Subject
Resolution 2129 declares the intention of the City Council to form Local Improvement District #322.
Summary and Background
The City Council, on June 24, directed the City Manager (Resolution 2127) to develop a feasibility report for the formation of LID #322. That report has been completed and is attached to this Staff Report. If, after reviewing the report, the Council wishes to proceed with LID formation, it must approve Resolution 2129, declaring your intention to form the LID and establishing a public hearing for August 12, 2019.
It is important to note that Resolution 2129 only declares your intention to form the LID, but does not actually form it. After the August 12 public hearing is opened, if more than 60% of the impacted properties oppose formation through formal remonstrances, then the Council can’t form the LID, and cannot re-try for at least 6 months. If 60% or fewer of the impacted properties formally oppose the formation, then Council may proceed with actually implementing the LID. However, it is also important to note that after receiving any remonstrances at the August 12 public hearing, if no more than 60% of properties oppose formation, then staff recommends postponing the hearing until October 28, 2019. The reason for the postponement would be to allow staff to finalize application to the US Economic Development Administration for $1,461,600 in grant funding; using the $1,161,600 in LID assessments as the bulk of the local match. If the grant application is turned down, then staff would recommend re-opening the hearing on October 28 and terminating the LID process.
Tie-In to Council Goals:
Goal 2.3: Determine South Hermiston Industrial Park Feasibility
Fiscal Information
Adoption of Resolution 2129 does not, itself, impose any LID Assessments, or commit any City funds. LID implementation will occur as a future action.
As outlined in the attached Feasibility Report, eventual formation of LID #322 would cost a total of $2,923,200. LID Assessments would be expected to cover $1,161,600 of the total project costs. LID Assessments would become a lien against the impacted properties, and may be paid in one lump sum, or may be repaid in installments.
The remainder of the project cost is expected to be covered by a coalition of public subsidies. The City of Hermiston is expected to contribute $250,000 toward the project costs; with approximately $208,000 coming from reserve cash which was originally approved by studying a potential natural gas utility in the same vicinity as these improvements, and the remainder coming from General Fund Economic Development budget resources.
The U.S. Economic Development Administration is expected to contribute $1,461,600 toward the project in the form of a grant, which requires 50% local match. US EDA grant funding has not been secured. The assurance of funding, undergirded by LID assessments, will be used to guarantee the local match. Application for funds will not be made until the local match is established.
Finally, it is important to note that although the Port of Umatilla is not listed above as helping to subsidize the projects, it will be by far the largest contributor toward the LID; with an assessment of approximately $575,000 across two properties. Therefore, POU will be covering approximately 50% of the cost assessed to benefitting properties.
Alternatives and Recommendation
Alternatives
-Approve Resolution #2129
-Reject Resolution #2129
Recommendation
-Approve Resolution #2129
Requested Action/Motion
Motion to approve Resolution #2129
Submitted By: Mark Morgan