Report 2014-119 All Recommendation Responses

Report 2014-119: City of Indio: Although the City Complied With the Mello-Roos Act in Forming and Managing Community Facilities District No. 2004-3, It Should Do More to Address Inequities (Release Date: December 2014)

Recommendation #1 To: Indio, City of

The city of Indio should shift a share of the water facilities cost borne by Area 1 to Area 2 residents in proportion to the benefits Area 2 residents receive from the facilities. To do so, it should impose through its Indio Water Authority a water fee on Area 2 residents and use the related revenues to reduce the bond debt of Area 1.

Agency Response*

The recommendation from the State Auditor was to impose (through the City of Indio Water Authority) a water fee on Area 2 residents and use the related revenues to reduce the bond debt of Area 1. Audit Report 20014-119 further elaborates that such a fee should be enacted "once Area 2 is substantially built, residents have moved in, and the area is receiving significant benefit from the water system." At this two-year reporting interval, Area 2 has not been substantially built in that only 140 of the potential 824 lots (17%) have been constructed. Therefore, implementation of the recommendation is not feasible at this time. The City continues to monitor the development. Assuming development continues at a pace of 70 homes per year, Area 2 will be 80 percent developed in the year 2024.

  • Response Type†: Annual Follow Up
  • Estimated Completion Date: 2025
  • Response Date: December 2016

California State Auditor's Assessment of Status: Not Fully Implemented


Agency Response*

The recommendation from the State Auditor was to impose (through the City of Indio Water Authority) a water fee on Area 2 residents and use the related revenues to reduce the bond debt of Area 1. Audit Report 20014-119, however, further elaborates that such fee should be enacted "once Area 2 is substantially built, residents have moved in, and the area is receiving significant benefit from the water system." At this one-year interval, Area 2 has not been substantially built in that only 80 of the potential 824 lots have been constructed. Therefore, implementation of the recommendation is not feasible at this time and the City continues to monitor the development.

  • Response Type†: 1-Year
  • Estimated Completion Date: 2020
  • Response Date: December 2015

California State Auditor's Assessment of Status: Not Currently Feasible

We agree that for it to implement our recommendation the City of Indio will need to wait until more housing units are constructed in Area 2 and the area begins receiving significant benefit from the water system.


Agency Response*

The recommendation from the State Auditor was to impose (through the City of Indio Water Authority) a water fee on Area 2 residents and use the related revenues to reduce the bond debt of Area 1. Audit Report 20014-119, however, further elaborates that such fee should be enacted "once Area 2 is substantially built, residents have moved in, and the area is receiving significant benefit from the water system." At this six-month interval, Area 2 has not been substantially built in that only 46 of the potential 824 lots have been constructed. Therefore, implementation of the recommendation is not feasible at this time and the City continues to monitor the development.

  • Response Type†: 6-Month
  • Estimated Completion Date: unknown
  • Response Date: June 2015

California State Auditor's Assessment of Status: Not Currently Feasible

We agree that for it to implement our recommendation the City of Indio will need to wait until more housing units are constructed in Area 2 and the area begins receiving significant benefit from the water system.


Agency Response*

The recommendation from the State Auditor was to impose (through the City of Indio Water Authority) a water fee on Area 2 residents and use the related revenues to reduce the bond debt of Area 1. Audit Report 20014-119, however, further elaborates that such fee should be enacted "once Area 2 is substantially built, residents have moved in, and the area is receiving significant benefit from the water system." At this 60-day interval, Area 2 has not been substantially built in that only 31 of the potential 824 lots have been constructed. Therefore, implementation of the recommendation is not feasible at this time and the City continues to monitor the development. Implementation will be feasible when the development is at least 2/3rds developed, which could be several years from now.

  • Response Type†: 60-Day
  • Estimated Completion Date: 2020
  • Response Date: February 2015

California State Auditor's Assessment of Status: Pending

The city's response is appropriate. Implementation of the recommendation is not feasible at this time because Area 2 has not been substantially built. We will continue to monitor the build out of Area 2.


All Recommendations in 2014-119

Response Type refers to the interval in which the auditee is providing the State Auditor with their status in implementing recommendations made in an audit report. Auditees must submit a response regarding their progress in implementing recommendations from our reports at three intervals from the release of the report: 60 days, six months, and one year or subsequent to one year.

*Agency responses received after June 2013 are posted verbatim.


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