CITY COUNCIL REGULAR MEETING AGENDA PACKET

Page 4 of 8 City staff intends to proceed with a Proposition 218-compliant vote this coming fiscal year to request an increase in assessment amount based on the expected funding shortfall for capital improvements, maintenance, electricity, and water costs. The maintenance, water, and electricity costs are projected to cost about $6,700 more than the collected assessment while another $40,000 is necessary for a Proposition 218-compliant vote, thus requiring about $46,700 in reserve fund use. The irrigation system repairs will cut down on leaks and, therefore, unnecessarily high water costs. Staff estimates the annual assessment would need to be increased from $16.90 to $40-$50 (an increase of $2-$3 per month per property), and an annual inflation escalator will be sought for district funding to be self-sustaining. If the Proposition 218-compliant vote does not pass, staff intends to permanently turn off a portion of the irrigation system as a means of cost control. Landscape Maintenance District 1993-1, Windsor The Windsor subdivision (District 1993-1) has been in place for 31 years. Maintenance in this district includes masonry walls, trees, shrubbery, groundcover, irrigation systems, entry features and common area drainage ditches along with furnishing all water and electricity for the irrigation system, situated in Lot A, on the northeast side of Tapestry Way and Minton Court, and in the northwest corner of the subdivision, and also Lot C in the southwest corner of the subdivision. The assessments for the coming year are not enough to fund the maintenance of the district areas to the same level as in past years. The county assessment fee will continue to be paid, as will the City administration fee. Due to the increasing cost of water and maintenance services, and because of the aging plant material, irrigation system, and improvements, the cash reserve for the district has been depleted. Major breaks in the irrigation system have led to significant water loss, high water bills, and expensive repairs over the last few years. Despite a significant reduction in the level of maintenance of the landscaped areas, there is a fund deficit of $14,000 for this district due to the significant irrigation breaks and repairs and the tree and tree limb failures that have occurred over the last few years. The winter storms of 2022/23 especially impacted the trees in the Windsor LMD due to a lack of funding for pruning. City staff began the process of increasing the assessments for the Windsor LMD in early 2022 by initiating a Proposition 218 discussion about an assessment increase. However, the property owners that attended the neighborhood outreach meeting on February 2, 2022, voiced their desire for the City to undertake more significant outreach prior to conducting a vote. Staff met with owners again on October 18, 2022. The homeowners expressed a desire to have more control over the landscape maintenance and how money was spent but opposed approval of an assessment increase. Staff worked with the HOA Board to pursue an alternative the HOA would approve. The HOA chose to take over the routine plant maintenance and water costs and in February 2024 entered into an agreement with the City to do so. This positive step from the HOA equates to approximately $17,000 annually in cost reductions to the LMD. The other LMD maintenance responsibilities beyond plant care and water costs, such as maintenance of the sound wall, irrigation repairs, tree pruning, etc. would continue to be managed by the City as part of the Windsor LMD. Although the transfer of the routine LMD maintenance responsibilities and water costs to the Windsor HOA is a significant step toward returning the LMD to a positive fund balance, over the long term an increase in the annual assessment will still be necessary to continue the maintenance standards of the district and replenish the reserve needed to fund eventual Page 269 of 720