TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Javier Carcamo, Finance Director
PREPARED BY: Evan Crockett, Management Analyst - Finance
SUBJECT:
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Resolution Declaring Intent to Annex Territory: Community Facilities District No. 2025-2 (Maintenance Services): Annexation No. 4 (Jefferson Apartments)
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ABSTRACT
The City Council is being requested by the developer to consider the adoption of a Resolution of Intention to annex approximately 2.09 acres into Community Facilities District No. 2025-2 (Maintenance Services) (CFD No. 2025-2) as Annexation No. 4 (Jefferson Apartments). The annexation area consists of APNs 909-030-032 and 909-030-033 and is proposed to be developed as an 82-unit affordable multifamily residential project.
The annexation will establish Tax Zone 4 within CFD No. 2025-2 and authorize the levy of a special tax to fund ongoing maintenance services associated with the project, including landscaping, street and pavement maintenance, park maintenance, graffiti abatement, reserves, and administrative expenses. No bonded indebtedness or public facilities financing is proposed as part of this annexation.
RECOMMENDATION
recommendation
Adopt Resolution No. 26-4982 entitled: Resolution of the City Council of the City of Murrieta Acting as the Legislative Body of Community Facilities District No. 2025-2 (Maintenance Services) of the City of Murrieta, Declaring its Intention to Consider Annexing Territory to Community Facilities District No. 2025-2 (Maintenance Services) of the City of Murrieta (Annexation No. 4-Jefferson Apartments); and
Set the Public Hearing for December 1, 2026.
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PRIOR ACTION/VOTE
On October 3, 2023, the City Council considered an Amendment to the Community Facilities District Goals and Policies and directed staff to present the recommendations in a workshop (Vote 3-2).
On December 5, 2023, the City Council held a workshop on and adopted the proposed Amendment to the Community Facilities District Goals and Policies (Non-Action Item).
On December 5, 2023, the City Council Adopted Resolution No. 23-4717, amending and restating Community Facilities District Goals and Policies (Vote 5-0).
On February 4, 2025, the City Council adopted Resolution No. 25-4806 (the “Resolution of Intention”), declaring its intention to establish Community Facilities District No. 2025-2 (Maintenance Services) (Vote:5-0).
On May 6, 2025, the City Council adopted Resolution No. 25-4822 (the “Resolution of Formation”) establishing Community Facilities District No. 2025-2 (Maintenance Services) (Vote 5-0).
STRATEGIC ALIGNMENT
This item aligns with the City Council goal to maintain a high performing organization that values fiscal sustainability, transparency, accountability and organizational efficiency. The item is listed on the City Departments’ Top Projects List and advances implementation of Community Facilities Districts to support maintenance services. Annexing the Jefferson Apartments project into CFD No. 2025-2 implements the City’s Community Facilities District Goals and Policies (Resolution No. 23-4717), which requires growth-related maintenance costs be funded through dedicated special taxes rather than by the General Fund. Establishing Tax Zone 4 provides a sustainable, project-specific revenue source that ensures new development fully funds its associated maintenance obligations, thereby preserving service levels, supporting responsible growth management, and maintaining quality public infrastructure as residential development is added to the community.
DISCUSSION
Community Facilities District No. 2025-2 (Maintenance Services) was established pursuant to the Mello-Roos Community Facilities Act of 1982 to provide a funding mechanism for the maintenance of public improvements and related services associated with new development within the City. CFD 2025-2 was formed as a future annexation district, allowing properties to be annexed as development projects are approved and maintenance obligations are identified.
History
On December 5, 2023, the City Council adopted amendments to the Community Facilities District Goals and Policies to establish updated requirements and procedures for the formation and administration of Community Facilities Districts. Among other provisions, the policy identifies circumstances under which new development projects may be required to participate in maintenance and public service financing programs to ensure that growth-related service demands are funded by the developments generating those demands.
On May 6, 2025, the City Council completed the formation of Community Facilities District No. 2025-2 (Maintenance Services), including the establishment of a Potential Annexation Area encompassing properties eligible for future annexation. Annexation proceedings are conducted pursuant to the Mello-Roos Community Facilities Act and allow project-specific Tax Zones to be established based on the maintenance obligations associated with individual development projects.
Analysis
The proposed Annexation No. 4 consists of approximately 2.09 acres identified as APNs 909-030-032 and 909-030-033, located along the west side of Jefferson Avenue, north of Murrieta Hot Springs Road and south of Los Alamos Road. The property is proposed for development as the Jefferson Affordable Family Apartments project, consisting of 82 multifamily residential units.
As a condition of development approval, the project is required to participate in the City's maintenance financing program through annexation into CFD No. 2025-2. This requirement is consistent with the City's Community Facilities District Goals and Policies, which provide for the use of maintenance financing districts to fund growth-related maintenance obligations associated with new development. The annexation will establish Tax Zone 4 and authorize the levy of a special tax to fund ongoing maintenance obligations associated with the project.
The maintenance responsibilities anticipated to be funded through Tax Zone 4 include landscaped frontage improvements, street and pavement maintenance, park maintenance obligations, graffiti abatement, reserve funding, and administrative expenses. The proposed Maximum Special Tax was developed based on the estimated annual maintenance costs associated with the project and does not include any facilities financing component. Based upon the estimated annual maintenance costs associated with these improvements, the proposed Maximum Special Tax A for Tax Zone 4 is $206 per residential unit for developed and approved multifamily residential property. The Maximum Special Tax B (Contingent) is proposed at $0.
The Resolution of Intention initiates the annexation proceedings and establishes December 1, 2026, as the date for the required public hearing. Following the public hearing, the property owner election required under the Mello-Roos Act will be conducted. Upon approval by the landowner election, the City Council may adopt the ordinance annexing the territory into CFD No. 2025-2 and authorizing the levy of the special tax.
PUBLIC NOTICING
The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item).
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 estimated annual maintenance cost for Tax Zone 4 is approximately $16,892 and includes landscaping, street and pavement maintenance, park maintenance, graffiti abatement, reserves, and administrative expenses. Based upon the estimated annual maintenance costs associated with these improvements, the proposed Maximum Special Tax A for Tax Zone 4 is $206 per residential unit for developed and approved multifamily residential property.
These costs will be funded through the annual levy of special taxes on property within Tax Zone 4 of CFD No. 2025-2. The annexation is not anticipated to have a fiscal impact on the City's General Fund. No bonded indebtedness, public facilities financing, or capital improvement financing is proposed as part of this annexation.
ATTACHMENTS
ATT 1 - Project Map
ATT 2 - Resolution No. 26-4982
ATT 3 - Maintenance Exhibit