2008/10/15 Council Agenda Packet

CITY OF EVERETT FISCAL ANNEXATION ANALYSIS Berk met with City Staff and policy makers to discuss each scenario, and determine which alternatives provided the best opportunities for leveraging existing City resources, utilizing economies of scale and minimize the potential costs of annexation, while still delivering an urban level-of-service to these areas. Because of significant public safety issues, the projected Police staffing levels for the neighborhoods on the west side (Emander, North Creek, and Lake Stickney), it was more likely that the area would require even greater costs per capita in these areas. Neighborhoods on the east side offered opportunities for cost savings because of the land use and demographics of the area, which would likely result in fewer calls for service per capita and provide the City with the ability to offer significant improvements in current service levels at a lower cost per capita relative to the current City average. After eliminating the west side areas due to public safety cost implications,that left the following areas for possible further analysis: • Eastmont • Hilton Lake • Rugg's Lake • Larimer • Cathcart • Silver Firs For three reasons Cathcart and Silver Firs were eliminated from further analysis and consideration: • The sales tax credit allowed by the State is distributed for cities annexing contiguous areas containing 10,000 or 20,000 residents. Therefore, annexing any areas with greater than 20,000 residents adds to the cost of annexation with no additional state sales tax credit, which would have been the case if Cathcart and Silver Firs were annexed. • Because of the large geographic area in these two neighborhoods, and the distance from the current distribution of City services, there are fewer opportunities to use current City facilities or staff to gain economies of scale for costs savings. • Recently the City of Mukilteo submitted an annexation plan to the Boundary Review Board that contained areas outside of their UGA. The Board denied the annexation and required Mukilteo to resubmit an annexation plan to include only those areas within the City UGA. 5.3 Commercial Development Sensitivity One question that might be asked is about the potential for future commercial development of the annexation areas and how that might change the mathematics of evaluating the annexation scenarios. It could be conceivable that an area with low per capita revenues in the present may redevelop and present a more attractive revenue stream for the City in the future. Based on evaluation of buildable lands analysis (see Section "Land-Based Development Assumptions" earlier in the report), Emander and North Creek have the largest commercial development capacity of all Everett's UGAs. ft Final Report October 2008 Page 18