A. The tax established by this chapter is a special tax, the proceeds of which are dedicated towards subsidizing those assessments levied upon Town citizens for sewer project implementation.
B. Revenue and Taxation Code section 7285.91 requires that this chapter include "an expenditure plan describing the specific projects for which the revenues from the tax may be expended". All revenue from the tax shall be restricted revenue, expended solely to fund the sewer project in such a manner as to lower sewer project assessments levied upon citizens in the Town of Yucca Valley. The Town shall negotiate an agreement with the Hi- Desert Water District under which the Town will remit payments of the tax proceeds towards the sewer project on an agreed-upon basis, subject to the following terms:
1. The Town's allocation of the tax proceeds towards the sewer project shall be credited towards sewer project assessments imposed upon Town citizens,
2. The tax proceeds shall be credited towards sewer project assessments equitably amongst all assessment payers in all sewer project phases, such that all assessment payers will receive the same pro-rata percentage decrease in their assessments,
3. The tax proceeds shall not be used to pay for any sewer project services or improvements already provided by a governmental or private entity or in a manner that would diminish or replace services provided by the Hi-Desert Water District,
4. The tax proceeds may be used to pay for the Town's costs associated with those independent audits, special fund management and administrative costs associated with the tax required by this chapter, excepting that payment of administrative costs shall not exceed five percent (5%) of the annual tax proceeds in any annual period, and
5. The Town's expenditure of tax proceeds shall be made on a regular basis on a frequency to be determined by the Town and in conformance with the State Board of Equalization's allocation of such proceeds to the Town.
In the event the Town and Hi-Desert Water District are unable to reach mutual agreement upon the foregoing terms, the Town shall undertake an alternative method of utilizing the tax proceeds to directly achieve lower assessments in an equitable manner for all sewer project phases, in accord with the foregoing expenditure terms in subsections B1 through B5 of this section. In any event, any expenditure of tax proceeds shall be undertaken for the sole purpose of decreasing or subsidizing assessments equitably in all sewer project phases.
C. When received by the Town, the proceeds resulting from the transactions and use tax imposed by this chapter shall be deposited into a special fund established by the Town as the "Sewer Project Assessment Assistance Fund". The Town's independent auditors shall complete a report reviewing the collection, management and expenditure of revenue from the tax levied by this chapter. The independent auditor's report shall include an accounting of the revenues received and expenditures made from the Sewer Project Assessment Assistance Fund annually to the Town Council and made available for public review. The Town Council shall, as part of the Town's regular budget process, annually review, direct and adopt an expenditure plan for the Sewer Project Assessment Assistance Fund, applying the proceeds of the transactions and use tax consistent with the requirements of this chapter. In no event shall the Town Council have authority to direct a use of tax proceeds that is inconsistent with the purposes expressed in this chapter. (Ord. 264, 11-8-2016)