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LAFCO Incorporation Guide

City Hood for El Dorado Hills Aerial City View

The purpose of this document is to provide basic information and practical advice on the entire incorporation process—starting with a group of residents discussing their community’s future to the first months of a newly incorporated city’s life. It is hoped this will help both citizens and Local Agency Formation Commission (LAFCO) staff unfamiliar with incorporations to avoid potential risks or pitfalls.

I. INTRODUCTION

This primer is NOT intended to be an all-inclusive and definitive guide to the requirements for incorporations. Interested parties should obtain a copy of The Governor’s Office of Planning and Research (OPR) Incorporation Guidelines which explain the minimum legal requirements of the

Cortese-Knox-Hertzberg Act of 2000. In addition, many individual LAFCOs have adopted policies and procedures augmenting the minimum legal requirements. It is critical that any individual, group, agency or community interested in incorporation carefully review the OPR Incorporation Guidelines and meet with your LAFCO staff.

II. BEFORE YOU START

Incorporations usually start with a group of residents forming a committee to explore the possible incorporation of their community. An incorporation committee defines and articulates incorporation goals, raises funds, collects signatures, assembles application materials, works with LAFCO staff and consultants, testifies at hearings and negotiates changes in the proposal. While each incorporation is unique, a committee of interested local residents is typically the impetus for incorporation.

A. Be Realistic

For any incorporation to succeed, it must have widespread community support since the voters must approve all successful incorporations. Therefore, ensuring that the residents are educated about the incorporation is critical during the incorporation process. It is recommended that the incorporation committee meet with people living in the incorporation area and in adjoining communities which may be directly affected by the proposal. Fund raising is another crucial task because the proponents of the incorporation are responsible for developing the information that will go into an application and for paying the costs of processing the application.

B. Look at Alternatives

Most unincorporated communities face the same challenges that cities face—changes in the character of their community, housing/jobs balance, provision of services, increased traffic and growth. Some communities see incorporation as a means to help address their problems without being aware of other alternatives. OPR strongly encourages any community investigating incorporation to explore a range of alternatives with their fellow residents, elected representatives, LAFCO and county officials before embarking on an incorporation effort.

C. Consult with LAFCO

Of all the actions incorporation proponents can take which will help to ensure a successful
incorporation process, early and frequent consultation with LAFCO is the most important. The
incorporation process can seem long and complicated and LAFCO staff can help the incorporation
proponents avoid the most common pitfalls. It is strongly recommended that proponents
develop the proposed boundaries of the new city with LAFCO staff early in the process—even
before deciding to move forward with any incorporation efforts. The inclusion (or exclusion) of
territory has a profound impact on the incorporation proposal and the preparation of the
comprehensive fiscal analysis (CFA).

D. Why Incorporate?

Incorporation shifts local government responsibility for an unincorporated area under the
jurisdiction of a county board of supervisors to a newly established city council. The reasons for
incorporation efforts may vary and can include, but are not limited to, the following: 

SERVICES: Incorporations can be proposed to improve local public services. Cities can provide
extensive services but are also required to fund their share of the cost to provide countywide
services though a process called “revenue neutrality” which is explained in following sections. 

REVENUES: Incorporation may be proposed to capture increased revenues to support local
services. 

LOCAL CONTROL: An incorporation may be proposed to give a community more local control over land use, growth, planning policy and other governmental
activities.

REPRESENTATION: Incorporations may also be proposed to create a politically accountable governing body (a city council) in a limited geographic area. Some incorporations are proposed because residents feel that a city council may be more accessible, more visible and responsive to the needs of their particular community…

Steve Ferry

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