The 2008 deal annexing 620 acres of land near the SLO County Regional Airport from the county into San Luis Obispo paved the way for the 720-home Avila Ranch housing development on Buckley Road. But that same agreement also prevents SLO city from capturing any property taxes from the development, leaving a potential revenue gap to provide future public services to the area.
On Feb. 7, the SLO City Council voted to execute a $54,825 contract with Economic Planning Systems to assist the city in conducting financial analysis and preparation to form a community facilities district for the Avila Ranch project, which if created would establish a special property tax to pay for the public services.
Since the land where Avila Ranch is proposed was zoned commercial when the city annexed it, the county is entitled to all future property taxes under the agreement while the city is entitled to all future sales taxes. Now, the city wants to rezone the Avila Ranch land to residential.
City staff told the council Feb. 7 that it would be meeting with the county in an attempt to negotiate a split of the taxes in light of the property’s likely change from commercial to residential zoning.
“City staff will be meeting with the county to encourage them to split the property tax to what it should be for raw residential land,” a staff report read. The staff report called forming a community facilities district a “backup” revenue source “should the city not be successful,” but the decision is “entirely a discretionary decision of the county.”
According to the report, SLO has never formed a community facilities district.