Kamis, 12 Agustus 2010

LMD and CFD Rates

LMD and CFD Rates:

Question:
At the Southridge meeting a resident was complaining about his CFD.

I at times thought that the fees on landscaping and lighting for the parts of the community are quite costly. (The exception being the middle of town that pay none of the district fees). My question is can you perhaps share an example of the cost break down how these revenues are dispersed?

Answer:
Community Facilities Districts (CFD), Landscape Maintenance Districts (LMD’s) and Landscape Lighting Maintenance Districts (LLMD’s) are put in place as a way to collect revenue to pay for city services associated with development. These revenues are collected through an assessment that is added to the County’s yearly property tax bills issued to property owners. That revenue is then used to pay for services such as park and landscape maintenance services and street lighting within the established boundaries of that particular neighborhood. CFD #1, or Southridge as it is known to most people, is unique in that this yearly assessment also pays for Police and Fire services. The breakdown of the yearly assessment is as follows:

46% - Park and Landscape maintenance services and utility costs
30% - Police services
18% - Fire services
6% - Administrative fees and cost allocation.

The assessment for services mentioned above will occur yearly for as long as the CFD, LMD or LLMD is in place. Some CFD’s may also have an additional assessment in place to pay off infrastructure bond debt incurred by the developer that built the neighborhood. This bond debt assessment goes away once the bonds have been paid off, which is usually after 30 years.


At their July 28th regular meeting, Fontana’s City Council recently approved the levying of these assessments for the 2010/2011 fiscal year. What is notable about this action is that the assessments for this fiscal year do not include any increases. The Council’s direction to City staff has always been to keep the costs for services in our CFD, LMD and LLMD areas low and as stable as possible. One of the ways this has been accomplished is through the restructuring of the City’s landscape maintenance contracts.

Ten years ago the City had 6 contractors performing park and landscape related maintenance services throughout the City. These contractors were all working under separate contracts and specifications. In 2004 the City’s Public Works Department combined the maintenance specifications for these services into one contract with three distinct service areas. This new contract was put out to bid and resulted in lower costs to the City due to decreased operational costs for the contractors. The contract also became easier for staff to manage due to only having to oversee 3 contractors rather then 6. In 2009 another change was made to include all irrigation system repair charges in the yearly contract price rather then billable as an extra charge as they previously had been. This again resulted in lower costs overall.
Some costs, such as the price of the water and electricity that are used in these areas, will always be difficult to control. Under direction of the City Council, staff will continue to look for innovative ways to keep our CFD, LMD and LLMD fees as low as possible for our residents.