Board of Supervisors - Regular Meeting

Okay, good evening, everyone. Welcome to the special meeting of the Board of Supervisors on Monday, September 14th, 5.30. Can we please start with the Pledge of Allegiance led by Supervisor Kosmicki. Thank you, is there a motion to acknowledge the certificate of posting?

So moved. Is there a second? Second.

All right, all in favor, aye. Aye. All right, moving to our regular agenda, our one and only item, receive informational presentation regarding the county service areas and county facilities districts.

The chair, board of supervisors, and the public. My name is Linda young CSA coordinator, I am here today to present and to have a public discussion regarding county service areas and Community facilities districts. This presentation is informal nature and intended to provide the board of supervisors and the public with an overview of the structure and operations of the CSA and CFD. This map provides an overview of the county's existing CSAs and CFDs, highlighting their locations and illustrating their geographic distributions of special districts where services and maintenance of infrastructure is provided. In today's presentation, we will provide information about how CSAs are funded, an overview of the CSAs and the CFDs, historical funding changes and impacts, financial statuses of all CSAs and CFDs, and an evaluation of future funding strategies. To begin, San Benito County has a long history with CSAs, with the first dating back to 1960. To understand how CSAs are funded, it is important to recognize the CSAs are funded under Prop 13 and Proposition 218. Over the years, articles have been passed adding Sorry, adding articles to the California Constitution, strengthening taxpayers' protection. It is important to note that Proposition 13 and Proposition 218 did not establish CSAs, rather they changed the requirements on how revenues can be assessed and used. Okay. So this slide will highlight the Proposition 13 versus Proposition 218. So to go further into a little detail about each of them, Prop 13 I'm sorry, CSAs are funded through the county's existing ad volum property tax, also known as Proposition 13, rather through a special assessment. Prop 13 limits general property tax rates at 1% of the assessed value, and a portion of that tax revenue is then allocated to be used to support each of the CSAs and their maintenance needs. It also limits the annual increase in assessed values to a 2% and requires a two-third voter approval for special taxes. Proposition 218 are subject to special benefits and proportionally requirements. The approval process requires specific notification procedures and a majority protest process. Both of these do provide impacts to the county and the differences between them. Under Prop 13, it reduces the flexibility in generating local revenues, a limited growth in property tax revenue, and a greater reliance on voter approval taxes. Under prop to 18 it gave greater property owner over oversight Lex less flexibility and establishing and increasing changes and revenues are limited to the cost of providing the authorized services, this provided a greater challenge maintaining service levels at cost of increase. Community facilities districts are governed under the 1982 Mellis-Roos Act. CFDs provide another tool to establish and dedicate a revenue source through special taxes. CFDs are used to fund public infrastructures, ongoing maintenance, and public services addressed towards the impact of the development. CFDs are also structured to include an annual CPI adjustment allowing the revenue to keep pace with the increased cost. This slide shows the comparison between the CSAs and the CFDs. Just to highlight some of the main points, CSAs are funded under either the Prop 13 or Prop 218, where the CFDs are financed under their special rate assessment, which allows us to provide services to the infrastructure. So where one is we provide localized services, the other one is funded through a special tax. Although they're taxed a little bit different, the tax revenues and the assessment are used essentially for the same services. It all depends on, I guess, the details of when they're developed. CSAs are commonly used for ongoing operation and maintenance. where cfds fund ongoing services csa's do not allow any finance through bondings where cfds there is that capability okay so here we show um a quick little glimpse of the cpi units that we use. So from the US Bureau of Labor Statistics, using all items to include like food, energy services and commodities, we're highlighting the units for the annual consumer price index adjustment for fiscal year 26-27, which shows you the CPI index percentage rates that we've calculated for this fiscal year. And as you can see, this is where I've mentioned in the past where each one uses or has a different escalating rate or percentage rate based on the baseline rule of when they were developed. So CFD 2018, which is known as a residential services program, And also, just to provide a little bit more context, we will be going into CFDs more into detail as we go on with the presentation. But CFD 2018, we use April to April. CFD 2015, which is known as Santana Ranch, we use the annual average. And then the CSAs, we use December to December. And here is the example of the calculation of how we come up with the percentage. This example specifically uses the units from CFD 2018. So I'm going to be going into the current CSA statuses. So this should actually state that there are 32 CSAs established historically. 24 are currently active and we continue to collect revenue and provide authorized services. And we have nine inactive CSAs. So out of the 24 active CSAs, The services provided to each CSA depends on the services required and the amount of available funds. So listed are some of the services. They don't all receive all the services, so it all depends on what they were developed with. The nine inactive CSAs that remain listed under the county but are not receiving any services, and that is due to a Proposition 218 procedure that took place back in 2010 where the majority opposed the assessment to increase their tax levy fees, resulting in services to be discontinued. This is the current status fund balances of the Prop 13 or inactive CSAs. So if we put all those funds together, there is approximately about $96,000 funds available. However, keep in mind that all of the funds are kept separate. And this is a more detailed graph or chart of the inactive CSA's fund balances and their historical trend. So we can date back starting in fiscal year 2014 and 2015 to the current status and their fund balances. Here we move on to the active CSAs that are currently under the Prop 13, or also known as the Ad Volum tax. And then we also show the fund balance trend with their history starting in fiscal year 2014 to 2015. Okay, so the next group of CSAs are the active CSAs that are under the Prop 218. And again, this is just their current fund balance as of the ending of fiscal year 2024-2025. And going into details in regards to their trend and their history starting also 2014 to 2015. and the rest of them. So this is where we're going to start moving forward onto the CFDs. In September of 2015, Santana Ranch also known as CFD 2015 was created by resolution to fund all services associated with the Santana Ranch development. In September of 2018, CFD Residential Services also known as CFD 2018 was created by resolution CFD 2018 was established to finance direct and incidental cost of authorized public services and maintenance of public infrastructure, benefiting properties within the districts to include future annexation areas. The county's current approach for annexation is that when any property owner is requesting to subdivide their property, they are to annex into CFD 2018 for negative fiscal impacts. or NFI and if there is a request for supplemental services that is calculated based on the development needs for maintenance. So that would be an additional fee on top of the NFI rates. CFDs provide a dedicated funding source for public services and infrastructure maintenance. So CFD 2015 growth and expansion. CFD 2015 was initially established specifically for Santana Ranch. The services provided include fire protection and suppression, ambulance and paramedic services, police or sheriff protection to include animal control services, maintenance of parks, parkways, landscape, and open space, flood storm protection, which includes storm drainage and detention basins, and street maintenance, including lighting and operation maintenance. These authorized services are provided for the benefit of properties within Santan Ranch only and are funded in accordance with the rate and method of apportionment, which is known as the RMA. CFD 2018-01, growth and expansion. So this is the residential services CFD. CFD 2018 was established to serve new subdivisions countywide, starting with the three original service areas, which include Bennett Ranch, Sunnyside Estates, and Promontory. CFD 2018 was also established intended for any future annexations to be incorporated into CFD 2018. Since the creation of CFD 2018, there have been 26 annexations completed with their own tax zones, and there are currently five pending annexations in progress. Seven out of the 26 annexations are currently receiving supplemental services beyond NFI. Those supplemental services The supplemental services vary, but are very similar to the structure of Santana Ranch. So they do receive fire, police, and related paramedic services, including emergency and non-emergency service related facilities, equipment, vehicles, fire apparatus, and services, supplies, and personnel. That is known as the negative fiscal impact fees, which is required for all annexations. Beyond that, if the subdivision is requesting supplemental services, that includes maintenance and lightings of parks, parkways, streets, roads, and open spaces, as well as flood and storm protection services, including operations and maintenance of storm drainage systems and detention basins. So that is all calculated and based depending on what is to be developed within that community. Also, these authorized services are provided for the benefit of properties within the individual CFD being annexed and are funded in accordance with the rate and method of apportionment. Here are the current CFD fund balances as of the ending of the fiscal year 2024-2025. And this is the the fund trend starting in fiscal year 2017-2018 for the CFDs.

Thank you. Thank you. Let's go to public comment then at this time.

If you'd like to make a comment in chambers, please provide a speaker card on Zoom. Please press star nine or the raised hand icon. Go ahead and use the microphone there. Just adjust it so that you speak into it clearly. Thank you.

Yes, good evening. My name is Carson Clower. I live in a neighborhood that has a CSA. When the project was approved, the county mandated that it have an HOA with six houses on a street that was going to be used by the public. Thankfully, later on, the county realized that that was probably a mistake and included us in a CSA. I think for small projects, the ongoing maintenance and paperwork to have an HOA is very difficult. It's probably the same for six houses as it is for 100. So I appreciate the CSA service that the county provides. We have street sweeping, which in the county I think might be a little rare, and that's much appreciated. And the other thing is, I've never met Linda in person, but she does a really good job of communicating. I think she handles the CSAs for you guys. And the, is that you? That's her. Nice to meet you. Yeah, it's one of the few communications that you get from a public agency that's positive and forward-facing and not reactive. So I appreciate you. Thanks, that's it. Thank you.

Thank you. I think there's one more. Thank you. Go ahead and state your name at the podium, please.

Hi, I'm Anne Hall with San Benito Engineering, and I wanted to talk about something that wasn't specifically covered in this, but it has to do with the CFDs and the process where you get annexed to a CFD right now. And this has been a topic, well, this action has caused this topic of discussion several meetings over the past year. And most of my clients are small subdivisions. I know a lot of the focus is on large subdivisions, but small subdivisions get caught up in this as well. Most of my clients are doing two, three lot split minor subs that have no improvements. So the only thing they need to do is annex into police and fire, which is one of the ones Linda went over. That can cost the applicant six months and over $5,000. And I don't know why. Just to join the CFD. That's something the county is requiring and then the applicant has to pay. And I understand people aren't always sympathetic to developers, but I think a lot of these small subdivisions are just your neighbors. They're not the developers you talk about in particular right now to join a CFD, we have to apply, send it to Linda. She goes through her process with the outside consultant. It has to come to two board supervisors meetings. It has to be heard. And then it has to come back 60 days later. This was a relatively recent decision because, um, I haven't been doing these as long as the CSAs are around that, um, but I have been doing them since about 2005. And it wasn't until about 2017, this whole two-step process was required. I know at one of the meetings, Supervisor Kaminski, you said that there had been an uptick that you noticed there was a whole bunch more CSAs coming before you. And I had to think about that for a while. And I think that was when it changed from it only came before the board once to everything had to come to the board twice. So it probably did look like there were a lot more CSAs, but they were really all just having to come more often. I don't know why this is. The only person who can protest the CSA annexation is the person doing the subdivision who's required to join the CSA and has at the point that it comes to the board already signed a notarized statement saying they want to join the CSA. This was a decision of a previous county council to do this. And I'm just asking that it be considered, you know, maybe someone look at it and say, why, why does this have to come to the board twice and 60 days apart? And when you have crowded agendas that can take three months, it can take you two months to get on there the first time. And then it can take another three months to come back the second time. It's not an easy thing. And when, um, that's the only thing holding up your map that can take a long time. The other thing I want to point out is,

No, sorry. Just to be fair, we got to cut you three minutes with everyone. Thank you.

I have one on Zoom. Tammy, you've been unmuted and you have three minutes. You'll need to unmute on your end.

I'm District 1. I'm on Tevis Trail. I know we've spoken in the past. This is regarding, once again, the speed on Tevis Trail. Last we spoke, the 25 mile an hour signs have been put up. They have also been stolen twice. Now we've talked about speed humps and other things, but now that the school is at full capacity, we have got parents double parking on Tevis and they're picking up their kids. We've had double parks where we have people stopped because they can't get through. And then with the speed that they come through here, we are just waiting for something to happen. We would appreciate it. We have been told about sheriffs coming. We know that it is hard for them to get out here being solo staffed and being busy, but we would appreciate something because Ms. Bronowski has sent out memos in regards to parents, please slow down. That goes over like the 25 mile an hour signs. They look at it, they ignore it. We have children, we have wildlife, we have our own animals. We just do not want anything to happen here. Thank you.

Thank you. And I have one other, Tammy Aviles. You can pull it down, Tammy.

I don't want to break it. No, it won't break. Good evening, Chair, Board of Supervisors. My name is Tammy Aviles. I reside in District 4 in CSA 25, which is one of the non-active districts. And I just wanted to thank Supervisor Carro and Linda for trying to work with us in figuring it out. Where we're stuck is the, I guess it's the 218 voting process to get our 26 homes on board to make a decision to move forward because we have this balance that we need to do something with and not let it just sit there. So appreciate your help and probably looking to you for some more help in the future. Thank you.

That concludes public comment.

Thank you. Thank you, everyone. I'll bring it back to the board. Board members, anyone like to start with any questions, comments? The CSAs? Supervisor Kosmicki, I guess?

Sure, I can come in. Just a couple issues we've talked about in the past. So the CFD 2018, that's just for the public. That's the one that essentially all new development in the country, unincorporated, would automatically be pushed into the CFD 2018. And those fees, that's based on a CPI formula?

So the initial rate was based on the RMA. Right. when it was developed and that established the base rate, which is for negative fiscal impact fees.

But the increase, the annual increase?

The annual increase is based on the CPI and that one is the April to April.

So I'm wondering, is there any avenue, you know, if, for instance, The county has a sudden surge in costs like like we've seen in the last several years we had the pandemic and then we've had this, you know, hyperinflation environment that we're in. There's basically no mechanism to, you know, look at specific it but it's it's CPI, but is Have we had a huge jump uh, in any of those years where, uh, cause I see this year's decent, you know, increase, frankly, 3.8 or something like that. I thought I saw, um, were there any years where it went up, you know, in accordance with the real inflation? Cause we didn't see like, it was a good presentation, but I didn't see like, uh, historical, like last six, seven, eight years?

No, so the annual Pax Levy presentation and report that I previously presented does have the history as far as like annually what the percentage CPI rate is per year. There has been, I believe, one other year where it was pretty high, but on the average, they're at one, two percent.

Okay, 1% to 2%. Oh, wow. It just doesn't seem like in some situations that the increases necessarily keep up with just those years or those periods. I don't want to promote overcharging or anything like that, but it just seems like in specific periods... We've had a lot of, you know, and we went through this whole budget situation recently where there was this major deficit. I just want to, are there any mechanisms to look at the current formula and how that increases?

The only way to be able to change the rates is that we would have to go out to do a new rate analysis and create a whole new CFD. And so similar to how 2018 was created, instead of annexing into the Santana Ranch CFD, we created the CFD 2018. So we would just have to create a new one. And then once that one is established and approved, we would determine if we want to then annex, you know, the new developments into that one.

Yeah, and I just, again, I'm just trying to wrap my head around whether we started at the right baseline. Again, I don't want to promote at all dinging people, you know, with these unexpected increases. I do think that for future development, because the county has seen costs rise so much in recent years that we may want to look at I'm not saying I support it, but we may want to look at that option that you noted, because I did have that in my notes, whether you could develop a new CFD for future development, just because I am concerned about whether the revenue is ultimately going to, over the long haul, whether it's going to keep pace with the costs. And again, I don't want to, I'm not promoting doing any massive increases for the current residents by any means. I just think if we go down the road of... we're going to grow. We should, we should, at some point we should look at whether these, whether these costs are really keeping pace with, with all of these services that we provide. And it's not just the, you know, the sheriffs and the, emergency services in particular are the ones that jump out. And Adolfo came up, so if he wants to chime in.

Good evening, Mr. Chair, Board of Supervisors, Adolfo Gonzalez, Public Works Administrator. So over the course of the next few months, what we will be doing is evaluating the CSA CFDs and determining what our expenditures have been historically. And from that point, determine evaluate the existing rate structure, and then potentially go out for an RFP to hire a consultant to reevaluate those rates.

Yeah, and I just think with new development in particular, that would be my focus, is just having a better handle on exactly what you're saying as far as those costs, just because the cost of everything has gone up so substantially, and I'm just... It just doesn't feel like, and we've always, we're always, and I think we're going to have another, this is part of our whole revenue generation umbrella. You know, I think there's a need to generate more revenue, whether it's through economic development or whether we look at our fees and are we actually recouping in real costs? And this just falls basically under that umbrella to me. We talked in the past about eliminating CSAs that are inactive. Is that more of a, Is that more of a process issue or was there a need to actually hold on to those CSAs for any reason other than, I know Angela and I have an eye contact because I know that's been something that Supervisor Curro has brought up in the past, but is there a need to hold on to the inactive CSAs or is that something we can just finally start moving ahead on?

well I think it's a mix of a little of everything so it is definitely a process issue but then we also have to keep in mind that if we're going to eliminate the CSAs we are handing over the responsibility of their maintenance as opposed to what the county has been providing and then ensuring that they're going to be able to sustain that maintenance so there's again that process for them to establish their own HOA be able to collect their funds. You know, for example, like if we eliminate the CSAs and they come, you know, years down the line requesting for maintenance of their roads, you know, there's that expectation that we expected them to take it on, but now they're looking towards us because maybe they, you know, couldn't come up with the funds available. So there's definitely a process that we have to go through.

Okay, and it kind of leads naturally into one of these other topics. We've talked about HOAs, and I know we had a speaker come up and talk about, which I understand where he's coming from. I think we should have some options on the table at some point as we move forward. One of those options could be looking at a new CFD, but the other option to me, whether we just fully move toward the HOA model, maybe with some exceptions. And so if you are a... And I'd have to research this more. This is why we value public speakers coming up and putting in their anecdotal points. But maybe we look at HOAs for a certain number of units over a certain number of units. And then if it's smaller and it just doesn't make sense, maybe they can be pulled into the CFD model. I'm just... I'm trying to wrap my head around this and I just think having multiple options moving forward, but I do know we have to make some changes. That's one thing that is pretty clear about all this stuff that's jumbled together. Um, but I, I would like to see maybe CFD, what would it look like to form a new CFD? Uh, and then, uh, you know, maybe looking more, more, um, directly at the HOA model and getting away from getting out of the business. If you want to build a large development in this community or a semi-large development that we really do need to be going down the HOA model and the county really should be getting out of managing these subdivisions. Esperanza?

Yes, we don't have control over HOAs. And so people have to understand that. If you don't take an action for the CSA creation or CFD, we don't have power over HOAs. That's between... the developer and the resident and so we don't get involved in those we cannot even right right and that's i think that's the best for the county going forward that's what i'm saying if we're going to be building on the other hand we have so many css and cfds what we're trying to understand is what do we have inactive because it didn't go to the proper to Prop 218. That's what I understood. Ms. Tammi, that's what you mentioned. I'm just confused about the comment that you made.

I'm almost done. I'll finish up right now. I'll finish up. I promise. I thought Anne Hall's point was reasonable about coming to the board two times. So perhaps we can look at that. I don't know what the procedural changes were when that happened or if there's legalities involved from the county council side, but just at least something. I appreciate that. If we could look into that, just if there's a reason why we're making folks go through multiple steps. I do want to clarify, I think my point was there's a lot of applications for the CFD going, not necessarily CSAs. I don't think we've expanded the CSAs per se, but it's the folks that are annexing into the CFD that we've seen this rush of annexations over the last couple years. And then Tammy's point, not this Tammy, but the other Tammy, about Tevis Trail. Not my district, so I don't want to step on toes, but anytime I hear speeds near schools, I'd like to get some sort of answer as to what's going on there. And I know we can't just put sheriffs all over the place, but is there something we can do, especially near schools, just to slow people down, whether it's speed controls, extra signage, whatever it might be. I know we can't stick a sheriff out at every school every morning. It just is not realistic, but I would like to see something toward that end. Thank you.

Thank you. Teresa Crow, do you have any comments?

Yeah, you're not going to like me being, giving me the mic. So I'm really sorry. I really appreciate where Supervisor Kosmicki is going. I have spent a tremendous amount of time doing research on this, and I have actually spent hours with the Ridgemark debacle that's been created because it's an HOA, it's a CSA, it's a CFD, it's a JHAD. I'm not going to say the the other word I say that I'm not supposed to say. But there are so many issues about the decisions that have been made in the past that are affecting residents and the communication of these communities. And so I'd like to take this a little, I'm not going to start with Ridgemark and I'm sorry, Penny, I'm not going to start with Ridgemark. It's way too complicated. I'm going to try and start very simplistically. So there are, I have several questions. Some of my basic questions are when you, I really appreciate Linda, how you broke down the presentation, because this is where it gets to the heart of the matter, especially from taxpayers. When you're talking about Prop 13, Are you talking about a CSA tax on their tax statement or it's coming out of their 1% of their property tax, which is our county general fund that gets distributed?

Yes, Prop 13 is based on the property tax assessed.

It's not an extra added cost. So I want to make this point very clear. We have Prop 13, which is coming out of the overall property tax, not an additional 218, which is an addition to their property tax that funds their services. Correct. And the problem with the 13 is the 13 is 1% with only a kind of 2% average, but I don't understand why it averages 2%. I don't understand why sometimes we can go higher annually or lower. It doesn't make sense to me, but I'm not going to get into the math of that because I think there's bigger fish to fry here. we have to understand that when we're looking at those prop 13 list if we go to that list that is specific to prop 13 and it says there were uh we have inactive and then what do we have active on Prop 13, hold on. I got inactive, Prop 13.

Am I on 13?

Oh, I didn't go far enough, sorry. Okay, so we have inactive before active. Now, if we talk about inactive on Prop 13, what does that mean? Does that mean they're not getting that 1% or they're not getting any services? Because if the 1% is still going into their account.

No, so these are actually, sorry for the confusion, but these are all just the inactive CSAs, period. So they don't get either additional tax, nor do I receive any revenue on a yearly basis to provide any services to them.

Great. But they have fund balances.

But they have fund balances.

And when you have fund balances, we have to go through a process whether it's a... Because a CSA, a county service area, is a special district under a LAFCO umbrella. Correct. A CFD, a community fiscal... A community facility's district, even though it has the word district, it's not a real district under LAFCO. It has no LAFCO authority. So right now, I want to stick with CSAs. I don't even want to get into the CFDs. And the reason I want to stick with the CSAs is because there's a process from conception to dissolving, and it goes through a LAFCO process. It does. And LAFCO has in 2026, according to their website, they're going to be doing municipal service reviews on CSAs. we should be taking advantage of that municipal service review. We should participate in what our challenges are with these CSAs so that the CSAs can have a municipal service review, which just means a service review, but service reviews can be what services they're receiving or what their financial status is or where they want to go. This is where LAFCO can facilitate that. So when we have inactive CSAs, I think it is, in my opinion, personally, I think is a disservice that we're holding on to funds that can never be used and either cannot go back or we have to come up with an agreement, a memorandum of understanding. I'm not an attorney. I don't know how you do this. But we have to come up with a way of utilizing those They're their tax dollars. They're not our tax dollars. We cannot move them to the general fund. And we need to make sure that none of this has been misused. Because that's what I've spoken to almost every CSA, at least one of the members of every CSA in District 4. And I will tell you, they have no faith because they don't get financial statements that say what their fund balances are. Do we have a requirement? We have CSAs here that you give us an annual report that we had in August of last year, but this doesn't cover all the inactives. This doesn't cover the Prop 13. This doesn't cover everything. So they're not getting the reports. of their CSA. So I think we need to break this down into chunks of what we need to do to fix it. And the first chunk is dealing with the inactives in CSAs. We need to know from council and from the CEO what is the process of dissolving them? Or if they're trying to get activated again, what is the process of activating them again and bringing back those services for them? I'm pretty sure they all want to be dissolved, but they also want their tax dollars back. And I don't think you can hand those dollars over because it's a special district. So you have to come up with an agreement of what those tax dollars will be used for for that specific development. And then once you're at zero, you can go through the LAFCO process and dissolve the district if they're inactive, but I don't even know if that's legal. I've spoken with the executive director of LAFCO, and I asked about dissolving CSAs, and she goes, there's a huge controversy around the state. You know, some people say you can, some people say you can't. It's a real legal debacle.

I just want to ask a question. Why do we have inactive CSAs? What do you mean by inactive CSAs?

So the reason why we have inactive CSAs is because around 2010, there was a Proposition 218 that took place requesting the CSAs to increase their tax levy or their tax assessments. The ones that had the majority protests, so voted against them, then they became inactive because the current tax rates were not enough to sustain the services that they were receiving, which was the main reason why the Prop 218 initiated this. So from that, then it resulted in the services being stopped. So then the meaning of the inactive CSAs is that they're still on the list of CSAs, but we don't tax them. So we don't receive any revenue from them. So we do not provide services to them.

So let me ask you a question. I'm a resident. I was in the CSA, active CSA. Rule passed, a law passed, and then I have an inactive. You kept some of my funding in your accounts. I cannot dissolve it. Who's providing the services that I was paying with the CSA? How do these services continue being provided to the residents if you have an inactive CSA?

So the only services for inactive CSAs that can be provided right now would be for like a MOU. So we would have to agree on the services that we are going to provide. Or my understanding is that they would have to establish an HOA and the money can be forward into an HOA, but there's a- I want legal opinion on that.

I don't think that's true. I don't think that's true. You can't do that. And that's the problem. I really need a legal opinion on what the process is to help you solve these inactive CSAs. And were they really inactivated properly? Because if you go back through the LAFCO process, I will tell you a lot of this stuff back prior to 2010 was a handshake. Oh, you guys don't want any more? Okay, we'll stop. But there's no documentation. we need to ensure the documentation i have gone to the recorder's office i have pulled up stacks and stacks of recordings that go back to the 60s and i will tell you it's not clear what services were providing and what services were not because all of a sudden they said okay in the in the prop 13 which was the one percent Yeah, well, in 2010, we decided we're not going to collect anymore and we're going to waive our services, but you have money sitting there. There was no closure.

So let me ask you another question, and this is for the auditor. On your presentation, you have inactive CSAs. You're jumping my question.

Oh, I'm sorry.

Yeah, I'm going to go right there.

I apologize. Don't worry. Your mind and mine are right in the same spot.

So my question is, because there is a request from your office requesting to not continue interest on CSAs that are not active. And I'm talking about, in this case, Rancho Larios. You have 27,000 in deficit. It's in red right there. So I mentioned, I think I spoke with the auditor and I said, I think you still need to charge because we're financing, the county is financing that amount for CSAs. So my question to the editor goes backwards to what are we doing with the money that is sitting over there? If it's an inactive CSA, are we paying interest over the money that we're keeping in those accounts?

So just to clarify, the request to freeze the interest rates is for an active CSA? It's just to try to help them get out of their negative balance?

active or inactive, we still need to charge CSAs. If we financing money to CSAs because they're not meeting the expenditure.

So when we use county's funds, we need to charge interest.

Can I step in here, Mr. Chair?

Yeah. I want to step in here because this is my next point. My next point is we're sitting on inactive. I'm still on page 11. We're sitting on inactive Prop 13 1%. We're no longer collecting that 1% for those CSAs. Is that true or not true? I'm seeing the auditor. Can you please come up? You're saying we are still collecting.

Good evening. I think Linda, you know, she talked about the list of inactives. They're just all inactives. I think maybe the Prop 13 being in that heading was probably, you know, shouldn't have been there.

but these are inactives, if you look at this list, these are inactives that are not part of Prop 218, because there's a separate list of Prop 218 inactives, like the development I live in, and that is...

But that's a little bit different.

Well, that's why...

The Prop 13, I believe there's four CSAs, five CSAs, that are still part of the 1%. In other words, there's... They call it Prop 13 because part of the 1% and when those, back when the ABA legislation passed, the state came in and they looked at the CSAs and they looked at the other agencies that were part of those areas, they somehow, said, okay, this CSA is going to be part of the 1%, and they have a factor associated with that, you know, with each of those CSAs. Of course, they're in different areas. And they still collect, you know, they still collect money because the law is that we charge 1% on all CES valuations, and that's the ad valorem tax that she was talking about. So none of those could really ever be truly inactive because they're always gonna receive part of the 1%.

And I get that, Joe Paul. There's five of them, and they are active, and they are receiving that. But we have one, two, three, four, five, six, seven, eight, nine. Nine that we're hearing are not receiving the 1% collected.

No, these are just inactive periods.

But is an apportionment going to these people? No.

No, that's what I was saying. They're just inactive, they're not getting taxed, and they're not Prop 13.

Okay, they're not Prop 13. They were due to the realignment, so the heading is wrong. I get that. But they still have a fund balance, and this is the taxpayer's money. It is not our money. And we can't use it. And if we're holding it and not going through the process of dissolving them and figuring out what the legal process is through county council and LAFCO, then they should be earning interest on the money that we're holding of their taxpayer dollars. And the opposite of that is if they are in deficit. They should be paying interest on that deficit, and that deficit needs to have a payment plan. Whether we lean all of those properties to get that money, that is an in-kind gift from our taxpayers generally that are paying for that deficit right now. I'm sorry, I'm just, I really need us to strategize about how we're going to fix these things. And we're not going to do it tonight, but I need it to be clear that these inactives need to be addressed. Even though they're inactive, it doesn't mean that they're done. Until they're dissolved, they're still our responsibility.

I think the way it was explained to me many years ago is that these CSAs that went through a 218 election process, if they voted to say, no, we don't want to assess ourselves, if they said that, and I believe there was, what, nine of them?

Nine of them.

If they did that, then there would be no authority to collect any future assessments against them. And therefore, any amounts of fund balance left over, the responsibility of the county as administrator of the CSAs was to ensure that every last dollar is spent on those services that were, you know, that was the intention of the CSAs, why they were formed anyway. Because each of them have different services. Right.

Totally agree. And that's step one. Step one, we need to know the legal process of dissolving them. We need a memorandum of understanding or whatever legal document needs to be done to be able to get this off of our balance sheet because we don't need to be dealing with this if they're dissolved. Right?

Yes, I agree. I think that's true. On the negative CSA, I think that one has a lot of history.

And there may need to be a negotiation with them and the county because we have to admit as a county, we have not done our fiduciary requirement of serving these CSAs. And we have to look at the history of the CSA and come up either with a reduction, a payoff, a payment plan. I get it because I've talked to these people. They're very, very angry people, especially the ones that didn't know. because they weren't getting like a fiscal statement and didn't know that they were in the hole. So I think there's a give and take, but I don't want to get into the weeds of those. I want to get on to, so that's what needs to happen, in my opinion, with the active, I mean, the inactive. And we just need to confirm that it's all documented and it's been recorded so that if it's dissolved, the recordation of that dissolving will cause this to be a moot point on our books. Okay, when it comes to the five that were active, the five that were active, we have one that is in the negative. And that's another one we need to address. We need to know the history about why it's in the negative. It is Bonnie View Estates, $76,096 in the red. So we need to have a conversation about how we're gonna resolve this and what the history is on why we're in the negative. When it comes to these other four, we need to make sure, and I've seen in your beautiful report, it shows us what the services are and the map and everything. I don't see that for these four. I don't see the history. I was able to find the services, on the website, but it didn't make sense where that agreement came from. So I think we need to get some history on these so that if these CSAs want to take over, is there a legal process for them to be dissolved? I don't think there is. My understanding is you can't dissolve a CSA unless they went through that Prop 218 vote in 2010. Now, when it comes to these four, they only get a small portion of the 1% property tax and then the CPI, the Consumer Index Price, the annual fee increasing, right?

These are the Ad Volum CSA. So these are the 1% of the property tax. So however, the tax collector assessor's office.

Well, I don't care how they collect it. We collect 1%. Let's make sure we.

On the Bonnevue Estates one, that one, the county spent money on behalf of that CSA.

We need the history.

I don't, you know. And remember, a CSA that's a Prop 13 CSA can also have a Prop 218.

That's what I wanted to ask. That was my next question.

A Prop 218 and be an assessment below the 1% line, an assessment that can be charged to cover these fronted costs by, it looks like the general fund probably fronted costs on behalf of that.

And I'm going to take this one step further. If they weren't able to pay off, we could do a Prop 218 to get them up to paying off. And we may have to understand the history a little there. It could have been some of our fault. I don't know. Who knows? I don't want to say it's just... I think we need to have history to understand this. I don't want to blame this on residents because I don't feel residents have enough information. But when it comes to the other CSAs, if that CSA... Bonnie View gets paid out, do they still want those services? So we have to sit down with them and ask them if they still want the services, and then we have to be able to tell them what those services are going to cost. And if it's going to cost more than what the amount is that we're collecting in the Prop 13 amount, then we have to do a Prop 218 election to increase the cost so that we're pulling in the money that they need for you to be able to provide the services. Do I have that correct? Okay. So with that, I think we need to do some stuff here because I will tell you right now, Ridgemark Estates, which I don't even want to get into all the other things that need to happen. I think that needs to be a sidebar with the CEO and I. They're not going to have enough money to maintain the services. They maintain all of the roads at Ridgemark. We do not maintain the roads. Okay. and as we know we can't afford to maintain our own roads well guess what ridge mark is coming up with they don't have enough money to maintain their roads and they're going to have to have a process and if that process is a prop 218 on top of that they need to understand what that is and they need help understanding how much money they have and how they can maintain their roads so So Ridgemark, because it's a CFD, a CSA, an HOA, seven HOAs, and now Promontory, which is the latest annexation into the Ridgemark Estates, I think we need to sit down. I've gained a lot of information and history, but we did not annex Ridgemark. promontory into the CSA nine. And so promontory is not getting their roads done. If I understand this correctly, I'm trying to remember my notes and I wish I took better notes. Sorry, Penny. But there's a problem with promontory and they need to be annexed in because what's happening is we're doing promontories or the annexation. It's what do they call it? annexation number 15 in the Ridgemark Estates and the CSA map for nine does not have that. So there's non-members, there's so much debacle there. I think we really need to look at this as a separate topic that I asked to bring to the board because there are things that need to happen and I don't want to waste the time tonight to try and solve it because it's way too complicated. It's like a huge spaghetti that you have to try and untangle. It's just a mess. But now that I understand kind of the difference between the two, because they're in the GHAD, which is different than a CSA or a CFD. And we're the board of that. So we need to just understand there's just a lot of issues there. So each one of these, they need to be educated on if we cannot afford their services, right? Because we're not collecting enough. There needs to be a process that legal can help walk us through. What is the process when they go to a vote and say, hey, we don't want to increase our fees. We're only going to accept that small percentage out of the Prop 13 amount. So we need to negotiate what the new services are going to be. And you're going to have to take over services as a resident or an HOA.

Mr. Chair, members of the Board of Supervisors, I think there are a couple of points that I think Supervisor Kuro is leading to. And ultimately, as we've discussed previously, is that the County General Fund may not legally subsidize a county service area or a community facilities district. So I think we've all discussed that at one point or another, but I think that's an important point. especially when we're going to discuss whether or not interest should be charged on outstanding balance the law is very clear in that regard i think secondarily and this may be one of the issues that the board will have to confront at some point and that is that if there is ongoing tax revenue but the revenue is not sufficient to cover the current cost of services then it is left to the discretion of the board to decide to reduce services down to the county's costs meaning that and this happened in riverside county while i was riverside county council so there was a county service area and they had been receiving a certain level of law enforcement patrolling within the CSA. And they had taxed themselves for this incremental increase over the basic patrol services. They wanted an extra deputy. So they taxed themselves for that extra deputy. However, over time, the cost of the extra deputy exceeded the cost of the revenue, that additional revenue they agreed to tax themselves. Well, once it exceeded, the county's cost exceeded the tax revenue received, the county had to make the decision to reduce the services down to their actual cost.

Unless they did a Prop 218 increasing their fee. Exactly. Right.

So, and that particular CSA refused to do another assessment of themselves to pay for the increased county costs to provide that enhanced patrol service.

But we have to have conversations with these CSAs before we just arbitrarily say, you're no longer going to have landscape services. You're no longer going to have street sweeping. You're no longer going to have the lights on your streets. We can't arbitrarily do it. We have to have the communication. And I'd really like council to be the one to help with the process of that so that there's a little legal backing to what we're doing.

But I think... that what is so critical here is that we may have instances where the costs have already exceeded the revenue and the county is subsidizing, The CSA and the CFD. And I think that is what the board has expressed their concerns with because we cannot legally subsidize.

But we can't at the same time look at these. And every time that I've been on this board every year, I have gone to the former public works director and said, look, you're showing in your budget a negative opportunity. on a CSA. I want a complete fund balance to ensure that we are not taking any money out of the general fund and subsidizing these CSAs. And so that, after looking at this, it looks like there's a fund balance, but I don't know. I'm assuming there's no money that's gone into these accounts that comes anywhere from the general fund. I'm hoping that can be We have not subsidized, but at the same time, from an owner's perspective, that none of these funds have gone into the general fund because it should be service in and service out for their CSA. Is that not correct?

Well, I can tell you if there's a negative balance there, it's because the county expended funds on behalf of the CSA. and they didn't have enough money to cover that. So they must have used general fund to do so. That's the only possibility.

And we had a previous discussion about that. There was a CSA that came maybe six months ago or seven months ago about a fence in the gate. The gate not being included into the budget enough money and then you came back to the board requesting additional funding. but the Prop 218 wasn't done to put it back into the residence. I remember that item coming to the board. And so what happened is in this case they gave was especially to be like $70,000 and it ended up being $80,000. So now we're upside down $10,000. But not only that, it's also the service to open the gate that was not contemplated into the class. And so now we have that one upside down. And that's the problem.

My next question, because CSA 22, which is Cielo Vista, is showing no number. And I thought there was a issue with their wastewater and the cost of the services we were providing of their wastewater. So I was looking at the bar chart. So it does. So that doesn't show on the fund balance as a negative. When you look at the Prop 218 bar chart, it's not there. So... These are the things that we need to come up with a plan on how we're going to address them. I don't want to belabor this because I think I've made my point. The problem is that if they are a 218 and they, for some reason, there is a list of 218s that are inactive. I'm trying to find that inactive list of the 218s. what do we have to do to ensure that the documentation is there to inactivate them to not just inactivate them to dissolve them and to get the money off of the books we just need a process and i'm sure there's a legal process whether it's to the hoa or to the csa or to i mean but it's their money and we have to remember it's not ours okay okay with that i have a couple more questions so when we said on the prop 213 or prop 13 it needs a vote of the owner it needs a voter's approval is that landowner on the prop 13 or is that voter approval on prop 13. the two-thirds vote i want to make sure we know the difference

Prop 218 requires its homeowners. No, no, Prop 13. Okay, I'm sorry, no.

Yeah, I know 218 is homeowners. So I want to make sure we understand that on Prop 13, I have a feeling it is registered voters, not landowners. So that may be another issue because that means it goes on the ballot.

This is where it really gets complicated because Those five CSAs sit in the AB8, which is that 1%, right? If you brought up a question that, I don't know, I think it's going to require specialized legal services, where you find the answer of, What happens if that CSA that sits within that 1% decides to expand its boundaries? It's a district, right? It is a district, yeah. It's a special district. So by adding the promontory, that now the promontory, part of the 1% of the promontory would now go into, I believe, would now go into the, you know, add to that CSA if it was annexed, right?

I don't think it was annexed. That was the problem.

See, I don't know.

Yeah. And so this is that'll be Ridgemark will be a sidebar because it's way too complicated for this meeting.

Sorry. So so as far as any of the of the Prop 13 CSAs, those are kind of like set in stone.

They're set in stone, but we could do a 218 on top of them if they wanted us to maintain the services. So I just want to make sure that we understand we have processes we need to go through, and the Prop 218 voting process of a landowner has to be paid for by the landowners. And so the election costs, because we've done these, I've done these, you have to go through. It's not hard. It's not that expensive. We just need to get the process rolling and bring the process back because we are not going to be able to maintain the services and we're going to have to make decisions on what we're cutting. And if that's the case in their 218 and they say no in their vote, then we need to negotiate what the services are that we're going to remove. When it comes to the two CFD formula, It said, oh, no, sorry. On the CSA formula, it said it was limited generally to 2%. Is there any legality on those, like new law that changes that 2%? Or is it, but it's not exactly 2%. It's a formula?

Well, remember, the CSAs that are part of the 1% have to follow the Prop 13 formula.

Oh, so they only get that little percent each year?

They can only go as much as 2%.

Okay. But it said varies on yours. And one of your slides, it said it was an increase on there of 2.1%. So that was CSAs, 2.875, the CSAs. So I got confused. Can they go up to 2.875 or 72? Or is it only up to 2%? I want to make sure that we're not increasing beyond what our legal capability is.

So the Prop 218 CSAs, when they were established, they were established with a max rate. Annually, we can increase their rates based on the CPI percentage, but we cannot exceed the max rate. Once we go to the max rate, we would have to do a Prop 218. Okay. The majority of the CSAs are maxed out. There are a handful that are not, and I have been increasing those, and those are the ones that were highlighted in the annual tax levy report that we've increased.

And this is a great report because it shows you the map of the CSA, it gives you the financials. It's these five that are part of Prop 13 and the AB8, AB9, whatever number. Those are the ones that don't get this level of a report and this is the level of report we need for those. Okay, real quick. I talked about the LAFCO process of the public. Oh, in these CSAs that are still there, we're the board of directors for these CSAs. Is there any ability to either form an ad hoc on some of these larger CSAs like Ridgemark where they can advise the board of some of the things? Because if we're going to have to cut down services, we need to have a way of communicating with them. And I'm thinking an ad hoc on these more complex CSAs Just a recommendation. We don't have to make a decision today. Because I know we can't add or change who the board of directors are on CSAs. That's not an option, right? Because the way you could get out of this, of us having to deal with this, is make the homeowners be on the board of directors and have to make the decisions about their money. That's a fun job. I'm on a water board. It's not fun. Your neighbors don't like you when you ask them for more money. Okay. When documents are signed during a title change and they're in a CSA, do we know exactly what documents we are requiring to disclose that they're in a CSA and the definition of what a CSA is? And the reason I say this is because the number of people that have moved into CSAs that come to me and say, I'm not only paying my property taxes, I'm paying this added fee for services, and I don't even know what I'm getting. So do we know, are they actually being told what services that they're getting in their closing documents? And is it confirmed that they're getting those disclosures? Just a legal question that maybe we can add to the minutes to look into. I can tell I'm not going to get an answer. So at what point does a Prop 218 not apply? It sounds like from our conversation today, even if they're a Prop 13 and they're limited that 1%, you can do a Prop 218 on top of that if they vote for it to increase their fees.

Yes, but that would be like a special assessment. So that would be considered like for a special project.

A special project, not an ongoing cost? Yes.

So those few CSAs in the Prop 13, based on the services that they were developed for, which most of them are just street light repairs or street lights, the assessment is enough for the services that they were developed for.

But not Ridgemark.

Should they need... Ridgemark is roads.

Correct. CSA 9. Yes. And that's where this topic is coming up. We need to have a mechanism. Can they increase it and do an added assessment or...

Yes, it would be considered a special assessment. So we would have to get the cost of the roads maintenance or the road project and then use that as... I guess, the foundation for the Prop 218 to be able to present to them and let them know that, you know, what the cost is going to be and what the balance is based on what we have in reserve funds. So we have to use some of the reserve funds and then take the balance of what is needed and use that for the Prop 218.

And when it's a CSA part of Prop 13 and it's a portion, who manages the projects? Who manages the estimating of the cost of the road repairs?

The Public Works Department.

Okay, just so you guys know, the HOA has been doing it. So we need to have a conversation about what the HOA is having to do because we haven't been getting those services because we can't afford the services of the county. They've been doing the estimates. My understanding, they've been hiring the contractors and they're paying it out of the CSA.

They're not paying it from county CSA funds. It would be from their HOA funds.

Well, we need to get this little, this needs to be untangled because I think it's a little more complicated than that.

So with that, look it, there's no more notes.

Aren't you guys happy I stopped? I really appreciate this presentation. I really had hoped that the HOA conversation could have been a bigger part of this, but where I'm at right now is we need to not form any more CSAs. We need to fix the CSAs we have and get out of the CSA business. And if there's a process for that that's legal, great. That stopped when CFD 2018 was created. Right. But now that gets me to Supervisor Kosmicki, which is exactly, are we collecting enough funds to be able to do new projects? So this is where the focus needs to be for new development. We need to make sure that our fees and our fee structure in this CFD is adequate and that we're looking at all of the other things that developers... And that brings me to my final thing, which is we still haven't come up with what our development negotiation policy is for development agreements. We've talked about it. We've said we need a process on project negotiations, and it needs to not be board members. We just need to have... a policy brought forward on development agreements. Okay. And with that, I'll stop. Thank you, Linda, for all your work.

I'll be super quick, I don't have any CSAs or CFDs in my district. But I appreciate your presentation and I appreciate all of the dialogue from everyone this evening. I've learned a lot. I do have a couple of questions. Do you know other communities or counties that are dealing with kind of maybe a similar problem? Do other jurisdictions create new CFD designations? So I don't know. You have your 2015, you have your 2018. Is there any rhyme or reason, like every five years you review it, every 10 years? I mean, we're going to be approaching nine years very, very soon. And so it seems like nine years would be very, very different rates than what it would be today. And so I just wasn't sure if you know, and speaking with your colleagues from other counties, et cetera, if there is, you know, any models that we can maybe learn from and how they keep up with the most current rates. And I don't know, is it just every five years we're going to review or no, it's just whenever a community decides, because it seems like nine years we've probably need to do it again. So and it sounds like that's what you're going to be doing. So I really appreciate that. But just curious if you know if any other jurisdictions, other counties have a process for this.

I don't. I am, you know, very vaguely familiar with the city of Hollister. I believe their CFDs are a little bit different than the county where they have CFDs or districts for the different services as opposed to an area in general. And then the services are provided in, you know, those pockets. But I do know they have like a CFD for landscape services, for street lighting. So they separate the services in that method.

So then they kind of, like the developer or whoever, you would pick what you want to be a part of. Okay. Okay. Yeah, I mean, I'm happy to hear that we're going to be evaluating because I think that's been the biggest concern from the board is ensuring that, you know, I think that some people are getting these annexations now, but then we're kind of locked in. And so we just want to make sure that the costs are keeping up with Um, all of the expenses. So, um, and then I agree with Supervisor Cosmic. I would love to look at do we need this 2 step process? Was this an internal thing that as a county we decided to adopt? Um, and and maybe, you know, what was the reasoning for that? There must have been some sort of reasoning. Or is this state law? And I don't know, but I think that warrants further review. And I think a lot of the other questions have already been asked. So thank you so much for the presentation. And I look forward to this being a starting point, right? Sounds like we've got a lot more work to do. So thank you very much.

Hi. Thank you. Yeah. So... I'll just say everything that Supervisor Curro said, all those questions about the CSAs and the inactive, all of that is reason to get away from this, in my opinion. I think the CSAs are very complicated. I like the HOA direction of things. I've been saying that. I said that at previous meetings. The CSAs, I have a fair number of CSAs in my district, and It provides the opportunity for residents to essentially never... They always have someone else to blame for something that isn't right, and maybe they're right, sometimes maybe they're not. But the point is, if they didn't HOA, they would have the authority, the responsibility, all of that to take care of the area in which they live. And I think it makes a lot more sense. So I... wish we would just go full and HOA. I understand maybe not every single situation. I know Carson brought up a situation with a small number of houses where there's a public road. So maybe they don't work all the time. But in terms of like major, large development, I think HOA is a much better route to go get out of the CSA business. We can avoid all of these future headaches and all of the legal issues and hoops that we have to jump through to get anything done. We don't even know really what we can do with the inactive ones at this point because of all the legal jargon and the process. It's unclear. So HOA is the way to go, in my opinion. Additionally, I agree with hearing the thing twice to the board. I don't really know what the rationale was. Obviously, I think we heard it was 2017. County Council, do you have any idea why that change would have been made? Do you think was that just to provide more opportunity, a second opportunity for the public to weigh in or something like that?

I do not know, but I will certainly research that and get back to the board.

Okay, great. Beyond that, I know there was a public comment about one of the CSAs, Tevis Trail, and the speed bumps, and for the speed signs up, the signs get stolen. There's only so much we can do aside from, I believe, in a lot of these situations, because I have other CSAs that are in a similar boat, they complain about speeding all the time, has to be something like speed bumps. I think that's just the only way, because obviously signs get stolen. The sheriff doesn't have the resources to have deputies at every street and the county to make sure people are going slow enough um and so i'm hoping that i know i believe there's a speed bump policy that uh public works may be working on that can come to the board at some point and we can adopt something like that ideally and we can hear that so that we can have that process available for csa's going forward because i believe that's going to be the answer to speeding especially in areas around schools i think it is important so there's that Everything else has pretty much been said. Obviously, I agree with checking on the fees, make sure that we're recuperating the costs that we should be. And I did have a question. Is there – is it standard – I don't know who could answer this, but in terms of HOAs, is it standard – I guess standard across the state for – is there a certain number of houses really that it hits to the point where it's, okay, now an HOA is probably appropriate versus not an HOA? Does anyone – is there – do you know if there's a rough number? Is it different? Okay. Well, yeah, maybe we can – I don't know what the number is. I don't know. I'd like to hear all the reasons why an HOA might not work sometimes because I think it would solve this whole issue. So I think that's all I had to say. Do you have something else, Bruce?

One last thing to piggyback. I think, you know, I talked about trying to have some options going forward. I think we've had good conversation here. But what I said earlier about CFDs, HOA, I think it would be good to have – there's certain things that you – It seems like HOAs are a natural fit for landscaping and for certain, keeping the streets clean and all that sort of stuff. And then having the option for, they also be required to, if we formed a new CFD for the police and fire services and those sorts of things, because you can't leave those services on an HOA because that's hiring private security and all that, that makes no sense. So to me, if we can get some options at some point when we come back together on this topic is to have those options, HOA for these, and maybe we don't all agree and that's fine, but at least to have those options for HOAs would really work better going forward for landscaping, gates, all those sorts of things that are more HOA friendly and then still requiring and potentially looking at forming a new CFD for essential public services like police and fire. Thank you. Thank you.

Mr. Chair, can I, Supervisor Kosmicki, I totally agree. The one thing I want to make sure that we recognize is Many property values, properties are not as marketable with an HOA because there are a lot of people that I've spoken to will never live in an HOA. So we need to keep that in mind that some people do not ever want to be in an HOA. How do we maintain services when you have, they're expecting us to be like cities? And I think that needs to be a conversation maybe on when we're looking at sphere of influence and when we have properties like Santana Ranch that was right up against the city and could have been an HOA. I don't think it is. So just food for thought for conversation purposes.

Thank you. All right. Well, thank you very much. I don't think there's any other comments. So thank you for the presentation. And thank you. We'll keep working on all these things, I guess. So that would bring us to the end of the agenda and to adjournment. Thank you, everybody.

Thank you.