By Cassandra Reinhart, Special to the Independent
Laguna Beach is moving ahead to determine whether to seek voter approval for utility undergrounding measures on the November 2018 ballot. The proposals would ask voters to tax themselves to fund the estimated $200 million citywide project.
At its meeting Tuesday, the City Council voted unanimously to spend $242,000 to hire two consulting teams to develop ballot measures for underwriting undergrounding of utilities in neighborhoods and evacuation routes.
As currently envisioned, voters would consider two separate measures on the November ballot: the first measure would be a citywide general obligation bond, which would ask all residents to tax themselves to fund undergrounding of overhead utilities on major city evacuation routes. Laguna Canyon Road, lined by 181 poles, Monterey Drive in North Laguna (from Hawthorne Road to Linden Street) and Thalia Street (from Temple Terrace to Glenneyre Street) are the city’s top three priorities for undergrounding.
“Those have a general public benefit,” said Shohreh Dupuis, the city’s director of public works. “A general obligation bond city-wide would be tax-based on assessed property value to pay for undergrounding of evacuation routes.”
The second ballot measure would establish a tax assessment in a community facilities district, and would be voted on only by residents in neighborhoods that have yet to pay the cost of burying their own overhead lines. In January, Dupuis said 6,000 parcels citywide still receive services from overhead wires. At the time, seven neighborhood initiatives to bury wires were underway, ranging in cost per parcel from $66,000 to $32,000 and typically pro-rated over 15 to 20 years.
Residents in neighborhoods free of overhead wires would not vote on the CFD ballot measure nor would they be assessed to pay for projects in other neighborhoods.
“If you already paid to underground your neighborhood, you wouldn’t be paying to underground someone else’s,” said City Manager John Pietig. “But you would potentially be contributing to a city-wide assessment district for evacuation routes.”
The initial feasibility study approved Tuesday is designed to determine quickly what is required to build support for a local funding measure and its timing.
The city hired bond consultant TBWB Strategies to assess support for the measure by surveying 500 residents by February. The San Francisco company that specializes in winning public finance measures also helped the city win passage of a hike in the hotel bed tax and to defeat medical marijuana dispensaries in 2016.
Another consultant will start devising the specific tax-raising method for the neighborhood undergrounding districts. If the city decides to pursue the ballot measure, consultants including a financial advisor, an underwriter and a bond counsel will also be hired.
A resident contended that the planned survey’s intent to gauge support showed bias.
“In terms of spinning a survey, that is the exact opposite of what you want to do,” said council member Bob Whalen, who champions the local measure to lower fire risk. He pressed utility executives unsuccessfully to bury lines and had no better luck with a legislative remedy in 2016.
Laguna Beach has experienced four fires sparked by utility lines in the last 10 years, the most recent July 3, 2015.
“You want to determine whether you have support for something or not or modify what you are proposing,” he said.
Given the recent eruption of wildfires in Southern California this week fueled by the Santa Ana winds, some residents expressed support for the city’s aggressive timeline.
People are concerned about the risk high winds pose to above ground power lines, said North Laguna resident Tom Gibbs. “The time is now; it is extremely dangerous.”
“A good part of Southern California is literally aflame,” said resident Matt Lawson. “The only difference between Laguna Beach and these other cities that have experienced horrific losses is that we are at a much higher risk of fire than they are.”
Others, who paid for undergrounding utility lines in their neighborhoods, were unhappy about the possibility of a new citywide tax to pay for undergrounding of evacuation routes.
Mystic Hills resident Judie Mancuso pointed out that a new property tax would be based on current assessments, which have escalated for a decade. “That’s what you’re going to hit us with,” she said.
“Attempting to sell voters on approving a general obligation bond in the range of $34 to $50 million for the evacuation routes is inconceivable when the council hasn’t shown it is able or willing to tighten its belt,” resident Michael Morris told the council.
In April, both Southern California Edison and San Diego Gas and Electric filed separate lawsuits challenging the city’s utility ordinance mandating that any new improvements be constructed underground.
The city repealed the initial ordinance and the utilities agreed to advance some funding for utility undergrounding projects. In October, the council also voted to use $3 million in available funds and up to $4 million in Measure LL and street lighting funds to get undergrounding started along evacuation routes.
If the plan moves ahead as scheduled, the city would vote to form a CFD and incur debt at its meeting on May 22. A narrower second survey of residents would follow, and at the end of June the city would file intent to place the bond measures on the ballot in November.
“I feel a strong obligation to present this to voters. It’s got to be a two-thirds vote, and that is a high bar,” said Whalen. “Voters will either approve it, one, both, or none.”