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Annexation No. 2018-01 for the County Island Annexation at Seventeenth Street and Tustin Avenue September 3, 2019 Page 6 ENVIRONMENTAL IMPACT In accordance with the California Environmental Quality Act (CEQA), the proposed annexation of an existing County island is exempt from further review per CEQA Guidelines Section 15319 (Annexation of Existing Facilities and Lots for Exempt Facilities). It has been determined that this Class 19 exemption is applicable to the proposed annexation as the project involves the annexation to the City areas containing existing private structures developed to the density allowed by the current zoning and prezoning of both the City and County, and the extension of utility services to the existing facilities have a capacity to serve only the existing facilities. In conjunction with the City's CEQA determination regarding the annexation, the County of Orange completed a negative declaration (ND) for the two developments. The ND identified any potential impacts to the environment as well as mitigation measures needed to reduce or eliminate the impacts. The City has reviewed this document and is in agreement with its findings and conclusions. The lead agency for the ND is the County of Orange. FISCAL IMPACT As part of the annexation efforts, the City hired AECOM to prepare a Fiscal Assessment of the proposed annexation. Based on the final report dated May 15, 2019, the conclusions note that the annexation of the existing land uses will result in a nominal net fiscal surplus to the City of approximately $35,000. Further, the study estimates that the existing land uses with the two proposed restaurant developments at the northeast corner of Seventeenth Street and Tustin Avenue will result in a positive net fiscal impact of $95,000 to $129,000, which will not be realized until the restaurant projects are completed and operational in approximately 18-24 months. The majority of the revenue increase will result from the sales tax generated from the restaurants, which is anticipated to be at least $64,000 per year (Exhibit H). inh Thai �Q T Executive Director Planning and Building Agency VF:Ia &RFCA\201MAnnexation No. 2018-01 K `-- Steven Mendoza Executive Director Community Development Agency Exhibits: 1. Resolution approving Annexation No. 2018-01 2. Cooperative Agreement with the County of Orange 3. Resolution approving a Property Tax Exchange Agreement with County of Orange 4. Resolution approving General Plan Amendment No. 2018-04 5. Ordinance approving Amendment Application No. 2018-07 6. Water Service Agreement with the City of Tustin 7. Ordinance approving the change in Ward 3 boundaries 8. Fiscal Assessment prepared by AECOM 75C-6