Rancho Santa Margarita Begins Setting Up City

A day after a landslide vote to break away as Orange County’s newest city, the residents of Rancho Santa Margarita awoke Wednesday without a city hall, without any city laws and without a single city cent.

The monumental task of creating a new government from scratch begins today inside the auditorium of the local intermediate school, where the five newly elected City Council members will convene for the first time.

From now until Jan. 1, when Rancho Santa Margarita officially becomes Orange County’s 33rd city, the city’s leaders must lay the groundwork for a municipality that provides services for more than 40,000 residents and handles an annual budget of as much as $7.4 million.

“We have to work on getting at least a facility, so that on Jan. 1, when people start calling the city, there is someplace to call,” Councilwoman-elect Debra Lewis said.

Rancho Santa Margarita must establish a police force, create a parks and planning department, adopt city ordinances to cover everything from barking dogs to billboards, plus hire the city administrators and staff to make it all happen.

Lewis said the committee will be calling on the many friends and contacts they’ve made in other municipal governments during the cityhood drive to make sure they take all the necessary steps to get the city off on the right foot.

“There is no need to reinvent the wheel, so we will be calling people for advice,” Lewis said.

Councilman-elect Gary Thompson said that the council has been advised to form a number of subcommittees, made up of council members and volunteers, to take on these tasks. The city also must find a city manager, secretary, clerk and an interim city attorney.

“We do not have any money at all on the first day of the city,” Thompson said. “That’s the interesting part. We can enter into an agreement with the employees and the owner of the facility, but it’s on a promise-to-pay basis. Whoever these people are they would really be doing this at their own cost to be billed later.”

The city will have a six-month grace period following incorporation during which the county will continue to provide services like planning, public works, engineering and animal control. At the end of those six months, the council will need to have agreements in place to provide each of those services.

“They’ve got a lot of work to do. A horrendous amount of work. They may have no idea,” said City Manager Leslie Keane of nearby Laguna Woods, which in March was the most recent California city to incorporate.

Keane said the simple, mundane tasks are the most essential: setting up the city’s telephone number and making sure it’s listed; creating an official city seal so city documents can be legally certified; and having liability insurance from Day 1 to protect the city from lawsuits.

Rancho Santa Margarita also needs to file with the state Board of Equalization to begin collecting sales and vehicle license fees, the staple revenue of their budget.

To ensure the new city is not overwhelmed, the county has also offered to provide police protection for two years and road-related services for one year.

“We should be able to assist them with any transition issues that they need help with,” said Michael Ruane, the county’s deputy chief executive officer.

That may include providing the new city with a temporary staff, or a loan to keep the municipality afloat while it waits for tax revenue to start rolling into the treasury, a process that can take up to three months, Ruane said.

“We’re in a support role. We want to be ready for Jan. 1,” he said.

The Orange County Board of Supervisors is willing to cradle its new cities so generously because it wants to shed its burden of providing municipal services, especially to isolated communities in unincorporated pockets of the county, Ruane said. The county began to assist communities hoping to incorporate, or annex to a neighboring city, in earnest after the county’s historic bankruptcy in December 1994.

“The board started looking at its long-term financial planning. You start looking at focusing on the things you do best,” Ruane said. “It’s difficult to focus on long-term regional needs if you’re also the city council for these local areas.”

Supervisor Tom Wilson said the county would prefer to handle regional concerns, from children’s services to the county jail, and leave decisions such as providing school crossing guards to local political bodies.

“I’m a big advocate of local control,” Wilson said.

The transition in Rancho Santa Margarita may be made smoother because the community has thrived under the leadership of strong civic associations, which have maintained private neighborhood parks and addressed other local needs since the master-planned communities were born in the mid-1980s.

Still, the city’s new council members, all of whom served on those private associations, will have to adjust to public life, and the state laws that require council members to conduct their business in the open.

Those laws apply even now, even though the five new council members will not be officially sworn in until Jan. 1, said Phil Kohn of the law firm of Rutan & Tucker and the city attorney for Laguna Beach.

“They’re going to be surprised about the rights they lose when you become a public official,” Kohn said.