HomeMy WebLinkAboutAgreement A-17-236 with City of Clovis.pdf
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2017 AMENDED AND RESTATED
MEMORANDUM OF UNDERSTANDING
COUNTY OF FRESNO AND CITY OF CLOVIS
This Amended and Restated Memorandum of Understanding (“MOU”) is made and executed this
___ day of ______, 2017 (“Effective Date”), by and between the County of Fresno, a political subdivision
of the State of California (“County”) and the City of Clovis, a municipal corporation of the State of
California (“City”), with respect to the following Recitals, which are a substantive part of this MOU.
County and City are each a “party” to this Agreement and are sometimes collectively referred to as “the
parties” to this Agreement.
RECITALS
A. On August 21, 1990, the parties entered into a comprehensive agreement covering
development, annexations, sales taxes, property taxes, and other matters, commonly referred to as the
County/Clovis MOU or Tax Sharing Agreement (“1990 MOU”). The 1990 MOU also included provisions
relating to redevelopment and included as a party the former Clovis Community Development Agency.
In 2011, the State adopted comprehensive legislation (ABx1 26) dissolving California redevelopment
agencies and prohibiting further redevelopment activities under the California Community
Redevelopment Law (former Health and Safety Code §§ 33000 et seq.)
B. On June 25, 2002, the parties entered a First Amendment to the 1990 MOU, which made
substantive changes to the 1990 MOU.
C. The parties entered into additional amendments and side agreements to the 1990 MOU to
address patterns of urban development and specific sphere of influence changes and annexations as
follows:
May 20, 1997, side agreement to address an annexation near Ashlan/Locan Avenues
(hereafter “1997 Side Agreement”); and
June 24, 2002, side letter agreement to address the City’s waste water plant (hereafter
“2002 Side Letter Agreement”); and
June 25, 2002, First Amendment to address new growth and special study areas, reciprocal
collection of County and City development fees, sales tax equivalent provisions for new
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2017 Amended and Restated Memorandum of Understanding
County of Fresno and City of Clovis
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 growth areas, and alternative standards for annexation to facilitate industrial and regional
commercial development projects (hereafter “First Amendment to 1990 MOU”) ; and
November 8, 2005, Second Amendment to address the annexation of Harlan Ranch and
the Locan/Nees Avenue area (hereafter “Second Amendment to 1990 MOU”); and
March 14, 2012, Third Amendment to address an annexation into the Dry Creek preserve
(hereafter “Third Amendment to 1990 MOU”); and
December 9, 2014, Fourth Amendment to expand the City’s sphere of influence (hereafter
“Fourth Amendment to 1990 MOU”).
Collectively, the 1990 MOU, the 1997 Side Agreement, the 2002 Side Letter Agreement,
the First Amendment to 1990 MOU, the Second Amendment to 1990 MOU, the Third
Amendment to 1990 MOU, and the Fourth Amendment to 1990 MOU are hereafter
referred to as the “1990 MOU, as amended”.
D. The 1990 MOU, as amended, contains some provisions that are no longer applicable to the
parties and the 1990 MOU, as amended is set to expire June 24, 2017. The parties desire to make
additional changes to their comprehensive agreement set forth in the 1990 MOU, as amended, and to
extend the term of their comprehensive agreement for an additional 10 years with an option for one 5 year
extension.
E. Due to the age of the 1990 MOU, as amended, the number of amendments, and a desire to
make additional changes, the parties determined that it is in their best interests to enter into this new
Restated and Amended MOU, which will replace the 1990 MOU, as amended.
F. The restated purposes for this MOU, as set forth in the 1990 MOU, as amended are as
follows:
1. County and City wish to work together to develop a fair and equitable approach to
tax sharing and encourage sound economic growth.
2. In order to encourage economic development and environmentally sound land use
planning, it is important that any tax sharing among County and City be determined in advance and that
such arrangements not be fiscally detrimental to either County or City.
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 3. County and City recognize the importance of County and City services and are
prepared to cooperate in an effort to address County’s and City’s fiscal problems.
4. Through annexation and appropriate development, City provides the opportunity
for economic growth and development to support public services for City and County.
5. Close cooperation between County and City is necessary to maintain the quality of
life throughout Fresno County and deliver needed services in the most cost efficient manner to all City
and County residents.
6. County recognizes the need for orderly growth within and adjacent to City and for
supporting appropriate annexations and promoting the concentration of development within City. In that
regard, County General Plan Goal LU-G, provides that County will direct urban growth and development
within the City spheres of influence to existing incorporated cities and will ensure that all development in
City fringe areas is well planned and adequately served by necessary public fac ilities and infrastructure
and further Countywide economic development goals.
7. Annexation which results in the development of urban uses in response to a clearly
demonstrated community demand is appropriate; and well planned and fiscally sound developmen t can
be a valuable tool in the physical and economic development of City and County.
8. City recognizes that development within City limits may also have the effect of
concentrating revenue generating activities within City rather than in unincorporated areas.
9. The parties recognize that when urban growth and development is directed to cities
there is a lost opportunity of development by County in the unincorporated area and the sharing of the
local sales and use taxes generated by such development would serve as a tool for the County to participate
in receiving a share of that new revenue.
10. It is the interest of the parties to require all new urban development to pay a roughly
proportionate share of the cost of urban services and infrastructure created by that development, whether
it occurs in the City or in the adjacent unincorporated area of the City’s sphere of influence.
11. The parties recognize the need to cooperate to pursue common goals of economic
development for citizens of the County and City.
G. The purpose for the 1990 MOU, as amended, as set forth above remain, and the parties
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 desire to address the fiscal, economic development, and service needs mentioned above.
H. Nothing in this MOU is intended to change the underlying property and sales tax sharing
formulas set forth in the 1990 MOU, as amended, and restated herein.
NOW, THEREFORE, County and City hereby agree as follows:
ARTICLE I
DEFINITIONS
Unless the particular provision or context otherwise requires, the definitions contained in this
article and in the Revenue and Taxation Code shall govern the construction, meaning, and applica tion of
words used in this MOU.
1.1. “Base property tax revenues” means property tax revenues allocated by tax rate equivalents
to all taxing jurisdictions as to the geographic area comprising a given tax rate area annexed in the fiscal
year immediately preceding the tax year in which property tax revenues are apportioned pursuant to this
MOU, including the amount of State reimbursement for the homeowners’ and business inventory
exemptions.
1.2. “Property tax increment” means revenue from the annual tax increment, as “annual tax
increment” is defined in Section 98 of the Revenue and Taxation Code, attributable to the tax rate area for
the respective tax year.
1.3. “Substantial development” or “substantially developed” means real property which, prior
to annexation, has an improvement value to land value ratio equal to or greater than 1.25:1, as of the lien
date in the fiscal year in which the annexation becomes effective.
1.4. “Property tax revenue” means base property tax revenue, plus the property tax increment
for a given tax rate area.
1.5. “Tax apportionment ratio” means the tax apportionment ratio of the parties for a given
fiscal year and shall be ascertained by dividing the amount determined for each party pursuant to Revenue
and Taxation Code Sections 96(a) or 97(a), whichever is applicable, by that party’s gross assessed value,
and by then dividing the sum of the resulting tax rate equivalents of both parties into each party’s tax rate
equivalent to produce the tax apportionment ratio.
1.6. “Tax rate equivalent” means the factor derived for an agency by dividing the property tax
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 levy for the prior fiscal year computed pursuant to Section 97 of the Revenue and Taxation Code by the
gross assessed value of the agency for the prior fiscal year.
1.7. “Urban development” or “urban type development” means development not allowed in
areas designated Agriculture, Rural Residential or River Influence in County’s General Plan or its
applicable community plans as of the Effective Date of this MOU.
ARTICLE II
ANNEXATIONS BY CITY
2.1. Any annexations undertaken by City following the date of the execution of this MOU shall
be consistent with both the terms of this MOU and the standards (hereinafter “The Standards” or
“Standards”) as set forth in Exhibit 1. This MOU shall not apply to annexations proposed by City which
are not in compliance with its terms or which fail to meet The Standards. If a proposed annexation is not
in compliance with the terms of this MOU, including, but not limited to, The Standards, then no property
tax exchange agreement, as required by Revenue and Taxation Code Section 99, shall exist in regards to
that proposed annexation. Any such non-complying annexation shall be handled individually through
separate negotiations between City and County.
2.2. In order to encourage the orderly processing of proposed annexations, City shall, at least
thirty (30) days prior to filing any annexation proposal with the Fresno County Local Agency Formation
Commission (hereinafter “LAFCo”), notify County of its intention to file such proposal and the date upon
which City expects such proposal to be filed. Upon County’s request, City agrees to meet with County to
review whether its proposed annexation complies with The Standards. Within fifteen (15) days after the
date County receives notice by City of its annexation proposal, County shall notify City in writing if it has
determined that the proposed annexation is inconsistent with The Standards. Upon receipt of such
notification, City may either modify the proposal to County’s specifications or adopt a resolution finding
that the proposed annexation is, in City’s determination, consistent with The Standards.
2.3. If City adopts a resolution making the findings described in Section 2.2, then County may
challenge such findings by appropriate court action filed within thirty (30) days of receipt of written notice
of the adoption of City’s resolution. The court shall independently review the evidence and determine
whether the proposed annexation is consistent with The Standards.
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 As an alternative to a judicial challenge by the County, the parties may within the aforesaid thirty
(30) day period mutually agree in writing to arbitrate their dispute through proceedings conducted in
accordance with the rules established by the American Arbitration Association. The parties upon agreeing
to arbitrate will proceed with arbitration in a timely manner. The arbitrator hearing the matter shall
independently review the evidence and determine whether the proposed annexation is consistent with The
Standards.
Costs incurred by the prevailing party, either in court proceedings or arbitration, shall be paid by
the non-prevailing party. The parties agree that the City shall not proceed to LAFCo with the proposed
annexation until the dispute is finally resolved either by court or arbitration proceedings. If City attempts
to proceed with such proposed annexation prior to the expiration of the period in which County may file
its court action or agree to arbitrate, or prior to the final conclusion of such court or arbitration proceedings,
then this memorandum shall immediately terminate as to such annexation and in particular no property
tax exchange agreement, as required by section 99 of the Revenue and Taxation Code, shall exist between
City and County as to that proposed annexation.
Notwithstanding the foregoing, the City may proceed to LAFCo under this MOU if court or
arbitration proceedings are not completed within thirty (30) days after the filing thereof provided,
however, that LAFCo in its resolution of approval, at the request of the City, conditions the completion
of the annexation upon the Executive Officer’s prior receipt of a certified copy of the document evidencing
the finality of the aforesaid court or arbitration proceedings determining that the proposed annexation is
consistent with Exhibit 1, or alternatively, receipt of a written stipulation of the City and County agreeing
that a master property tax agreement still exists permitting the completion of such proposed annexation.
If LAFCo declines to include the aforesaid condition in its approval, or City fails to timely request such
condition, no property tax exchange agreement as required by Section 99 of the Revenue and Taxation
Code shall exist between City and County as to that proposed annexation. If City nevertheless attempts
to proceed with the annexation, such action on the part of the City shall also be deemed good cause fo r
the County at its option to terminate this MOU in its entirety.
2.4. For the purpose of promoting economic development and job creation, an Alternate
Standard for Annexation for industrial or regional commercial uses is hereby created. In the place of th e
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 Standards for Annexation set forth in Exhibit 1, the Alternate Standard for Annexation shall apply to and
govern the review of annexation proposals for industrial or regional commercial uses. Annexation
proposals for industrial/regional commercial uses shall include a conceptual development plan, as
described herein. The conceptual development plan shall consist of the economic objectives to be
achieved, the service and financing strategy and its schedule, and shall include a map of the proposed
prezoning. The conceptual development plan’s schedule shall include milestones for major project
components to measure the progress of the project. Due to the complexity of such projects the
development schedule for planning and implementation may reasonably require a period of from five to
ten years. The annexation proposal shall be submitted to and reviewed by the County pursuant to Section
2.2. Annexation proposals that comply with the criteria of this Section 2.4 shall be deemed to comply with
Section 2.1. The annexation application to be submitted to LAFCo shall be considered complete upon
adoption of the prezoning by the City. County and City agree to meet annually to review the progress
toward the achievement of the economic development objectives and to identify ways to promote mutual
economic development objectives.
2.4.1. Section 2.4 shall be deemed suspended if City rezones an area that was annexed
using the Alternate Standard for Annexation to a zone other than Industrial/Regional Commercial without
County’s consent.
2.5. The following conditions shall apply to the 830-acre Dry Creek Preserve area as shown on
Exhibit 2.
2.5.1. Prior to approving any Master Plan development standards for the Dry Creek
Preserve area, City shall notify and invite County to participate in development of the scope for the Master
Plan. After meaningful consultation and taking into consideration County’s comments, City may approve
the Master Plan. City shall provide draft Master Plan documents to County as part of any environmental
review process and in no event less than 30 days prior to City’s first public hearing to consider adoption
of the Master Plan.
2.5.2. Prior to annexations proposed in the Dry Creek Preserve, City shall demonstrate
that it has sufficient capacity to provide urban services to the annexation project area and areas within 1/8
mile of the site in accordance with the Clovis General Plan, Dry Creek Preserve Master Plan, and City
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 adopted master service delivery plans. Clovis commits to studying urban service delivery (at a minimum
provision of potable water and collection and treatment of wastewater) to the entire Dry Creek Preserve
in the context of its Master Plan Updates and Planning Program.
2.5.3. City shall demonstrate that City’s impact fee structure includes, at a minimum, fees
for signalization of the following intersections: Sunnyside and Shepherd, Fowler and Shepherd, Teague
and Fowler, Nees and Fowler, Sunnyside and Teague, and Armstrong and Nees.
2.5.4. As part of any proposed annexation, City shall require a Traffic Report signal
warrant study of the intersections listed above to determine if the proposed annexation at build out would
result in any of the six intersections meeting signalization warrants. If so, City shall require the developer
to provide said signalization as part of the conditions of approval for the development. County shall assist
City in the analysis of the project traffic analysis and traffic signal warrant studies for this area.
2.5.5. City agrees that following annexation and upon request from the Director of the
County’s Public Works and Planning Department, City shall conduct specific traffic enfo rcement
activities for Fowler Avenue between Shepherd and Nees Avenues, Teague Avenue between Fowler and
Armstrong Avenues, and Armstrong Avenue between Nees and Teague Avenues within the confines of
the Dry Creek Preserve area.
2.5.6. If intersection safety lighting or additional regulatory or warning signage
improvements are determined to be warranted by the County following a study for Fowler Avenue
between Shepherd and Nees Avenues, Teague Avenue between Fowler and Armstrong Avenues, and
Armstrong Avenue between Nees and Teague Avenues, City shall provide for the installation of the
identified facilities at City’s expense within 90 days of request by the County.
2.5.7. When development activity requires the construction of municipal utilities in
County road rights-of way, City shall obtain an encroachment permit that will, in part, obligate City to
timely maintenance of the roadway at City expense for any repairs created by or related to City-installed
improvements.
2.5.8. City shall provide for the pick-up and removal of illicitly dumped trash and debris
within the public road rights-of-way of Fowler Avenue between Shepherd and Nees, Teague Avenue
between Fowler and Armstrong Avenues, and Armstrong Avenue between Nees and Teague Avenues on
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 an as needed basis or as requested by the County.
2.5.9. All storm drainage generated by the proposed annexation and all existing drainage
patterns shall be accommodated by existing or project-installed Master Planned Storm Drainage
infrastructure and shall not contribute to the surface flows or ponding within the unincorporated areas. All
new storm drainage shall conform with the Fresno Metropolitan Flood Control District’s Master plan for
this area.
2.5.10. City shall provide street sweeping on Armstrong Avenue between Teague and Nees
Avenues; on Teague Avenue between Fowler and Armstrong Avenues; and on Fowler Avenue between
Shepherd and Nees Avenues, on an as needed basis or as requested by the County.
ARTICLE III
EXCHANGE OF PROPERTY TAX REVENUES TO BE MADE UNDER
SECTION 99 OF THE REVENUE AND TAXATION CODE
3.1. The property tax revenues collected in relation to annexations covered by the terms of this
MOU shall be apportioned between City and County as set forth in sections 3.2 and 3.3 below. The parties
acknowledge that, pursuant to Sections 54902, 54902.1 and 54903 of the Government Code and Sections
97 and 99 of the Revenue and Taxation Code, the distribution of such property tax revenues will not be
effective until the revenues are collected in the tax year following the calendar year in which the statement
of boundary changes and the map or plat is filed with the County Assessor and the State Board of
Equalization.
3.2. In regards to the annexation of real properties which are not considered substantially
developed at the time of annexation, County will retain all of its base property tax revenue upon
annexation. The amount of the property tax increment for special districts whose services are assumed by
City shall be combined with the property tax increment of the County, the sum of which shall be allocated
between City and County pursuant to the following ratio:
County: 63%
City: 37%
3.3. In regards to the annexation of real properties which are considered substantially developed
at the time of annexation, property tax revenue (base plus increment) will be reallocated as follows: a
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 detaching or dissolving district’s property tax revenue (base plus increment) shall be combined with
County’s and the sum of which shall be allocated between City and County pursuant to the ratio set forth
in section 3.2.
ARTICLE IIIA
ANNEXATIONS THAT DO NOT RESULT IN URBAN DEVELOPMENT
County and City have expressed concern with the effect of property being annexed into City for
the purposes of urban development but being utilized for new non-urban uses. To address these concerns,
County and City agree to the following:
3A.1. City shall develop and implement policies and procedures, including amendments to its
General Plan, Specific Plans and zoning ordinances, as City deems appropriate, to ensure that property
planned for urban development and annexed into the City based upon that premise pursuant to the terms
of this MOU, shall not be developed with new non-urban type development.
3A.2. With regards to property annexed into City for the purposes of urban development, if the
entitlements for urban development expire and the land remains undeveloped without new urban type
development entitlements for a period of 365 days, or if the property is subsequently used for new non-
urban development uses (those not previously in active use at the time of annexation) regardless of the
expiration of entitlements, City agrees to do the following:
Pay County the Cash Equivalent of 150% of the City’s incremental allocation of the Countywide
one-percent (1%) property tax rate that City collects from the annexation area subject to this
Section until said properties receive new entitlements for urban development or are developed with
urban type development, whichever occurs first. The first payment of Cash Equivalent shall be
due and payable ninety (90) days after 365 days following the expiration of the City issued
entitlements or (90) days after the annexed property is developed with new non-urban
development, whichever occurs first.
3A.3. The Cash Equivalent payment shall only be due on those portions of the annexation that
meet the requirements of Subsection 3A.2.
3A.4. Nothing in this Section shall prevent City from including in its policies and procedures a
requirement that the property owner and developer be responsible to City for the Cash Equivalent.
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 ARTICLE IV
DEVELOPMENT WITHIN, ADJACENT TO AND NEAR
CITY’S SPHERE OF INFLUENCE
4.1. Development within City’s sphere of influence.
4.1.1. Within one half (1/2) mile of City’s boundary as set forth in Exhibit 3, County shall
not approve any discretionary development permit for new urban development within the City’s sphere of
influence unless that development shall have first been referred to City for consideration of possible
annexation. If City does not, within sixty (60) days of receipt of notice from County, adopt a resolution of
application to initiate annexation proceedings before LAFCo, County may approve development permits
for that new urban development. County’s approval shall take into consideration City’s general plan and
be consistent with County’s general plan policies, provided that the development is orderly and does not
result in the premature conversion of agricultural lands.
4.1.2. Within the City’s sphere of influence, County shall require compliance with
development standards that are comparable to City’s and charge fees reflecting the increased
administrative and implementing cost where such City standards are more stringent than County’s. These
requirements shall apply to discretionary development applications approved by County. For purposes of
this Agreement, “discretionary development applications” shall mean General Plan Amendments,
Rezoning, Tentative Tract Maps, Tentative Parcel Maps, Conditional Use Permits, Director Revie w and
Approvals, and Variances.
4.1.3. City development fees shall be charged for any discretionary development
applications to be approved by the County within City’s sphere of influence. To establish or amend City
development fees, City shall conduct a public hearing and notify property owners in accordance with State
Law. At the conclusion of that hearing, City shall adopt a resolution describing the type, amount, and
purpose of City fees to be requested for County adoption.
4.1.4. City shall transmit the adopted resolution to the County for its adoption of the fees.
City shall include a draft ordinance for County’s adoption with appropriate supporting documentation or
findings by the City demonstrating that the fees comply with Section 66000 of the Government Code and
other applicable State Law requirements. City fees may also include City’s and County’s increased
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 administrative costs and inspection charges.
4.1.5. County shall collect the applicable City development fees for infrastructure and
facilities at the time of final map approval or issuance of building permits as established by the f ee
schedule. Or, County shall require the applicant to present a voucher issued by City evidencing the
payment of the fees directly to City, or written confirmation by City that fees are inapplicable. If County
imposes and collects fees on behalf of City, County shall transfer the fees to City at the earliest time legally
permitted.
4.1.6. City shall give County at least thirty (30) days notice before implementing any new
fees or an amendment to existing fees. Notwithstanding this Section 4.1.6, or any oth er provision of this
MOU, City shall be solely responsible for determining the amount of the fees and setting them in
accordance with law. This Section 4.1.6 shall not be construed as a representation by County as to the
propriety of the fees or the procedures used in setting them.
4.1.7. City shall hold harmless, defend and indemnify the County from all claims,
demands, litigation of any kind whatsoever arising from disputes relating to the fees, the enactment of the
fees or the collection of fees.
4.2. Development adjacent to and near City’s sphere of influence.
4.2.1. Within the City’s sphere of influence and the area beyond that sphere of influence,
as shown in Exhibit 3, County and City agree to the following prior to adopting any general plan
amendment allowing new urban development or approving a discretionary development permit for new
urban development:
A. With respect to general plan amendments, County shall notify City staff of the
proposed general plan amendment, and consult with the City at a staff level in such fashion as to provide
meaningful participation in County staff’s analysis of the proposed general plan amendment, and shall
likewise consult on other policy changes which may have an impact on growth or the provision of urban
services. In this regard, City shall be given the opportunity to respond to County staff before the proposed
general plan amendment is prepared for presentation to County’s Planning Commission. Such
consultation shall include County’s solicitation of comments from City in the preparation of any Initial
Study required by the California Environmental Quality Act undertaken as part of County staff’s analysis
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 of the proposed general plan amendment. If City determines that urban development which could occur
as a result of the proposed general plan amendment may have a significant effect on the environment,
County shall require an EIR to be prepared if a fair argument, based on substantial evidence in the record
before the County, can be made in support of the City’s finding.
B. With respect to discretionary development permits for new urban development,
County shall notify City staff of the proposed discretionary development permit, and consult with the City
at a staff level in such fashion as to provide meaningful participation in County staff’s analysis of the
proposed discretionary development permit and consult with City over the potential effects on City
services of the proposed development, consistency with City’s general plan, and the potential for an
expansion of the City’s sphere of influence to include the proposed development. Consultation shall
commence not less than sixty (60) days prior to the first scheduled action to consider the discretionary
permit, and before the completion of environmental studies. After meaningful consultation and taking
into consideration City’s general plan, County may approve development permits for that new urban
development that is consistent with County’s general plan policies, provided that the development is
orderly and does not result in the premature conversion of agricultural lands.
4.2.2. County shall support urban unification. To this end, County shall oppose the
creation of new governmental entities within City’s sphere of influence, or within one-half (1/2) mile
thereof, except for such entities that may be necessary to address service requirements that cannot be
addressed by annexation to City. City and County will support transition agreements with current service
providers which recognize the primary role of cities as providers of urban services within urban areas and
where current service providers of urban services have participated in service master planning.
4.3. County development fees.
4.3.1. If County adopts County-wide capital facilities fees, City shall require that an
applicant for any land use entitlement or permit within City pay all County public facilities fees applicable
to the entitlement or permit on behalf of County.
4.3.2. At County 's request, City shall either timely impose or collect all such fees or shall
require the applicant to present a voucher issued by County evidencing the payment of the fees directly to
County or written confirmation by County that fees are inapplicable.
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 4.3.3. If adopted by County, the fees are to mitigate the impact of development on required
County facilities and services including, but not limited to, the criminal justice system, health, social
services, parks, transportation and library. If City imposes and collects fees on behalf of County, City
shall transfer the fees to County at the earliest time legally permitted. County's fees may also include
City’s and County’s increased costs required for their administration.
4.3.4. County shall give City at least thirty (30) days notice before implementing any new
fees or an amendment to existing fees. Notwithstanding this Section 4.3.4, or any other provision of this
MOU, County shall be solely responsible for determining the amount of the fees and setting them in
accordance with law. This Section 4.3.4 shall not be construed as a representation by City as to the
propriety of the fees or the procedures used in setting them.
4.3.5. If County proposes non-County-wide fees dedicated for localized improvements or
quality of life issues, City is willing to consider such fee proposals.
4.3.6. County shall hold harmless, defend and indemnify the City from all claims,
demands, litigation of any kind whatsoever arising from disputes relating to the fees, the enactment of the
fees or the collection of fees.
4.4. Special Study Area.
4.4.1. The area generally bounded by Tollhouse Road (State Route 168) to the north, east
of DeWolf Avenue, generally north of the Nees Avenue alignment on the southern boundary, and
approximately halfway between McCall and DelRey Avenues to the east as shown in Exhibit 4, shall be
the subject of a special study area by City and County. City and County agree to discuss further planning
and development of the special study area, primarily for job generating uses. Development of the special
study area shall require an amendment to this MOU.
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ARTICLE V
IMPLEMENTATION OF SALES TAX
REVENUE COLLECTION
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 5.1. Pursuant to the Bradley Burns Uniform Local Sales and Use Tax Law, Part 1.5, Division
2, of the Revenue and Taxation Code (commencing with Section 7200), City consistent with the 1990
MOU, amended its local sales and use tax ordinance, first operative as of October 1, 1990, to provide
County with an equivalent sales tax revenue sharing proportion. After periodic reallocations, the County’s
proportion is currently set at five percent (5%) of the City’s one percent (1%) sales and use tax revenues
City receives from the Statewide sales tax generated within the incorporated areas of the City. The precise
amount is reflected in Clovis Municipal Code, § 3.3.310, with the City receiving .950% and the County
receiving .050%. The City’s local sales and use tax ordinance is on file with the State Board of
Equalization (“SBE”).
5.2. The City’s sales and use tax ordinance enables the County, pursuant to its sales and use tax
ordinance, to collect from the SBE that percentage portion of the sales and use tax revenues generated
within the incorporated areas of City set forth in Section 5.1.
5.3. Whenever City proposes an annexation of unincorporated territory which generates
substantial sales tax revenue for County, City agrees to further amend its local sales and use tax ordinance
as set forth in this section. This additional amendment shall become operative no later than the
commencement of the next calendar quarter following the date upon which such annexation is certified as
complete by the Executive Officer of LAFCo. This additional amendment shall decrease City’s sales tax
rate to yield an amount equal to the amount of substantial sales tax revenue being collected by County in
the area to be annexed, thus enabling County to increase its sales tax rate by a corresponding percentage,
which shall continue to accrue to County throughout the term of this MOU. Any such additional
amendment made by City pursuant to this section shall likewise preserve intact the existing percentage
share set forth in Section 5.1. Further, City agrees that it shall not split or separate areas into smaller
annexations for the purpose of, or having the effect of, creating an annexation or annexations which,
individually, do not generate substantial sales tax revenue, but which would generate such revenue if
combined. For purposes of this Article, the term “substantial sales tax revenue” shall be defined as sales
tax revenue derived from taxable sales in the area annexed equal to at least:
5.3.1. If only information, for less than one fiscal year exists, then $100,000 in taxable
sales in the most recent quarter for which such information from the State Board of Equalization is
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 available in writing or electronic media, and projected to a full four quarters, at least $400,000 in taxable
sales.
5.3.2. If information for one or more years exists, then $400,000 in taxable sales in the
most recent year for which such information from the State Board of Equalization is available in writing
or electronic media.
5.4. If City fails to amend its sales tax ordinance upon the annexation of unincorporated
territory which generates substantial sales tax revenue for County as provided in section 5.3, or if City
splits or separates areas into smaller areas as prohibited by section 5.3, then this MOU shall immediately
terminate and, in particular, no property tax exchange agreement, as required by Section 99 of the Revenue
and Taxation Code, shall exist between City and County.
5.5. City and County further agree that the annual report of the State Board of Equalization and
the Department of Finance Annual Population Estimates shall be used as the data source for the purpose
of calculating the per capita sales tax revenue pursuant to this MOU.
5.6. The provisions of Section 5.1 shall continue in effect during the entire term of this MOU
at the current 5% level. The sharing of sales and use tax revenues shall include only those amounts
collected pursuant to the Bradley-Burns Uniform Local Sales and Use Tax Law, and not any amounts
collected as the result of any voter approved override to the local allocation to City. The provisions of
Section 5.1, allowing the County to collect a portion of sales and use tax revenues generated within the
incorporated area of City, shall continue to apply to all incorporated areas of City, regardless of the time
of annexation.
5.7. In addition to local sales and use tax sharing pursuant to Sections 5.1 through 5.6 of this
Article, City shall share with and pay County the cash equivalent of an additional percentage of City’s
portion of local sales and use taxes generated, as set forth in Section 5.8 (hereinafter “Cash Equivalent”).
The sharing and payment of the cash equivalent of sales and use tax revenues shall include only those
equivalent amounts collected pursuant to the Bradley-Burns Uniform Local Sales and Use Tax Law, and
not any amounts collected as the result of any voter approved override to the local allocation to City. Such
Cash Equivalent payment shall represent only such local sales and use tax as shall be collected within City
limits within the Expanded Sphere of Influence, as shown on Exhibit 5 (hereinafter “Expanded Area”).
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 No Cash Equivalent payment shall be required for that area shown as the 1983 Sphere of Influence in
Exhibit 5. Cash Equivalent payments shall be made by City warrant to County. Such payments shall not
be made by distribution by the SBE from sales and use tax collected, but shall b e paid separately by City
to County in an amount equal to the percentage set forth in Section 5.8.
5.8. The Cash Equivalent shall be three percent (3%) of City’s portion of local sales and use tax
collection in City by the SBE.
5.9. The first payment of Cash Equivalent shall be due and payable ninety (90) days after the first
quarter in which the final SBE data becomes available to City showing collection by City of sales and use
tax revenue within the incorporated areas of the City annexed from the Expanded Area. Within one
hundred eighty (180) days after each payment is made, City shall provide supporting documentation,
including situs reports, on the calculation of the first payments. The requirements of this section shall
apply to each of the first four quarterly payments made based on actual data available.
5.10. After the first four quarterly payments of the first year provided under section 5.9, City shall
make quarterly payments based on estimates of the Cash Equivalent using the applicable percen tage rate
provided in Section 5.8 (hereinafter “Estimated. Payment”). The Estimated Payment shall be computed
and paid quarterly by City to County at the end of each calendar quarter based on the most recent SBE
data available, no later than 30 calendar da ys from the end of the quarter the sales and use tax revenue is
collected by City, each quarter ending as follows: March 31, June 30, September 30, and December 31.
Within 180 days after each quarter for which an Estimated Payment is made, City shall provide supporting
documentation, including situs reports, on the calculation of the amount of each Estimated Payment, as
well as the actual amount of the Cash Equivalent based upon final data for the applicable quarter. If an
Estimated Payment is less than the actual amount, City shall pay such difference to the County within 30
days of such calculation, but no later than 180 days after the subject quarter. If an Estimated Payment is
in excess of the actual amount, such excess shall be deducted from the Estimated Payment for the
subsequent calendar quarter. To the extent permitted or required by law, all supporting documentation
provided by City regarding the sources of local sales and use tax revenue to County shall be deemed
confidential and not made public. This restriction shall not apply to aggregate information regarding totals
of revenue from the entire area.
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 5.11. Payments will be considered delinquent if City fails to make payments of Cash Equivalent
within 30 days of the quarterly payment dates listed in Section 5.10. If one or more payments become
delinquent, County shall notify City of such deficiency specifying the dates said payments were due. If
City does not make current all past due payments within 30 calendar days of said notice, County will
notify City of its intent to terminate the property tax exchange agreement for the Expanded Area within
30 calendar days of the date of the notice if full payment is not received. If City fails to make payment
during the time provided by the termination notice, no property tax exchange agreement, as required by
Section 99 of the Revenue and Taxation Code, shall exist between City and County for the Expanded
Area.
ARTICLE VI
MANAGED GROWTH URBAN CENTERS
6.1. City agrees to manage growth and development in the new urban centers in the following
manner. City agrees not to proceed with development in City’s Northwest Urban Center as depicted in
Exhibit 6, until 60% of the developable area in the Southeast Urban Center (“Loma Vista”) as depicted
in Exhibit 6 is committed to development. Such limitation shall not apply to public facilities to be located
in the Northwest Urban Center. For purposes of this section, “committed to development” shall mean a
parcel that is constructed upon, has an approved Tentative Tract Map, or has an approved Site Plan Review
and is either annexed to the City or the City has a pending application of annexation before LAFCo.
“Committed to development” shall also mean a parcel on which development activity has occurred under
jurisdiction of the County including 2.5 acre or smaller parcels with a developed single family residence.
For purposes of this section “developable area” shall mean all land designated for use as follows: very
low, low, medium, medium high, and high density residential; commercial; office; mixed use;
industrial/employment center; or village center all as designated on the Clovis General Plan. Special
studies or amendments to the City general plan for specific plans for the Northwest Urban Center
conducted in advance of reaching the 60% development limitation in Southeast Urban Center shall not be
considered a violation of this section.
ARTICLE VII
COUNTY AND CITY ASSURANCES ON USE OF REVENUE
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 7.1 County recognizes that certain revenue reallocated to it by this MOU would otherwise have
been appropriated by City to meet demands for services. Therefore, County agrees to use this new revenue
in order to maintain levels of County services that are supportive of City services, unless the federal or
state governments materially reduce the level of funding for such services. Examples of such County
services include: criminal justice system, public health, and other similar services. This section shall not
be construed as establishing minimum levels of County services that are supportive of City services.
7.2 City agrees to continue enforcement of laws which result in the collection of fines and
forfeitures.
ARTICLE VIIA
ADMINISTRATIVE PROCESSING FEE
7.3 City agrees to pay to County, as additional consideration for entering into this MOU, a one-
time fee of $75,000. Payment shall be made within 60 days of the Effective Date of this MOU. This fee
is to cover County’s costs of developing, administering, and implementing this MOU throughout its term.
ARTICLE VIII
COOPERATIVE EFFORTS AT LEGISLATIVE REFORM
8.1 City and County agree to work jointly for state legislation and appropriations that would
improve the fiscal condition of City and County.
ARTICLE IX
TERM OF MOU AND TERMINATION
9.1. Term of MOU.
This MOU shall commence as of the date of execution by County and City and shall remain in
effect through June 30, 2027 (“Initial Term”). This MOU shall be automatically extended for one
additional five (5) year period, through June 30, 2032 (“Extension Term”), unless either party provides
written notice not less than one hundred eighty (180) days prior to expiration of the Initial Term, of its
desire to not extend this MOU. This MOU may also be terminated at any time by mutual agreement of
the parties.
9.2. Termination.
Should all or any portion of this MOU be declared invalid or inoperative by a court of competent
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any party to this MOU take any action to frustrate the intentions of the parties as expressed in this MOU,
then in such event, this entire MOU, as well as any ancillary documents entered into by the parties in order
to fulfill the intent of this MOU, shall immediately be of no force and effect and, in particular no property
tax exchange agreement, as required by Section 99 of the Revenue and Taxation Code, shall exist between
the City and County as to unincorporated property, and City shall not be required to further amend its
sales tax ordinance.
9.3. Renegotiation Following Court Action.
If this Agreement is terminated by reason of court action, the parties agree to negotiate in good
faith to achieve new agreement consistent with fundamental objectives of this MOU.
9.4. Penalty for County’s Arbitrary Termination.
Other than termination for a reason specified in this MOU, if the County terminates this Agreement
arbitrarily and without good cause, the City shall be entitled to increase its sales tax by one-half of one
percent (.005) above its tax in place at the time of County’s breach, beginning the next calendar quarter
following the expiration of thirty (30) days written notice of breach to County.
9.5. Penalty for City’s Arbitrary Termination.
Other than termination for a reason specified in this Agreement, if the City terminates this
Agreement arbitrarily and without good cause, the County shall be entitled to increase its sales tax by one-
half of one percent (.005) above its tax in place at the time of City’s breach, beginning the next calendar
quarter following the expiration of thirty (30) days written notice of breach to City.
9.6. Implementation of Penalties.
The parties covenant to make necessary changes in their respective sales tax ordinances to
effectuate the intent hereof notwithstanding termination of this MOU.
9.7. Termination Due to Changes in Law.
The purpose of this MOU is to alleviate in part the revenue shortfall experienced by County which
may result from City’s annexation of revenue-producing or potentially revenue producing properties
located within the unincorporated area of County. The purpose of this MOU is also to enable City to
proceed with territorial expansion and economic growth consistent with the terms of existing law as
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 mutually understood by the parties as well as to maximize each party’s ability to deliver essential
governmental services. In entering into this MOU, the parties mutually assume the continuation of the
existing statutory scheme for the distribution of available tax revenues to local government and that
assumption is a basic tenet of this MOU. Accordingly, it is mutually understood and agreed that this MOU
may, by mutual agreement be terminated should changes occur in statutory law, court decisions or state
administrative interpretations which negate the basic tenets of this MOU.
9.8. Termination Due to Breach or Default.
Except as provided in Article II, prior to this MOU being terminated for breach or default by City,
County shall provide notice to City of such breach, and City shall comply with the terms and conditions
of this MOU within thirty (30) days of receipt of notice. If City fails to timely comply, this MOU shall
terminate as provided herein. During the thirty (30) day notice period and until City certifies in writing
that it is in compliance and County agrees in writing, no property tax exchange agreement, as required by
Section 99 of the Revenue and Taxation Code, shall exist between County and City with respect to any
pending annexations.
In like manner the City shall give County thirty (30) days written notice and op portunity to cure
any alleged breach of this MOU on the part of the County.
ARTICLE X
GENERAL PROVISIONS
10.1. Exhibits.
Exhibits 1, 2, 3, 4, 5, and 6 are incorporated into and made a part of this MOU.
10.2. Modification.
This MOU and all of the covenants and conditions set forth herein may be modified or amended
only by writing a duly authorized and executed by County and City.
10.3. Enforcement.
County and City each acknowledge that this instrument cannot bind or limit themselves or each
other or their future governing bodies in the exercise of their discretionary legislative power. However,
each binds itself that it will insofar as is legally possible fully carry out the intent and purposes hereof, if
necessary by administrative action independent of ordinances, and that this MOU may be enforced by
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 injunction to the extent allowed by law.
10.4. Entire MOU; Supersession.
With respect to the subject matter hereof, this MOU supersedes any and all previous negotiations,
proposals, commitments, writings, and understandings of any nature whatsoever between County and City
except as otherwise provided herein. In addition, this MOU supersedes the 1990 MOU, as amended. This
MOU does not supersede the “Joint Resolution on Metropolitan Planning” except where that resolution is
inconsistent with this MOU; in such a case, this MOU supersedes the resolution.
10.5. Notice.
All notices, requests, certifications or other correspondence required to be provided by the parties
to this MOU shall be in writing and shall be delivered by first class mail or an equal or better form of
delivery to the respective parties at the following addresses:
COUNTY CITY
County Administrative Officer City Manager
County of Fresno City of Clovis
Hall of Records, Room 300 City Hall
2281 Tulare Street 1033 Fifth Street
Fresno, CA 93721 Clovis, CA 93612
10.6. Most Favored Nation Clause; Renegotiation.
If County enters into an MOU with another City that has terms and conditions more favorable in
the aggregate to that City than those terms and conditions contained herein, County agrees that it will
negotiate such terms and conditions upon written request from City, with the intent of offering a more
favorable agreement. Negotiations shall conclude thirty (30) days from the date of receipt of notice by
County and, if agreement is tentatively reached during that period, the legislative bodies of the parties
shall approve any such amendment within thirty (30) days following the date of the tentative agreement.
County and City are not required to reach agreement.
10.7. Other Remedies.
Except as otherwise provided in this MOU for a breach of its terms and conditions, the parties may
enforce this MOU in any other manner authorized by law.
IN WITNESS WHEREOF, the parties hereto have executed this MOU in the County of Fresno,
State of California, effective on the dates set forth above.
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 EXHIBIT 1
STANDARDS FOR ANNEXATION
The proposal must be consistent with adopted sphere of influence of the city and not conflict with the
goals and policies of the Cortese-Knox-Hertzberg Act.
The proposal must be consistent with city general and specific plans, including adopted goals and
policies.
Pursuant to CEQA, the proposal must mitigate any significant adverse effect on continuing
agricultural operations on adjacent properties, to the extent reasonable and consistent with the
applicable general and specific plan.
A proposal for annexation is acceptable if one of the following conditions exist:
1. There is existing substantial development provided the City confines its area requested to that
area needed to include the substantial development and create logical boundaries.
2. Development exists that requires urban services which can be provided by the City.
3. If no development exists, at least 50% of the area proposed for annexation has:
(i) Approved tentative subdivision map(s) (S.F. residential)
(ii) Approved site plan (for other uses)
The proposal would not create islands. Boundaries must ultimately minimize creation of peninsulas
and corridors, or other distortion of boundaries. For any of the following circumstances a proposal
for annexation is presumed to comply with all standards for annexation:
The request for annexation is by a city for annexation of its own publicly-owned property for public
use.
The request for annexation is by a city in order to facilitate construction of public improvements or
public facilities which otherwise could not be constructed.
The request for annexation is to remove an unincorporated island or substantially surrounded area.
The request for annexation is for an industrial or regional commercial project for which a
development application has been made and no significant adverse environmental impact will result
that cannot be mitigated or overridden by a necessary public purpose. Condition(s) assuring the
financing or completion of necessary development infrastructure before completion of annexation
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LOZANO SMITH 7404 N. Spalding Avenue Fresno, CA 93720-3370 Tel 559-431-5600 Fax 559-261-9366 shall be made a part of the proposal.
The annexation is intended to mitigate or otherwise comply with standards/conditions required by
another agency with respect to another development/annexation.
C:\Users\bjimenez\Desktop\2017 Amended and Restated MOU btwn County and City (00502121x7AD00) (003).docx
SHEPHERDNEESHERNDONBULLARDSHAWASHLANSHIELDSWILLOWMINNEWAWASUNNYSIDETEMPERANCEDEWOLFMCCALLACADEMYCOPPERBEHYMERFOWLERHIGHLANDDEL REYBETHELTOLLHOUSEC L O V I SDry CreekPreserveExhibit 2 - Dry Creek Preserve5Dry Creek PreserveClovis City Limits 2017Current Clovis Sphere of InfluenceDocument Path: H:\Marianne\ArcMap Projects\administration\MOUExhibit2.mxd
SHEPHERDNEESHERNDONBULLARDSHAWASHLANSHIELDSWILLOWMINNEWAWASUNNYSIDETEMPERANCEDEWOLFMCCALLACADEMYCOPPERBEHYMERFOWLERHIGHLANDDEL REYBETHELTOLLHOUSEC L O V I SExhibit 3 - 1/2 Mile Perimeter of Sphere of Influence5Clovis City Limits 2017Current Clovis Sphere of Influence1/2 Mile Perimeter of Sphere of InfluenceDocument Path: H:\Marianne\ArcMap Projects\administration\MOUExhibit3.mxd
SHEPHERDNEESHERNDONBULLARDSHAWASHLANSHIELDSWILLOWMINNEWAWASUNNYSIDETEMPERANCEDEWOLFMCCALLACADEMYCOPPERBEHYMERFOWLERHIGHLANDDEL REYBETHELTOLLHOUSEC L O V I SSpecialStudy AreaExhibit 4 - Special Study Area5Special Study AreaClovis City Limits 2017Current Clovis Sphere of InfluenceDocument Path: H:\Marianne\ArcMap Projects\administration\MOUExhibit4.mxd
SHEPHERDNEESHERNDONBULLARDSHAWASHLANSHIELDSWILLOWMINNEWAWASUNNYSIDETEMPERANCEDEWOLFMCCALLACADEMYCOPPERBEHYMERFOWLERHIGHLANDDEL REYBETHELTOLLHOUSEC L O V I SExhibit 5 - Previous and Expanded Clovis Sphere of Influence51983 Shpere of InfluenceCurrent Clovis Sphere of InfluenceDocument Path: H:\Marianne\ArcMap Projects\administration\MOUExhibit5.mxd
SHEPHERDNEESHERNDONBULLARDSHAWASHLANSHIELDSWILLOWMINNEWAWASUNNYSIDETEMPERANCEDEWOLFMCCALLACADEMYCOPPERBEHYMERFOWLERHIGHLANDDEL REYBETHELTOLLHOUSEC L O V I SNorthwestUrbanCenterSoutheastUrban CenterExhibit 6 - Northwest Urban Center / Southeast Urban Center Locations5Clovis City Limits 2017Current Clovis Sphere of InfluenceSoutheast Urban CenterNorthwest Urban CenterDocument Path: H:\Marianne\ArcMap Projects\administration\MOUExhibit6.mxd