Consolidation/Formation/Dissolution of Special District
Special District Dissolution Proceedings:
Note: All Code Sections refer to the California Government Code
Definition
Dissolution means the dissolution, disincorporation, extinguishment, and termination of
the existence of a district, and the cessation of all its corporate powers, except as the
commission may otherwise provide pursuant to Section 56886 for the purpose of
winding up the affairs of the district (56035).
Initiation of Proceedings
Notice of Intention:
1. Before circulating any petition for change of organization, the proponent shall file with
the executive officer a notice of intention to circulate a petition. The notice shall be
signed by the proponent, include the name and mailing address of the proponent and a
written statement not to exceed 500 words in length setting forth the reasons for the
proposal. The notice shall be in the form set forth in Section 56700.4.
Resolution of Application to LAFCO:
1. Proceedings for dissolution of a district may be initiated by petition or resolution of the
governing body of an affected local agency or school district. The Commission may also
initiate proposals for the dissolution of districts (56375).
Petition of Application to LAFCO:
Petitions for dissolution shall be signed by:
A.
For registered-voter districts, by either of the following: (1) Not less than 10% of
the registered voters within the district; or (2) Not less than 10% of the number of
landowners within the district who also own not less than 10% of the assessed value of
land within the district (56870).
B.
For landowner-voter districts, by not less than 10% of the assessed value of land
within the district (56870).
2. Non-Use of Corporate Powers (56871):
A petition for the dissolution of a district for the "non-use of corporate powers" requires
the signatures of three or more registered voters within the district for a registered-voter
district, or by three or more landowners within a landowner-voter district, provided that
one or more of the following conditions have existed or now exists:
A.
That during the three-year period preceding the date of the first signature on the
petition:
(1)
There has not been a duly selected and acting quorum of the board of directors
of the district;
(2)
The board of directors has not furnished or provided services or facilities of
substantial benefit to residents, landowners, or property within the district; and
(3)
The board of directors has not levied or fixed and collected any taxes,
assessments, service charges, rentals, or rates or expended the proceeds of those
levies or collections for district purposes.
B.
That during the one-year period preceding the date of the first signature upon the
petition, a quorum of the duly selected and acting board of directors has not met for the
purpose of transacting business.
C.
That, upon the date of the first signature upon the petition, the district had no
assets, other than money in the form of cash, investments, or deposits.
Commission Proceedings
After the dissolution proceedings have been initiated, SLO LAFCO must conduct a
noticed public hearing. After hearing public testimony, the Commission may approve,
modify, or deny the proposed dissolution. If it is approved, the Commission also will
adopt terms and conditions for the dissolution pursuant to Section 56886. Then the
proposed dissolution is scheduled for a conducting authority hearing where no further
modifications may be made.
Conducting Authority Protest Proceedings
The Commission is the conducting authority for district dissolution. The conducting
authority shall adopt a resolution making a finding regarding the value of written protests
filed and not withdrawn, and take one of the following actions:
1.
Order the dissolution without election (except for the dissolution of health
care/hospital districts, which require an election); or
2.
Order the dissolution subject to confirmation of the voters if a petition is
submitted signed by 25% of the landowners or voters requesting an election (57114); or
if protests are filed and not withdrawn by at least 25% or the landowners or voters
(57077).
3.
In the case of a LAFCO initiated dissolution, order the dissolution subject to
confirmation of the voters if a petition is submitted signed by 10% of the landowners or
voters within any affected district requesting an election (57113); or
4.
Terminate proceedings if a majority protest exists in accordance with Section
57078.
Concluding the Dissolved District's Affairs
Sections 57450 - 57463 provide detailed information and procedures for successor
agencies in concluding the affairs of a dissolved district. Pursuant to Section 57451(b), if
the territory of the dissolved district is located entirely within the unincorporated territory
of a single county, the county is the successor agency.
5. LIMITS OF OBLIGATION
The limit of obligation of LAFCO under this Agreement is in the sum of
$__________, which amount is estimated to be sufficient to compensate Consultant
for all services performed hereunder during the terms of this Agreement. In the
event at any time it appears to Consultant that said sum is not sufficient, s/he shall
immediately so notify the Executive Officer. S/he will not perform any work or incur
any obligation beyond said sum of $__________ without appropriate amendment to
this Agreement.
6. Consultant shall procure and shall maintain during the life of this Agreement:
Public Liability Insurance, Property Damage Insurance and Vehicle Liability
Insurance. Said Liability Insurance shall be in an amount not less than $500,000
(single limit) for injuries, including accidental death, to any one person, and subject to
the same limit for each person, in an amount not less than $500,000 on account of
one occurrence, and Property Damage Insurance in an amount not less than
$500,000.
Consultant shall either: (1) require each of his/her subcontractors to procure and to
maintain during the life of his/her subcontract, subcontractor’s public liability and
property damage of the type and in the same amount as specified in the preceding
paragraph, or (2) insure the activities of his/her subcontractors in his/her own policy.
The following endorsements must be attached to the policy:
1) If the insurance policy covers on an “accident basis”, it must be changed
to “Occurrence”.
2) The policy must cover personal injury as well as bodily injury.
3) The policy shall state that the policy shall not be cancelled or reduced in
coverage without thirty (30) days written notice to LAFCO.
4) Broad form property damage liability must be afforded.
5) The policy must name LAFCO, its officers and employees, as co-insureds.
6) Within ten (10) days after execution of this Agreement, Consultant shall furnish
LAFCO with certificates of insurance evidencing that Consultant has such
insurance and that such insurance names LAFCO as a co-insured.
7. Consultant shall defend, indemnify, and save harmless the Local Agency
Formation Commission, its officers, agents, and employees from any and all
claims, demands, damages, costs, expenses, or liability arising out of this
Agreement or occasioned by the performance or attempted performance of the
provisions hereof, including but not limited to any act or omission to act on the
part of Consultant or his/her agents or employees or independent contractors
directly responsible to him/her.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date and year first above written.
LAFCO
PAUL L. HOOD
Executive Officer
CONSULTANT
Date
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