SR-413-002 (9)
L .:9-::'~'
eanta Monica, Cal1fornia, elUary 12, 19R2
FI:NR:KW:jw
12/10/81
f/3-CJOZ
lo-D
J ANI I"J 4gS?
.::. I _
all"'- . ~---_ .:!._~e_~. ~
~ ,k ~ ~~..
TO: Mayor and City Council
FROM: C1ty Staff
SUBJECT: Redevelopment Agency Debt to the City of
Santa Monica
Introduction
This report recommends that the City Council adopt the
attached resolut1on which sets the interest the Agency shall
pay on advances from the City.
D1Scussion
The June 30, 19B1 City finanC1al state~ent shows the Downtown
Redevelopment project and the Ocean Park Redevelopment
Project 1n debt to the C1ty of Santa Monica in the amounts of
S871,840 and S824,449 respectively.
Of this total debt of
Sl,~9~,2e9, S500,nOO of the ~cean Park debt was secured by a
one (1) year prom1ssory note at 10% due December 11, 19B1.
This t1me period has already expired.
The rest of the debt
is listed as advances w1th no definite tlme of repayment and
with no interest charges.
1;.dditionally, the City has, si"ce 19"7~, allocated certain
Community Development Block Grant (CDBr;) funds for the
payment of outstanding Ocean Park Redevelopment pro4ect
Federal Project Notes.
These advances total S1 ,057 ,975 .87
and the
lnterest amount which has accrued through June 10,
lo-l)
1981, totals S185,291.~1 for a grand total of Sl,~~3,~~~.98.
tt t" ~ :
J".'
.
.
To: Mayor and City Council
- 2 -
January 12, 1982
A promissory note effective July 1, 1981, has been Issued to
cover this debt at ten percent (l0%).
This promIssory note
is due on June 10, 1983.
Senate Bill 12] (Craven), Chapter 109R, increases the maximum
interest ceiling from ten percent (In%) to twelve
percent (12%) effective Janui'lry 1, 1982.
This bill was
enacted to brIng the interest rate ceiling closer to the
prevailing market interest rates.
The nttached resolution sets the Interest rate at 12%,
accrues interest startIng January 1, lQ82, an0 authorizes the
the City to receive three separate promissory notes from the
Redevelopment Agency In the amounts of $871,840, $824,449,
and S] ,?43,2fi/i.88.
The resolution further resolves that all
future advances are to be paId quarterly as funds are
available.
Recommendation
It is recommend ed that the City Coune i 1 adopt the attached
resolution.
prepared By: ~ick Rives
K. Watanabe
.
.
WHEREAS, the Ocean Park ProJect debt was secured by
a one (1) year promissory note bearing annual Interest at ten
percent (10%1; and
WH ERE AS, the C i t Y has, sin c e 1 9 .., Ii, a I I 0 cat e d
certain Community Development Block Grant funds for the
payment of outstanding Ocean Park Redevelopment Project
Notes; and
WHEREAS, these advances total $1,057,9/5.87 and the
Interest amount which has accrued through June 1(), 1981,
totals $185,291.01 for a grand total of $1,243,2~~.A8; and
WHEREAS, these advances are secured by a two (2)
year promissory note due June 30, 1983 bearing interest at
ten percent (10%); and
WHEREAS, effective January 1, 1982, the interest
rate ceiling on public agency debt has been changed from ten
percent (10%) to twelve percent (12%); and
WHEREAS, in consideration of not calling the
amounts due and in consideration of future advances, the
Agency agrees to pay interest cost for all advanced funds at
the rate of twelve percent (12%),
NOW, THEREFORE, THE CITY COUl<JC I L OF THE CITY OF
SANTA MONICA RESOLVES AS FOLLOWS:
2
. .
SECTION 1. The City Council hereby authorizes the
CIty to receive from the Agency, promissory notes In the
amounts of Eight Hundred Seventy One Thousand, Eight Hundred
Forty Dollars ($871,840), Eight Hundred Twenty Four Thousand,
Four Hundred Forty Nine Dollars ($824,449), and One Million,
Two Hundred Forty Three Thousand, Two Hundred Sixty SIX
Dollars and Eighty Eight Cents ($1,243,2"'11.88).
Such notes
shall bear interest at twelve pe rcent (12%) annua 11 y.
Such
notes shall be due on demand by the City.
The Ci ty Manager
is hereby authorized to demand payment of such notes on
behalf of the City.
SECTION 2. Any future advances by the City to the
Agency shall be reimbursed on a quarterly basis from
available funds. Such advances shall bear interest at twelve
percent 02%) annually.
Whether funds are available for
repayment or are required for current or future redevelopment
activi ties shall be determined by the Redevelopment Agency
Executive Director.
SECTION 3.
The City Clerk shall certify to the
adoption of this resolution, and thenceforth and thereafter
the same shall be in full force and effect.
APPROVED AS TO FORM:
~~. 1.."""v" '-- - \- - ~
ROBERT M. MYERS ,J
CIty Attorney
3
.
.
t
ADOPTED AND APPROVED THIS
12th
DAY
OF January
t 1982.
~
I
~.
,
.A.
..... l" ,_............ ..
,
- .:--
...... __J" ~
MAYOR
I HEREBY CERTIFY THAT THE FOREGOING RESOLUTION
NO. 6416 (CCS)WAS DULY ADOPTED BY THE CITY COUNCIL OF THE
CITY OF SANTA MONICA ftT A MEETING THEREOF HELD ON
January 12 ,1982 BY THE FOLLOWING COUNCIL VOTE:
AYES: COUNCILMEMBERS: Conn, Edwards, Jennlngs, Press,
Reed, Zane, Mayor Yannatta Goldway
NOES:
COUNCILMEMBERS: None
ABSENT:
COUNCILMEMBERS: None
ABSTAIN:
.
COUNCILMEMBERS: ~one
ATTEST:
~~~
CITY CLERK