Dear Cambrians,

As we begin a new year, it’s the perfect time to reflect on what makes Cambria such a unique and vibrant community—and a big part of that is our local government. Specifically, we will head into our strategic planning sessions here in a few months. We thought it would be a good idea to break down what a special district does and how that information will be valuable to the community as we ask them for input on our strategic planning in 2025. 

The Cambria Community Services District (CCSD) is crucial in delivering essential services that keep our town running smoothly, from providing water and fire protection to maintaining parks and recreation spaces. To help you better understand how it all works, we’re excited to introduce a “Special District 101” guide. This guide will offer a simple, clear look at what a special district is, how CCSD functions, and how it serves Cambria.

You may have heard that Cambria operates as a special district, but what does that mean? How is it different from an incorporated city or town?

A special district is a type of local government created to provide specific services for a particular community. While cities and counties manage various responsibilities (like police, schools, road maintenance, and more), special districts focus on specialized services that their communities need.

Cambria’s special district is the Cambria Community Services District (CCSD). This means our community isn’t an incorporated city with a mayor or city council but instead governed by a locally elected Board of Directors. Their sole focus is on the unique services that Cambria requires.

CCSD is tasked with a few key responsibilities that are critical to our daily lives:

• Water and Wastewater Management: Ensuring clean, sustainable water and safe wastewater treatment.
• Fire Protection and Emergency Response: Keeping our homes and families safe.
• Street Lighting: Providing well-lit streets for safety and convenience.
• Facilities & Resources and Parks, Recreation, & Open Spaces: (to include the Veterans' Memorial Hall) Maintaining the natural beauty and recreational spaces we all enjoy.

How is a Special District Different from an Incorporated City?

Scope of Responsibility

• Incorporated City: A city is responsible for many services, such as police and fire protection, schools, housing, economic development, and more.
• Special District: CCSD focuses only on the specific services outlined above, allowing for specialized expertise and local control in those areas.

Governance

• Incorporated City: Cities have a mayor, a city council, and often a city manager. These officials oversee a wide range of city services and policies.
• Special District: CCSD is governed by a Board of Directors elected by Cambria residents. Their sole responsibility is to oversee the district’s services and budget, ensuring they meet the community’s needs.

Funding

• Incorporated City: Cities often have access to a broader range of funding sources, including sales tax, property tax, tourism tax, and business licenses.
• Special District: CCSD relies on property taxes, fees for services otherwise known as enterprise funds (like water and wastewater), and occasionally grants to fund operations.

Flexibility and Focus

Special districts like the CCSD are nimble and focused solely on the services they’re created to provide. This allows for efficient and locally tailored decision-making without the competing priorities of a broader municipal government.

This approach fits our town’s size and character, giving us a more streamlined government that focuses on what matters most to us—water, fire protection, recreation, and open spaces.

By being a special district, CCSD remains deeply connected to the people of Cambria. Local residents who live here make decisions and understand our unique challenges and opportunities. This ensures we stay responsive and transparent while working to preserve Cambria’s charm and natural beauty.

While special districts like the CCSD offer many benefits, such as tailored services and local control, they also come with some challenges. Understanding these disadvantages can help the community make informed governance and resource management decisions. Here are some of the potential drawbacks of being a special district:

Limited Scope of Services

• Explanation: Special districts are designed to focus on specific services (e.g., water, wastewater, fire protection). While this specialization can be beneficial, they do not provide broader services like police protection, road maintenance, or economic development, which other entities like the county must handle.
• Impact: Residents may lack centralized governance, leading to potential coordination challenges with other agencies.

Fragmentation of Local Government

• Explanation: Special districts operate independently of other government entities, which can create a patchwork of overlapping jurisdictions.
• Impact: This can lead to inefficiencies, duplication of effort, or confusion about which agency is responsible for specific services or issues.

Dependence on Limited Revenue Streams

• Explanation: Special districts like CCSD often rely on a small number of revenue sources, such as property taxes, service fees, and grants.
• Impact: Economic downturns, reduced grant funding, or unexpected costs (e.g., natural disasters) can strain budgets and make it difficult to maintain or expand services.

Lack of Public Awareness

• Explanation: Many residents may not fully understand what special districts do or how they operate, leading to low engagement in decision-making processes like board elections or public meetings.
• Impact: This lack of awareness can reduce accountability and transparency, potentially leading to mismanagement or decisions that don’t reflect community needs.

Limited Administrative Resources

• Explanation: Small special districts often have fewer staff and resources than larger cities or counties.
• Impact: This can result in slower response times, limited capacity for large projects, or challenges in meeting regulatory requirements.

Challenges with Long-Term Planning

• Explanation: Special districts may focus heavily on their specific responsibilities without considering broader regional issues or future growth.
• Impact: This can lead to a lack of coordination with other agencies and missed opportunities for collaborative solutions.

Potential for Overlapping or Conflicting Jurisdictions

• Explanation: In some cases, multiple special districts may serve the same area, each responsible for different services (e.g., water, parks, fire).
• Impact: This overlap can create inefficiencies or confusion for residents who may not know which agency to contact for a specific issue

Difficulty in Addressing Broader Community Issues

• Explanation: Special districts are designed to address narrow scopes, which can limit their ability to tackle broader issues like affordable housing, transportation, or economic development.
• Impact: Residents may feel critical community needs are left unaddressed because they fall outside the district’s responsibilities.

The CCSD provides essential services to our community, such as water, fire protection, wastewater management, street lighting, and recreational spaces. To fund these services, CCSD relies on various revenue sources, each designed to support specific areas of its operations. Here’s a breakdown of how CCSD generates its revenues:

Property Taxes

• What it is: A portion of the property taxes collected from property owners in Cambria is allocated to CCSD.
• How it’s used: These funds help pay for general services like fire protection, emergency response, and administrative costs. Property taxes are a stable and consistent source of revenue.

Service Fees

• What it is: CCSD charges fees for the direct use of specific services, including:
  • Water Services: Bi-monthly bills based on water usage.
  • Wastewater Services: Fees for collecting, treating, and disposing of wastewater.
• How it’s used: These fees are dedicated to maintaining, operating, and improving the water and wastewater systems.

Special Assessments and Charges

• What it is: Some special districts sometimes impose special assessments or charges for specific purposes, such as maintaining fire services or funding park improvements.
• How it’s used: These funds are earmarked for the specific services or improvements outlined in the assessment.

Grants

• What it is: CCSD actively applies for state, federal, and other grants to help fund significant projects or programs, especially those related to infrastructure or environmental improvements.
• How it’s used: Grant money often supports one-time capital projects, such as upgrades to the water treatment facility or enhancements to parks and open spaces, like the skate park project.

Donations and Contributions

• What it is: Community members, businesses, or organizations sometimes make voluntary donations to support CCSD’s services, such as parks, recreation, or emergency services.
• How it’s used: Donations are often directed toward specific projects or community enrichment efforts.

Reserves and Investment Earnings

• What it is: CCSD may earn income from investments of its reserve funds or use portions of its reserves during financial planning.
• How it’s used: Investment earnings and reserves stabilize the budget, especially for unforeseen expenses or emergencies.

Raising revenues can be particularly challenging for special districts like the Cambria Community Services District (CCSD) due to several structural, legal, and practical factors. These constraints make it difficult for special districts to generate additional funding when needed to maintain or expand services. Here’s why:

Dependence on Limited Revenue Sources

• Explanation: Special districts typically rely on property taxes, service fees, and grants as their primary sources of income. These revenue streams are often fixed or grow slowly over time.
• Impact: Unlike cities or counties, which have broader taxation authority, special districts have fewer options for diversifying or increasing their revenue.

Proposition 13 and Property Tax Limitations

• Explanation: California's Proposition 13 limits property tax rates to 1% of a property’s assessed value and caps annual increases in assessed value at 2%, regardless of market value changes.
• Impact: These restrictions mean that property tax revenues grow very slowly, even as the cost of services and infrastructure rises. Special districts must often seek voter approval to increase taxes, which can be a lengthy and uncertain process.

Voter Approval Requirements

• Explanation: Under California law (e.g., Proposition 218), special districts must secure voter approval to impose or increase taxes, assessments, or fees.
  • A two-thirds majority is required for special taxes.
  • A simple majority is needed for some assessments or general taxes.
• Impact: Achieving voter approval, especially a two-thirds majority, is challenging, even for well-justified funding needs. Campaigning for these measures requires time, resources, and public support.

Fee Increases Are Regulated

• Explanation: Service fees (e.g., water or wastewater fees) are often subject to strict regulations under Proposition 218, which requires public hearings and opportunities for ratepayers to protest.
• Impact: Fee increases must be carefully justified, and if a significant number of ratepayers oppose them, the increases can be blocked. This can make it hard to cover rising operational costs or fund infrastructure upgrades.

Competition for Grants

• Explanation: Grants from state, federal, or private sources are a valuable revenue source, but they are highly competitive and often come with specific restrictions on how the funds can be used.
• Impact: Special districts may not always secure grants and the funds are typically insufficient to cover ongoing operational costs.

Resistance to New or Higher Taxes

• Explanation: Communities may be reluctant to approve new taxes or fees, especially in economically challenging times or when residents are already overburdened with taxes.
• Impact: Special districts often face public opposition, even when additional revenue is needed to sustain essential services.

Small Tax Base in Rural or Small Communities

• Explanation: In smaller communities like Cambria, the population and property values may limit the revenue generated from property taxes and service fees.
• Impact: The district may struggle to fund large projects or respond to emergencies without increasing the financial burden on a small group of ratepayers.

Inflation and Rising Costs

• Explanation: Due to inflation, the cost of providing services—such as maintaining infrastructure, purchasing equipment, and paying staff—continues to rise.
• Impact: Revenue sources, particularly property taxes and fees, may not keep pace with these increasing costs, creating budget shortfalls.

Limited Ability to Borrow

• Explanation: Special districts can issue bonds or take out loans to fund large projects, but these mechanisms often require voter approval and come with repayment obligations that strain future budgets.
• Impact: Borrowing is not always viable, especially if the district’s revenue streams are already stretched.

The unique role of the CCSD makes it clear that being a special district brings both opportunities and challenges. By understanding how CCSD operates, its benefits, and its limitations, we can better appreciate its vital services and our critical role in shaping our community’s future. Moving forward, let’s continue working together, engaging in public discussions, participating in elections, and supporting initiatives that strengthen our district and preserve the beauty and character of Cambria. Together, we can address challenges, embrace opportunities, and ensure that CCSD remains a responsive and effective partner in serving our community.

Here’s to another year of collaboration, resilience, and community growth!

Thank you again for your support; I am at your service. 

Sincerely,

Matthew McElhenie