sr-012412-3tRedevelopment Agency Meeting: January 24, 2012
Agenda Item:
To: Chairperson and Redevelopment Agency
From: Andy Agle, Director of Housing and Economic Development
Gigi Decavalles- Hughes, Director of Finance
Subject: Redevelopment Agency Amended Enforceable Obligation Payment
Schedule
Recommended Action
Staff recommends that the Redevelopment Agency (the Agency) adopt the attached
Resolution approving the Redevelopment Agency's amended Enforceable Obligation
Payment Schedule.
Executive Summary
This report recommends that the Redevelopment Agency, under protest and subject to
reservation, adopt the attached resolution, approving the amended Enforceable
Obligation Payment Schedule (EOPS), for the purpose of making payments on
enforceable obligations associated with the Agency's Priority Projects and Five -Year
Implementation Plan.
Background
On August 23, 2011, Council adopted Resolution No. 533 (RAS), approving its EOPS,
covering the time period between August and December 2011, for the purpose of
preserving all rights to make payments and perform enforceable obligations associated
with the Agency's Redevelopment Plans and Five -Year Implementation Plan. The
EOPS was posted on the Agency's website and transmitted to the County Auditor -
Controller and the State Department of Finance (DOF) on August 24, 2011 and was
deemed approved on September 8, 2011, following no objections by the DOF.
On December 29. 2011, the Court issued its final opinion in California Redevelopment
Association v. Matosantos, rendering a decision to uphold AB 26 and strike down AB 27
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and exercising its power of reformation to revise and extend certain effective dates or
deadlines for performance of obligations in part 1.85 of division 24 of the Health and
Safety Code. The net effect of the decision is that redevelopment agencies are to be
dissolved and replaced with successor agencies responsible, among other things, for
administering the payment and performance of obligations listed in required EOPS. On
January 10, 2012, Council adopted Resolution No. 10647 and Resolution No. 10648 for
the purpose of becoming the designated successor entity to the redevelopment agency
and retain the redevelopment agency's housing assets and functions.
Discussion
In accordance with AB 26, staff has prepared an amended EOP schedule to set forth all
of the Agency's obligations determined to be enforceable obligations, covering the time
period between January 1, 2012 and June 30, 2012. Staff recommends that the
Agency adopt the attached Resolution and the accompanying amended EOP Schedule
in Exhibit 1 to continue to pay its obligations, including enforcing existing covenants and
making payments thereunder.
Next Steps
Following adoption of the EOPS, staff will post the schedule on the City's website and
send notice to the County Auditor - Controller and DOF. Additionally, as required by AB
26, in Health and Safety Code § 34170.5, staff will work on establishing a
Redevelopment Obligation Retirement Fund by February 1, 2012 to receive the tax
increment to be used as the source of funding for the enforceable obligations and
the administrative costs included in the EOPS.
On February 1, 2012, the City will assume the role as the Successor Agency. Following
dissolution of the redevelopment agency, a Recognized Obligation Payment Schedule
(ROPS) must be prepared twice annually until all debt is repaid. Staff will be coming
back to the Successor Agency before March 1, 2012 to submit the initial draft ROPS,
which is essentially the EOPS, except the schedule is subject to review and certification
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by the City's independent auditor and approval by the Oversight Board. By April 15,
staff will submit the ROPS to the State Controller and DOF. The first ROPS becomes
effective May 1, 2012 and remains in effect until June 30, 2012. The second ROPS will
cover the July 1 to December 31, 2012 time period. Given the short time frame of the
first ROPS, staff will prepare both the first and second ROPS at the same time to
ensure timely remittance of tax increment funds to pay enforceable obligations and
administrative costs.
Financial Impacts & Budget Actions
There are no budgetary impacts associated with the adoption of the resolution and
EOPS. The EOPS simply sets forth the Agency's existing financial obligations.
Prepared by: Nia Tang, Acting Administrative Services Officer
Approved:
T
. �tireckor
Economic Development
Director, Finance
Attachments:
Attachment A: Resolution
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Forwarded to Council:
Rod Gould
City Manager
Reference Resolution No.
536 (RAS).