City-to-Be, County Agree on Tax Deal

Orange County supervisors approved a financial agreement Tuesday with Rancho Santa Margarita cityhood proponents, marking a major milestone in the area’s nearly five-year crusade for political independence.

The Local Agency Formation Commission is expected to set boundaries and approve the cityhood plan today. The proposal goes to the voters for final approval in November.

Under the financial deal, the county would give the new city $200,000 a year in property tax revenue to offset the long-term cost of including the Dove Canyon and Robinson Ranch communities within Rancho Santa Margarita’s boundaries.

County leaders and cityhood advocates have wanted to create a larger, fiscally viable city ever since the push for independence began in 1994.

“Four-and-a-half years is a long time, and we’re finally there,” said Gary Thompson, a spokesman for the Rancho Santa Margarita cityhood effort. “I think [today’s vote] is going to go very well.”

Supervisor Tom Wilson said Tuesday’s vote was a big sigh of relief for everyone who has been involved in the negotiations.

“I think it demonstrates that if folks can be flexible and really sit at the table, things do work out,” Wilson said.

The revenue neutrality agreement--required by a 1992 state law--calls for the city to pay the county $12 million over the next 10 years. About 60% of the total would come in cash payments in the first seven years of incorporation, and the remainder would come, under Tuesday’s agreement, from the county’s share of the sales tax revenue.

The county also has agreed to extend the current law enforcement contract for two years after cityhood is approved and road-related services for one year at no charge.

“They really worked hard to get a good deal for everyone,” Thompson said.

The Local Agency Formation Commission meeting is at 9 a.m. today in the Planning Commission hearing room, Hall of Administration, 10 Civic Center Plaza.