City of Beaumont MSR - Final July 27 2017

Final July 27, 2017 LAFCO 2014-14-5 RIVERSIDE LOCAL AGENCY FORMATION COMMISSION City of Beaumont Municipal Service Review Riverside Local Agency Formation Commission 3850 Vine Street Ste. 240 Riverside, CA 92507 Phone: (951) 369-0631 www.lafco.org Table of Contents I. Overview .............................................................................................................................................. 1 II. Service Review Process .................................................................................................................. 3 III. Agency Overview ............................................................................................................................... 3 A. Governing Body ........................................................................................................................... 4 B. Basic Financial Information ...................................................................................................... 5 C. Population & Growth ................................................................................................................ 10 IV. Services.............................................................................................................................................. 11 A. Police Protection ....................................................................................................................... 11 B. Fire Protection ............................................................................................................................ 14 C. Park and Recreation ................................................................................................................. 16 D. Water and Wastewater ............................................................................................................ 20 E. Road Maintenance .................................................................................................................... 25 F. Street Lighting ........................................................................................................................... 25 G. Street Sweeping ........................................................................................................................ 26 H. Solid Waste ................................................................................................................................. 26 I. Library Service ........................................................................................................................... 26 J. Animal Control ........................................................................................................................... 26 K. Disadvantaged Unincorporated Communities .................................................................. 27 V. Sphere of Influence ......................................................................................................................... 29 VI. Determinations ................................................................................................................................. 30 List of Exhibits City of Beaumont Boundary and Sphere of Influence Map City of Beaumont General Plan Land Use Map City of Beaumont Zoning Map Overview LAFCOs are mandated by the Cortese-Knox-Hertzberg Reorganization Act of 2000 (CKH) to encourage orderly development within their county of jurisdiction. The Act governs the boundaries of special districts and cities, consistent with each agency’s principal act. To implement boundary changes, CKH directs LAFCOs to make reorganization decisions based on several factors, including the need for and efficiency of public services. To promote greater efficiency in services for future planning purposes, CKH mandates LAFCOs to conduct Sphere of Influence (SOI) reviews once every five years, as necessary. SOIs are used as a planning tool for agencies to conduct service and facility planning for areas it intends to serve in the future. A SOI is defined as “a plan for probable physical boundaries and service area of a local agency, as determined by the Commission.” Consistent with Commission SOI policies, a SOI can be a) coterminous to agency boundaries as the ultimate foreseen configuration of the agency in anticipation of no future growth, b) extended beyond the agency boundaries in anticipation of future growth, c) be smaller, indicating the need to detach areas from the agency boundaries, or d) be designated a “zero sphere”, which indicates a potential dissolution of the agency. In order to amend the sphere of influence boundaries, formal approval from the Commission is required. Prior to or in conjunction with SOI reviews, a Municipal Service Review (MSR) must be prepared pursuant to Government Code Section 56430. MSRs are conducted to assist in the SOI review process by providing information regarding the ability of agencies to provide public services. This Municipal Service Review will review the services provided by the City of Beaumont and, to a lesser extent, services provided within the City of Beaumont by other agencies. Pursuant to 56430 (a), the MSR will make the following determinations: (1) Growth and population projections for the affected area. (2) Disadvantaged Unincorporated Communities (DUCs) Characteristics. (3) Present and planned capacity of public facilities and adequacy of public services, including infrastructure needs or deficiencies including needs or deficiencies related to sewers, municipal and industrial water, and structural fire protection in any DUC within or contiguous to the sphere of influence. (4) Financial ability of agencies to provide services. (5) Status of, and opportunities for, shared facilities. (6) Accountability for community service needs, including governmental structure or operational efficiencies. (7) Any other matter related to effective or efficient service delivery, as required by the Commission. Municipal Service Review -City of Beaumont – Final Page 1 Provided below is a summary of what each determination will assess. (1) Growth and population projections for the affected area. This will evaluate the method of projection and its relationship to services and facility planning. (2) Disadvantaged Unincorporated Communities (DUCs) Characteristics. Identifies the location and characteristics of any disadvantaged unincorporated communities within or contiguous to the sphere of influence. (3) Present and planned capacity of public facilities and adequacy of public services, including infrastructure needs or deficiencies including needs or deficiencies related to sewers, municipal and industrial water, and structural fire protection in any DUC within or contiguous to the sphere of influence. This section now requires the Commission to prepare specific written determinations on infrastructure needs or deficiencies related to sewer, water, and fire protection services in any DUC(s) within or contiguous to the sphere of influence of a city or special district that provides those services. The review will assess standard/objective levels of municipal services in relation to the current level of services as well as future plans to attain those objectives and/or maintain existing level of services. (4) Financial ability of agencies to provide services. Identifies the status of reserves, recent expenses vs. revenues, its purpose, tax rate and when the debt will be retired. In addition, general taxes, special taxes and assessments will be identified in relation to the services funded by those monies. In extreme cases, agencies not financially capable of providing the basic services will be identified. (5) Status of, and opportunities for, shared facilities. To promote greater efficiency in public services, the MSR explores opportunities for different agencies to share facilities and/or resources. By sharing facilities or other resources, agencies can eliminate the duplication of studies, planning efforts, staff or equipment, and potentially lower the cost for providing services. (6) Accountability for community service needs, including governmental structure and operational efficiencies. Municipal Service Review -City of Beaumont – Final Page 2 Identifies efforts made by the agency to increase public participation and accountability. Also, discusses whether audits are performed and how they are made available to the public. (7) Any other matter related to effective or efficient service delivery, as required by Commission policy. This will allow LAFCO to identify areas outside an agency’s boundaries currently receiving or requesting services from the agency. Also, identifies inhabited areas within or outside the current sphere of influence that the City anticipates annexing within the next five years or that could benefit from services provided by the agency. Issues unique to a particular agency or geographic area will be explored. I. Service Review Process In preparation of the MSR, public agency input is very important. To begin the MSR process the affected agencies were sent a questionnaire regarding services provided. Through a combination of responses from the questionnaires, follow-up conversations with the agencies and research, the MSR is prepared. Agencies are encouraged to review and comment on a draft prior to the document being presented to the Commission. This is an opportunity to address any concerns of the affected agencies regarding the data presented. After conducting the public hearing, the Commission will adopt determinations and receive and file the MSR. II. Agency Overview The City of Beaumont was incorporated as a general law City on November 18, 1912, predating LAFCOs existence. It is located in the northerly central portion of Riverside County. It is bounded by the City of Calimesa as well as unincorporated areas to the west, to the north by the unincorporated community of Cherry Valley, to the east by the City of Banning, and to the south by unincorporated county areas and the City of San Jacinto. The City encompasses approximately 30 square miles. Beaumont has been an older established small community that with the wake of the housing boom accelerated with significant growth consisting of several single family and rural residential master-planned communities such as the Three Rings Ranch, Tournament Hills, Oak Valley Greens, Sun Cal, Seneca Springs, and Four Seasons. Oak Valley Greens and Tournament Hills are golf course communities. The City has also been home to senior citizens, which in 2013, consisted of approximately ten percent of the City’s population. The City is largely known for its larger new homes. Associated urban uses include commercial, industrial, and public uses. The City’s southern tip is generally undevelopable open space designated as Recreation and Open Space. Municipal Service Review -City of Beaumont – Final Page 3 A. Governing Body The City is governed by a five-member City Council and each Council Member shares equal voting powers on all items coming before the Council. Council members are elected to at-large positions for four-year terms, with elections held in November of even-numbered years. The City Council meets annually to select one of its members to serve as Mayor and another to serve as Mayor Pro Tem for one year but no more than two consecutive years. The City Council provides legislative and policy direction to the City Manager, who implements their decisions to direct the activities of the City. All decisions by the City Council are made at public meetings. The City Council appoints the City Manager and City Attorney and members of all advisory boards, commissions and committees. The City Council also serves as the Board of Directors for the Beaumont Financing Authority, Beaumont Utility Authority, Beaumont Conservation Authority, and Beaumont Successor Agency. Traditionally, the City Council meets regularly on the 1st and 3rd Tuesdays of each month at 6:00 p.m. at the Beaumont Civic Center, 550 E. Sixth Street, Beaumont, CA 92223. Agendas are available prior to the meetings and the minutes are available following approval on the City’s website at: www.ci.beaumont.ca.us. The official posting area for all meeting agendas is located on the bulletin board inside the Civic Center. Anyone wishing to address the City Council on any matter not on the agenda may do so during the oral communications portion of the agenda. As of November of 2016, the City Council’s regularly scheduled meetings are video recorded and are available on YouTube, where they can be streamed live or viewed later. The Planning Commission meetings are held on the second Tuesday of each month at 6:00 p.m. at the Beaumont Civic Center, 550 E. Sixth Street, Beaumont, CA 92223. Agendas are available prior to the meetings. Minutes are available following approval. Anyone wishing to address the Planning Commission on any matter not on the agenda may do so during the oral communications portion of the agenda. Planning Commission as of January 2017 Name Term Beginning Term Ending Nathan Smith January 2015 December 2018 Brian Voss January 2017 December 2019 Paul St. Martin January 2015 December 2018 Jessica Johnsen January 2017 December 2019 Jason Rearick January 2017 December 2019 Since the former City Manager was placed on administrative leave, there have been two City Managers that have served the City. Most recently, as of October 31, 2016, the City has hired a new regular City Manager. The City Manager is the operations officer for the city and is charged with the responsibility of implementing the goals and objectives set by the City Council. The role and responsibilities as a city manager include supervising the day-to-day operations of all city departments, supervising the department heads, and advising the City Council on matters of interest. Municipal Service Review -City of Beaumont – Final Page 4 City Council as of December 2016 Name Title Elected Current Term Expires Nancy Carroll Mayor Pro-Tem November 2016 November 2020 Mike Lara Councilman November 2014 November 2018 Julio Martinez Councilman November 2016 November 2020 Mark Orozco Councilman November 2014 November 2018 Lloyd White Mayor November 2014 November 2018 The City Hall hours of operation are Monday through Thursday from 8:00 a.m. to 5:00 p.m. and Fridays 8:00 a.m. to 12:00 p.m. closing most holidays. B. Basic Financial Information Until recently, the City of Beaumont was in a dire financial situation due to approximately nine years of poor management. Within the last 2-3 fiscal years the City has improved its financial condition and is currently cash solvent and nearing budget solvency from an operating basis, the City has balanced its budget, but their reserves are underfunded. However, the City has service level issues that need to be addressed. Provided is a brief synopsis of the significant fiscal events that have occurred over the past few years, which significantly affected the City’s finances:  The Western Council of Governments (WRCOG) sued the City of Beaumont for keeping or waiving the Transportation Uniform Mitigation Fee (TUMF) that WRCOG was entitled to for regional transportation improvements. o In May of 2014, the court ruled in favor of WRCOG. o The judgment is for $43 million plus accumulated interest. o In September of 2014, the City filed an appeal.  In April of 2015, the Riverside County District Attorney’s (DA) office with the support of the Federal Bureau of Investigation (FBI) began an investigation of the City’s relationship with its consultant of over twenty years, Urban Logic Consultants causing several search warrants to be served and the City’s computers and financial records to be seized.  In April of 2015, the City’s FY 12-13 Audit revealed an unrestricted negative net position of $32.7 million in Governmental Activities and a negative unassigned General Fund Balance close to $7 million.  In May of 2015, the State Controller’s Office (SCO) discovered a discrepancy in the amount of expenditures the City reported to the SCO, which was $50 million less than what was reported in the City’s FY 12-13 financial statements.  In a May 2015 Report, a City consultant, MGO Certified Public Accountants confirmed that the City had been using restricted funds for general fund operations. o The City General Fund had been borrowing from it Community Facilities Districts (CFD) funds to balance its Budget for approximately eight years. o Cumulatively, borrowing was approximately $10 million.  In September of 2015, during the preparation of the FY 15-16 Budget, the Interim City Manager’s Budget Message declared the General Fund Budget was cash insolvent. Municipal Service Review -City of Beaumont – Final Page 5  In September of 2015, the FY 15-16 General Fund was reduced by $4 million in order to balance the budget. This was the first truly balanced budget in several years.  In November of 2015, the SCO issued a report that identified questionable financial transactions of the City and lack of internal controls for fiscal oversight. The report also presented several recommendations for the City to implement and correct the situation.  In December of 2015, the City Council was presented a strategy and timeline to develop a Work Out Plan to Sustainability.  In March of 2016, the City hired a public accounting firm to complete the audit of the FY 14-15 financial statements.  In May of 2016, several former city management staff were arrested for corruption related charges.  In June of 2016, the City’s consultant, presented the City Council with a Beaumont Work Out Plan to Sustainability, which laid out several scenarios with various service assumptions for the City to become fiscally solvent. The goal of the Plan was for the City to become fiscally solvent by FY 22-23 and eliminate its negative General Fund balance of approximately $7.4 million. o City Council directed staff to present the Plan to the general public to allow the citizens to weigh in on the alternatives. o Subsequently, a workshop was held by city staff in August of 2016.  In September of 2016, the City General Fund received a repayment of approximately $5 million, previously advanced to the Wastewater Enterprise Fund in 2014. This further reduced the general fund deficit.  In February of 2017, the City Council accepted the Audited Financial Statements for FY 14-15, including the opinion, Management Discussion & Analysis (MD&A) and minor corrections. o The audit includes a disclaimer opinion, which “is a declination to express an opinion on the fairness of the final statements in conformity with generally accepted accounting principles.” This is due to the City’s inability to produce appropriate documentation for various beginning balances. o The City also addressed several of the Auditor’s recommendations while others are in progress. o The most significant findings, as they relate to the General Fund deficit, inter-fund borrowing, capital assets’ recordation, and the validity of CalPERS eligible City employees, have been addressed. Due to changes in the City’s administration and a healthy housing industry, in May of 2017, the City Council adopted a Balanced Budget for FY 2017-18. A crucial component to the City’s financial status was the reconciliation and closing of the books for FY 2014-15. Although the City is on an upward trend there are lingering ramifications caused by the prior administration’s poor management. The City is under investigation by the Securities Exchange Commission (SEC) and cannot participate in the public bond market. The City however, has the ability to sell bonds through the private bond market, which are generally higher interest, increasing the overall cost of financing. Municipal Service Review -City of Beaumont – Final Page 6 General Fund: A general fund for local municipalities can be generally described as the main operating fund used to account for all general revenues that are not specifically levied or collected for other City funds, and for expenditures for general services provided by the City. The City of Beaumont has generally adopted an annual budget prior to the commencement of the affected fiscal year. The FY 16-17 Budget was adopted June 6, 2016. This marked a return to some stability. In the prior year, the FY 15-16 Budget was not adopted until September 14, 2015, two and a half months into the fiscal year. This was largely due to an abrupt change in city management and several unprecedented occurrences as briefly described above. Over the course of three fiscal years, the City has made significant progress toward addressing its negative financial position. The FY 15-16 General Fund Budget included $4 million of expenditure reductions. This was achieved by the elimination of 23.5 positions (-$1.5 million), salary reductions (-$1.5 million), and reducing consulting contracts (-$1 million). In FY 16-17 the City received one-time revenues of $8 million. Approximately $3 million is related to a development agreement extension negotiation. The remaining $5 million is a discretionary transfer from the Wastewater Enterprise Fund. Memorandums of Understandings (MOU) with bargaining units were also amended to reduce payroll related expenses comparable to the current labor market. At the close of the 16-17 fiscal year, revenues are projected higher than budget and expenditures are expected to be below budget, resulting in a surplus of approximately $2.5 million. With the combination of these strategies, the General Fund balance deficit of approximately $4.4 million has been eliminated. Currently, the City is cash solvent. It is no longer operating at a deficit and is expected to have sufficient carryover to allocate funds to reserves. The FY 17-18 Budget calls for reserve allocations of approximately $6.1 million. Approximately $4.6 million is allocated to the General Fund Unobligated Reserve (14.9% of operating expenses) and $1.5 million to Insurance Reserves. In order to become budget solvent, the City has indicated its capital reserve fund needs a minimum balance of $2 million for the replacement and maintenance of vehicles, equipment and facilities. Provided is a snapshot of the City’s General Fund Budget: FY 11-12 FY 12-13 FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 General Fund Audited Audited Audited Audited Preliminary Projected Budget Revenues $27,647,828 $25,634,643 $27,269,466 $28,239,671 $29,784,170 $30,751,362 $31,188,310 Expenditures $29,723,148 $30,301,776 $30,604,221 $48,906,153 $26,733,221 $28,230,696 $31,188,310 Surplus/Deficit ($2,075,320) ($4,667,133) ($3,334,755) ($20,666,482) $3,050,949 $2,520,666 $0 The $20 million deficit presented in the table above for FY 14-15 is Redevelopment Agency (RDA) reimbursement that is no longer being considered due or payable to the City and as such was recorded as an expense. Since the City has achieved financial stability, the “Work Out Plan to Sustainability” is being revamped. City staff are working to develop a fiscal sustainability model to identify all revenues sources and sustain the FY 2018 service levels for the next five years. This is a multi-year model that will determine when additional revenues will be available to meet the growing service needs. Municipal Service Review -City of Beaumont – Final Page 7 General Fund FY 11-12 FY 12-13 FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 Discretionary Revenues Audited Audited Audited Audited Preliminary Projected Budget Property Taxes $2,601,805 $3,314,109 $2,846,677 $3,894,320 $3,430,325 $3,309,000 $3,888,000 Property Transfer Tax $117,475 $145,611 $186,310 $241,382 $202,094 $215,000 $230,000 Sales Taxes $3,732,539 $3,846,904 $4,149,782 $4,209,246 $3,665,722 $4,715,000 $5,648,630 Franchise Fees $787,791 $837,617 $882,609 $944,869 $929,261 $850,000 $867,180 Transient Occupancy Tax $205,074 $235,656 $225,093 $224,705 $213,141 $217,500 $150,000 Utility User Tax $1,268,937 $1,284,708 $1,366,836 $1,373,661 $1,804,096 $1,600,000 $1,500,000 VLF Revenues $2,582,829 $2,637,026 $2,709,016 $3,244,340 $3,584,034 $3,804,000 $3,800,000 Total $11,296,450 $12,301,631 $12,366,323 $14,132,523 $13,828,673 $14,710,500 $16,083,810 Fund Balance: The General Fund’s Unassigned Fund Balance serves as the City’s reserve fund. Based on the City’s FY 14-15 financial statements, the fund balance was a negative $7.4 million. Considering the repayment of $5 million by the City’s Wastewater Enterprise Fund to the General Fund and other one-time revenue totaling approximately $8 million, the deficit was eliminated. The City projects, FY 16-17 will close on a positive note and with an operating surplus of approximately $2.5 million and a total surplus of approximately $10.5 million. Approximately $6.1 million will be allocated to reserves. GENERAL UNASSIGNED FUND BALANCE FY 10-11 FY 11-12 FY 12-13 FY 13-14 FY 14-15 FY 15-16 FY 16-17 Audited Audited Audited Audited Audited Preliminary Projected Beginning Balance $(10,277,406.00) $(10,871,057.00) $(4,162,063.00) $(6,866,481.00) $(6,354,884.00) $(7,438,424.00) $(4,387,375.00) Increase/ (Decrease) $ (593,651.00) $ 6,708,994.00 $(2,704,418.00) $ 511,597.00 $(1,083,540.00) $ 3,051,049.00 $ 6,133,291.00 Transfer to Reserves $ 6,133,191.00 Ending Balance $(10,871,057.00) $ (4,162,063.00) $(6,866,481.00) $(6,354,884.00) $(7,438,424.00) $(4,387,375.00) $ - Liabilities: As briefly mentioned previously, the City of Beaumont General Fund borrowed approximately $10 million from its CFD capital project funds. Over the course of seven fiscal years, the City has been operating at a structural deficit, yet closing each of those fiscal years beginning in FY 07-08 on a positive note by transferring money from capital project funds to its General Fund. The $10 million was a liability owed by the City, causing the General Fund Balance to be negative by that same amount. Due to an upward trend in the housing economy, which has generated greater than anticipated revenues and the one-time revenue of $8 million, the City was able to replenish the CFD capital project funds. At the close of FY 16-17, there will no longer be a debt/liability to the CFD capital project funds. A significant liability for the City was the WRCOG TUMF settlement that reached approximately $62 million. In April of 2017, the litigation was settled. As a result, a settlement agreement was entered into by the City and WRCOG. The agreement requires the City to complete road improvements in designated areas totaling approximately $7.1 million. The City has indicated the City’s transportation impact fees will be used to fund the improvements. In addition, the City’s portion of Measure A revenues, up to a maximum of $9.4 million, will be shared with WRCOG. The City will also share future recovered proceeds of litigation against former city management Municipal Service Review -City of Beaumont – Final Page 8 currently estimated at $31 million. In the event that no funds or limited funds are recovered, the City will guarantee $8 million to WRCOG. As with most public agencies, general liabilities are long-term and include net pension liabilities, compensated absences and claims payable. In addition, the City of Beaumont’s long-term liabilities include payments due to the Successor Agency (related to redevelopment) and AB 1484 Due Diligence for the State Controller’s review of the City’s Administration and Internal Accounting Controls. The table below lists the City’s long-term liabilities as of June 30, 2015. LONG-TERM LIABILITIES Governmental Business-type Activities Activities TOTAL Net Pension Liability $ 10,524,787 $ 491,132 $11,015,919 Payable to Successor Agency $ 4,235,674 $ - $ 4,235,674 AB 1484 Due Diligence $ 2,575,912 $ - $ 2,575,912 Compensated Absences $ 1,963,488 $ 200,672 $ 2,164,160 Claims Payable $ 1,423,587 $ - $ 1,423,587 TOTALS $ 20,723,448 $ 691,804 $21,415,252 Accountability: Annual audits have generally been performed on the financial statements of the City of Beaumont on a regular basis through FY 13-14. Although the City’s financial statements were audited, beginning in FY 07-08, the Management Discussion and Analysis (MD&A) was not prepared. The Governmental Accounting Standards Board (GASB) requires an MD&A to be prepared by staff of the affected agencies. The MD&A conveys the affected agency’s financial performance, based on existing conditions, and can put the financial statements in a broader context, including activities that have occurred after the audit period. In FY 12-13, the City’s financial audit reported the City’s Governmental Activities had a deficit in unrestricted net position of $32,707,527 and the General Fund had a deficit in unassigned fund balance of $6,866,481. The following year’s audit for FY 13-14 became the second year where the audits declared a “going concern” regarding the City’s financial statements. As such, a “going concern” is indicative of an agency’s inability to continue operating as it has been. The City has not yet accepted the FY 13-14 Audit and does not consider it final. In August of 2015, the City hired an auditing firm to prepare an audit for FY 14-15. A complete audit of the City’s financial statements was completed in January of 2016, presented and accepted by the City Council February 7, 2017. The Auditor provided the City with a “disclaimer opinion” because the auditing firm was unable to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion. This is largely due to records seized by agencies investigating the City, the City not recording capital assets, the City combining individual restricted and unrestricted development impact fees, not properly accounting for restricted property assessments, and the City not having sufficient documentation supporting General Fund expenditures. Municipal Service Review -City of Beaumont – Final Page 9 As of June 30, 2015, the unrestricted net position of City-wide reporting was a negative $92.7 million, $62 million consisting of the WRCOG liability, followed by the City’s net pension liability of $11 million. The General Fund had a deficit of approximately $7 million. The City has been absolved of the WRCOG $62 million and the General Fund deficit was eliminated. The Internal Control findings and recommendations prepared by the Auditor found there was a deficiency in the internal controls that would not allow management or employees in the normal course of performing functions and duties to prevent, detect and correct, misstatements in a timely manner. In addition, several material weaknesses were identified and recommendations were made to correct the deficiencies. Generally, the audit identified areas where the City needed to develop policies and procedures regarding accounting, segregation of duties, implementation of budgetary controls for the General Fund, timely reconciliation of transactions, proper documentation and approvals for cash disbursements as well as payroll, and complying with its policy for competitive bidding. The City has responded to the internal control recommendations and has indicated policies for accounting, financial management, investment, fixed assets and capital improvements have been adopted. The City has also addressed several of the findings most significantly, the General Fund deficit, which has been reconciled, quantified, and steps have been taken to correct the deficit and eliminate the inter-fund borrowing. Several financial software system upgrades were also completed to improve record keeping, separation of duties and the reconciliation of the transactions. Competitive bidding has been in process since July of 2015. Other corrective measures are in process such as an Overhead Allocation Study and the reconciliation of Development Impact Fees (DIF) as of June 30, 2016. It is expected that the FY 15-16 financial statements will be audited within the next few months. Population & Growth The City of Beaumont has experienced significant growth in a short period of time, as briefly discussed below: Year 1990 2000 2005 2010 2016 2017 Population 9,685 11,384 20,090 36,877 45,118 46,179 Source: DOF From 2000 to 2010, the City’s population tripled and between 2000 and 2016, the City’s population quadrupled. As of January 1, 2017, the population of the City of Beaumont was estimated at 46,179 by the State Department of Finance (DOF). This is an increase of approximately 25% within a seven year period. Existing projections continue to demonstrate a continued accelerated growth rate. Based on the 2013 Riverside County Progress Report, the City’s population is projected at 56,534 by 2020 and 79,534 by 2035. This represents increases of 25 percent and 76 percent, respectively, over the current DOF estimate. In the last seven years, an estimated 1,900 new housing units have been constructed within the City of Beaumont. Between 2013 and 2015, the City has had the highest percentage of new homes constructed in comparison to the number of existing homes within the incorporated areas. For being one of the smallest cities in the County, an average of 400 new homes are being built Municipal Service Review -City of Beaumont – Final Page 10 within the City, which ranks 4th in the number of new homes within the incorporated areas for 2016. Based on the population and housing units the population per household is increasing. City of Beaumont Demographic Information 2011 2012 2013 2014 2015 2016 2017 Population 38,034 38,851 39,776 40,853 42,851 45,118 46,179 Housing Units 13,262 13,445 13,668 13,975 14,461 14,864 15,200 Employment 15,300 15,900 16,600 17,700 18,400 18,600* 19,500** Source: State Employment Development Dept.(EDD); *EDD 2016 Avg. through Oct; 2013 Riverside County Progress Report; **EDD April Preliminary For the month of April 2017, the City of Beaumont was reported to have the lowest unemployment rate of 2.8% in comparison to all of the cities in Riverside County (EDD). At this rate, the labor force in the City of Beaumont is 20,000 of which 19,500 are employed. The unemployment rate has been decreasing and dropped by more than half between 2011 and 2013. Historically, most of the City’s working residents have commuted to work. As of 2013, 9.5% of the residents lived and worked in the City of Beaumont, while the remainder, 90.5% commuted to work (Southern California Association of Governments (SCAG), Beaumont Profile, 2013-2014). As of 2013, there were 6,155 total jobs in the City, 24% in Retail, 6.2% in Professional and Management, 5.9% in Manufacturing, and 5% in Construction. Between 2007 and 2013, there was a trend downward for Construction jobs with a decline of 42.2%. The Retail Industry experienced the most growth during that timeframe and increased at 24%. III. Services The City of Beaumont provides several municipal and administrative services. Services are provided by City staff, private firms through contracts, and by contracting with public agencies. The City has its own City Police Department. In addition, the City provides wastewater collection, disposal and treatment. The City contracts with the County to provide fire protection services. Most animal control services are provided by the City, while shelters are provided through contract by the Ramona Humane Society via contract. Three special districts operate within the city limits for other direct municipal services. Beaumont Cherry Valley Water District (BCVWD) provides water services. The Beaumont Recreation and Park District provides park and recreation services City-wide. Lastly, Beaumont Library District provides library services to city residents. A. Police Protection The City of Beaumont is one of 11 cities in Riverside County that operates its own Police Department. The Beaumont Police Station is located at 660 Orange Avenue, across the street from City Hall. Municipal Service Review -City of Beaumont – Final Page 11 As of 2016, the City has indicated it has 38 sworn officers. This is a significant reduction from previous years. From 2010 through 2013, the figure ranged from a high of 59 officers to a low of 56. In addition to patrol services, the Department has a Detective Bureau that is responsible for conducting investigations leading to the apprehension and conviction of both misdemeanor and felony offenders. The City’s COPPS (Community Oriented Policing and Problem Solving) Team works with neighborhoods with an emphasis on prevention. The City also participates in regional partnerships, including the Riverside County Gang Task Force and the East Valley Street Enforcement Team, which is a joint effort with the City of Redlands targeting illegal drug activities. Between FY 09-10 and 13-14 expenditures for police services had been very stable. In FY 09-10, expenditures were approximately $10.1 million, increasing a total of only 2.3 percent over the next four years to $10.33 million. The City’s FY 14-15 Budget called for a reduction to $9.8 million, followed by the FY 15-16 Budget appropriation at $8.7 million. The FY 16-17 Budget increased police protection expenditures to $10.5 million, slightly higher than they were at their highest however, actual year end projections are expected to be $8.7 million. The FY 17-18 Budget for police protection services is approximately $9.8 million, an increase of approximately 13% in comparison to FY 16-17 projected year end. The FY 17-18 Budget increases the number of sworn officer personnel to 42. Once those positions are filled at a population of 46,179, the officer to population would increase to .90 officers per 1,000 population. There are no perfect metrics to evaluate law enforcement services. Common indicators for demand and service provision each have limitations. Among the data included in this MSR are calls for service, crime statistics, response times, population, number of patrols and number of deputies. The information below is presented as a reference and can be used for comparison purposes with other agencies. However, caution should be exercised when comparing data between agencies. Different jurisdictions can have quite different characteristics, making direct comparisons less meaningful. For example, comparing data from a primarily suburban residential city with one that is a tourist destination or large employment center might not be particularly useful. One measure of demand is the number of calls received within the agency. Between 2009 and 2016, the total number of calls increased by approximately 15 percent, substantially less than the 32 percent increase in population over the same period. Call Activity 2009 2010 2011 2012 2013 2014 2015 2016 Total Calls 43,352 58,669 52,275 55,104 60,886 57,763 50,791 49,773 Population 34,387 36,468 38,033 38,877 39,734 40,853 43,601 45,118 *Population estimate used by the FBI to calculate crime rates differs slightly from DOF estimates. Known crimes as reported by the City to the FBI are shown below for the years 2009 through 2014. These crimes do not represent all criminal activity, only those standard offenses that are reported to the FBI for statistical purposes. These figures are useful for demonstrating trends in overall crime and specific types of offenses. While the number of crimes against people has remained relatively stable, property crimes have increased substantially in recent years. Almost all of the increase is attributable to non-auto thefts. Municipal Service Review -City of Beaumont – Final Page 12 Violent and Property Crimes 2009-2015* Year 2009 2010 2011 2012 2013 2014 2015 Population** 34,387 36,877 38,033 38,877 39,734 40,853 45,118 Total Violent Crimes 85 87 89 103 85 71 138 Murder/Manslaughter 0 0 2 0 1 0 1 Rape 9 6 6 7 8 8 17 Robbery 15 16 14 16 20 19 21 Aggravated Assault 61 65 67 80 56 44 99 Total Property Crime 897 781 980 1342 1298 974 877 Burglary 190 173 216 192 180 171 157 Theft 630 543 676 1061 1015 707 582 Auto Theft 77 65 88 89 103 96 148 *Crime data is from the FBI Uniform Crime Reports for 2009-2012. Crime data for 2013-2014 is from the Dept. of Justice, Office of the Attorney General **Population estimates shown are from the State Dept. of Finance. Population estimates used by the FBI to calculate crime rates may differ from DOF estimates. The following table shows violent and property crimes expressed as a ratio to population for the City of Beaumont, nearby cities and the State for the years 2008-2014. Expressing crime as a rate allows for direct comparison between cities, although the warning provided earlier applies. The violent crime rate in Beaumont compares very favorably with other area cities and the State. For 2014, the City’s rate is approximately 45.6 percent lower than the average of the other five nearby cities. Although all of the cities included in the comparison tables had a decline in the violent and property crime rates between 2013 and 2014, the City of Beaumont rates are significantly less, with the exception of the City of Yucaipa’s rates. The rates between the Cities of Yucaipa and Beaumont are very similar. Violent Crime Rate Reported Offenses per 100,000 Population* 2008 2009 2010 2011 2012 2013 2014 Beaumont 210.5 231.0 235.9 238.5 270.5 211.4 171.8 Banning 556.7 544.5 523.6 530.9 484.6 422.9 417 Hemet 594.8 516.5 469.1 453.6 499.9 547.1 521.8 Moreno Valley 553.0 467.2 374.4 374.2 353.6 317 287.8 San Jacinto 409.1 404.0 244.3 263.9 300.2 271.3 218.5 Yucaipa 162.1 252.1 270.6 227.0 226.1 203.7 134.5 California 504.2 473.3 439.6 411.2 423.1 402.6 369.1 *Population estimates used by the FBI to calculate crime rates may differ from DOF estimates. Municipal Service Review -City of Beaumont – Final Page 13 Property Crime Rate Reported Offenses per 100,000 Population 2008 2009 2010 2011 2012 2013 2014 Beaumont 2370.8 2437.5 2117.9 2626.6 3524.9 2648.9 2016.4 Banning 2488.6 1927.8 1844.4 2370.5 2318.2 3228.2 2357.0 Hemet 4674.8 3923.1 3670.4 4362.8 4292.4 4850.8 4073.4 Moreno Valley 3201.7 3022.6 2700.6 2945.2 3190.7 2917.3 3159 San Jacinto 3834.0 3468.2 3101.9 3269.3 3240.8 3948.5 4057.0 Yucaipa 1832.0 2028.3 1567.2 1731.7 1793.9 1763 1852.5 California 2941.0 2731.0 2629.9 2584.2 2758.7 2651.21 2441.1 *Population estimate used by the FBI to calculate crime rates differs slightly from DOF estimates. A commonly used measure of service is the number of sworn personnel per 1,000 population. The City has a target ration of 1.0 to 1.2 officers per 1,000 population, which is reviewed annually. Based on the FY 16-17 Budget, the City has approximately .89 officers per 1,000 population. This is a significant drop from the 2014 ratio of 1.41 in FY 13-14. This reduction was due to an elimination of multiple joint task forces and auxiliary positions. The number of officers assigned to patrol remained constant. The FY 17-18 Budget calls for two additional patrol officers and creates a deputy chief position, increasing overall police protection services in the City to approximately .93 officers per 1,000 population. Looking at the officer-to-population ratio alone can be misleading when making comparisons between agencies. For example, given similar officer-to-population ratios and call characteristics, an agency with a more compact service area would be expected to respond to calls quicker than in an agency with a sparsely populated rural service area. Another way of looking at coverage would be the average area per patrol. The City is divided into a four beat patrol grid with each beat having an assigned officer to patrol in the area. The response times are an average of three minutes for in progress calls. Based on a total area of the City of approximately 31 square miles, the average coverage per regular patrol is approximately 7.75 to 10.33 square miles. However, over 40 percent of the area of the City is vacant mountainous territory that would not require routine patrol. This would substantially reduce the effective average size of patrol areas. The City of Beaumont Police Department tracks calls on the basis of either in progress or past. For 2014, the City reported response times for in progress calls were 3.2 minutes and 6.4 minutes for past calls. In 2015, the response times were 2.9 minutes for in progress calls and 5.9 minutes for past calls. B. Fire Protection The City contracts with the County of Riverside for fire protection services. In turn, the County contracts with the California Department of Forestry and Fire Protection (CalFire). The full-service contract also provides for dispatch, emergency medical response, fire prevention and fire safety education programs. Although contract costs are generally based on stations, apparatus and personnel located within each contracting city, service is provided as part of the County Fire Department’s coordinated regional network. Municipal Service Review -City of Beaumont – Final Page 14 Fire protection services are funded by City general funds. Fire protection expenditures represented approximately 27 percent of the City’s General Fund budget for FY 2014-15. The City does not levy any additional special taxes to support fire protection and emergency services. Units responding to an incident may be dispatched from stations either within or outside of the City. Conversely, stations located within Beaumont can also respond to incidents in adjacent contract cities and unincorporated areas. Two fire stations are currently located within the City’s boundaries. The station number, approximate location and apparatus are shown in the table below. Station 66, located near downtown Beaumont is the City’s primary station. Station 20 is on the eastern edge of the City near the Beaumont/Banning boundary. The engine company operating out of this station is technically a resource that is part of the City of Banning contract with the County. However, operational funding for this Station and the associated apparatus, which is owned by CALFire, is shared equally between Beaumont, Banning and the County. Like nearly all engine companies in the County’s system, engine companies serving Beaumont are staffed with three persons, including paramedic personnel. Fire Protection Facilities Fire Station No. Location Equipment Station No. 66 628 Maple Ave. Two Paramedic Engines (one staffed, one (Beaumont City) reserve) One Rescue Squad (not staffed) Station No. 20 1550 6th St. One Paramedic Engine (contracted to (Beaumont) Banning; County and Beaumont also participate in funding) In addition to these stations, response may also come on an occasional or regular basis from nearby Station 22 in Cherry Valley, approximately 1.2 miles north of the City and Station 21 in Calimesa, approximately 4.1 miles north of Beaumont. In 2015, County Fire Department units responded to 3,176 incidents within the City of Beaumont, a 4.85 percent increase from 2014. In 2015, approximately 79 percent of calls in Beaumont were for medical aid, slightly higher than the County system average of 75.2 percent. The next highest frequency incidents in the City for 2015 were, in descending order, responses to false alarms (5.7%), traffic collisions (5.2%), and public service assistance (4.9%). Fire calls, including structure, vehicle, wildland and other fires, accounted for approximately 2.4 percent of calls in 2015, slightly lower than to the 2.9 percent system-wide figure. (Call data from Riverside County Fire Department 2015 Annual Report.) The Fire Department has the following response time targets: 911 processing/dispatch: 1:20 Turnout: 1:00 Drive time: less than 5 minutes 90 percent of the time. The Fire Department tracks response times within the City of Beaumont. Provided is a description of average response times in 2016. The citywide average response times were 7.3 minutes. Municipal Service Review -City of Beaumont – Final Page 15 Approximately 74 percent were responded to in fewer than five minutes. Approximately 94 percent were responded in fewer than 10 minutes. Fire Station 20’s engine responded to 1,011 calls for service and maintained a 3.8 minute average response time in the City. Approximately 78% of the call volume was answered in fewer than 5 minutes. Fire Station 66’s engine responded to 1,581 calls for service and maintained a 10.2 minute average response time in the City. Approximately 73% of the call volume from Station No. 66 was answered in few than five minutes. Although response times in core of Beaumont generally met the target, the lower average is due to the extended travel times and increasing response frequency in the western portion of the City. Most of the territory west of the SR 60/I-10 junction is beyond a five minute response time. Some residential areas in the westernmost portion of the City are more than five miles from the nearest fire station. Additionally, there are currently no stations south of I-10. The City is in the planning process for a new fire station in this general area. A part of an MOU between a property owner and City, 5 acres are being dedicated to the City as a potential west-side fire station in this general area, fronting Potrero Blvd. in the westerly corridor of SR60 and I-10. The City has appropriated approximately $10,000 from the Fire Station Mitigation fee Fund to prepare and process the Grand Deed and Title associated with the dedication of this site. It is anticipated that the City will have adequate funds to construct the station within the next 3-5 years. The ongoing operation and maintenance costs are estimated at $1.1 million. The City is evaluating to fund the annual costs associated with the operation of the proposed west-side fire station. Red markers indicate City Fire Stations. C. Park and Recreation Park and recreation services in the area are provided by two local agencies, the City of Beaumont and the Beaumont-Cherry Valley Recreation and Park District (BCVRPD). City park and Municipal Service Review -City of Beaumont – Final Page 16 recreation services are exclusively provided within the city limits. The District’s park and recreation services are provided to a broader area, inclusive of the City and adjacent unincorporated communities, most notably, Cherry Valley. There is an existing overlap in services provided by the City and the District. The City does not have a contract for services with the District and there are no joint programs. The City is currently operating a total of 34 parks and facilities with a total of approximately 261 acres. The City states that their current standard condition is consistent with City standards and the Beaumont General Plan, the subdivider is obligated to provide fully improved park space at a ratio of 5 acres of parkland and full improvements per 1,000 population. The City is currently operating at 3.03 acres per 1,000 residents based on the City’s current estimated population of 46,179 residents. This is lower than the City’s standard. The most recent park developed in the City of Beaumont is Nicklaus Park, which opened in October of 2016. It is located within the City at the corner of Oak Valley Parkway and Palmer Avenue. It is a 22-acre park with a nine-hole disc golf course, a tot playground, a dog park and several other amenities. Other than those parks identified within in each approved City Specific Plan, no other future public parks are being proposed at this time. An additional 113.81 acres of improved park facilities are conditioned within a tentative tract map or specific plan for future residential subdivisions. Future parks will either be maintained by the City or respective HOA. The City operates a pool and senior center and provides various other recreation programs. The cost of these programs amount to $806,000 and the City receives revenue of $200,000 (25 percent of costs). City staff also provides park and ground maintenance services. The City is evaluating options for maintenance and operations that improve cost efficiencies. The City will continue to evaluate these options in addition to considering an increase to user fees. Local governments in California provide a critical role in the effort to set aside parkland and open space for recreational purposes. The Quimby Act (California Government Code §66477) was passed in 1975. Cities and counties have been authorized to pass ordinances requiring that developers set aside land, donate conservation easements, or pay fees for park improvements. Revenues generated through the Quimby Act cannot be used for the operation and maintenance of park facilities. The requirement formula is three acres of land per one thousand people calculated by multiplying the number of dwelling units times the average density per dwelling unit in each municipal boundary according to the latest U.S. Census. In‐lieu fees are based on the fair market value of land within a subdivision. Development impact fees are one‐time charges imposed on development projects to recover capital costs for public facilities needed to serve those new developments and the additional residents, employees, and visitors they bring to the community. California law, with a few minor exceptions, prohibits the use of impact fees for ongoing maintenance or operations costs. New development proposals in Beaumont involving a tentative map or parcel map would pay fees, dedicate land, or both, directly for park and recreation review purposes in accord with the Quimby Act and must show proof of payment to obtain a permit. Development proposals are sent to the City of Beaumont for review and input on servicing aspects as related to the proposed development. The City has started a Development Impact Fees study and estimates completion of the end of 2017. Municipal Service Review -City of Beaumont – Final Page 17 The BCVRPD does not collect Quimby Act Fees within the City. Quimby Act fees provide for additional parkland, which should offset the demands of new development within the District’s boundaries. To supplement the District’s facilities in a cost-saving manner, the District has a joint use agreement with the Beaumont Unified School District for the use of the School District’s facilities (i.e., classrooms, gymnasium, and other athletic facilities). BCVRPD has adopted a service provision standard of 5 acres of parkland per 1,000 residents. Within the boundaries of the City, BCVRPD operates three parks and facilities estimated at 62 acres, yielding a ratio of 1.5 acres of park space per 1,000 population. Provided are several of the recreation programs provided by the District and well as a list of annual events. Recreation Programs Provided by Beaumont-Cherry Valley Recreation and Park District Martial Arts (Karate, Ilokano) Exercise (Gymnastics) Music (Guitar) Yoga Story Time Zumba Taking off Pounds Sensibly Dog Training Skyhawk Camp (Baseball, Soccer, Flag Art (Foundation in Art) Football) Events Provided by Beaumont-Cherry Valley Recreation and Park District BYB Opening Day - February BYB Closing Day – May VFW Flag Retiring – February and June Movies Under the Stars – June through July Annual Spring Fling (Egg Hunt) – March or Noble Creek Music Festival – August April Welcome Home Vietnam Veterans Day Park Closure – Last two weeks of August – March 30th Fishing Derby – April Annual Oktoberfest – September Arbor Day – End of April Pumpkin Carve – October Memorial Wall Dedication – May Annual Winterfest – First weekend in December Adult Softball – Winter, Spring, Summer and Fall League programs. Municipal Service Review -City of Beaumont – Final Page 18 The following table shows park and recreational facilities the City of Beaumont and BCVRPD maintain and operation within the city limits: Municipal Service Review -City of Beaumont – Final Page 19 Planned Future Parks within the City of Beaumont Approved for 4,000 st foot club house, Aerobics, pool, spa, BBQ, tennis courts, Four Season Rec Center 3 395 Four Season Circle 4.2 pickleball, walking track, etc Approved for fitness Center, billards room, pools, spa, pickle ball courts, BBQ, Sundance PA 32 Rec Center Sundance PA 32 7.52 amphitheater, etc Sundance Trail and Open Space Areas Approved not Constructed Sundance PA 37 Park Sundance PA 37 3 In Specific Plan Heartland Park Areas (Parcel 14 & 19) PM 34880 Lot 14 & 19 36 In Specific Plan Noble Creek Vistas SP Park and Open Space SP Located: SWC Brookside & 37.58 In Specific Plan Areas Beaumont Ave SP Located: SWC Oak Valley Kirkwood SP Park Areas 7 In Specific Plan Parkway and Elm Ave Fairway Canyon PA 17 35350 Mickelson 7.53 In Specific Plan Fairway Canyon PA 21B Sorenstam Drive 8.08 In Specific Plan Tourment Hills 3 Park TM 36307 2.9 In Tract Map Total Planned Future Park Acreage 113.81 Tallying the aggregate acreage of the all of the parks and facilities maintained by the City and BCVRPD, within the City limits, a total of 4.35 acres of parkland per 1,000 population is being provided. This is higher than the City’s standard. Riverside County Regional Park and Open Space District owns and operates regional facilities in the area. However, the focus of the MSR is on local municipal services. Therefore, the regional facilities are not discussed in this report. D. Water and Wastewater Water: Water services in the City of Beaumont are provided by Beaumont Cherry Valley Water District (BCVWD), the local water retailer. The service area of the District encompasses the City of Beaumont and surrounding unincorporated area, including Cherry Valley. The District serves over 50,000 residents. The District’s water system consists of 24 wells, one recharge facility and 14 reservoirs with nearly 22 million gallons of storage capacity. This is sufficient storage to meet the demand of slightly more than two average days. Two of its major water supply sources include groundwater from the Beaumont Basin and imported water purchased from the State Water Contractor, San Gorgonio Pass Water Agency (SGPWA). A very minor source is surface water, which comes from diversions and streams. The Beaumont Basin is adjudicated and overlying water rights were allocated at the 2004 safe yield of 8,650 acre-feet per year (AFY). Any unused overlying rights could be used by the appropriators, including BCVWD. The 2004 Beaumont Basin Adjudication also allowed for a temporary overdraft of 16,000 AFY for the first ten years. During this time period any unused amounts were credited to appropriators’ accounts for future use. BCVWD was able to “bank” 39,725 acre-feet during the ten year period. The safe yield of the basin is evaluated every ten years. The current safe yield is 6,700 AFY, which is significantly less than the initial 8,650 AFY. This reduces the amount of groundwater available to all of its users for the next ten years. Based on the BCVWD 2013 UWMP, for 2015, the District’s water resources include approximately 1,500 acre-feet/year of groundwater from the Beaumont Basin Adjudication, an estimated 451 acre-feet from unused allocated overlying water rights, approximately 2,260 acre-feet/year from the Edgar Canyon Basin, an estimated 2,300 acre-feet imported water purchased from San Gorgonio Water Agency (SGPWA), and 1,500 acre-feet of non-potable water supply. However, Municipal Service Review -City of Beaumont – Final Page 20 to date non-potable water supplies are unavailable to the District, decreasing its water supply to an estimated 6,600 acre-feet in 2015. The total water demand for 2015 was estimated at 12,453 acre-feet, creating a water deficit of approximately 5,900 acre-feet. Since the UWMP includes a non-potable water supply of 1,500 acre-feet, the deficiency in water supply is estimated at 4,400 acre-feet, which would be offset by its Beaumont Basin storage account of 39,725 acre-feet. At an annual deficit of 4,400 acre-feet, the storage account would be exhausted in approximately nine years (BCVWD, 2013 UWMP, P. 4-37). Based on the UWMP estimated demand projections beyond 2020 and the unavailable non-potable water supply, the water deficit will continue to increase. This would cause BCVWD to exhaust its storage account sooner than nine years. According to the 2015 BCVWD Operating Budget, the District provides retail water services to approximately 16,577 service connections with an estimated water demand of 11,000 acre-feet. Although the demand is significantly less than anticipated in the UWMP for 2015, a water shortage still remains. The water banked in the Beaumont Basin is meeting the current shortfalls, however, it is a temporary solution. As a more permanent solution, the UWMP indicates additional purchases of imported water would be required to meet the projected water demand of BCVWD through 2035. As a base figure BCVWD estimates it will receive 3,040 acre-feet/year of the SGPWA allocation of SWP water. In addition to this 3,040 AFY, BCVWD would require purchases of other imported water supply sources ranging between 4,400 and 9,800 acre-feet annually to meet its water demands through 2035. Water supply projections are based on three different scenarios. Depending on the scenario, additional imported water supplies are needed as early as 2023 and as late as 2028 through 2035. It has been the intent of the State Water Contractor, SGPWA to purchase additional water supplies to meet the water demands of the Pass Area retailers, including BCVWD. With the implementation of a water capacity fee, SGPWA will seek new water rights to purchase additional water supplies. The details on how the water capacity fee will be collected is being developed. In the meantime, SGPWA is negotiating the purchase of supplemental imported water supplies to meet the demands in the general San Gorgonio Pass Area. Currently, SGPWA’s State Water Project (SWP) Table A entitlement is 17,300 acre-feet/year. The SWP allocation has been as follows, for the past five years: Year Approved Percentage Allocation of Table A 2016 10,380 AF 60% 2015 3,460 AF 20% 2014 865 AF 5% 2013 6,055 AF 35% 2012 11,245 AF 65% 5-yr Avg. 6,401 AF 37% Since 2012, the average SWP allocation available to SGPWA has been 37% or approximately an average of 6,401 acre-feet in a five year period. Due to the unreliability of SWP allocations, the Municipal Service Review -City of Beaumont – Final Page 21 limited local water supplies, and the increased water demand projections, additional new water supplies are required to sustain growth in the San Gorgonio Pass area inclusive of the City of Beaumont. In addition, to reduce dependency on imported water supplies BCVWD is exploring other alternatives such as conservation, a stormwater capture project, implementation of a groundwater extraction system in San Timoteo Creek, and implementation of a high nitrate groundwater extraction system at the mouth of Little San Gorgonio Creek in Edgar Canyon for non-potable purposes. Most significantly, BCVWD also anticipates purchasing reclaimed water to offset the use of potable water for irrigation purposes. BCVWD is exploring purchasing reclaimed water from Yucaipa Valley Water District (YVWD) and the City of Beaumont. By 2035, BCVWD anticipates approximately 2,600 acre-feet of non-potable water demand and supply. Currently, there is no reclaimed water available to the District. In the event that reclaimed water becomes available for purchase by BCVWD, the water supply deficiency will be reduced, but will still exist. Wastewater: The City of Beaumont provides wastewater services within the city limits and to a couple of developments outside the City. The communities of Highland Springs Country Club and Highland Springs Village Mobile Home Park outside of the city limits are currently being served by the City. These areas are located north of city limits and outside of the City’s sphere of influence. The City’s Public Works Department maintains and operates the City owned Wastewater Treatment Plant (WWTP) located 715 W. 4th St. The current capacity is 4 million gallons per day (mgd) and is not sufficient to accommodate all expected future growth within the City. Generally, since January of 2014, the City has routinely operated its plant at 75% or more of its capacity. Anytime a wastewater plant’s dry-weather wastewater flow reaches or exceeds 75% of its treatment capacity in any given month, a report must be filed with the Regional Water Resources Control Board (RWQCB) and subsequently corrected. Initially, under prior city management, the City failed to file the report. Consequently, in April of 2016, the City received a Notice of Violation from the Board and was ordered to file a written report within 90 days of the violation. On May 3, 2016 the City responded in writing to the Notice of Violation and provided a plan to address capacity and salt mitigation issues. In August of 2016, the City received an Order; Directive for Investigation of the Beaumont Wastewater Treatment Plant’s capacity. The order requested additional information and set dates for the City to perform certain tasks to become compliant with capacity requirements and the Beaumont Basin Management Plan. Also in the summer of 2016, the City hired a consultant to perform a feasibility study to evaluate two options for the future wastewater provisions. These options included 1) the City expands and upgrades its wastewater treatment plant and 2) the City connects to Yucaipa Valley Water District’s (YVWD) sewer system. In October of 2016, the City was presented with a preliminary feasibility study and held a few meetings shortly thereafter to allow for community input and discussion. On November 7, 2016, the City decided to proceed with its plant expansion and upgrade. This was based on the feasibility study findings, which indicated the City’s plant Municipal Service Review -City of Beaumont – Final Page 22 expansion would be the most cost effective alternative. The greatest cost difference in the two options was the amount of capacity each respective plant would need to be increased by. In order for YVWD to accommodate the City’s treatment volume through 2026, it would need to expand its plant capacity by 6 mgd. With the City’s Plant treatment capacity at 4 mgd, the expansion would be for 2 mgd to reach the needed treatment capacity of 6 mgd. The cost difference was approximately $63 million. The costs for Option 1 were estimated at $101 million and $164 million for Option 2. Option 1 also included the cost of facilities in the amount of $5.2 million to produce and distribute reclaimed water. Since the City has selected an option to proceed, the City has been able to proceed and comply with several of the Regional Board’s requirements, as follows:  In October of 2016, the City submitted a development and sewer flow projection study, which accounted for future residential, commercial and industrial growth.  In December of 2016: - The City submitted a Feasibility Study for the WWTP Expansion and Salt Mitigation (Option 1) to expand the existing facility to a capacity of 6 mgd and produce reclaimed water. The plant will be expandable to 8 mgd, which is expected to meet the City’s full build out. Ultimately, the City seeks to provide reclaimed water services for landscape irrigation purposes. The estimated cost, including distribution of reclaimed water presented in the study was $95.7 million. - The City submitted an Exceedance Prevention Plan, which identifies how the City will prevent exceedance of its plant’s capacity of 4 mgd.  In May of 2017, the City submitted its preliminary design for the plant expansion and upgrade. On a routine basis, the City must also report the following to the Regional Board:  Every six months in June and December, provide completed list of existing and proposed commercial and industrial facilities with the respective wastewater flows.  Provide semi-annual reports and supporting information to confirm the City’s average dry weather flows will not to exceed capacity, prior to the completion of the plant’s expansion. By December of 2017, the City must provide the Regional Board with a final financing plan for the plant’s expansion. At that time the City should have secured appropriate funding. Currently, the City’s consultant is preparing a State Revolving Fund (SRF) loan application for this project. The City is also exploring funding opportunities such as Proposition 1 financing and California Infrastructure and Development Bank financing to fund the required upgrade. A rate study was also performed, which indicated the monthly residential customer rate would increase by Municipal Service Review -City of Beaumont – Final Page 23 approximately $15 to help fund the WWTP expansion. The City’s utility bill would continue to be issued bi-monthly with combined charges for trash and sewer services. To address the City’s treatment volumes reaching capacity, the City has provided a table showing projected demand and treatment capacity through 2026 and the assumptions used. The City table reports the average daily flows for 2016 as 3.17 mgd and the closest the WWTP demand would come to treatment capacity is in 2019 at approximately 87% of capacity. These projections were based on an average annual growth rate of 500 equivalent dwelling units (edu) with daily effluent discharges of approximately 210 gallons per day (gpd). As such, the City’s projections are currently as follows: Average Daily Capacity Pct. of Year EDUs Flows (MGD) (MGD) Capacity 2016 15,053 3,171,973 4,000,000 79% 2017 15,553 3,277,333 4,000,000 82% 2018 16,053 3,382,693 4,000,000 85% 2019 16,553 3,488,053 4,000,000 87% 2020 17,053 3,593,413 6,000,000 60% 2021 17,553 3,698,773 6,000,000 62% 2022 18,053 3,804,134 6,000,000 63% 2023 18,553 3,909,494 6,000,000 65% 2024 19,053 4,014,854 6,000,000 67% 2025 19,553 4,120,214 6,000,000 69% 2026 20,053 4,225,574 6,000,000 70% Source: City Staff Update based on City of Beaumont Sewer Capacity Fee Study Final Report-June 2017. EDUs includes commercial/industrial uses. Based on these numbers, the City estimates the WWTP will not reach its capacity of 4 mgd until 2024. Construction for the WWTP expansion is expected to begin in July of 2018 and scheduled to be completed by March of 2020, prior to the plant reaching capacity. The Regional Board has expressed concerns regarding the City’s WWTP project expansion completion schedule by March of 2020 due to required CEQA compliance and securing funding sources. To oversee the City’s schedule, the Regional Board is working with City staff to track construction milestones and financing for the plant’s expansion. In the event that the City were to fall behind schedule, the Regional Board has indicated enforcement actions would be required. In extreme cases these would include violations, penalties and fines. Potentially, this could delay new development. The City has also submitted a draft Title 22 Report to the State Resources Control Board (SRCB) Division of Drinking Water to distribute recycled water for resale. The City is working to address the division’s comments to its Title 22 Report. The City’s plant is currently producing Title 22 compliant water, however, the final Title 22 Report must be filed with the SRCB Division of Drinking Water prior to distribution. Municipal Service Review -City of Beaumont – Final Page 24 E. Road Maintenance The City currently has approximately 120 miles of roads within the city limits. Traditionally, two city staff have been dedicated to maintaining the City’s road system. The City road conditions were never professionally assessed therefore, no Capital Improvement Plan (CIP) was developed to maintain or improve the road system. During the preparation of the City’s 2016 Work Out Plan to Sustainability, a rough assessment of the City’s road conditions was completed as well as the cost associated for road maintenance based on the Pavement Condition Index (PCI). Generally, most of the roads fell in the “fair condition” PCI range where the roads are likely to need some type of preventative maintenance of slurry sealing or minor overlay. In order to prevent further degradation and keep the roads in a “good condition” PCI range, the Work Out Plan recommends the General Fund include $9 million for road capital improvements for the first year and $4 million every year after. This preventative maintenance plan is expected to keep the roads from failing and needing complete reconstruction, which would be more expensive than regular maintenance. The FY 17-18 Budget includes approximately $1.98 million for the Street Department to begin proactive road maintenance services. Not only does the City need to maintain its existing road system, as a rapidly developing City, main street arterials are a critical component to its future growth. The City working on the Potrero Interchange Project, which would create an overpass as well as an on and off ramp on Potrero Blvd. at the intersection of Western Knolls Ave. and State Route 60 (SR-60). The Project would provide full access to SR-60, with Potrero Blvd. providing direct access to areas located north and south of the highway. To date the City has contributed $11 million towards the Project. The total cost to the City is estimated at $31 million, or 55% of the cost. Other funding sources identified by the City include grant funding ($13.4 million), and developer/property owner participation. As of April of 2017, several adjacent property owners that would potentially benefit from the interchange improvements have entered into agreements with the City to advance $8.6 million in road and bridge fees to fund Phase I of the project. Phase I consists of a six lane bridge over SR- 60 and approaching roadways. Phase II of the project consists of on and off ramps to the interchange. The City is in the process of forming an infrastructure district to fund Phase II. As part of the settlement with WRCOG, the City of Beaumont’s membership to WRCOG has been reinstated. This will allow the City to work cooperatively with other agencies and participate in regional transportation planning. F. Street Lighting The City provides street lighting and the city pays the electric bill to Southern California Edison (SCE). Additionally, a majority of the new street lights that are being installed are solar powered and not connected SCE. Municipal Service Review -City of Beaumont – Final Page 25 G. Street Sweeping The City reports that street sweeping services are being performed by a contractor, CR&R. The contract expired December 4, 2016. The City renewed the contract for an additional year and increased street sweeping services by adding weekly services to commercial areas. The remainder of city areas will continue to receive monthly services. The City is seeking to combine street sweeping with waste management services in the near future and hence only extended the contract for a year. H. Solid Waste Through a contract with the City of Beaumont, Waste Management (WM) provides solid waste collection within the city limits. WM offers weekly trash, green waste and recycling curbside service. This is not a franchise agreement. The arrangement between WM and the City is atypical since Beaumont is responsible for billing residential customers and does not receive reimbursement for its involvement. Consequently, the City will not be extending its contract with WM beyond its termination date of December 31, 2018. The plan is to undergo a competitive bidding process and enter into a modern franchise agreement where the City would collect franchise fees as well as a significant upfront payment from the hauler. The City has indicated its existing contract service is antiquated and should not be extended beyond its termination date. To correspond with the City’s plan for a new franchise agreement, the City has included a $1 million upfront payment in its FY 2018-19 budget. I. Library Service The Beaumont Library District (BLD) provides library services within the City of Beaumont. The Beaumont Library main branch is centrally located at 125 E. Eighth Street. Although the City population has quadrupled since 2000, the library facility remains at an estimated 11,700 square feet. This leaves the BLD below the State average of .7170 square feet of per capita and the County’s of .2996 sq. ft. per capita at .1508 sq. ft. per capita. The Beaumont Library is open an average of 49 hours per week and is closed every Wednesday. Again, the average hours of operation per 100 population as estimated by the California State Library Statistics is significantly higher than compared to BLD, which meets a third of the average. There are approximately 124,500 volumes held within the branch, which is also lower when compared to the State and County averages of collections per capita. As the population of the City of Beaumont continues to grow, the BLD services will continue to be impacted. J. Animal Control The City of Beaumont provides animal control services within the city limits, the Cities of Banning and Calimesa as well as some tribal territory. Animal Control is a division of the City’s Police Department. Staff attend to service calls, conduct investigations, impound dogs and cats, respond to complaints, issue citations, host education fairs, host low-cost clinics, perform micro- chipping, euthanize and issue licenses. By City Ordinance all cats and dogs residing within the Municipal Service Review -City of Beaumont – Final Page 26 city limits must be spayed or neutered. Penalties for unaltered animals are borne by the pet owner or custodian. Provided are the current licensing charges for altered and unaltered dogs. In the State of California pet licensing does not extend to cats. Type of License 1 Year 2 Year 3 Year Altered Dogs $16 $25 $35 Unaltered Dogs $100 $175 $225 Source: City of Beaumont License Application Form. The City’s maximum number of dogs allowed per household is four and the maximum number of cats allowed per household is nine. A kennel permit is required if the number of dogs or cats in one household exceeds the maximum. The City does not own an animal shelter facility. When necessary, the City contracts for animal control services with Riverside County Animal Services, or with the Ramona Humane Society in San Jacinto. K. Disadvantaged Unincorporated Communities Effective January 1, 2012, SB 244 was chaptered into law. The provisions of the bill addressed disadvantaged unincorporated communities (DUCs). Several provisions impact LAFCO proposals and studies. A disadvantaged unincorporated community is defined as territory that constitutes all or a portion of a “disadvantaged community” that includes 12 or more registered voters, or some other standard as determined by the Commission. A disadvantaged community is defined as territory with an annual median household income (MHI) that is less than 80 percent of the statewide median household income. Two DUCs have been identified outside the City of Beaumont’s boundaries from data generated from the U.S. Census. Both of these DUCs are located within the boundaries of the Cherry Valley community and has a residential population of approximately 3,036 in an area of 794 acres. Municipal Service Review -City of Beaumont – Final Page 27 DUC 1 “Highland Springs” is located on the northern edge of the City boundaries between the Cities of Calimesa to the west and Banning to the east. DUC 1 is generally located north and south of Brookside Ave., west of Highland Springs Ave., east of Cherry Ave., and south of Dutton St. The area consists of large and rural lots with mixed land uses of Medium Density Residential (MDR), Very Low Density Residential (RC-VLDR) Light Industrial (LI) and General Commercial (C-1/C-P). Zoning designations include One-Family Dwellings (R-1-1 & R-1-1/2), Residential Agricultural (R-A-20000), Manufacturing-Medium (M-M) and Light Agriculture (A-1-1). This DUC also includes the Highland Springs Village Senior Community that consist of a mobile home community of 476 lots. The DUC falls into one Block Group (BG) with a MHI of $42,153 in Census Tract 043809 BG2. The Highland Springs DUC has an estimated population of 2,019. Senate Bill (SB) 244 also requires that counties include in their Land Use Elements identification and analysis of underserved disadvantaged unincorporated communities (DUC) within unincorporated areas and outside city spheres of influence (SOI). This information, along with the analysis of each DUC, can be found in Appendix P-2 in a draft of the County of Riverside General Plan/Housing Element. The County has identified a “Cherry Valley Area” DUC. This DUC includes two separate areas, one of which we have previously identified as “Highland Springs.” The other portion of the DUC is a separate residential area west of Highland Springs, which we now refer to as “DUC 2 Cherry Valley West”. DUC 2 is also located on the northern edge of the City boundaries between the Cities of Calimesa to the west and Banning to the east. DUC 2 is generally located north of Cherry Valley Blvd., west of Beaumont Ave., south of Orchard and east of Union St. It is located less than a mile to the west of DUC 1. The area consists of large and rural lots with mixed land uses Municipal Service Review -City of Beaumont – Final Page 28 of Medium Density Residential (MDR), Very Low Density Residential (RC-VLDR) High Density Residential (HDR), General Commercial (C-1/C-P) and Commercial Retail (CR). Zoning designations include One-Family Dwellings (R-1, R-2, R-3), Residential Agricultural (R-A-20000), Light Agriculture (A-1-1). DUC 2 has an estimated population of approximately 1,017. The Commission initially identified the “Country Hill” Mobile Home Park as a DUC. It is located east of Manzanita Park Rd. and south of Eagle’s Nest Dr. Upon further investigation, it was determined that the area consists of only temporary residents of less than six months that does not have a permanent population. We no longer consider it as a DUC. IV. Sphere of Influence Government Code Section 56425 requires the commission after July 1, 2012, to adopt additional determinations for an update of a sphere of influence of a city or special district that provides public facilities, or services related to sewer, water, or fire protection. The Commission must make determinations regarding the present and probable need for those public facilities and services in any DUCs within the existing sphere of influence. The City Beaumont Sphere of Influence contains mostly vacant mountainous area to the west of the city limits. To the southwest the sphere follows the demarcation of the Township Ranges 1 & 2 W, which includes areas straddling Highway 79 and Lamb Canyon. The City’s most eastern SOI post is easterly of the Badlands. Municipal Service Review -City of Beaumont – Final Page 29 V. Determinations Prior to or in conjunction with SOI Reviews, the Commission must conduct a service review of municipal services. The purpose of the Municipal Service Review is to assist in the SOI Review process by providing information regarding an agency’s ability to provide services. Pursuant to Govt. Code Section 56430 (a), the Commission is also required to make determinations with respect to each of the following: (1) Growth and population projections for the affected area. Based on the most recent projections produced by the Southern California Association of Governments (SCAG), the City’s population is estimated to increase by approximately 75 percent by 2040. These projections indicate the City will experience substantial growth over the next 23 years. Past estimates and projections for 2040 are shown below. City of Beaumont Demographic Information 2011 2012 2013 2014 2015 2016 2040** Population 38,034 38,851 39,776 40,853 42,851 45,118 80,600 Housing Units 13,262 13,445 13,668 13,975 14,461 14,864 27,000 Employment 15,300 15,900 16,600 17,700 18,400 18,600* 18,000 Source: State Employment Development Dept. (EDD); *EDD 2016 Avg. through Oct; 2013 Riverside County Progress Report; **SCAG 2016 RTP Growth Forecasts. (2) Disadvantaged Unincorporated Communities (DUCs) Characteristics. There are currently two DUCs adjacent to the City limits. DUC 1 is referred to as “Highland Springs” and is located at the northern edge of the City boundaries. This majority of the area consists of scattered large and rural lot residential development and a senior community. There are also two small designated areas that allow for light industrial and general commercial land uses, respectively. The estimated population in this DUC is approximately 2,000. DUC 2, the “Cherry Valley Area” consists of large and rural lots, primarily rural community— estate density residential, some medium density residential, approximately 40 acres of very high density residential and commercial retail. The estimated population is approximately 1,000. Neither of the DUCs are within the City’s sphere of influence. Municipal Service Review -City of Beaumont – Final Page 30 Initially, the Commission identified the “Country Hill” Mobile Home Park (MHP) as a DUC adjacent to the City and within the City’s sphere of influence. However, it was recently discovered that residing within the MHP are non-permanent transient residents. Without a permanent population, the “Country Hill” Mobile Home Park cannot be defined as a DUC. The “Country Hill Park” is located at 14711 Manzanita Rd. and can generally be described as being south of I-10, west of Highland Springs Ave., and east of SR-79. (3) Present and planned capacity of public facilities and adequacy of public services, including infrastructure needs or deficiencies including needs or deficiencies related to sewers, municipal and industrial water, and structural fire protection in any DUC within or contiguous to the sphere of influence. Water Services Water is provided by the BCVWD in the City of Beaumont and the general unincorporated area north of the city limits where both the Highlands and Cherry Valley DUCs are located. Both BCVWD, the retailer and San Gorgonio Pass Water Agency (SGPWA), the State Water Contractor are planning for adequate water supply for the region to accommodate the growth expected to occur within the City and its current and proposed SOI. The SGPWA is currently pursuing and negotiating new sources of water supply for future development. In order to purchase new water supplies, a facility capacity fee of approximately $171 per equivalent dwelling unit (EDU) is being applied to new development. Generally, due to the rural large lot development called for in the County General Plan, limited development is expected to occur in Cherry Valley therefore, water demand will be relatively small. Development proposed within the Sunny Cal Specific Plan (SP) and the proposed SOI/ Municipal Service Review -City of Beaumont – Final Page 31 annexation area is estimated at 472 acre-feet per year (AFY). The Sunny Cal SP properties are an “overlying party” to the Beaumont Basin adjudication and have an entitlement of approximately 1,440 AFY. BCVWD and the property owner have an arrangement for the transfer of the entitled groundwater supply to serve the Sunny Cal SP. As a result, the project will be served from its own water entitlement by BCVWD. Wastewater Services Generally, in the Cherry Valley area, which includes the previously mentioned DUCs, there has been concern about nitrate levels in the groundwater. As a result, the County has adopted an Ordinance setting limitations on the installation of new septic systems and repair of existing systems. The City of Beaumont provides wastewater services within the city limits and to two developments outside of the City. These include the Highland Springs Country Club and Highland Springs Village Mobile Home Park, which are located north of city limits and outside of the City’s sphere of influence. The City’s Public Works Department maintains and operates the City owned wastewater treatment plant (WWTP) located within the City at 715 W. 4th Street. The plant’s capacity is 4 million gallons per day (mgd) and is not sufficient to accommodate all expected near term future growth within the City. Presently, the City is routinely operating its WWTP at 75% of capacity. Recently, the City adopted a feasibility study and a preliminary design plan to expand its WWTP to 6 mgd to accommodate projected growth through 2026. This is requirement of the Santa Ana Regional Water Quality Control Board. The expansion of the City’s wastewater plant is on a tight schedule, but the City is taking the necessary steps to complete the project prior to reaching capacity in March of 2020. The plant would be designed to an expandable capacity of 8 mgd, which is expected to meet the City’s full build out capacity. The City’s plant is currently producing Title 22 compliant water, however, the final Title 22 Report must be filed with the State Resources Control Board Division of Drinking Water prior to distribution. Upon completion of the City’s WWTP upgrade, the City will distribute recycled water for non-potable uses and resale to offset the need for potable water services. This is expected to be an additional revenue stream for the City in the future. Fire Protection Services The City of Beaumont contracts with the County of Riverside Fire Department for fire protection services. At the north side of the City, Riverside County Fire Station No. 22, located in Cherry Valley provides fire and paramedic services on. This station is adequately serving both DUCs within 0.6 miles from DUC 1 and 0.2 miles from DUC 2 and the general northern city territory. Fire Station No. 20 located in the general Downtown area on 6th Street also provides fire protection and paramedic services the City. Currently, the westerly portion of the City, within the SR 60/I 10 corridor is deficient in fire protection services. This general area is outside of the average five minute response times. The City is planning to build a west-side fire station in the corridor within the next 3-5 years. As a result of a development agreement, a site for the proposed fire station has been allotted to the City. The proposed sphere of influence and annexation of the Sunny Cal Specific Plan is within a five minute average response time of Fire Station No. 22. Municipal Service Review -City of Beaumont – Final Page 32 (4) Financial ability of agencies to provide services. In order to balance the FY 15-16 Budget, several reductions were made to core city services. The FY 17-18 Budget increased service levels to a new standard however, large capital improvements in the following services are areas of concern:  The City’s street network system  Recently, as assessment of the City’s roads was completed and declared most of the City roads to be in “fair condition” suggesting the road requires preventative maintenance to avoid deterioration.  Preventive road maintenance performed by the City includes slurry sealing and minor overlay, with the exception of regional road improvements pursuant the WRCOG settlement where Transportation Development Impact Fees will be used.  To maintain the City’s roads in a “good condition”, the City’s Director of Public Works estimated that $9 million in capital improvements would be required the first year, followed by maintenance of $4 million thereafter.  As of June of 2016, City staff could not recall when a street was overlaid.  Currently, the City is working to develop a pavement management system (PMS). Due to the circumstances described above, the City’s road system will require substantial financial resources to prevent further deterioration. The FY 2017-18 Budget includes five new positions for street maintenance to begin preventive maintenance. All in-tract street facilities within new developments, including the Sunny Cal SP will be maintained by project HOAs. Cherry Valley Blvd. and Brookside Ave. will be improved as a result of the Sunny Cal SP development and the maintenance of those public streets will be funded by a Community Facilities District (CFD).  Wastewater Services—The City is nearing its maximum daily capacity at its WWTP. The cost to complete the expansion and upgrade to the plant is approximately $95.7 million. The City is exploring funding opportunities such as Proposition 1 financing and California Infrastructure and Development Bank financing to fund the required upgrade. At this time, the City’s consultant is preparing a State Revolving Fund (SRF) loan application for WWTP expansion project. This is expected to occur by December 31, 2017 in conjunction with the submittal of a financing plan for the final plant expansion to the Regional Board. Also, an initial rate study indicated that the monthly residential customer rate would increase by approximately $15 to help fund the WWTP expansion.  Fire Protection Services—The western portion of the City is outside of the standard five minute response times for fire protection services. Recently, the Municipal Service Review -City of Beaumont – Final Page 33 City secured a site for the future construction of a fire station in the Interstate 10, 60 State Highway Corridor along Potrero Blvd. Financing the construction of a new fire station and dedicating funds for the estimated annual operation and maintenance of $1.1 million will be the determining factor on whether this fire station will be built.  Police Protection Services—The City is currently operating below its goal of 1 officer per 1,000 population at .82 officers per 1,000. The FY 17-18 Budget increases the ratio to .90 officers per 1,000 population, which brings it closer to its goal. Generally, residential developments are fiscally negative for cities. To offset the General Fund costs associated tract developments, the City of Beaumont is annexing new residential developments into an existing Community Facilities District (CFD) or forming new CFDs to fund public safety and other municipal services.  WRCOG Litigation—The City was potentially facing bankruptcy as a result of a $67 million judgment against the City and negative fund balances. In April of 2017, WRCOG and the City entered into a settlement agreement. The settlement requires the City to share any potential proceeds recovered from frozen assets to be pursued through litigation. The bulk of those funds would go to WRCOG and a portion to the City. If the City is unable to collect any monies from the frozen assets, the City will be responsible for reimbursing WRCOG up to $8 million. Aside from this type of repayment structure to WRCOG, the settlement requires the City to share its Measure A sales tax revenues with WRCOG and proceed with road improvements as outlined in the agreement. The City is finalizing a multi-year fiscal sustainability model to determine what fiscal resources are available to sustain the existing levels of service as presented in the FY 17- 18 Budget. The City considers those service levels as the new standard. The model will also consider the potential to increase levels as needed. The City is under investigation by the Securities Exchange Commission (SEC) and at this time is unable to access the public bond market. However, the City has the ability to sell bonds through the private bond market. This is not an ideal situation, especially as the City is seeking to finance its WWTP expansion, but there are opportunities for private financing at generally higher interest rates, increasing the overall cost of financing. (5) Status of, and opportunities for, shared facilities. In the event that the City of Beaumont WWTP produces reclaimed water, it would be available to Beaumont Cherry Valley Water District for purchase. The District’s 2015 Urban Water Management Plan (UWMP) includes the City of Beaumont’s reclaimed water as an alternative Municipal Service Review -City of Beaumont – Final Page 34 non-potable water source that would augment approximately 5 percent of its water demand by 2020. As a result of the settlement agreement with WRCOG, the City agrees to become a full participant in the TUMF program. The City is expected to benefit from regional transportation funding in the general pass area. Generally, the majority of new park sites within the City limits will be located within gated communities and maintained by HOAs. This approach would not benefit the general city population. Conversely, the City and Beaumont Cherry Valley Recreation and Park District (BCVRPD) could build a cooperative relationship to maintain additional park sites to enhance park and recreation services citywide. (6) Accountability for community service needs, including governmental structure and operational efficiencies. Under the new City administration, transparency and community involvement have been encouraged. Special Workshops have been held to allow for community input, prior to the City Council’s action. The City’s audited financial statements can be found online dating back to FY 2007-08 and the City’s Annual Budgets from FY 2010-11 to date. The City’s website hosts public meeting information, including agendas, minutes and video recordings for meetings of the Council and City Commissions. Various commissions and committees also offer opportunities for public participation in the City decision-making process. A calendar of events can also be found at the City’s homepage. The effects of the events that occurred over the last few years still linger and have eroded public confidence. The City has made strides to create transparency in its expenditures, selection of outside firms, reconciliation of its accounts and cooperating with the annual audits of its financial statements. Hopefully, these efforts will restore the confidence over time. (7) Any other matter related to effective or efficient service delivery, as required by Commission policy. The City continues to improve its fiscal condition. The 17-18 fiscal year budget calls for an increase in service levels, which are considered the new standard by the City. The City should provide LAFCO with periodic updates of its ability to provide services. Specifically, by July 1, 2018 and again July 1, 2020, the City should provide a progress report addressing the following: upgrade and expansion of its WWTP, implementation of a fire station of the west-side of the City, and adoption/funding of a Capital Improvement Program (CIP). The updates will be posted on the Commission’s website as an addendum to the MSR. Municipal Service Review -City of Beaumont – Final Page 35