CC Resolution 11320RESOLUTION NO. 11320
Resolution of the City Council of the City of Campbell Approving an Agreement
with the City of San Jose to Annex County Territory Known as Cambrian No. 36
and Authorizing the Interim City Manager to Execute an Agreement
WHEREAS, the City of Campbell has heard from and received petitions from the
majority of the residents of the County Pocket known as Cambrian No. 36 through the
public meeting process; and
WHEREAS, such residents have indicated a strong desire to be annexed into
the City of Campbell; and
WHEREAS, Cambrian No. 36 is currently in the "Sphere of Influence" of San
Jose, thus, requiring an authorization to allow Campbell to annex such territory; and
WHEREAS, the City of San Jose is willing to grant such authorization under the
terms of a negotiated agreement with the City of Campbell; and
WHEREAS, based on a fiscal analysis of the cash flows related to this
opportunity, it was determined that annexing the territory would be revenue/cost neutral
to the City; and
WHEREAS, the Campbell City Council believes it is in the best interest of the
City to annex the Cambrian No. 36 territory.
NOW, BE IT RESOLVED, by the City Council of the City of Campbell, that the
following major terms of agreement with the City of San Jose are hereby approved:
1. Campbell will make an initial guaranteed base payment of $199,000 for 5 years,
subject to the provisions below.
2. Beginning in Year 6, and every 5 years thereafter, through the term of this
agreement, the cities will determine the actual change in net revenue during the
past 5 year period. This change shall equal the difference between 1) the
percentage increase (decrease) in revenues associated with the Cambrian 36
pocket and 2) CPI change for All Urban Consumers, for the month of February.
3. After the initial 5 year term, the net revenue change will be shared 50% to afford
each city an equal share in any gains or losses accruing from future changes in
net revenues.
4. For years 6-40, payment will be adjusted by the net revenue change since the
previous calculation, unless such payment amount is negative, in which case no
payment will be made for the next 5 year period.
5. If at any time between the 5 year calculation period the hotel, located at 1300
Camden Ave., or gas station, located at 1370 Camden Ave., ceases operations
or otherwise stops generating tax revenue, a revised calculation, using actual or
estimated revenue, will be performed, no later than the end of the fiscal year in
which this event occurred and an adjustment to the base payment will be made
Adopt Resolution of Agreement with City of San Jose
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accordingly. The revised calculation will be used, effective the following July 1,
until the next 5 year calculation is due. Should a new business replace either of
these two businesses, a new calculation will be performed as soon as a full year
of tax revenue is known by Campbell and an adjustment to the base payment will
be made.
6. If any new business is established, which did not exist at the time of annexation
to Campbell, and generates more than $50,000 in tax revenue, a revised
calculation will be performed to adjust the base payment, effective the following
July 1, until the next 5 year calculation is due.
7. Over a period of 40 years, Campbell anticipates it will need to perform at least
two street maintenance treatments to maintain the roadway and appurtenances
at a level commensurate with their existing pavement condition levels. In today's
dollars, this is estimated to cost $3.3 million. Over the next 40 years, the cost is
certain to increase considerably. In order to recognize this significant future
expenditure, Campbell will be entitled to a credit in its annual payment to San
Jose of $30,000 beginning July 1, 2021 increasing to $40,000 in 2031 and
$50,000 in 2041 for the duration of this agreement. These credits will be applied
after the 5 year calculation is performed but cannot reduce the annual payment
amount below $0.
8. The term of this agreement will be for a total of 40 years after which time all
payments and obligations of the City of Campbell to the City of San Jose will be
completed in full.
BE IT FURTHER RESOLVED, that the Interim City Manager is authorized to
execute an agreement with the City of San Jose that adheres to the major terms
enumerated in this resolution and proceed with the annexation process.
PASSED AND ADOPTED this 2"d day of August, 2011, by the following roll call
vote:
AYES: Councilmembers
NOES: Councilmembers
ABSENT: Councilmembers
ATT T:
Anne Bybee, City Clerk
Waterman, Low, Cristina, Kotowski, Baker
None
None
APPROVED:
son T. Baker, Mayor
Attachment 2
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