONTROL ZONE OF THE SANTA CLARA VALLEY WATER DISTRICT AND AUTHORIZING A PROCEDURE FOR CORRECTING SPECIAL TAX AMOUNTS FOR FISCAL YEAR 2024-2025.
Body
SUMMARY:
Provisions of Resolution 20-64 (Providing for the continuation and levy of special tax to pay the cost of a Safe, Clean Water and Natural Flood Protection Program in the combined flood control zone of the Santa Clara Valley Water District (Valley Water) subject, nevertheless, to specified limits and conditions) require Valley Water’s Chief Executive Officer to prepare a written report recommending rates for the Safe, Clean Water and Natural Flood Protection (Safe, Clean Water) Special Tax, which was approved by voters on November 3, 2020. Rate limits as specified in the Safe, Clean Water ballot measure are indexed to the fiscal year (FY) 2023-24 rates plus the change in the Bay Area Consumer Price Index (CPI) or 2 percent, whichever is greater.
Based on projected costs of the Safe, Clean Water Program activities, and reports released by the Bureau of Labor Statistics indicating that the change in CPI from February 2023 to February 2024 is 2.4 percent, staff recommends that the special tax rates for FY 2024-25 be set at their maximum level, which would reflect a 2.4 percent increase.
The senior exemption provided for in the ballot measure will continue to allow low-income parcel owners over the age of 65 to be exempt from paying the special tax consistent with Resolution 20-64. Staff has continued to enhance its outreach program to better inform the senior population of the tax exemption program.
The contemplated activities in the proposed FY 2024-25 budget are consistent with the activities identified in the Valley Water report, “Safe, Clean Water and Natural Flood Protection, Community Preferred Program Report” (Report) that explained the voter approved program in detail and any Board approved project modifications to Key Performance Indicators (Attachment 3), per the Change Control Process identified in the Report. The rates identified in the Report reflect staff recommended increases of 2.4 percent, resulting in projected revenue of $53.5 million in FY 2024-25. The Proposed FY 2024-25 budget reflects a 2.0 percent increase in rates with $53.4 million in total revenue, or $105 thousand lower than the staff recommendation. If the Board adopts the staff recommended rate increase, the final FY 2024-25 budget will be adjusted accordingly. Planned future expenditures as currently forecasted reasonably indicate that the revenue raised next year will be spent according to the Report.
ENVIRONMENTAL JUSTICE AND EQUITY IMPACT:
The Safe, Clean Water and Natural Flood Protection Parcel Tax was approved by voters in November 2020. Revenues from the parcel tax fund critical flood protection projects, such as the Coyote Creek Flood Protection project which benefits disadvantaged communities.
FINANCIAL IMPACT:
Levy of the Safe, Clean Water and Natural Flood Protection Special Tax at the recommended level for FY 2024-25 will generate an estimated total of $53.5 million in net revenue that will fund budgeted expenditures consistent with the Report. If the Board does not approve special tax rates for FY 2024-25, Valley Water would not receive the funding necessary to accomplish voter approved outcomes.
CEQA:
The recommended action does not constitute a project under CEQA because it does not have a potential for resulting in direct or reasonably foreseeable indirect physical change in the environment.
ATTACHMENTS:
Attachment 1: Staff Report
Attachment 2: Resolution
Attachment 3: Summary of Key Performance Indicators
UNCLASSIFIED MANAGER:
Manager
Christopher Hakes, 408-630-3796