Annexation

Introduction

On February 5, 2019, the Los Gatos Town Council directed staff to initiate the streamlined annexation process for multiple unincorporated islands. An urban unincorporated island (or pocket) is unincorporated land that is located within a city/town Urban Service Area (USA). Even though these islands are completely or substantially surrounded by the Town, they remain under the jurisdiction of the County, which is currently responsible for providing basic municipal services. This Annexation Answer Guide is intended to provide information about the annexation process and the benefits of annexation.

The Town of Los Gatos currently has 32 urban islands of various sizes within the valley floor and hillsides of the Town. Twenty-three of the thirty-two urban islands are under consideration for annexation at this time. Unincorporated islands in Santa Clara County are a result of past development patterns dating back to the 1950s and 1960s, when much of Santa Clara Valley was predominately agricultural and cities were expanding rapidly. Since the early 1970s, it has been the policy and practice of the County and cities throughout Santa Clara County that urban development should occur only within cities, and unincorporated islands should be annexed into their surrounding cities so urban services and facilities can be provided and maintained more efficiently. The continued existence of these unincorporated islands creates problems for the Town, the County, island residents, adjacent Town residents, and the various agencies responsible for providing services and facilities to these areas.

Recognizing the inefficiencies associated with the continued existence of urban islands, the California State Legislature took action and passed special legislation in 2001 that made it easier for local governments to annex small urban islands within their jurisdictions that were 75 acres or less. The legislation was further revised in 2005 (Government Code Section 56375.3) to allow for a streamlined process for the annexation of islands less than 150 acres in size. The streamlined annexation process requires a public noticing period and adoption of a resolution by the Town Council of Los Gatos in-lieu of an election.

Public Hearings

The streamlined annexation process requires two public hearings; therefore, the Town Council will conduct two public hearings to consider island annexation. The first Council meeting will consider adoption of a “Resolution to Initiate Annexation” of island properties. If the Resolution is adopted, a second public hearing will be held to consider adoption of a “Resolution to Approve Annexation.” Both public hearings will take place during Town of Los Gatos Council meetings at Town Hall (110 East Main Street).

  • Tuesday June 4, 2019 – Public hearing to initiate annexation: Town Council holds first public hearing to initiate annexation by resolution and set the date for the second public hearing.
  • Tuesday June 18, 2019 – Public hearing to approve annexation: Town Council holds the second public hearing to consider the annexation and adopts a resolution making findings pursuant to State Government Code 56757 and 56375.3, which provides for annexation without protest and election requirements.

In addition, the Town is holding a community meeting to answer questions and provide additional information.

  • Monday May 6, 2019 – Community Meeting: Information session and an opportunity to meet your Police Chief and other key Town officials to get your questions answered. The meeting is scheduled at the Addison Penzak JCC of Los Gatos Auditorium (14855 Oka Road) from 6:30 – 8:00 p.m. 

Annexation Summary

California State Legislation 

In 2001 the California State Legislature enacted special legislation which made it easier for local governments to annex small urban islands within their jurisdictions that were 75 acres or less. The legislation was further revised in 2005 (Government Code Section 56375.3) to allow for a streamlined process for the annexation of islands less than 150 acres in size. The streamlined annexation process allows cities to annex property without protest or election requirements.

Santa Clara County Supports Annexation

The annexation of urban pockets implements longstanding, county-wide policies stating that urban development should occur within cities which are responsible for planning and providing services within their Urban Service Areas. These basic urban development policies were agreed to by the County, the 15 cities, and the Local Agency Formation Commission (LAFCO) over 35 years ago. Ever since, the policies have provided the fundamental framework for land use relationships between the County and the 15 cities. The 1994 County General Plan reiterates the County's policy that unincorporated pockets should eventually be annexed to their surrounding cities. Given the relatively small sizes and scattered locations, it is no longer feasible for the County to efficiently provide the remaining pockets with the same levels of urban services and infrastructure maintenance routinely provided by their surrounding cities.

The County also supports annexation of pockets because provision of urban services in Santa Clara County is primarily a city/town responsibility. Cities/towns and counties generally exist for very different purposes. Cities/towns are the units of government primarily responsible for planning for and providing services and facilities to urban/suburban areas. The vast majority of the Town’s efforts and budgets are used to perform these functions. Counties, by comparison, exist primarily to provide various health services, human services, and law and justice services. The overwhelming majority of the County's budget is used for these purposes. Providing urban services to neighborhoods is a diminishing County role.

Residents of unincorporated urban pockets should understand that there is little likelihood that urban services and infrastructure serving their neighborhoods will ever improve significantly as long as they remain unincorporated. As the pockets continue to decline as a percentage of County population and it becomes increasingly more inefficient for the County to serve the remaining pockets, it becomes less likely that the County will allocate substantially increased resources to provide improved services and facilities to the pockets especially since they can be provided more efficiently by the surrounding cities/towns.

Town of Los Gatos Annexation Process

On February 5, 2019 the Town Council of Los Gatos directed staff to initiate the streamlined annexation process of multiple unincorporated islands. Senate Bill 1266 created the streamlined process which allows cities/towns to annex unincorporated “islands" that are 150 acres or less, and that meet certain criteria, without requiring protest hearings or elections.

As noted in the “Public Hearings” section above the annexation process takes place primarily through public hearings before the Los Gatos Town Council.

For more information about the Town Council action please see item #9 of the February 5, 2019 Town Council Agenda: https://granicus_production_attachments.s3.amazonaws.com/losgatos/371eba55ea16077c87775a30c044dd4b0.pdf

Benefits of Annexation

Increased Services-Without Increased Taxes

Residents of urban pockets generally receive fewer urban services and reduced infrastructure maintenance compared to the Town residents in neighborhoods surrounding them. While pocket residents pay about the same amount in taxes and fees as their Town neighbors.

URBAN SERVICES

Service

Town

Comments

Property Tax & Assessed Valuations

No change

Annexation would not increase property taxes nor assessed valuations

Police Services

Increased Service

Los Gatos maintains an independent Police Department with higher service level coverage than currently provided.

Schools

No Change

School District boundaries are unaffected by annexation. Children will continue to attend the same schools they currently attend.

Fire Protection

No Change

The Santa Clara County Fire Department provides service to the Town and the County islands.

Road Maintenance

Increased Service

In general, the Town has more resources to maintain roads.

Library

Increased Service

Los Gatos maintains a state-of-the-art Town Library.

Annexation Costs

Fee Elimination

Currently, homeowners proposing renovations or new construction would need to annex into the Town and pay the required annexation fees. The streamlined annexation process takes care of this requirement, saving property owners time and money.

By annexing into the Town, unincorporated pocket residents will receive increased urban services at little or no increase in cost. The tables below represent a typical property tax bill from a pocket resident as compared to a Los Gatos resident. The primary difference for “Land, Improvements, Personal Property” is the lack of the County Library Retirement assessment for Los Gatos residents. Los Gatos residents pay no assessment for access to our state-of-the-art Library. All other taxes and fees are identical.

TAXES and FEES

Land, Improvements, Personal Property

Taxing Agency

Santa Clara County Rate

Town of Los Gatos Rate


Property Tax

1% of assessed value

1% of assessed value

County Retirement Levy

.03880

.03880

CO Bond 2008 Hosp Fac

.0072

.0072

CO Housing Bond 2016

.0105

.0105

Comm College Bonds

.0198

.0198

Elem or Unif Sch Bonds

.0486

.0486

High School Bonds

.0304

.0304

Mid Pen Open Space 2014

.0018

.0018

CO Library Ret

.0024

NA

Total Assessed Rates

1.1595

1.1571

Land and Improvements 

Taxing Agency

Santa Clara County Rate

Town of Los Gatos Rate


SCVWD-State Water Pro

.0042

.0042

Total Assessed Rates

.0042

.0042

Like the table above, the table below compares specific parcel taxes and special assessments between an unincorporated parcel and a Los Gatos parcel. The primary difference between these tax bills is the slightly higher assessment for the West Valley Sanitation District which is offset by the lack of a Santa Clara County Library assessment.. However, the elimination of duplicate garbage and recycling vehicles serving your neighborhood will help to reduce noise and traffic.  New Los Gatos residents could also potentially see minor differences in the Santa Clara County Water District’s Safe, Clean Water and Flood Control Debt assessments (under $10 dollars combined). In general, total Parcel Tax and Special Assessment tax bills are anticipated to be slightly lower after annexation.

TAXES and FEES

Parcel Tax/Special Assessments

Taxing Agency

Santa Clara County Rate

Town of Los Gatos Rate


Los Gatos-Saratoga High SD -Parcel Tax 2016

$49.00

$49.00

Santa Clara Valley Water Dist – Safe, Clean Water

$66.26

$66.26

Santa Clara County – SCCO Vector Control

$5.08

$5.08

Santa Clara County – Mosquito Asmt #2

$8.36

$8.36

Santa Clara County – Library JPA

$33.66

NA

Los Gatos Union School Dist – Measure B

$290.00

$290.00

Santa Clara Valley Water Dist – Flood Ctl Debt

$21.20

$21.20

West Valley Sanitation Dist – Sewer San/Storm

$555.00

$575.38

SF Bay Restoration Auth – Measure AA

$12.00

$12.00

Total Parcel Tax/Special Assessments

$1,040.56

$1,027.28


Greater Influence Over the Future of Your Neighborhood

In addition to improved services, one of the major benefits of annexation is that it will give you, and those who may reside on the property, greater influence over the future quality of life within your neighborhood. Decisions about the future of your neighborhood are made almost entirely by the Los Gatos Town Council, not the Santa Clara County Board of Supervisors.

Property owners in an unincorporated pocket are unable to vote in Town Council elections which ultimately determines the decision-makers who will be making these decisions. They also cannot serve on the Town Council, the Town Planning Commission, or other Town advisory committees whose decisions and advice are shaping the future of the larger community around you. By being annexed into Los Gatos, property owners gain a more effective voice in shaping the future quality of life within their neighborhood.

Annexation Does Not Affect Schools

Annexation into the Town does not affect school district boundaries. Children will continue to attend the same schools as they currently attend.

No Annexation Fees

Since the Town is initiating annexation, there are no annexation fees for pocket residents. If you were to seek to annex your property individually to the Town, or if you were required to annex because you were remodeling/reconstructing your home, you would be required to pay the normal annexation fees. These fees currently total approximately $7,900 for a single parcel, not inclusive of necessary land survey services.