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Consent-General Government # 11.
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| Board of Supervisors |
County Counsel |
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| Subject |
| Approve Settlement with River City Land Holding Company, LLC and River City Parking, LLC regarding tax refund action, direct County Counsel’s Office and the Department of Financial Services to finalize settlement, and authorize Chair to sign final Settlement Agreement. (General fund impact approx. $10,000/year) (Pogledich/May) |
| Recommended Action |
| Approve Settlement with River City Land Holding Company, LLC and River City Parking, LLC regarding tax refund action, direct County Counsel’s Office and the Department of Financial Services to finalize settlement, and authorize Chair to sign final Settlement Agreement. |
| Strategic Plan Goal(s) |
Operational Excellence
Thriving Residents
Safe Communities
Sustainable Environment
Flourishing Agriculture |
| Reason for Recommended Action/Background |
River City Land Holding Company, LLC and River City Parking, LLC (“River City”) are the corporate entities that own Raley Field and surrounding parcels in West Sacramento. Beginning for the 2008/2009 tax year, River City has sought a reduction in the assessed value of the stadium and land. In December 2014, the Assessment Appeals Board (“AAB”) largely upheld the Assessor’s assessment.
River City filed a tax refund action with the Yolo County Superior Court challenging the AAB’s decision. The parties were able to enter meaningful negotiations in an effort to avoid a costly litigation, and have reached a proposed agreement (Attachment A). Under the settlement agreement, the stadium would be valued based on a methodology that accounts for the fact that sports facilities’ values are often less than the cost to construct them. The settlement also keeps intact the assessed value of the land, to be in line with sales in the area. The settlement would eliminate the risk of a much lower assessment if River City prevailed in its tax refund action, and avoids years of further litigation and associated costs that would have been needed to bring the tax refund matter to a final judgment.
Staff and the Assessor agree that this figure represents a fair assessment of River City’s property, treats River City in line with other taxpayers, and recognizes the unique nature of the stadium. The settlement is subject to approval by the West Sacramento City Council. If approved, the settlement would result in a refund of approximately $120,000 per year for the nine years covered by the settlement, plus statutory interest. The impact to the County is relatively modest, because most of the County's share of property taxes is contractually committed to the stadium's financing arrangement. Some of the County's payments to the stadium financing will be reimbursed to the County as a result of the reduced property tax assessment. Staff estimate that the net annual cost to the County's general fund is therefore only up to $10,000 per year.
The Agreement is subject to minor changes needed to effectuate the refund logistics. Accordingly, Staff asks that the Board direct the County Counsel's Office and Department of Financial Services to finalize the settlement and authorize the Chair to sign the final document, which will substantially conform to the document presented here. |
| Collaborations (including Board advisory groups and external partner agencies) |
| The County Counsel's Office, the Assessor's Office, and Department of Financial Services collaborated on finalizing the settlement and resulting financial calculations. |
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