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SR 01-12-2021 3F Redevelopment Successor Agency Report City Council Meeting: January 12, 2021 Agenda Item: 3.F 1 of 3 To: Redevelopment Successor Agency From: David Martin, Director, Administration Subject: Adoption of Resolutions Approving the Annual Recognized Obligation Payment Schedule (ROPS) Submission Recommended Action Staff recommends that the Redevelopment Successor Agency adopt resolutions approving the Agency’s draft recognized obligation payment schedule and administrative budget for July 1, 2021 through June 30, 2022. Summary In compliance with the statewide elimination of all Redevelopment Agencies in 2012, the Redevelopment Successor Agency is required to prepare a recognized obligation payment schedule (ROPS) and corresponding administrative budgets on a yearly basis. The ROPS identifies the former redevelopment agency’s enforceable obligations and the agency’s administrative costs. The ROPS also identifies the sources of payment for the obligations, including bond proceeds, interest income, and distributions of tax increment revenue from the State’s Redevelopment Property Tax Trust Fund (RPTTF). The Santa Monica Redevelopment Successor agency is required to submit a ROPS, approved by the 3rd District Consolidated Oversight Board, to the California Department of Finance (DOF) and the relevant county auditor-controller no later than February 1 of each year. The ROPS 2021-22 includes Successor Agency enforceable obligations of $17,481,336 and an administrative budget of $264,251 covering July 1, 2021 to June 30, 2022. Staff recommends that the Successor Agency adopt the proposed resolutions (Attachments A and B) authorizing the submission of the ROPS 2021-22 and administrative budget to both the DOF and the County Auditor-Controller. Discussion The ROPS 2021-22 includes all Successor Agency enforceable obligations. All 3.F Packet Pg. 155 2 of 3 proposed enforceable obligations have been previously listed and approved for payment on a previous ROPS. In addition, all enforceable obligations have received final and conclusive determinations from the DOF. Under AB 26 and SB 107, the Agency may receive an administrative cost allowance of up to three percent of the property tax allocated to the Agency each fiscal year, based upon an approved administrative budget which justifies the administrative cost allowance. Based on estimated property tax allocation to the Successor Agency for fiscal year 2021-22, the administrative cost allowance of $264,251 is within the cap of $305,861 and is included as an enforceable obligation on the ROPS 2021-22 (see Attachment A, Exhibit 1, Line Item 30). Per ABX1 26, the Santa Monica Redevelopment Successor Agency Oversight Board was established to oversee certain fiscal management matters and assets of the former Agency, except for affordable housing. Per SB 107, on July 1, 2018, each of the 71 Oversight Boards in Los Angeles County were consolidated into five Consolidated Oversight Boards organized by supervisorial district. The Third Supervisorial District Consolidated Oversight Board (Consolidated Oversight Board) has jurisdiction over the Santa Monica Successor Agency. The Consolidated Oversight Board is meeting on January 12, 2021 and is expected to approve its own resolutions approving the Successor Agency’s draft ROPS 21-22 and administrative budget, for the period July 1, 2021 through June 30, 2022, and authorizing the transmittal to the Department of Finance for approval. Next Steps Copies of the ROPS 2021-22, as approved by the Consolidated Oversight Board, must be sent to the State Controller’s Office and the Department of Finance and posted on the Successor Agency’s website no later than February 1, 2021. The Department of Finance must make its determination regarding the ROPS 2021-22 no later than April 15, 2021. 3.F Packet Pg. 156 3 of 3 Financial Impacts and Budget Actions On June 1, 2021 and January 2, 2022, the Los Angeles County Auditor-Controller will transfer property taxes into the Successor Agency’s cash account from which the Agency will pay enforceable obligations listed on the approved ROPS 2021-22. Before the distributions take place, the DOF must issue a determination letter with the total RPTTF revenues to be disbursed for enforceable obligations along with a final administrative cost allowance cap amount. Prepared By: Melissa Lindley, Principal Administrative Analyst Approved Forwarded to Council Attachments: A. Proposed Resolution: ROPS 2021-22 B. Proposed Resolution: Admin Budget 3.F Packet Pg. 157 Successor Agency Meeting: January 12, 2021 Santa Monica, California RESOLUTION NO. (SA) A RESOLUTION OF THE SANTA MONICA REDEVELOPMENT SUCCESSOR AGENCY APPROVING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR THE PERIOD JULY 1, 2021 THROUGH JUNE 30, 2022 WHEREAS, pursuant to ABx 1 26, enacted on June 28, 2011, and as subsequently amended by AB 1484, SB 341, and SB 107 ("Dissolution Act"), the Redevelopment Agency to the City of Santa Monica was dissolved as of February 1, 2012, and the City of Santa Monica elected to serve as the Successor Agency to the former Redevelopment Agency to the City of Santa Monica (“Successor Agency”); and WHEREAS, pursuant to Health and Safety Code Section 34179 (q), commencing on and after July 1, 2018, in the County of Los Angeles, where more than 40 oversight boards were created by the Dissolution Act, the oversight boards were consolidated into five consolidated oversight boards each encompassing one of the County’s five supervisorial districts; and WHEREAS, the Third Supervisorial District Consolidated Oversight Board ("Third District Consolidated Oversight Board") has jurisdiction over the Successor Agency of the Former Redevelopment Agency to the City of Santa Monica; and WHEREAS, the Third District Consolidated Oversight Board held a regular meeting on January 12, 2021; and WHEREAS, Section 34177(a)(3) of the Health and Safety Code, as reformed by the California Supreme Court in California Redevelopment Association v. Matosantos (2011) 53 Cal. 4th 231, provides that commencing on May 1, 2012, only those payments listed in a Recognized Obligation Payment Schedule (“ROPS”) may be made by the Successor Agency from the funds specified in the ROPS; and 3.F.a Packet Pg. 158 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) WHEREAS, Section 34177(o) of the Health and Safety Code requires that the Successor Agency submit an oversight board-approved ROPS to the Department of Finance (“DOF”) and County Auditor- Controller (“CAC”) no later than February 1 of each year, commencing February 1, 2016; and WHEREAS, the Third District Consolidated Oversight Board has reviewed and duly considered the Recognized Obligation Payment Schedule for the period July 2021 – June 2022, inclusive, attached as Exhibit 1, and other written evidence presented at the meeting, if any; and WHEREAS, under Title 14 of the California Code of Regulations, Section 15061(b)(3), the approval of the FY 2021-22 ROPS is exempt from the requirements of the California Environmental Quality Act (“CEQA”), in that it can be seen with certainty that there is no possibility that the FY 2021-22 ROPS will have any significant effect on the environment. NOW THEREFORE, THE SUCCESSOR AGENCY DOES HEREBY RESOLVE AND FIND AS FOLLOWS: SECTION 1. The Successor Agency hereby finds and determines that the foregoing recitals are true and correct. SECTION 2. The Successor Agency hereby approves and adopts the Recognized Obligation Payment Schedule for the period July 2021 – June 2022, inclusive, attached hereto as Exhibit 1 (referenced hereinafter as “the Recognized Obligation Payment Schedule”). SECTION 3. The Successor Agency authorizes the Community Development Director to: (1) Submit the Recognized Obligation Payment Schedule to the County Auditor-Controller for review; and (2) Submit an electronic copy of the Recognized Obligation Payment Schedule to the State Department of Finance for approval; and 3.F.a Packet Pg. 159 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) (3) Designate a Successor Agency representative to respond to all questions related to the Recognized Obligation Payment Schedule; and (4) Take such other actions and execute such other documents as are appropriate to effectuate the intent of this Resolution. SECTION 4. The Secretary of the Successor Agency shall certify the adoption of this Resolution and thenceforth and thereafter the same shall be in full force and effect. APPROVED AS TO FORM: GEORGE S. CARDONA Interim Successor Agency Counsel 3.F.a Packet Pg. 160 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) Exhibit 1 Recognized Obligation Payment Schedule (ROPS 21-22) 3.F.a Packet Pg. 161 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) Recognized Obligation Payment Schedule (ROPS 21-22) - Summary Filed for the July 1, 2021 through June 30, 2022 Period Successor Agency: Santa Monica County: Los Angeles Current Period Requested Funding for Enforceable Obligations (ROPS Detail) 21-22A Total (July - December) 21-22B Total (January - June) ROPS 21-22 Total A Enforceable Obligations Funded as Follows (B+C+D) $ - $ 3,300,000 $ 3,300,000 B Bond Proceeds - - - C Reserve Balance - - - D Other Funds - 3,300,000 3,300,000 E Redevelopment Property Tax Trust Fund (RPTTF) (F+G) $ 9,048,333 $ 5,397,254 $ 14,445,587 F RPTTF 8,784,082 5,397,254 14,181,336 G Administrative RPTTF 264,251 - 264,251 H Current Period Enforceable Obligations (A+E) $ 9,048,333 $ 8,697,254 $ 17,745,587 Certification of Oversight Board Chairman: Name Title Pursuant to Section 34177 (o) of the Health and Safety code, I hereby certify that the above is a true and accurate Recognized Obligation Payment Schedule for the above named successor agency. /s/ Signature Date 3.F.a Packet Pg. 162 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) Santa Monica Recognized Obligation Payment Schedule (ROPS 21-22) - ROPS Detail July 1, 2021 through June 30, 2022 A B C D E F G H I J K L M N O P Q R S T U V W Item # Project Name Obligation Type Agreement Execution Date Agreement Termination Date Payee Description Project Area Total Outstanding Obligation Retired ROPS 21-22 Total ROPS 21-22A (Jul - Dec) 21-22A Total ROPS 21-22B (Jan - Jun) 21-22B Total Fund Sources Fund Sources Bond Proceeds Reserve Balance Other Funds RPTTF Admin RPTTF Bond Proceeds Reserve Balance Other Funds RPTTF Admin RPTTF $289,434,826 $17,745,587 $- $- $- $8,784,082 $264,251 $9,048,333 $- $- $3,300,000 $5,397,254 $- $8,697,254 1 2011 Earthquake RDA Bonds Bonds Issued After 12/31/10 06/07/2011 07/01/2042 Union Bank Bond Payment Earthquake 75,659,650 N $2,262,413 - - - 2,262,413 - $2,262,413 - - - - - $- 2 2006 Earthquake RDA Series A Bonds Bonds Issued On or Before 12/31/10 04/27/2006 07/01/2029 Union Bank Bond Payment Earthquake 39,295,874 N $4,382,308 - - - 4,382,308 - $4,382,308 - - - - - $- 5 2011 Earthquake RDA Bonds (Reserve) Reserves 06/07/2011 07/01/2042 Union Bank 2011 Earthquake RDA Bonds reserve as required by the bond indenture Earthquake - N $- - - - - - $- - - - - - $- 13 Bank of America Term Loan Third-Party Loans 05/08/ 2008 07/15/2028 Bank of America Bank of America Loan Payment Earthquake 24,242,425 N $4,233,315 - - - 2,136,061 - $2,136,061 - - - 2,097,254 - $2,097,254 16 1978 Promissory Notes City/County Loan (Prior 06/28/11), Property transaction 10/24/ 1978 06/29/2028 City of Santa Monica Property acquisition note payment Downtown - Y $- - - - - - $- - - - - - $- 17 2003 Promissory Note A City/County Loan (Prior 06/28/11), Property transaction 12/14/ 2004 01/01/2033 Parking Authority Downtown Parking Structures 1-6 acquisition note payment Earthquake - Y $- - - - - - $- - - - - - $- 18 2003 Promissory Note B City/County Loan (Prior 06/28/11), Property transaction 12/14/2004 01/01/2033 Parking Authority Downtown Parking Structures 1-6 acquisition note payment Earthquake - Y $- - - - - - $- - - - - - $- 24 Arizona and 4th Notes Miscellaneous 10/13/2010 01/01/2042 Multiple entities Mixed-use development with public plaza and underground parking Earthquake 71,700,000 N $3,300,000 - - - - - $- - - 3,300,000 - - $3,300,000 30 Successor Administrative Cost Allowance Admin Costs 02/01/ 2012 06/30/2014 Successor Agency 3% Administration Costs All 6,787,777 N $264,251 - - - - 264,251 $264,251 - - - - - $- 34 Bond Trustee Fees 06/07/07/01/2042 Union Annual Bond Earthquake 40,000 N $2,000 - - - 2,000 - $2,000 - - - - - $- 3.F.a Packet Pg. 163 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) A B C D E F G H I J K L M N O P Q R S T U V W Item # Project Name Obligation Type Agreement Execution Date Agreement Termination Date Payee Description Project Area Total Outstanding Obligation Retired ROPS 21-22 Total ROPS 21-22A (Jul - Dec) 21-22A Total ROPS 21-22B (Jan - Jun) 21-22B Total Fund Sources Fund Sources Bond Proceeds Reserve Balance Other Funds RPTTF Admin RPTTF Bond Proceeds Reserve Balance Other Funds RPTTF Admin RPTTF Fees- 2011 Earthquake RDA Bonds 2011 Bank of California Administrative Fees 35 Bond Trustee Fees- 2006 Earthquake RDA Series A Bonds Fees 04/27/ 2006 07/01/2029 Union Bank of California Annual Bond Administrative Fees Earthquake 9,100 N $1,300 - - - 1,300 - $1,300 - - - - - $- 40 Arizona and 4th-Reimbursement Agreement Miscellaneous 06/23/ 2010 01/01/2042 City of Santa Monica Mixed-use development with public plaza and underground parking Earthquake 71,700,000 N $3,300,000 - - - - - $- - - - 3,300,000 - $3,300,000 3.F.a Packet Pg. 164 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) Santa Monica Recognized Obligation Payment Schedule (ROPS 21-22) - Report of Cash Balances July 1, 2018 through June 30, 2019 (Report Amounts in Whole Dollars) Pursuant to Health and Safety Code section 34177 (l), Redevelopment Property Tax Trust Fund (RPTTF) may be listed as a source of payment on the ROPS, but only to the extent no other funding source is available or when payment from property tax revenues is required by an enforceable obligation. A B C D E F G H ROPS 18-19 Cash Balances (07/01/18 - 06/30/19) Fund Sources Comments Bond Proceeds Reserve Balance Other Funds RPTTF Bonds issued on or before 12/31/10 Bonds issued on or after 01/01/11 Prior ROPS RPTTF and Reserve Balances retained for future period(s) Rent, grants, interest, etc. Non-Admin and Admin 1 Beginning Available Cash Balance (Actual 07/01/18) RPTTF amount should exclude "A" period distribution amount. - 2,267,095 - 195,832 - 2 Revenue/Income (Actual 06/30/19) RPTTF amount should tie to the ROPS 18-19 total distribution from the County Auditor-Controller - 21,731 - 2,950 30,052,469 D2 and F2 are for interest earned. 3 Expenditures for ROPS 18-19 Enforceable Obligations (Actual 06/30/19) - - - 35 29,958,746 4 Retention of Available Cash Balance (Actual 06/30/19) RPTTF amount retained should only include the amounts distributed as reserve for future period(s) - 2,288,826 - - - 5 ROPS 18-19 RPTTF Prior Period Adjustment RPTTF amount should tie to the Agency's ROPS 18-19 PPA form submitted to the CAC No entry required 93,723 6 Ending Actual Available Cash Balance (06/30/19) C to F = (1 + 2 - 3 - 4), G = (1 + 2 - 3 - 4 - 5) $- $- $- $198,747 $- 3.F.a Packet Pg. 165 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Santa Monica Recognized Obligation Payment Schedule (ROPS 21-22) - Notes July 1, 2021 through June 30, 2022 Item # Notes/Comments 1 2 5 13 Variable interest rate. Payments based on actual interest rate from most recent bill received plus a 1% escalation. 16 17 18 24 30 34 35 40 3.F.a Packet Pg. 166 Attachment: Proposed Resolution: ROPS 2021-22 [Revision 2] (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) Successor Agency Meeting: January 12, 2021 Santa Monica, California RESOLUTION NO. ______ (SA) A RESOLUTION OF THE SANTA MONICA REDEVELOPMENT SUCCESSOR AGENCY APPROVING THE ADMINISTRATIVE BUDGET FOR THE SUCCESSOR AGENCY OF THE FORMER REDEVELOPMENT AGENCY TO THE CITY OF SANTA MONICA FOR THE PERIOD JULY 1, 2021 THROUGH JUNE 30, 2022 WHEREAS, pursuant to ABx 1 26, enacted on June 28, 2011, and as subsequently amended by AB 1484, SB 341, and SB 107 ("Dissolution Act"), the Redevelopment Agency to the City of Santa Monica was dissolved as of February 1, 2012, and the City of Santa Monica elected to serve as the Successor Agency to the former Redevelopment Agency to the City of Santa Monica (“Successor Agency”); and WHEREAS, pursuant to Health and Safety Code Section 34179 (q), commencing on and after July 1, 2018, in the County of Los Angeles, where more than 40 oversight boards were created by the Dissolution Act, the oversight boards were consolidated into five consolidated oversight boards each encompassing one of the County’s five supervisorial districts; and WHEREAS, the Third Supervisorial District Consolidated Oversight Board ("Third District Consolidated Oversight Board") has jurisdiction over the Successor Agency of the Former Redevelopment Agency to the City of Santa Monica; and WHEREAS, the Third District Consolidated Oversight Board held a regular meeting on January 12, 2021; and WHEREAS, Section 34177(j) of the Health and Safety Code, provides that the Successor Agency shall prepare an administrative budget (“Administrative Budget”) and submit it to the Oversight Board of the Successor Agency for its approval; and WHEREAS, the Administrative Budget shall include the following: 3.F.b Packet Pg. 167 Attachment: Proposed Resolution: Admin Budget (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) (1) Estimated amounts for successor agency administrative costs for the upcoming annual fiscal period; (2) Proposed sources of payment for the costs identified in subparagraph (1); (3) Proposals for arrangements for administrative and operations services provided by a city, county, city and county, or other entity; and WHEREAS, on February 2, 2012, the Successor Agency approved a Reimbursement Agreement by and between the City of Santa Monica and Successor Agency, Contract No. 9549 (CCS/RAS/SA), in accordance with Section 34171(d)(1)(F) of the California Health and Safety Code; and WHEREAS, Section 34177(k) of the California Health and Safety Code requires the Successor Agency to provide administrative cost estimates, from its approved Administrative Budget, that are to be paid from property tax revenues deposited in the Redevelopment Property Tax Trust Fund, to the Los Angeles County Auditor-Controller for each six-month fiscal period; and WHEREAS, under Title 14 of the California Code of Regulations, Section 15061(b)(3), the approval of the Administrative Budget is exempt from the requirements of the California Environmental Quality Act (“CEQA”), in that it is not a project as the adoption of the Administrative Budget will not have the potential of causing a significant environmental effect and it can be seen with certainty that there is no possibility that the adoption of the Administrative Budget will have any significant effect on the environment; and WHEREAS, the Third District Consolidated Oversight Board has reviewed and duly considered the Administrative Budget for the period July 2021 – June 2022, inclusive, attached as Exhibit 1, and other written evidence presented at the meeting. 3.F.b Packet Pg. 168 Attachment: Proposed Resolution: Admin Budget (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) NOW THEREFORE, THE SUCCESSOR AGENCY DOES HEREBY RESOLVE AND FIND AS FOLLOWS: SECTION 1. The Successor Agency hereby finds and determines that the foregoing recitals are true and correct. SECTION 2. The Successor Agency hereby approves and adopts the Administrative Budget for the period July 2021 – June 2022, inclusive, attached hereto as Exhibit 1. SECTION 3. The Successor Agency authorizes the Community Development Director to: (1) Provide an administrative cost estimate to the County Auditor-Controller for the period July 2021 – June 2022, inclusive, based upon the approved Administrative Budget; and (2) Submit the Administrative Budget to the Department of Finance; and (3) Take such other actions and execute such other documents as are appropriate to effectuate the intent of this Resolution and to implement the Administrative Budget on behalf of the Successor Agency. SECTION 4. The Secretary of the Successor Agency shall certify the adoption of this Resolution and thenceforth and thereafter the same shall be in full force and effect. APPROVED AS TO FORM: _____________________________ GEORGE S. CARDONA Interim Successor Agency Counsel 3.F.b Packet Pg. 169 Attachment: Proposed Resolution: Admin Budget (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS)) Exhibit 1 Successor Agency Administrative Budget Costs FY 2021-22 Total Total Staffing Costs for approx. 0.9 FTE 215,940 Supplies and Expenses Costs FY 2021-22 Total Office Supplies and Expenses 1,425 General Liability/Auto 33,729 Conferences, Meetings, Travel 293 Training 261 Mileage 17 Utilities - Telephone 697 Utilities - Water 324 Legal Expense 318 Financial Consultant Services 2,414 Audit Services 8,834 Total Supplies and Expenses Costs 48,311 Total Successor Agency Administrative Costs *264,251 * Per HSC 34171 (b) the administrative cost allowance shall be up to 3 percent of actual property tax distributed in the preceding fiscal year, less prior year administrative cost allowance and City-Agency loan repayments pursuant to HSC section 34191.4 (b) Exhibit 1 3.F.b Packet Pg. 170 Attachment: Proposed Resolution: Admin Budget (4380 : Approval of Annual Recognized Obligation Payment Schedule (ROPS))