Pending Updates
The Assessment District formation process is currently under review and procedures are subject to change without notice. For more information on proposed modifications, please contact Joe Chiquete at (949) 497-0338 or jchiquete@lagunabeachcity.net
Preliminary Assessment District Engineer's Reports
Click here for a copy of the Preliminary Engineer's Report for Assessment District No. 2009-2 (Allview Terrace).
Assessment District Formation Process
Over the past several years, neighborhood groups throughout the City have shown increased interest in the undergrounding of overhead utilities. Some of the reasons for pursuing these projects include view enhancement, safety, improved neighborhood aesthetics and utility modernization.
How is it done?
There are two methods to accomplish an undergrounding project:
- Working together with neighbors and accomplishing it privately; or
- forming an Assessment District with assistance from the City.
An Assessment District is somewhat time-consuming but easier to finance. It can take 3 to 4 years to complete a project depending on the number of projects currently in progress and the level of cooperation of participating residents. This brochure provides you with an overview of these two methods.
Who starts a Project?
Both of these processes require a resident to act as the liaison between your neighbors and the City or utility companies. The resident(s) informally surveys all affected homeowners in your area to determine if sufficient support for undergrounding exists. The City will assist in creating a boundary map for the project.
Defining the Project Area
The boundary map defines which property are determined to specially benefit from having their utility poles removed or wires placed underground. The survey information is used to determine how much interest and support can be expected for the formation of such a project. Once this information is evaluated, the City verifies with companies such as Southern California Edison, SDG&E, Cox Communications and Verizon Telephone whether the proposed boundary is viable. After the level of neighborhood interest is determined, a decision on which undergrounding method should be pursued can be made.
The Methods
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A Private District
A privately financed undergrounding project is handled exclusively by a group of homeowners and the utility companies.
The City is not included in this type of project, except to issue Building and Public Works permits. The utility companies are paid by you and other interested property owners to prepare plans for the conversion of the overhead facilities to an underground system. You then arrange to receive bids on these plans. Engineering, construction and incidental fees must be paid in full prior to the construc?tion of the underground system. Under this method of undergrounding, any number of parcels can be included with 100% of the affected properties required to participate.
You are also responsible to pay for the cost of connecting to the under?ground system from the street to your house. A licensed electrician can do this work for you. Alternatively, you may choose to contact the general contractor doing the work in the street for an individual bid.
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An Assessment District
To initiate the Assessment District process, these minimum requirements must be satisfied: five parcels must be included; 600 linear feet of line must be placed underground; and a preponderance of affected property owners must sign a petition indicating support to proceed with the process.
The City will help you form an Assessment District by providing project management and administrative and financial coordination. If sufficient interest exists to proceed with a District, the City will coordinate the design, financing and construction of the project. Additionally, the City finances the initial engineering costs at its sole risk. The primary benefit of this method is that you can finance safety and aesthetic improvements over time. The main drawback is that the formal process can take a long time to complete.
If you are interested in proceeding with the formation of an Assessment District, the following more detailed information will help you understand the procedures the City must follow.
Planning your Project
The first step in forming an Assessment District is to determine which poles and wires your neighborhood is most interested in placing underground. City staff then works with the utility companies to set the preliminary boundary for the project. The next step is to assess who will support such a project.
Typically, an energetic individual will seek the assistance of a few of his or her neighbors and divide the area into blocks, one neighbor surveying one block, another neighbor surveying the next. An alternative is to arrange a neighborhood meeting to present the project and receive input from those at the meeting. Holding such a meeting is also a good way to enlist the assistance of members of your neighborhood group. After each representative has informally surveyed the area, you should contact City staff to set a meeting to discuss your preliminary findings from the survey.
Confirming the Boundary and Petitioning
Once you identify your specific project boundaries, City staff meets with representatives of the utility companies. The purpose of this meeting is to determine whether the perimeters of the project are sufficient to move forward or if they need to be modified to assure that the various utility companies maintain their systems adequately.
Formal petitioning begins after the boundaries are confirmed. Staff can provide you with a sample petition for you to circulate. Once every homeowner has had an opportunity to sign, the petitions are submitted to the City for evaluation and verification of signatures. To proceed, the City Council looks for a preponderance of support from the affected property owners. Generally, this means that signatures from property owners represent?ing 70% of the number of homes within the boundary area must be filed with the City to indicate a solid level of commitment.
Engineerig and Design
After the City Council has confirmed that a sufficient number of signatures has been filed and has approved proceeding with the project, staff usually is authorized to send the boundary map to the utilities so that they can design the underground systems. Southern California Edison, or San Diego Gas and Electric, begins the initial design for the new system. In turn, these electrical plans are forwarded to Verizon and Cox Communications for their respective designs. This part of the process can take six to twelve months to complete depending on the existing work load of the utility companies.
During the design phase of the project, staff instructs the assessment engineer to prepare the Preliminary Engineer's Report. The report contains a detailed breakdown of all costs associated with the District formation and lists the estimated amounts proposed to be assessed to individual property owners. The Final Engineer's Report lists more accurate costs giving you and the City Council a better idea of how much the project will cost and how much individual assessments are estimated to be.
City Council Action and Requirements of Proposition 218
Once the design plans are completed and preliminary costs are estimated, State law requires the City Council to conduct at least one public hearing. The purpose of the hearing is to review detailed aspects of the project and to provide you with an opportunity to support or protest the formation of the District.
All property owners who are subject to the proposed assessments are notified of a public meeting and a public hearing and are mailed ballots as required by Proposition 218. The mailed ballot process allows all affected property owners to express their support or opposition to the proposed assessment. If a majority of the assessment ballots cast are in favor of the project, as weighted by each assessment amount, the City Council must proceed to have the District officially formed.
Project Costs
Construction costs vary substantially depending on the physical constraints impacting constructing of the project, the number of parcels sharing the costs and the types of utilities being undergrounded. Recent costs for a single family dwelling ranged from $8,000 to $20,000. All costs relating to the formation of the District and construction of the underground system can be paid over a 15 or 20 year period (the annual cost including interest for the example above approximates $750 to $1,500.) As with a private district, you must retain a contractor to connect your home to the underground system. The cost of this work generally ranges from $1,000 to $2,000.
Cash Pay-off Period
After the City Council has taken action to officially form the District, you have the opportunity to pay off your assessment before it is placed on your tax bill. This cash pay-off period, 30 days from the date of the Public Hearing, allows you to receive a discount of approximately 8 to 10 percent.
Financial Assistance for Senior, Blind or Disabled Citizens
The State Franchise Tax Board offers a Homeowner Assistance Program where it reimburses qualifying persons for a portion of the property taxes assessed on their home. The State Controller?s Office administers a Property Tax Postponement Program whereby eligible homeowners can postpone payment of part or all of the property taxes on their residence, including Assessment District costs, until the house is sold. To qualify, you must meet certain requirements as to age or disability, occupancy, income, property equity and tax status.
Therefore, it is possible if you are a lower income senior who owns your own home to participate in an Assessment District without any immediate out-of-pocket costs except the cost to hire a private contractor to connect the house to the public system.
Construction Schedule
The time frame for a typical utility undergrounding project is three to four years, from initial planning to the end of construction. Two to three months after the City Council has approved the project at the public hearing and has awarded a construction contract, the work of trenching and installing the conduit begins. The utilities then install wires in the conduit and remove the overhead facilities. By this time, your electrician will have completed the work from the street onto your property.
Contacts
For information on how to do a private project contact:
Southern California Edison 14155 Bake Parkway Irvine, CA 92718 (949) 458-4447
or
San Diego Gas & Electric 662 Camino de los Mares San Clemente, CA 92672 (949) 361-8047
For information on an Assessment District contact:
Mr. Joe Chiquete Public Works Department 505 Forest Avenue Laguna Beach, CA 92651 (949) 497-0338
For more information about Assessment Districts, call (949) 497-0338 or email jchiquete@lagunabeachcity.net
