AGENDA TITLE:
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Public Hearing to Repeal and Replace Resolution No. 2018-111 and Authorize the City of Lodi to Join the Statewide Community Infrastructure Program; Authorize the California Statewide Communities Development Authority to Accept Applications from Property Owners, Conduct Special Assessment Proceedings and Levy Assessments and Special District Taxes and to Form Assessment Districts and Community Facilities Districts Within the Territory of the City of Lodi; Embody the Terms of a Joint Community Facilities Agreement Setting Forth the Provisions for Community Facilities District Financings; Approve Form of Acquisition Agreement for Use When Applicable; and Authorize Related Actions (ED)
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MEETING DATE:
March 4, 2026
PREPARED BY:
Luis Aguilar, Economic Development Director
recommendation
RECOMMENDED ACTION:
Public Hearing to repeal and replace Resolution No. 2018-111 and authorize the City to join the Statewide Community Infrastructure Program (SCIP); authorize the California Statewide Communities Development Authority (CSCDA) to accept applications from property owners, conduct special assessment proceedings and levy assessments and special district taxes and to form assessment districts and community facilities districts within the territory of the City of Lodi; embody the terms of a joint community facilities agreement setting forth the provisions for community facilities district financings; approve form of acquisition agreement for use when applicable; and authorize related actions.
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BACKGROUND INFORMATION:
CSCDA is a joint powers authority sponsored by the League of California Cities and the California State Association of Counties. Over 500 cities, counties and special districts throughout California are members of CSCDA, including the City of Lodi.
SCIP was instituted by CSCDA in 2002 to allow owners of property in participating cities and counties to finance the development related fees that would be payable by property owners upon receiving development entitlements or building permits through a pooled special assessment districts program and later expanded to include financing of public capital improvements constructed by developers and public services necessary to support development in the City, as provided for in the proposed Resolution. Since its inception SCIP has issued over $1 billion in land secured special assessment and CFD bonds for development projects in California.
The City of Lodi joined SCIP in 2018 as authorized by Resolution No. 2018-111. Now it is before the City Council to consider modifications to its SCIP participation to modernize the legal documentation.
If a property owner applies to participate in SCIP, and the City approves the application, the selected public capital improvements, facilities and/or development related fees owed to the City will be financed by the issuance of bonds by CSCDA. Property owners, in consultation with the City and the SCIP team, can opt to have CSCDA form either an assessment district or a community facilities district. CSCDA determines whether the project will be included in the SCIP pool program (where no one developer within the SCIP pool is responsible for the payment related to any other project) or, depending on the projected bond sizing and other factors, implemented as a stand-alone financing. In either case, CSCDA will form the appropriate district and impose an assessment or special tax, as applicable, on the owner’s property to repay the portion of the bonds issued to finance public capital improvements, facilities and/or development related fees.
With respect to the financing of development related fees, the property owner will either pay the development fees at the time of permit issuance and will be reimbursed from the SCIP bond proceeds when the SCIP bonds are issued, or the fees will be funded directly from the proceeds of the SCIP bonds. In both cases, the fees are subject to requisition by the City at any time to make authorized fee expenditures, and the City is never at risk for payment of its fees. If the property owner is required to construct improvements to be dedicated to the City, the proposed Resolution includes a form of acquisition agreement to be used when such improvements are funded with SCIP bond proceeds, which outlines how a developer will be reimbursed for improvements as they are certified complete by the City.
The benefits of SCIP to the property owner include:
• Only property owners who choose to participate in the program will have assessments or special taxes imposed on their property.
• Instead of paying cash for public capital improvements and/or development related fees, the property owner receives low-cost, long-term tax-exempt financing of those fees, freeing up capital for other purposes.
• The property owner can choose to pay off the assessments or special taxes at any time.
• For home buyers, paying for the costs of public infrastructure through an assessment or special tax is superior to having those costs "rolled" into the cost of the home. Although the tax bill is higher, the amount of the mortgage is smaller, making it easier to qualify. Moreover, because the assessment/special tax financing is at tax-exempt rates, it typically comes at lower cost than mortgage rates.
• Owners of smaller projects, both residential and commercial, can have access to tax-exempt financing of infrastructure. Before the inception of SCIP, only projects large enough to justify the formation of an assessment or community facilities district had access to tax-exempt financing. SCIP can finance projects as low as $500,000, which would not be economical on a stand-alone basis.
The benefits of SCIP to the City include:
• As in conventional assessment district and CFD financing, the City is not liable to repay the bonds issued by CSCDA or the assessments or special taxes, as applicable, imposed on the participating properties.
• CSCDA handles all district formation, district administration, bond issuance and bond administration functions. A participating city, county or special district can provide tax-exempt financing to property owners through SCIP while committing virtually no staff time to administer the program.
• Providing tax-exempt financing helps participating cities and counties cushion the impact of rising public capital improvements costs and development related fees on new development. Many developers rely on assessment district or CFD financing through SCIP in making the decision to purchase land, thereby improving the City’s competitive advantage in attracting new development.
• The availability of financing will encourage developers to pull permits and pay fees in larger blocks, giving the participating city, county or special district immediate access to revenues for public infrastructure, rather than receiving a trickle of revenues stretched out over time. As part of the entitlement negotiation process, the possibility of tax-exempt financing of fees can be used to encourage a developer to pay fees up front.
• In some cases, the assessments or special taxes on successful projects can be refinanced through refunding bonds. Savings achieved through a refinancing may be directed to lower property taxes subject to applicable federal tax limitations.
The proposed Resolution repealing and replacing Resolution 2018-111 authorizes CSCDA to accept applications from owners of property within our planning jurisdiction to apply for tax-exempt financing of public capital improvements and development related fees through SCIP. It also authorizes CSCDA to form assessment districts and community facilities districts within the City’s boundaries, conduct assessment and special tax proceedings and levy assessments and special taxes against the property of participating owners. The authorization of CSCDA to form assessment districts within the City’s boundaries, conduct assessment proceedings, and levy assessments against the property of participating owners previously approved by this City Council would remain in effect.
In addition to the funding of public capital improvements and development related fees, the proposed Resolution authorizes CSCDA to form community facilities districts within the City’s boundaries to levy special taxes to fund public services necessitated by new development projects, if approved by the participating property owner. Similar to the funding of public capital improvements and development related fees, once an application is received by the participating property owner and approved by the City, CSCDA handles all district formation and district administration. CSCDA will coordinate with the City annually to prepare the budget for the levy, and will levy and collect the special taxes for disbursement to the City when collected.
The proposed Resolution further embodies the terms of a joint community facilities agreement to be entered into between CSCDA and the City for each community facilities district, setting provisions for collection and application of the special tax for use when a community facilities district is formed and approves the form of an acquisition agreement to be entered into between the City and the participating property owner/developer to provide the procedure for disbursement of bond proceeds to pay for facilities constructed by the property owner/developer. It also authorizes miscellaneous related actions and makes certain findings and determinations required by law.
FISCAL IMPACT:
Not applicable.
FUNDING AVAILABLE:
Not applicable.