Agency Chief Favors Aliso Viejo Cityhood

The executive officer of the agency that oversees incorporations and annexations in Orange County recommended Wednesday that Aliso Viejo be allowed to become a city but without 150 acres of homes and a park that neighboring Laguna Hills wants to annex.

Dana M. Smith, executive director of the Local Agency Formation Commission, wrote in his report that Aliso Viejo could be a stronger city without the area north of Moulton Parkway, which has about 1,800 residents.

The commissioners will vote Friday on Aliso Viejo’s cityhood bid.

Since December, the agency has studied the Aliso Viejo cityhood application and a competing proposal by Laguna Hills to annex two portions of the community: the northern Indian Hills neighborhood and a 190-acre area south of that and east of Alicia Parkway, which includes the Aliso Viejo Plaza.

A financial analysis released this month by the agency said losing the revenue from the 33 stores in the plaza, which is anchored by Target and Stater Bros., would kill Aliso Viejo’s cityhood plans.

Smith recommended that if Aliso Viejo becomes a city, it should be allowed to have the southern area but not the northern one because the cost of providing services to the latter might exceed the tax revenue it brings the city.

The analysis says the plaza generates $500,000 a year in sales tax revenue. Without that money, the city would be forced into deficit spending in its second year and bankruptcy by 2007, it says.

Don White, Laguna Hills’ assistant city manager, told the agency last week the city would drop its bid to annex the plaza and homes in the southern area to salvage Aliso Viejo’s incorporation, but it still wanted the northern area.

But cityhood advocates in Aliso Viejo objected to the possibility of losing the northern section.

Carmen Vali, president of Aliso Viejo’s Cityhood Committee, said she understood the logic of the agency’s recommendation but has no plans to change the community’s boundary request.

“In the north area, there is not a clear consensus on how people feel,” Vali said. “I don’t think that neighborhood is well-informed.”

Vali said the committee will ask the county agency Friday to approve Aliso Viejo’s incorporation with its original boundaries intact.