Vineyards CSD is forming

The Vineyards at Anderson, one of Shasta County's largest planned communities at 521 acres, is poised to take full advantage of the market swing once the recession officially ends.

That was the message developer Roger White and a half-dozen of his financial advisers, bond attorneys and local real estate agents wanted the Anderson City Council to hear during a special meeting Aug. 25.

It appears the message did not fall upon deaf ears.

Although the Anderson council was one member shy - freshman James Yarbrough was vacationing in Branson, Mo. - the remaining four unanimously approved five resolutions and one ordinance that will allow The Vineyards' property owners to form a Community Facilities District, sell bonds based on the appraised $45 million value of the undeveloped land and establish special tax liens on the parcels that will be paid once the undeveloped lots sell.

At build-out, it is expected that the first phase of The Vineyards will contain 847 single-family homes, with several other phases planned for development later, City Manager Dana Shigley told the council.

When sold to investors, the bonds will pay for most of the developer's projected $7 million to $10 million infrastructure costs to build roads and sidewalks, curbs and gutters, install water and sewage lines, and provide electrical power and utilities such as phones and cable television to each, White told the Valley Post after the meeting.

Additional expenses such as setting aside land for public purposes such as an elementary school site, a police sub-station and a fire department will also be covered by subsequent bond sales, White said.

Non-residential property remaining in the Community Facilities District will annually be taxed at the rate of $10,382 per acre for the first bond sale, and another $999 per acre per year for the second bond sale.

More typically, a 2,000-square-foot house will annually be taxed $2,706 per unit on the first round of bond financing and another $250 per unit for the subsequent round, White said.

The assessment could also increase by 2 percent per year if the nation's Consumer Price Index rises, he said.

Any special taxes will be levied for a period not to exceed fifty years and commencing with fiscal year 2010-2011, according to documents White filed with the city.

One bonus for the city, according to White, is the bond sale will allow him to immediately repay Anderson nearly $750,000 in city staff and planning department time already spent studying the project, which has been on-going for several years.

"As our No. 1 priority, we need to reimburse the city for the $418,000 that the city contributed to stepping up and solving our water problem. We also need to catch up on $250,000 to $350,000 in payments for money spent on engineering and other costs," White said.

Once established, the city will need to manage the assessment district, develop a district budget, pay back the bonds on a regular basis, monitor any special tax receipts, place the annual special tax on the annual tax roll and other similar activities, Shigley noted.

However, since the bonds will be repaid with interest as the properties are developed and sold, "there is no obligation on the city's general fund to finance any part of the issuance, management or deft service associated with the Community Services District or the bonds," Shigley's background information informed the councilors.

California law allows the formation of such district under the Mello-Roos Community Facilities Act of 1982. That law provides a mechanism for government agencies to finance the construction of infrastructure and similar public facilities in support of a development project.

Thus, the property owners who will receive the benefit of new or improved sewer, water, schools, parks and other similar improvements and services are the ones who pay the costs even if they purchase the property after the improvements are put in place, Shigley wrote in her background notes.

Because the property in question overlaps the boundaries of two special districts - the Cascade Union Elementary School District and the Anderson Fire Protection District - the city had to form two separate Joint Community Facilities Agreements, she also noted.