Butte County Clerk of the Board

2008 BOARD OF SUPERVISORS MEETING CALENDAR

chapter seven

LOCAL GOVERNMENT JURISDICTION,

DEVELOPMENT & RELATED ISSUES

This chapter deals with the need for the County and City of Chico to work on a cooperative basis to address the issues that arise in solving the health and regulatory issues which impact the citizens of the Chico Urban Area. In addition to the need to coordinate the planning, financing and construction of sewer infrastructure as discussed in previous sections, the agencies will need to address such issues as annexation policies, land use planning and development regulations.

The two agencies have resolved many difficult issues in recent years. Among other successes, agreement has been reached on strengthening the "green line" to limit development into agricultural soils to the west, on adoption and implementation of the Nitrate Action Plan, a resolution of property tax and sales tax allocation, and the cooperative formation of the Greater Chico Urban Area Redevelopment Project. As the County's plan for compliance with water quality objectives has taken shape, the need for resolution of area wide land use and infrastructure planning issues, as well as issues related to annexation has become clear.

The recommended alternative of utilizing the City's sewer collection and treatment system gives rise to questions of interest to both agencies and the public at large. Opportunities for further coordination and cooperation arise with the prioritization of redevelopment funds and related financing mechanisms, annexation policies, and expansion of the wastewater treatment plant.

Existing County and City Agreements Relevant to Nitrate Compliance

The County of Butte and the City of Chico have negotiated several milestone agreements in the past decade that are germane to the groundwater nitrate issue.

Nitrate Action Plan (1985, 1988 {amended}). These joint documents laid out a plan of action which both entities would undertake in order to prevent further water quality degradation and to minimize the existing nitrate problem in the groundwater beneath the Chico Urban Area.

Amended Master Property Tax Transfer Agreement (1987). This document settled a dispute regarding property tax and sales tax allocations. The issue was generated by the proposed annexation of the North Valley Plaza Mall to the City of Chico, a significant generator of sales tax revenue to the County. The litigation and political rancor that characterized the period prior to the settlement of this issue and the related Municipal Affairs Agreement marked a low point in relations between the two agencies.  

In entering into this agreement, County and City agreed to the allocation of the local share of property taxes between the two agencies, and the sharing of sales and use tax revenues generated from within the city limits.

Municipal Affairs Agreement (1987). Accompanying the above agreement on tax revenues, this document set forth a larger view of the long-term provision of municipal services to the urban area fragmented by many pockets of fully urbanized yet unincorporated territory. Included was an agreement to pursue coordination of land use planning and development standards and the joint formation of an urban area-wide redevelopment project.  

Greater Chico Urban Area Redevelopment Project (1994). Citing groundwater nitrate contamination as the leading "blight condition" requiring the use of redevelopment funding mechanisms, the County and City cooperated in the formation of this cross-jurisdictional redevelopment project area. (Refer to section 5.5 for further discussion of the Greater Chico Urban Area Redevelopment Project.)

Opportunities for Further Cooperation Between City and County

In an era of shrinking revenues available to California counties and cities, the City of Chico and County of Butte have each sought to identify efficiencies in the provision of public infrastructure and services. The differing nature of their responsibilities, revenue sources, territory and constituencies, however, leads to varying perspectives on a range of common issues. Further complicating the relationship is the state's reallocation of local property tax revenues, mandated programs that are unfunded, and the threat that federal programs and their associated costs will be shifted down to local government.

The components of the proposed Plan substantially affect the entire urban area and both local agencies. Opportunities for further cooperation between the County and the City include the following: 

  Oversight of septic systems. The incorporated area contains up to 1,500 annexed properties that are served by septic systems. Many of these systems serve single family dwellings which are not proposed for sewering. As annexations occur over time, the number of such systems can be expected to increase.  

Provision of public infrastructure. The County and City currently coordinate street and storm drainage improvements and various other infrastructure-

related programs as well as the cross-jurisdictional redevelopment project. Implementation of the proposed plan and resolution of the nitrate issue may expand such opportunities for coordinated actions. Construction of the collection system will impact both County and City streets in a variety of ways that will need to be addressed by the two agencies.  

Land use planning. The City has recently completed a comprehensive update of the Chico General Plan, which is the foundational document for development of the City and its sphere of influence. Until this update, which enacted fundamental changes to the general plan previously in place, the County and City general plans closely conformed to each other. County and City staffs have begun a review to determine where areas of inconsistency may exist.  

Development standards and impact fees. With certain exceptions, the development standards and regulations of the two agencies are compatible. Further alignment may be considered to ensure that development of the unincorporated area is not substantially at variance with the long-term inclusion of these areas within the city limits. Development impact fees have been adopted fairly consistently by both County and City with few exceptions.

7.2 Annexation Policy

City of Chico Policy Regarding Annexation as a Condition of Sewer Service

It has been the policy of the City Council (Title 15, Water and Sewers, of the Chico Municipal Code), to require annexation as a condition of connection to sewer facilities, if possible. If annexation is not possible, the city requires the property owner to execute an annexation and sewer service agreement before connecting. The requirement for mandatory annexation to the City of Chico appears to be strongly opposed by a number of property owners affected by the Prohibition Order. Proposed annexations of large segments of the Chico Urban Area have historically caused significant debate and keen interest in the public forum.

Annexation Law and the Local Agency Formation Commission

The Butte County Local Agency Formation Commission (LAFCo) is established pursuant to the Cortese-Knox Local Government Reorganization Act of 1985 as set forth in California Government Code §56000, et seq. It consists of seven commissioners drawn from the Butte County Board of Supervisors (2 members), the five incorporated cities in the county (2 members), representatives of special districts in the county (2 members), and one member from the public at large.

The primary purpose of the Butte County LAFCo is "to encourage the orderly growth and development of local agencies within the County, in accordance with the policies and procedures established by the State Legislature..." LAFCo has the authority and responsibility for the following:

LAFCo is specifically charged with encouraging the efficient and economic delivery of public services, while protecting other important state interests such as the preservation of agricultural and open-space lands.  

Government Code §56133 was amended by the California Senate (SB 807, Senate Agriculture and Water Resources Committee) on October 7, 1999. This legislation allows, if certain conditions are met, a LAFCo to authorize a city or special district to extend services outside of its jurisdictional boundaries and outside its sphere of influence to respond to an existing or threatened public health or safety threat to the residents of the affected territory.

Effective January 1, 2000, state law (Assembly Bill 1555, Longville) was amended to establish a modified process when the annexation involves an "island of unincorporated territory." Under this new law "islands" can be annexed without consideration of a protest or City Council hearing. For the purposes of this special process, the territory proposed for annexation must meet the following criteria:

According to the City of Chico Community Development Department (November 1999 memo to City Council), there are approximately 65 "islands of unincorporated territory," ranging in size from a single parcel of 5500 square feet to several hundred parcels in an area exceeding 100 acres. Of these "islands" at least 60 meet the criteria above and could be annexed with the modified process. Approximately 7 of these "islands" include areas that are proposed to be sewered as part of the Nitrate Compliance Plan and the majority of these are located south of Lindo Channel.

Current City policy is to provide assistance to residents and landowners requesting annexation. Should the City of Chico pursue annexation of "unincorporated islands," an amendment of City policy would be required. As of February 2000 the Chico City Council has not yet officially considered the new law regarding the annexation of "islands."

7.3 Proposed Memorandum of Understanding Between County and City

Citing the greater priority of the community health issue and the difficulty of obtaining majority public acceptance, County representatives have requested the City to modify its annexation policy. An ad-hoc committee of the Chico-area Supervisors, City Council members and staff have met to discuss annexation and related issues. The County representatives have expressed the objective of relieving the owners of residential property affected by the Prohibition Order of the annexation requirement. In turn, City representatives have stated their concerns regarding development within the unincorporated portion of the Chico Urban Area, and the logic and public benefit of achieving a community within a single local government jurisdiction.

Discussion of Issues and Draft Provisions

Although it must be emphasized that the parties have not yet reached agreement, negotiations are currently proceeding. The representatives of the County and City have committed to continuing discussions on these matters. The process should be facilitated by completion of the Nitrate Compliance Plan, which may provide further perspective to all participants and assist in problem-solving. The continued good faith efforts of City and County representatives will allow progress on these issues to continue along with the consideration and refinement of the Nitrate Compliance Plan.

The Butte County Local Agency Formation Commission may need to consider and approve certain of these provisions, as well as the full Board of Supervisors and City Council.

7.4 Wastewater Disposal Requirements for New Development

As previously described in Chapter 3, the threshold density which will not cause exceedance of the maximum containment level for nitrate in groundwater beneath the Chico Urban Area has been calculated at approximately four dwelling units per acre. This calculated density is absent an engineering safety factor, however, which is typically applied as standard engineering practice in similar situations. Additional protection for existing dwellings will be afforded by the establishment of a program to monitor onsite systems (see Chapter 6).

Minimum Lot Sizes and Density Limits for New Development

In considering the proposed Nitrate Compliance Plan, the Regional Board will be asked to consider the reasonableness of expanded sewering of existing units, the decreased feasibility and increased cost of sewering lower density neighborhoods, and the effectiveness of alternative measures proposed by the County. These factors may be persuasive for existing systems. However, the Regional Board may view new development served by onsite systems within the Chico Urban Area as an unnecessary contribution to degradation of the aquifer.

Reflecting the County's emphasis on the most cost-effective alternatives, a dual standard for residential density is proposed. The allowable density for existing dwelling units on septic systems, based on acceptable nitrate loading and fully addressed in Chapter 4, is approximately four units per acre. As previously discussed, this density will ensure compliance with the maximum contaminant level for nitrate in groundwater when combined with the other measures, but further development to this density may tend to perpetuate high nitrate loading, due to the lack of an engineering safety factor.

In view of the foregoing, and in pursuit of good land use practice and cooperation with the City of Chico, new residential development within the Chico Urban Area will have a minimum parcel size of 20,000 square feet if it is to be served by a conventional septic system and a density of approximately two dwelling units per acre. This applies a reasonable safety factor to calculated nitrate loading and ensures that long-term water quality will be protected and improved.