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Consent-General Government # 18.
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| Board of Supervisors |
Financial Services |
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| Subject |
| Adopt resolution placing North Davis Meadows County Service Area's water fees dedicated to the Water Connection Project into an impound until resolution of the litigation. (No general fund impact) (Rinde) |
| Recommended Action |
| Adopt resolution directing the County Chief Financial Officer to impound North Davis Meadows County Service Area's water fees dedicated to the Water Connection Project into an impound until resolution of the litigation. |
| Strategic Plan Goal(s) |
| Operational Excellence |
| Reason for Recommended Action/Background |
The North Davis Meadows County Service Area (CSA) adopted a Proposition 218 fee increase on March 20, 2018 to support the construction of a water project to connect to the City of Davis water system. The charges for the water project were first enrolled for the 2018-19 tax bills that were due in two installments on December 10, 2018 and April 10, 2019. After the adoption of the fee increase, a lawsuit was brought around October 2018 challenging the authority to charge the fee and that the Proposition 218 process was improperly conducted.
Originally, it was believed that the lawsuit would be resolved relatively quickly, however at this point, it is unclear on exactly when the lawsuit will be resolved. Should the lawsuit be awarded in the favor of the residents bringing the suit, it may require the County to refund charges collected on the 2018-19 tax bills.
In order to ensure that the fees charged and collected on the December 10, 2018 and April 10, 2019 tax deadlines are preserved and set aside for the water project, it is prudent to impound the funds to ensure that they are not spent on the water project or on other costs of the North Davis Meadows CSA until after resolution of the lawsuit. In accordance with Government Code 26906.1, the County Auditor (part of Chief Financial Officer duties at Yolo County) with approval from the Board of Supervisors may impound disputed revenues levied and collected for the County or another revenue district if a claim or action is filed for the return of the revenues. The County Auditor shall continue to impound the revenues until resolution of the claim or action.
The total amount impounded from the fee in 2018-19 would be the amount collected for the 94 developed parcel fees in the amount of $4,157 per parcel and the one undeveloped parcel in the amount of $3,338, for a 2018-19 total impound amount of up to $394,096. Should the claims not be resolved before future fiscal year tax collection, additional amounts from those collections would be impounded as well. |
| Collaborations (including Board advisory groups and external partner agencies) |
| The Department of Financial Services collaborated with the County Administrator's CSA Administrative Support Team and County Counsel on this recommended action. |
| Competitive Bid Process |
| Not Applicable. |
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| Fiscal Impact |
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| Source of Funds for this Expenditure |
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Explanation (Expenditure and/or Revenue) |
| Further explanation as needed: |
| The fiscal impact of the impounding these revenues is that they are not available for the continuance of the North Davis Meadows CSA water project until the lawsuit is resolved. |
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