sr-022812-3qSuccessor Agency Meeting: February 28, 2012
Agenda Item: 3 — sa
To: Chairperson and Successor Agency
From: Andy Agle, Director of Housing and Economic Development
Gigi Decavalles- Hughes, Director of Finance
Subject: Successor Agency Draft Recognized Obligation Payment Schedules
Recommended Action
Staff recommends that the Santa Monica Redevelopment Successor Agency (the
Successor Agency) adopt the attached Resolutions approving the Successor Agency's
draft Recognized Obligation Payment Schedules.
Executive Summary
This report recommends that the Successor Agency adopt the attached resolutions,
approving the initial draft Recognized Obligation Payment Schedules (ROPS) for the
six -month periods of February through June 2012, inclusive, and July through
December 2012, inclusive, in order to pay enforceable obligations associated with the
Successor Agency's Priority Projects and Five -Year Implementation Plan.
Background
On January 10, 2012, Council adopted Resolution No. 10647 and Resolution No. 10648
to serve as the Successor Agency to the former Redevelopment Agency. The City
assumed the role as the Successor Agency on February 1, 2012. Under Assembly Bill
No. 26 (2011 -2012 1St Ex. Sess.) (codified, in part, as Part 1.8 and Part 1.85 of the
California Health and Safety Code) (AB 26), the Successor Agency is required to
perform specific functions that are separate and independent of the duties of the City,
acting as a charter city. Therefore, on February 14, 2012, to establish a separate
operating framework to distinguish between the actions of the Successor Agency and
the actions of the City, the Successor Agency adopted the Successor Agency Bylaws.
In addition, on February 14, 2012, the Successor Agency and City authorized a
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Reimbursement and Operating Agreement for the purpose of formalizing the Agency's
use of City staff, facilities and administratively services (collective, City Services) to
implement the Successor Agency's administrative duties under AB 26, as codified in
Part 1.85 of the California Health and Safety Code.
Under AB 26, the Successor Agency may receive an administrative cost allowance
which is payable from property tax revenues of up to five percent of the property tax
allocated to the Successor Agency for the 2011 -12 fiscal year and up to three percent of
the property tax allocated to the Successor Agency for each year thereafter.
The amount of property taxes that are allocated to the Successor Agency are based on
an approved Recognized Obligation Payment Schedule (referred to herein as the
ROPS). A ROPS must be prepared twice annually until all enforceable obligations are
paid.
Discussion
Previous reports noted that staff would return to the Successor Agency to submit two
draft ROPS for approval to comply with the deadlines established under AB 26.
The first ROPS covers the period between February 1, 2012 and June 30, 2012 and the
second ROPS covers the period between July 1, 2012 and December 31, 2012.
For each recognized obligation, the ROPS identifies one or more sources of payment,
as required by AB 26. In accordance with Health and Safety Code § 34170.5, staff has
also established a Redevelopment Obligation Retirement Fund (RORF) to receive the
remittance of property tax revenues from the County to fund certain obligations on the
ROPS. By March 1, the initial draft ROPS, adopted by the Successor Agency at this
meeting, will be submitted to the Los Angeles County Auditor - Controller for certification.
Staff recommends that the Successor Agency adopt the attached Resolutions with
ROPS exhibits to pay its obligations.
Next Steps
Following adoption of the ROPS, staff will forward the ROPS to the County for
independent certification. Upon the County Auditor - Controller's approval of the ROPS,
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staff will submit the ROPS to the Oversight Board for approval, with a copy sent to the
State Controller's Office and the Department of Finance by April 15, 2012, and a copy
posted on the City's website.
On May 16, 2012, and on each January 16 and June 1 thereafter, the County Auditor-
Controller will transfer funds into the Successor Agency's Redevelopment Obligation
Retirement Fund (RORF) to pay enforceable obligations listed on the certified ROPS.
Financial Impacts & Budget Actions
There are no budgetary impacts associated with the adoption of the resolutions and
ROPS. The ROPS simply sets forth the Successor Agency's existing financial
obligations, which are included in the FY11 -13 Revised Budget.
Prepared by: Nia Tang, Acting Administrative Services Officer
Approved:
Andy Agle, Dire o
Housing and Economic Development
Gigi Decavalles -H
Director, Finance
Attachments:
Attachment A: Resolution — 1 st ROPS
Attachment B: Resolution — 2nd ROPS
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Forwarded to Council:
Rod Gould
City Manager
Reference Resolution Nos.
1 (SAS) and 2 (SAS).