The City Council annually levies an assessment on land and improvements covering the Downtown Parking Maintenance District debt service. Although Proposition 218 requires a new methodology for assessment of the District’s operation and maintenance costs, the City may allow the existing method of assessing for the bonded indebtedness to continue as an ad valorem property tax. For FY 1999/2000, staff is recommending that the Parking Maintenance District assessment rate for the ad valorem component be ($.0590) per $100 of assessed valuation.

Since 1964, the City Council has annually levied an assessment for the debt service requirements associated with the acquisition of land for parking facilities. A separate assessment is levied to cover maintenance, operation, and construction of improvements for the City’s Downtown Parking Maintenance District parking facilities. Both of these assessments have been ad valorem based on the value of each property within the district boundaries. Proposition 218, passed by California voters in 1996, only affects the operation and maintenance component of the Parking District. The existing method of assessing for the bonded indebtedness component can legally continue as an ad valorem assessment. The debt service represents approximately one-third of the Parking District’s cost, or $73,050.

The bonded indebtedness portion of the assessment will be completely retired in the year 2002. Once retired, property owners will be assessed for only the operations and maintenance costs by separate assessment.

The Downtown Parking Maintenance District consists of approximately 100 parcels in Sunnyvale’s downtown area. Over 95% of the Parking Maintenance District consists of commercial businesses, of which Sunnyvale Town Center is the largest.

Staff used the Downtown Parking Maintenance District’s total assessed valuation for FY 1998/99 to calculate the ad valorem tax rate. The District’s total assessed valuation for FY 1998/99 is $123,845,553. The County Assessor’s Office is unable to provide staff with the District’s FY 1999/2000 total assessed valuation at this time.

Approval of the debt service component of the Parking Maintenance District assessment will generate approximately $73,050 for FY 1999/2000 to pay bonded indebtedness.

1. Approve an ordinance establishing ad valorem rate for the debt service for the Parking Maintenance District for Fiscal Year 1999/2000 at $.0590 per $100 of assessed valuation.
2. Do not approve the ordinance.

Required public notice will be given through the publication of the City Council Agenda. A copy of this report is also available in the Library and on the City’s Internet home page.

It is recommended that the City Council approve Alternative 1.

Prepared by:

Therese B. Balbo
Administrative Services Manager

Reviewed by:

Mary J. Bradley
Director of Finance

Approved by:

Robert S. LaSala
City Manager