TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Javier Carcamo, Finance Director
PREPARED BY: Evan Crockett, Management Analyst - Finance
SUBJECT:
title
Continued Public Hearings to Form Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta and to Annex into Community Facilities District No. 2025-2 (Maintenance Services) and Community Facilities District No. 2025-S (Safety Services)
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ABSTRACT
Staff recommends that the City Council hold each of the three (3) public hearings that were continued from the April 21, 2026, City Council meeting regarding the formation of Community Facilities District (CFD) No. 2026-1 (Gierson Ranch), authorizing up to $8 million in bonded indebtedness, and annexing the Gierson Ranch project into CFD No. 2025-2 (Maintenance Services) and CFD No. 2025-S (Safety Services).
The proposed 107-unit single-family residential development, located between Washington Avenue and Adams Avenue, would finance public infrastructure, Development Impact Fees (DIF), and eligible maintenance and safety services through the levy of special taxes under the Mello-Roos Act.
RECOMMENDATION
recommendation
Hold a public hearing regarding the formation of Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta;
Adopt Resolution No. 26-4939 entitled: A Resolution of the City Council of the City of Murrieta, California, Establishing Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta, Authorizing the Levy of a Special Tax Therein, Calling an Election and Approving and Authorizing Certain Actions Related Thereto;
Adopt Resolution No. 26-4940 entitled: A Resolution of the City Council of the City of Murrieta, California, Acting as the Legislative Body of Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta, Determining the Necessity to Incur Bonded Indebtedness in an Amount Not to Exceed $8,000,000 Within Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta and Calling an Election Therein;
Direct the City Clerk to hold an election within CFD No. 2026-1;
Adopt Resolution No. 26-4941 entitled: A Resolution of the City Council of the City of Murrieta, California, Acting in its Capacity as the Legislative Body of Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta Certifying Election Results;
Introduce and conduct the first reading of Ordinance No. 636-26 entitled: An Ordinance of the City Council of the City of Murrieta, California, Acting in its Capacity as the Legislative Body of Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta Authorizing the Levy of Special Taxes;
Acting as the Legislative Body of Community Facilities District No. 2025-2 of the City of Murrieta (Maintenance Services), hold a public hearing regarding Annexation No. 3;
Adopt Resolution No. 26-4942 entitled: A Resolution of the City Council of the City of Murrieta Acting as the Legislative Body of Community Facilities District No.2025-2 of the City of Murrieta (Maintenance Services), Annexing Territory to Community Facilities District No. 2025-2 of the City of Murrieta (Maintenance Services), and Calling Elections Therein (Annexation No. 3 - Gierson Ranch);
Direct the City Clerk to hold an election within CFD 2025-2;
Adopt Resolution No. 26-4943 entitled: A Resolution of the City Council of the City of Murrieta Acting as the Legislative Body of Community Facilities District No. 2025-2 (Maintenance Services) Certifying the Results of the June 2, 2026, Annexation and Special Tax Election (Annexation No. 3 - Gierson Ranch).
Acting as the Legislative Body of Community Facilities District No. 2025-S of the City of Murrieta (Safety Services), hold a public hearing regarding the annexation of Annexation No. 1;
Adopt Resolution No. 26-4944 entitled: A Resolution of the City Council of the City of Murrieta Acting as the Legislative Body of Community Facilities District No. 2025-S of the City of Murrieta (Safety Services), Annexing Territory to Community Facilities District No. 2025-S of the City of Murrieta (Safety Services) and Calling Elections Therein (Annexation No. 1 - Gierson Ranch);
Direct the City Clerk to hold an election within CFD 2025-S; and
Adopt Resolution No. 26-4945 entitled: A Resolution of the City Council of the City of Murrieta Acting as the Legislative Body of Community Facilities District No. 2025-S (Safety Services) of the City of Murrieta Certifying the Results of the June 2, 2026, Annexation and Special Tax Election (Annexation No. 1 - Gierson Ranch).
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PRIOR ACTION/VOTE
On March 17, 2026, the City Council adopted a Resolution of Intention to Establish Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta and a Resolution of Intention to Incur Bonded Indebtedness for Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta and set a public hearing for April 21, 2026.
On March 17, 2026, the City Council adopted a Resolution of Intention to Annex Territory to Community Facilities District No. 2025-2 (Maintenance Services) of the City of Murrieta (Annexation No. 3-Gierson Ranch) and set a public hearing for April 21, 2026.
On March 17, 2026, the City Council adopted a Resolution of Intention to Annex Territory to Community Facilities District No. 2025-S (Safety Services) of the City of Murrieta (Annexation No. 1-Gierson Ranch) and set a public hearing for April 21, 2026.
On April 21, 2026, at the request of the Property Owner, and due to the complexity of the proposed CFD No. 2026-1, the City Council opened and voted to continue the public hearing on the formation of CFD No. 2026-1 and continued the public hearing to June 2, 2026.
On April 21, 2026, at the request of the Property Owner, and due to the complexity of the proposed annexations to CFD No. 2025-2 (Maintenance Services) and CFD No. 2025-S (Safety Services), the City Council opened and voted to continue each of the public hearings regarding the proposed annexations and continued the public hearings to June 2, 2026.
STRATEGIC ALIGNMENT
This item aligns with the City Council’s goal of: maintaining a high performing organization that values fiscal sustainability, transparency, accountability and organizational efficiency relating to an administrative priority.
DISCUSSION
Gierson Ranch Project and Community Facilities District No. 2026-1
The property owner of the proposed Gierson Ranch project within the City is Century Communities of California, LLC, a Delaware limited liability company (Property Owner), and the Property Owner has submitted a petition requesting that the City form Community Facilities District No. 2026-1 (Gierson Ranch) of the City of Murrieta (CFD No. 2026-1). The property to be included in the proposed CFD No. 2026-1 (Property) is located between Washington Avenue and Adams Avenue, near the corner of Washington Avenue and Ivy Street. The Gierson Ranch project is proposed to include approximately 107 single-family homes at full buildout and will be developed by the Property Owner.
The Property Owner has requested that the City form CFD No. 2026-1 to encompass the Property, in accordance with the Mello-Roos Act, to finance the costs of certain public improvements through the levy of a special tax and the issuance of bonds. The proposed maximum bonded indebtedness is $8 million. The proceeds of bonds issued by CFD No. 2026-1 are expected to be used to finance public facilities to be owned and operated by the City, as well as financing the payment of Development Impact Fees owed by the Property Owner to the City, and to finance fees and public facilities to be owned and operated by the Murrieta Valley Unified School District and the Western Municipal Water District.
On March 17, 2026, the City Council adopted Resolution No. 26-4915 of Intention to Establish CFD No. 2026-1 and Resolution No. 4916 of Intention to Incur Bonded Indebtedness for CFD No. 2026-1 and called for a public hearing to be held on April 21, 2026, regarding the proposed formation of CFD No. 2026-1. On April 21, at the Property Owner’s request, the public hearing was continued until June 2, 2026.
The Property Owner has requested that the boundaries of CFD No. 2026-1 include the area described in Attachment A of Resolution No. 26-4915 presented at this meeting (CFD No. 2026-1 Resolution of Intention), and that special taxes be levied within the boundaries of CFD No. 2026-1 in accordance with the Rate and Method of Apportionment for CFD No. 2026-1 (CFD No. 2026-1 RMA) described in Attachment C to Resolution No. 26-4915. The proposed rates of the special tax range from $3,956 per unit for single-family homes less than 1,950 square feet to $4,179 per unit for single-family homes greater than 2,150 square feet. The special tax rates within CFD No. 2026-1 will increase two percent (2%) annually on July 1, of each year, commencing July 1, 2026.
The CFD No. 2026-1 Resolution of Intention was the first step in the process of forming CFD No. 2026-1 and, together with Resolution No. 26-4916 of Intention to Incur Bond Indebtedness by CFD No. 2026-1 adopted by the City Council on March 17, 2026, declared the City’s intention to establish CFD No. 2026-1, its intention to incur bonded indebtedness by CFD No. 2026-1, and called for a public hearing to take place on April 21, 2026. Notice of the public hearing was published in The Press Enterprise and mailed to the Property Owner.
At the request of the Property Owner, and due to the complexity of the proposed CFD No. 2026-1, the City Council opened the public hearing on the formation of CFD No. 2026-1 on April 21, 2026, and continued the public hearing to the June 2, 2026, City Council meeting.
In connection with the public hearing, Spicer Consulting Group has prepared a Public Hearing Report that describes and analyzes the facilities to be financed by CFD No. 2026-1 and the estimated costs of such facilities. Following the close of the public hearing, the City Council will be asked to adopt the Resolution of Formation for CFD No. 2026-1 and the Resolution Determining Necessity to Incur Bonded Indebtedness by CFD No. 2026-1 which, together, approve the formation of the CFD No. 2026-1, the levy of the special taxes in CFD No. 2026-1 in accordance with the CFD No. 2026-1 RMA and determines the necessity for the Facilities CFD to issue bonds in an amount not to exceed $8,000,000. Such resolutions call for an election to submit to the qualified voters of the CFD No. 2026-1 ballot measures on the approval of the special taxes, the issuance of bonds, and an appropriations limit for the CFD No. 2026-1.
The CFD No. 2026-1 Resolution of Formation also approves the execution and delivery of an Acquisition, Construction and Funding Agreement with the Property Owner (Acquisition Agreement). The Acquisition Agreement sets forth the terms pursuant to which CFD No. 2026-1 will acquire improvements constructed by the Property Owner from bond proceeds from CFD No. 2026-1 and how the Property Owner will be reimbursed for development impact fees from bond proceeds. In order to be eligible for acquisition, such facilities must be constructed in accordance with the terms and conditions of the Acquisition Agreement. The City and CFD No. 2026-1 are only required to pay for the acquisition of such facilities from the proceeds of bonds or special taxes levied in CFD No. 2026-1 and not from any other source.
The CFD No. 2026-1 Resolution of Formation also approves the execution and delivery of a Joint Community Facilities Agreement between the City and the Murrieta Valley Unified School District (School District JCFA) and the execution and delivery of a Joint Community Facilities Agreement between the City and the Western Municipal Water District (Water District JCFA). The School District JCFA and the Water District JCFA set forth the terms pursuant to which the Property Owner will be reimbursed from bond proceeds from CFD No. 2026-1 for certain school facility fees and certain water facility fees the Property Owner is required to pay to the Murrieta Valley Unified School District and the Western Municipal Water District. In order to be eligible for acquisition, such facilities must be constructed in accordance with the terms and conditions of the Acquisition Agreement. The City and CFD No. 2026-1 are only required to pay for the acquisition of such facilities from the proceeds of bonds or special taxes levied in CFD No. 2026-1 and not from any other source.
On file with the City Clerk is a Certificate of the Registrar of Voters of Riverside County certifying that there are no registered voters residing within the boundaries of the CFD No. 2026-1. Accordingly, under the Mello-Roos Act, only property owners who own land in CFD No. 2026-1 are eligible to vote at the election for CFD No. 2026-1, with each owner having one vote for each acre (or portion thereof) that they own within CFD No. 2026-1. The Property Owner has executed a consent and waiver of certain election procedures with respect to the election, including certain timing requirements with respect to the election, in accordance with the Mello-Roos Act. Accordingly, if the City Council approves the Resolution of Formation and the Resolution Determining Necessity to Incur Bonded Indebtedness, the City Clerk will conduct the election. The Property Owner will have delivered its ballot to the City Clerk in advance of the public hearing, and the City Clerk will announce the election results, and the City Council will be asked to adopt the Resolution Certifying the Election Results. Upon certification that two-thirds of the votes cast are in favor of the propositions voted upon in CFD No. 2026-1, the Resolution Certifying the Election Results will direct the City Clerk to record a notice of special tax lien on the property within CFD No. 2026-1. The City Council will then be asked to introduce the ordinance authorizing the levy of the special tax within CFD No. 2026-1, in accordance with the CFD No. 2026-1 RMA.
Annexation to CFD No. 2025-2 (Maintenance Services) and CFD No. 2025-S (Safety Services)
New development projects (such as the Gierson Ranch Project) meeting certain design criteria are required by the City’s Community Facilities District Goals and Policies, as amended in December 2023, to annex into Community Facilities District No. 2025-2 (Maintenance Services) of the City of Murrieta and Community Facilities District No. 2025-S (Safety Services) of the City of Murrieta.
On March 17, 2026, the City Council adopted Resolution No. 26-4917 and Resolution No. 26-4918, declaring the City Council’s intention to annex the Property into CFD No. 2025-2 (Maintenance Services) and CFD No. 2025-S (Safety Services), respectively, and called for public hearings to held on the proposed annexations on April 21, 2026.
Like the proposed formation of CFD No. 2026-1, at the request of the Property Owner, and due to the complexity of the proposed annexations to CFD No. 2025-2 (Maintenance Services) and CFD No. 2025-S (Safety Services), on April 21, 2026, the City Council opened each of the public hearings regarding the proposed annexations and continued the public hearings to June 2, 2026.
Following the close of the public hearing for the proposed annexation to CFD No. 2025-2 (Maintenance Services), the City Council will be asked to adopt a Resolution of Annexation for Annexation No. 3 (Gierson Ranch) (CFD No. 2025-2 Resolution of Annexation), which approves the annexation to CFD No. 2025-2 (Maintenance Services) and the levy of the special taxes in CFD No. 2025-2 (Maintenance Services), in accordance with the Rate and Method of Apportionment for CFD No. 2025-2 (Maintenance Services). The CFD No. 2025-2 Resolution of Annexation also calls for elections to be held within CFD No. 2025-2 (Maintenance Services) to submit to the qualified electors ballot measures on the approval of the annexations and the special taxes.
Following the close of the public hearing for the proposed annexation to CFD No. 2025-S (Safety Services), the City Council will be asked to adopt a Resolution of Annexation for Annexation No. 1 (Gierson Ranch) (CFD No. 2025-S Resolution of Annexation), which approves the annexation to CFD No. 2025-S (Safety Services) and the levy of the special taxes in CFD No. 2025-S (Safety Services), in accordance with the Rate and Method of Apportionment for CFD No. 2025-S (Safety Services). The CFD No. 2025-S Resolution of Annexation also calls for elections to be held within CFD No. 2025-S (Safety Services) to submit to the qualified electors ballot measures on the approval of the annexations and the special taxes.
On file with the City Clerk is a Certificate of the Registrar of Voters of Riverside County certifying that there are no registered voters residing within the boundaries of the proposed annexation areas. Accordingly, under the Mello-Roos Act, only property owners who own land are eligible to vote at the elections, with each owner having one vote for each acre (or portion thereof) that they own within the annexation area. The Property Owner has executed a consent and waiver of certain election procedures with respect to the elections within CFD No. 2025-2 (Maintenance Services) and CFD No. 2025-S (Safety Services), including certain timing requirements with respect to the elections, in accordance with the Mello-Roos Act. Accordingly, if the City Council approves the CFD No. 2025-2 Resolution of Annexation and the CFD No. 2025-S Resolution of Annexation, the City Clerk will conduct the elections. The Property Owner will have delivered its ballots to the City Clerk in advance of the public hearings, and the City Clerk will announce the election results, and the City Council will be asked to adopt a Resolution Certifying the Election Results for CFD No. 2025-2 (Maintenance Services) and a Resolution Certifying the Election Results for CFD No. 2025-S (Safety Services). Upon certification that two-thirds of the votes cast are in favor of the propositions voted upon, the Resolution Certifying the Election Results for CFD No. 2025-2 (Maintenance Services) and the Resolution Certifying the Election Results for CFD No. 2025-S (Safety Services) will direct the City Clerk to record notices of special tax liens on the property within each of the proposed annexation areas.
PUBLIC NOTICING
The agenda item has been noticed in accordance with the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). At the April 21, 2026, City Council meeting, the public hearing was opened and continued to June 2, 2026. Notice of the public hearings was published on May 18, 2026, in The Press Enterprise and mailed to the Owner at least 15 days prior to the public hearing.
CEQA AND REGULATORY OVERVIEW
This action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly.
FISCAL IMPACT
The Property Owner has made a deposit of $65,000 to pay for the costs of the formation proceedings, which may be reimbursed to the Property Owner from proceeds of a future bond issuance in accordance with the reimbursement agreement with the Property Owner. If established and subject to necessary City Council and voter approvals, each of the CFDs will annually levy special taxes on all of the taxable property within the applicable district in accordance with the applicable rate and method of apportionment. Such special taxes will be used to pay for the costs of services or facilities, administration of the CFDs, including mandated annual disclosures, and, in the case of CFD No. 2026-1, debt service on bonds. Any bonds issued by CFD No. 2026-1 are not obligations of the City and will be secured solely by the Special Taxes levied within CFD No. 2026-1. The levying of the special taxes for services is expected to alleviate some of the financial impact of the new development on the costs of providing such services to the Property by the City.
Additionally, the Property Owner provided additional deposits of $30,000 to cover the annexation costs associated with the property annexing into CFD No. 2025-2 (Maintenance Services) and CFD No. 2025-S (Safety Services).
ATTACHMENTS
ATT 1 - Landowner Waiver (CFD No. 2026-1)
ATT 2 - Public Hearing Report (CFD No. 2026-1)
ATT 3 - Resolution No. 26-4939
ATT 4 - Resolution No. 26-4940
ATT 5 - Resolution No. 26-4941
ATT 6 - Ordinance No. 636-26
ATT 7 - Certificate of the Registrar of Voters (CFD No. 2026-1)
ATT 8 - Acquisition Construction and Funding Agreement
ATT 9 - Joint Community Facilities Agreement with Murrieta Valley Unified School District
ATT 10 - Joint Community Facilities Agreement with Western Municipal Water District
ATT 11 - Landowner Waiver (Annexation No. 3 to CFD No. 2025-2)
ATT 12 - Resolution No. 26-4942
ATT 13 - Resolution No. 26-4943
ATT 14 - Certificate of the Registrar of Voters (Annexation No. 3 to CFD No. 2025-2)
ATT 15 - Landowner Waiver (Annexation No. 1 to CFD No. 2025-S)
ATT 16 - Resolution No. 26-4944
ATT 17 - Resolution No. 26-4945
ATT 18 - Certificate of the Registrar of Voters (Annexation No. 1 to CFD No. 2025-S)