Eastern Municipal Water District
California

Action/Info Item
4809
Received and Filed
Feb 17, 2021 9:00 AM

Fourth Quarter Report on Activities Related to Program Management of Community Facilities Districts and Assessment Districts

Information

Department:FinanceSponsors:
Category:Action/Info ItemMeeting Workflows:Board Admin Committee Workflow

Background

In the fourth quarter of Calendar Year 2020, Eastern Municipal Water District (EMWD) was responsible for the program administration of seven Assessment Districts (ADs), and 62 Community Facilities Districts (CFDs), which include 109 separate financing areas; i.e., Improvement Areas (IAs) or Tax Zones, as detailed in the Quarterly CFD Program Management Report (Exhibit A) and Quarterly Status Report (Exhibit C).

 

CFD Formations:

 

The formation of CFD No. 2019-86 (Benton) is currently in progress.  The Resolution of Intention (ROI) is scheduled for the January 20, 2021 board meeting, and the Public Hearing is scheduled for March 3, 2021.  The team continues to evaluate the applications to form CFD No. 201987 (Copper Skye), CFD No. 202088 (French Valley 154), and CFD No. 202089 (Saddle Point).  We have also received an application to form CFD No. 2020-90 (Sageview/MV Ranch/Los Olivos).  The team commenced the formation of this CFD by working with multiple developers, each with projects of less than 100 parcels, to combine efforts towards the formation of a single CFD.  With this combined effort, the resulting CFD will meet EMWDs minimum lot guideline per the Comprehensive Debt Policy.  Additional information is needed from the developers regarding all projects currently under evaluation before the Resolutions of Intention are scheduled for consideration by the Board.  Recent and upcoming CFD activity is listed in the Action Item Summary (Exhibit B).  The location of each current item pertaining to EMWD CFDs is illustrated in the Location Maps (Exhibit F).

 

Bond Sales:

 

In the fourth quarter, the team completed new money bond issuances for CFD No. 201261 (Autumn Winds) and CFD No. 2016-72 (Hidden Hills).  The bond sale for CFD No. 201675 (Camberly Place) is in progress.  This issuance went before the Board on December 16, 2020. It is expected to close January 28, 2021.  These new money issuances will result in savings for the property owners beginning with the Fiscal Year 2021-22 enrollment.  In addition, the team is currently working on a pooled refunding which will provide savings to 4,161 property owners within twelve different CFDs which is scheduled for the January 20, 2021 board meeting.  Bond issuances for CFD No. 200435 IA D (Mountain Gate) and CFD No. 201882 (Aspen Pointe) are under evaluation.  All refunding and new money issuances must substantially comply with the District’s Comprehensive Debt Policy.

 

Change Proceedings:

 

The change proceedings for CFD No. 2016-74 IA D (Menifee Town Center) was completed in the fourth quarter.  The team continues to evaluate petitions received from developers for change proceedings within CFD No. 2006-51 (Nuevo Meadows) and CFD No. 201362 (Eucalyptus Grove/McLaughlin South).  All requested change proceedings will comply with the Special Funding Land Secured Guidelines as incorporated in the District’s Comprehensive Debt Policy.

 

Joint Community Facilities Agreements:

 

During the fourth quarter, JCFAs with Hemet Unified School District (USD) CFD No. 2020-4 and Moreno Valley USD CFD No.  20201 were completed.  The JCFA with Hemet USD CFD No. 20201 is in progress and anticipated to go before the Board on February 17, 2021.  Also, proposed JCFAs with City of Menifee CFD No. 2020-3, Hemet USD CFD No. 20211, Hemet USD CFD No. 20202, and San Jacinto USD CFD No. 20201 are under evaluation.  The District reviews each JCFA against the Land Secured Guidelines to ensure it is within the two percent effective tax rate at formation.  Additionally, each agency forming a JCFA with EMWD must covenant that they will not place EMWD’s name on the property tax bills referencing a CFD where EMWD is not the lead agency.

 

Administration and Consulting:

 

The annual administration for the ADs and CFDs includes budget preparation, annual levy calculation and submittal, delinquency monitoring, bond call preparation, disclosure reporting, and property owner services.

 

As part of the Program Management, Webb Municipal Finance, LLC receives and answers telephone inquiries regarding the ADs and CFDs.  The quarterly Call Log (Exhibit D) details 15 calls received by the Webb team within the fourth quarter.  For comparison, 41 calls were received in the same quarter last year.  Most of the callers inquired about the maturity of the bonds in their district.

 

The Delinquency Summary Report (Exhibit E), dated as of December 10, 2020, reflects an overall delinquency percentage of 0.51 percent.  This is lower than the delinquency percentage of 0.82 percent for last quarter and 0.59 percent from the fourth quarter last year.  Given the anticipation of the most current delinquency data due to COVID, the Delinquency Summary Report also includes Fiscal Year 2020-21 delinquency information.  The first installment of this fiscal year’s taxes was due on December 10, 2020.  As of that date, $255,564.36 or 2.44 percent of the aggregate EMWD AD special assessments and CFD special taxes for Fiscal Year 2020-21 are considered delinquent.  The team continues to proactively monitor delinquencies.

 

The team has also been working on required reports and disclosures during the fourth quarter.  The CDIAC reports required for each CFD and Marks-Roos Pooled Financing for Fiscal Year 2019-20 have been completed and filed.  All Disclosure Reports due by December 31, 2020 have also been completed and filed.  The team continues to prepare the remaining reports due in February and March of 2021.  The team also prepared and filed the required calendar year 2020 Senate Bill 165 report with the Board during the December 16, 2020 board meeting.  In addition, the team completed the parcel tax reports for each CFD pursuant to AB 2109.  These reports are filed with the State Controller’s Report.  We have also started compiling the information necessary to develop the SB 1029 reports.  These reports are due January 31, 2021, and cover any debt issued between January 1, 2017 and June 30, 2020.  The District has four new eligible land secured debt issuances to be included in this year’s report:  CFD No. 2002-07 IA C 2019 Series, CFD No. 201363 IA A, CFD No. 2014-66, and CFD No. 201674 IA C; all closed after July 1, 2019 and before June 30, 2020.

Financial/Strat Plan/Enviro

FINANCIAL IMPACT:

None

 

STRATEGIC PLANNING GOAL/OBJECTIVE:

Financial Stability: Enhance and maintain EMWD’s strong financial position and credit quality by identifying and implementing specific opportunities to improve underlying financial metrics.

 

ENVIRONMENTAL IMPACT:

None

Recommendation

Receive and file

Meeting History

Feb 4, 2021 4:00 PM  Board Administrative Committee Regular Meeting
draft Draft
RESULT:REVIEWED AT COMMITTEE
Feb 17, 2021 9:00 AM  Board of Directors Regular Meeting
draft Draft
RESULT:RECEIVED AND FILED