City Council approves annexation into CFD Improvement Area 5 and declares intention for Improvement Area 12 in Preserve development

The Chino City Council on July 3 conducted a public hearing and adopted measures to extend Community Facilities District (CFD) financing in the Preserve development.

Council adopted Resolution No. 2025-017 calling a special election within the proposed annexation territory and then adopted Resolution No. 2025-018 declaring the election results for Annexation No. 9 into CFD 2003-3 Improvement Area 5. City Clerk Natalie announced the election ballots were unanimous in favor of the proposition. The motions passed on 4 yes votes with 1 member absent.

The annexation covers parcels proposed for commercial use (initially a fast-food restaurant) and future apartment development. Director of Finance Kim Sauer and consultant Heidi Shephey of Webb Municipal Finance told the council the initial annexation is anticipated to generate roughly $2,102.50 annually from the commercial parcel and that full buildout of the area could provide an estimated $25,338 in annual revenue, with the amount to vary based on the number and mix of apartment units.

Separately, the council considered a declaration of intent to form Improvement Area 12 within CFD 2003-3. Heidi Shephey described Improvement Area 12 as a residential improvement area east of Main Street and south of Legacy Park expected to contain about 306 single-family homes with projected sale prices in the presentation of roughly $842,900 to about $1,190,000 per home. The staff presentation estimated: - Special Tax A (facility tax, to support bond issuance): projected range $6,700–$9,300 per home, allocated by home square footage. - Aggregate annual services revenue (Special Tax B): approximately $293,000 per year, escalating by CPI (not to exceed 7%). - Estimated aggregate annual revenue for Special Tax A/B: a little over $2.3 million. - Projected bonding capacity (estimate): about $28.5 million, with an illustrative list of eligible facilities totaling roughly $71 million (parks, street improvements, wet utilities, residential amenities, and fees-in-lieu); staff said not all listed facilities would be funded by IA12 and additional improvement areas could finance remaining items.

Shephey said the term of the facility special tax would run to fiscal year 2069–70 to allow issuance and repayment of bonds. The council voted to adopt the resolutions of intention for Improvement Area 12 (Resolution Nos. 2025-022 and 2025-023) and authorized staff to proceed, with the motion passing 4 yes, 1 absent.

Council discussion clarified that the $28.5 million bonding figure and other amounts are estimates that depend on future product mix, market conditions and interest rates; staff noted interest-rate or market changes would alter the amount of bonds that could be issued. Council members asked whether unfunded portions of the listed facilities would be paid by the developer or later improvement areas; staff replied the developer or subsequent improvement areas would cover remaining facilities costs when necessary.

Next steps described by staff include setting public hearing dates, holding required elections, and—if approved—reading and adopting the ordinance to levy the special taxes. After formation and developer-built homes produce assessed value, the developer may return to request issuance of bonds supported by the facility special tax.