HomeMy WebLinkAbout6797 RESOLUTION NO. 6797
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ARCADIA, CALIFORNIA, APPROVING AND AUTHORIZING
THE EXECUTION OF A CONDITIONAL COMMUNITY
REMITTANCE FUNDING AGREEMENT BY AND BETWEEN
THE CITY OF ARCADIA AND THE ARCADIA
REDEVELOPMENT AGENCY PROVIDING FOR THE
TRANSFER OF TAX INCREMENT REVENUE TO THE CITY
IN AN AMOUNT NOT TO EXCEED THE AMOUNT OF THE
COMMUNITY REMITTANCE REQUIRED UNDER AB 1X 27
WHEREAS, pursuant to the Community Redevelopment Law (Health and Safety
Code sections 33000 et seq.), the City Council of the City of Arcadia ("City") created the
Arcadia Redevelopment Agency ("Agency")to serve as the redevelopment agency within
the City; and
WHEREAS,the Agency has been responsible for implementing the Redevelopment
Plan for the Central Redevelopment Project covering certain properties within the City
("Project Area"); and
WHEREAS, as part of the 2011-2012 State budget bill, the California Legislature
enacted, and the Governor signed, companion bills AB 1X 26 and AB 1X 27, requiring that
each redevelopment agency be dissolved unless the community that created it enacts an
ordinance committing it to making certain payments; and
WHEREAS, specifically,AB 1X 26 prohibits agencies from taking numerous actions,
effective immediately and purportedly retroactively, and additionally provides that agencies
are deemed to be dissolved as of October 1, 2011; and
WHEREAS, AB 1X 27 provides that a community may participate in an "Alternative
Voluntary Redevelopment Program,"in order to enable a redevelopment agency within that
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community to remain in existence and carry out the provisions of the CRL, by enacting an
ordinance agreeing to comply with Part 1.9 of Division 24 of the Health and Safety Code;
and
WHEREAS, participation in the Alternative Voluntary Redevelopment Program
requires the City to remit specified annual amounts to the county auditor-controller
("Community Remittance"); and
WHEREAS, the California Director of Finance has notified the City that its
Community Remittance for Fiscal Year 2011-2012 is One Million Four Hundred Seventy-
One Thousand Fifty-Three Dollars ($1,471,053); and
WHEREAS, California Health and Safety Code Section 34194.2 provides that the
City may enter into an agreement with the Agency, whereby the Agency will annually
transfer tax increment revenue to the City, in an amount not to exceed the amount of the
Community Remittance for such fiscal year,for the purpose of financing activities within the
Project Area related to the Agency's goals ("Agreement"); and
WHEREAS, a Petition for Writ of Mandate was filed in the Supreme Court of the
State of California on July 18, 2011 (California Redevelopment Association, et al. v. Ana
Matosantos, et al., Case No. 5194861), challenging the constitutionality of AB 1X 26 and
AB 1X 27 on behalf of cities, counties and redevelopment agencies and requesting a stay
of enforcement; and
WHEREAS, on August 11, 2011, the Supreme Court agreed to take the case and
issued an order for the immediate stay of enforcement of AB 1X 26 in part and AB 1X 27 in
its entirety; and
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WHEREAS,on August 17, 2011,the Supreme Court modified its order to clarify that
Health and Safety Code Sections 34161 through 34169.5, enacted by AB 1X 26, and
Health and Safety Code Section 34194(b)(2), enacted by AB 1X 27, are not stayed
("Court's Stay"); and
WHEREAS, the Agency and the City desire to enter into this Agreement, effective
on the condition that the Supreme Court orders that the Court's Stay be lifted or modified in
a manner that permits the Agency to enter this Agreement, to establish a yearly obligation
of the Agency, beginning Fiscal Year 2011-2012,to transfer tax increment revenues to the
City in an amount not to exceed the Community Remittance, on the condition that the
Agency's transfer of tax increment revenues to the City and the City's payment of the
Community Remittance will be made only if there is a final determination that AB 1X 26
and AB 1X 27 are constitutional and with the City adopting Ordinance No. 2286 electing to
participate in the Alternative Voluntary Redevelopment Program; and
WHEREAS, the City reserves the right, whether any Community Remittance has
been paid, to challenge the legality of AB 1X 26 and AB 1X 27; and
WHEREAS, all other legal prerequisites to the adoption of this Resolution have
occurred.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ARCADIA,
CALIFORNIA, DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS:
SECTION 1. The facts set forth in the recitals above are true and correct and are
hereby incorporated into the City Council's findings and determinations.
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SECTION 2. Upon consideration of the facts set forth in the staff report
accompanying this Resolution and other written and oral evidence presented to the City
Council, the City Council finds that the transfer of tax increment revenue from the Agency
to the City for the funding of the Community Remittance payment by the City will: (1)allow
the Agency to remain in existence and continue to act to accomplish the Agency's goals in
the Project Area and is in the best interests of the health, safety and welfare of the City's
residents; and (2)free the City from committing general fund revenues or other City assets
to pay the Community Remittance for any fiscal year.
SECTION 3. The City Council hereby conditionally approves the Agreement, in
substantially the form attached hereto as Exhibit"A"and incorporated herein by reference.
The Agreement shall be effective upon the Court's Stay being lifted or modified in a
manner that permits the Agency to enter into the Agreement, on the condition that the
Agency's transfer of tax increment revenues to the City and the City's payment of the
Community Remittance will be effective only if there is a final determination that AB 1X 26
and AB 1X 27 are constitutional and with the City adopting Ordinance No. 2286 electing to
participate in the Alternative Voluntary Redevelopment Program. The City Council
authorizes and directs the City Manager to execute the Agreement on behalf of the City,
subject to any minor clarifying, conforming and technical changes as may be approved by
the City Attorney. The City Manager is further authorized and directed to take such actions
and execute such documents as may be necessary to carry out the obligations of the City
under the Agreement.
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SECTION 4. The City Council finds, under Title 14 of the California Code of
Regulations, Section 15378(b)(4), that this Resolution is exempt from the requirements of
the California Environmental Quality Act ("CEQA") in that it is not a "project," but instead
consists of the creation and continuation of a governmental funding mechanism for
potential future projects and programs, and does not commit funds to any specific project
or program. The City Council,therefore, directs that a Notice of Exemption be filed with the
County Clerk of the County of Los Angeles in accordance with CEQA Guidelines.
SECTION 5. If any provision of this Resolution or the application thereof to any
person or circumstance is held invalid, such invalidity shall not affect other provisions or
applications of this Resolution which can be given effect without the invalid provision or
application, and to this end the provisions of this Resolution are severable. The City
Council hereby declares that it would have adopted this Resolution irrespective of the
invalidity of any particular portion thereof.
SECTION 6. This Resolution shall take effect immediately upon its adoption.
SECTION 7. The City Clerk shall certify to the adoption of this Resolution.
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Passed, approved and adopted this 20th day of September, 2011.
yor • he it of Arcadia
ATTEST:
./•► AdA9
city Clerk
APPROVED AS TO FORM:
getialVA, i: t2ti� -cd
Stephen P. Deitsch
City Attorney
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STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS:
CITY OF ARCADIA )
I, JAMES H. BARROWS, City Clerk of the City of Arcadia, hereby certifies that the
foregoing Resolution No. 6797 was passed and adopted by the City Council of the City of
Arcadia, signed by the Mayor and attested to by the City Clerk at a regular meeting of said
Council held on the 20th day of September, 2011 and that said Resolution was adopted by
the following vote, to wit:
AYES: Council Members Amundson, Chandler, Harbicht, Segal and Kovacic
NOES: None
ABSENT: None
y Clerk of the City of Arcadia
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Exhibit "A"
Community Remittance Funding Agreement
EXHIBIT "A"
COMMUNITY REMITTANCE FUNDING AGREEMENT
This COMMUNITY REMITTANCE FUNDING AGREEMENT ("Agreement"), is
entered into as of , 2011, for reference purposes only and shall be
effective only as provided for below, by and between the CITY OF ARCADIA, a
California charter city and municipal corporation ("City"), and the ARCADIA
REDEVELOPMENT AGENCY, a public body, corporate and politic ("Agency"). The
City and the Agency are sometimes, individually, referred to in this Agreement as a
"Party" or are sometimes, collectively, referred to in this Agreement as the "Parties."
The Parties enter into this Agreement with reference to the following recited facts:
RECITALS
A. Pursuant to the Community Redevelopment Law (Health and Safety Code
Sections 33000, et seq.) ("CRL"), the City Council of the City created the Agency to
serve as the redevelopment agency within the City; and
B. The Agency has been responsible for implementing the Redevelopment
Plan for the Central Redevelopment Project covering certain properties within the City
("Project Area"); and
C. As part of the 2011-2012 State budget bill, the California Legislature
enacted, and the Governor signed, companion bills AB 1X 26 and AB 1X 27, requiring
that each redevelopment agency be dissolved unless the community that created it
enacts an ordinance committing it to making certain payments; and
D. Specifically, AB 1X 26 prohibits agencies from taking numerous actions,
effective immediately and purportedly retroactively, and additionally provides that
agencies are deemed to be dissolved as of October 1, 2011; and
E. AB 1X 27 provides that a community may participate in an "Alternative
Voluntary Redevelopment Program," in order to enable a redevelopment agency
within that community to remain in existence and carry out the provisions of the CRL, by
enacting an ordinance agreeing to comply with Part 1.9 of Division 24 of the Health and
Safety Code; and
F. Participation in the Alternative Voluntary Redevelopment Program
requires the City to remit specified annual amounts to the county auditor-controller
("Community Remittance"); and
G. On July 19, the City Council introduced Ordinance No. 2286 agreeing to
the Alternative Voluntary Redevelopment Program, on August 2nd the Council approved
the Ordinance on second reading, and it became effective on September 2, 2011,
although AB 1X 27 is under a temporary stay; and
H. The California Director of Finance has notified the City that its Community
Remittance for Fiscal Year 2011-2012 is One Million Four Hundred Seventy-One
Thousand Fifty-Three Dollars ($1,471,053); and
I. California Health and Safety Code Section 34194.2, enacted by AB 1X 27,
provides that the City may enter into an agreement with the Agency, whereby the
Agency will transfer a portion of the taxes allocated to it pursuant to Health and Safety
Code Section 33670 ("Tax Increment") to the City in a particular fiscal year, in an
amount not to exceed the amount of the Community Remittance for such fiscal year, for
the purpose of financing activities within the Project Area related to the Agency's goals;
and
J. A Petition for Writ of Mandate was filed in the Supreme Court of the State
of California on July 18, 2011 (California Redevelopment Association, et al. v. Ana
Matosantos, et al., Case No. 5194861), challenging the constitutionality of AB 1X 26
and AB 1X 27 on behalf of cities, counties and redevelopment agencies and requesting
a stay of enforcement; and
K. On August 11, 2011, the Supreme Court agreed to take the case and
issued an order for the immediate stay of enforcement of AB 1X 26 in part and AB 1X
27 in its entirety; and
L. On August 17, 2011, the Supreme Court modified its stay to clarify that
Health and Safety Code Sections 34161 through 34169.5, enacted by AB 1X 26, and
Health and Safety Code Section 34194(b)(2), enacted by AB 1X 27, are not stayed
("Court's Stay"); and
M. The Parties desire to enter into this Agreement, with the effectiveness of
this Agreement conditioned on the Supreme Court ordering that the Court's Stay be
lifted or modified in a manner that permits the Agency and the City to enter into this
Agreement, the purpose of which is to establish a yearly obligation of the Agency to
transfer Tax Increment to the City and the City to pay the Community Remittance only if
there is a final determination that AB 1X 26 and AB 1X 27 are constitutional; and
N. The City reserves the right, whether any Community Remittance has been
paid, to challenge the legality of AB 1X 26 and AB 1X 27.
AGREEMENT
NOW, THEREFORE, in consideration of the promises of the City and the Agency
contained in this Agreement and other good and valuable consideration, the City and
the Agency agree as follows:
1. Incorporation of Recitals. The Recitals of fact set forth preceding this
Agreement are true and correct and are incorporated into this Agreement in their
entirety by this reference.
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2. Conditional Transfer of Tax Increment to City. On the condition that a final
determination is made that AB 1X 26 and AB 1X 27 are constitutional, Agency hereby
agrees to transfer to City, throughout the term of this Agreement, out of Tax Increment
or any other available funds, an amount equal to the amount of the Community
Remittance for each fiscal year, as determined under Health and Safety Code Section
34194, beginning with Fiscal Year 2011-2012. No later than January 10 and May 10 of
each fiscal year, Agency shall transfer to City one-half of the Community Remittance
payment specified for such fiscal year, as determined pursuant to Health and Safety
Code Section 34194 in order that City may timely make the Community Remittance
payments. However, for Fiscal Year 2011-2012, the Agency shall transfer to the City
the amount(s) of the Community Remittance payment(s) required for that fiscal year
prior to the date(s) on which the City is required to make such payment(s), if a final
determination is made that AB 1X 26 and AB 1X 27 are constitutional. The City and
Agency agree that if Agency does not have sufficient Tax Increment available to make
the full Community Remittance payment in any fiscal year, City shall have no obligation
to use City funds for such purpose, in which case the Agency may be deemed to be
dissolved under Health and Safety Code Section 34195.
3. City Payment of Community Remittance Each Fiscal Year. Subject to the timely
receipt of Tax Increment or other funds from the Agency in an amount equal to the
amount of the Community Remittance, the City shall pay to the Los Angeles County
Auditor-Controller, no later than January 15 and May 15 of each year, one-half of the
Community Remittance amount due for such fiscal year while this Agreement is in
effect, except for Fiscal Year 2011-2012, when the City shall make the required
payment(s) no later than the date(s) required for the Community Remittance to be
made. The City's obligation to make such Community Remittance payments shall be a
special limited fund obligation of the City payable solely from Tax Increment or other
funds paid to the City by the Agency pursuant to this Agreement. Nothing contained in
this Agreement is intended to nor shall be deemed to be a pledge of the City's general
fund revenues or other City assets to pay the Community Remittance for any fiscal year.
Notwithstanding the foregoing, City shall have no obligation to make the Community
Remittance payment until a final determination is made that AB 1X 26 and AB 1X 27 are
constitutional and the City has adopted an ordinance electing to participate in the
Alternative Voluntary Redevelopment Program.
4. Effectiveness. This Agreement shall not be effective unless and until the
California Supreme Court orders that the Court's Stay be lifted or modified in a manner
that permits the Agency to enter into this Agreement. This Agreement shall be deemed
null and void if AB 1X 26 and AB 1X 27 are determined by a court of competent
jurisdiction to be unconstitutional, illegal, invalid or otherwise unenforceable or
inapplicable, for any reason or in any manner. Notwithstanding the foregoing or any
other provision of this Agreement, either the City or the Agency may terminate this
Agreement at any time, for any reason or no reason.
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5. General Provisions.
5.1 Notices, Demands and Communications Between the Parties. Any and all
notices submitted by either Party to the other Party pursuant to or as required by this
Agreement shall be proper, if in writing and transmitted to the address of the City or the
Agency, as applicable, set forth below in this Section 5.1, by one or more of the
following methods: (1) messenger for immediate personal delivery; (2) a nationally
recognized overnight (one business day) delivery service (i.e., Federal Express, United
Parcel Service, etc.); or (3) registered or certified United States mail, postage prepaid,
return receipt requested. Such notices may be sent in the same manner to such other
addresses as either Party may designate, from time to time, by notice. Any notice shall
be deemed to be received by the addressee, regardless of whether or when any return
receipt is received by the sender or the date set forth on such return receipt, on the day
that the notice is delivered by personal delivery, on the date of delivery by a nationally
recognized overnight courier service (or when delivery has been attempted twice, as
evidenced by the written report of the courier service) or four (4) calendar days after the
notice is deposited with the United States Postal Service for delivery, as provided in this
Section 5.1. Rejection, other than refusal to accept or the inability to deliver a notice
because of a changed address of which no notice was given or other action by a person
to whom notice is sent, shall be deemed receipt of the notice. The following are the
authorized addresses for the submission of notices to the Parties, as of the date of this
Agreement:
To City: City of Arcadia
240 W. Huntington Drive
P.O. Box 60021
Arcadia, CA 91066
Attn: City Manager
To Agency: Arcadia Redevelopment Agency
240 W. Huntington Drive
P.O. Box 60021
Arcadia, CA 91066
Attn: Executive Director
5.2 Calculation of Time Periods. Unless otherwise specified, all references to
time periods in this Agreement measured in days shall be to consecutive calendar days,
all references to time periods in this Agreement measured in months shall be to
consecutive calendar months and all references to time periods in this Agreement
measured in years shall be to consecutive calendar years.
5.3 Principles of Interpretation. No inference in favor of or against any Party
shall be drawn from the fact that such Party has drafted any part of this Agreement.
The Parties have both participated substantially in the negotiation, drafting, and revision
of this Agreement, with advice from legal and other counsel and advisers of their own
selection. A word, term or phrase defined in the singular in this Agreement may be
used in the plural, and vice versa, all in accordance with ordinary principles of English
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grammar, which shall govern all language in this Agreement. The words "include" and
"including" in this Agreement shall be construed to be followed by the words: "without
limitation." Each collective noun in this Agreement shall be interpreted as if followed by
the words "(or any part of it)," except where the context clearly requires otherwise.
Every reference to any document, including this Agreement, refers to such document,
as modified from time to time (excepting any modification that violates this Agreement),
and includes all exhibits, schedules, addenda and riders to such document. The word
"or" in this Agreement includes the word "and." Every reference to a law, statute,
regulation, order, form or similar governmental requirement refers to each such
requirement as amended, modified, renumbered, superseded or succeeded, from time
to time.
5.4 Governing Law. The substantive and procedural laws of the State of
California shall govern the interpretation and enforcement of this Agreement, without
application of conflicts or choice of laws principles.
5.5 Binding on Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the Parties and their respective legal representatives,
successors and assigns.
5.6 No Third-Party Beneficiaries. Nothing in this Agreement, express or
implied, is intended to confer any rights or remedies under or by reason of this
Agreement on any person other than the Parties and their respective permitted
successors and assigns, nor is anything in this Agreement intended to relieve or
discharge any obligation of any third person to any Party or give any third person any
right of subrogation or action over or against any Party.
5.7 Signature in Counterparts. This Agreement may be signed by the
authorized representatives of the Parties in multiple counterpart originals, each of which
shall be deemed to be an original, but all of which together shall constitute one and the
same document.
5.8 Entire Agreement. This Agreement constitutes the entire understanding
and Agreement of the Parties regarding the subjects addressed in this Agreement. This
Agreement integrates all of the terms and conditions mentioned in this Agreement or
incidental to this Agreement, and supersedes all negotiations or previous agreements
between the Parties with respect to the subjects addressed in this Agreement.
5.9 Time Declared to be of the Essence. As to the performance of any
obligation under this Agreement of which time is a component, the performance of such
obligation within the time specified is of the essence.
[Signatures on the following page]
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SIGNATURE PAGE
TO
COMMUNITY REMITTANCE FUNDING AGREEMENT
CITY OF ARCADIA, a California charter ARCADIA REDEVELOPMENT AGENCY,
city and municipal corporation a public body, corporate and politic
By: By:
Donald Penman, City Manager Donald Penman, Executive Director
ATTEST: ATTEST:
By Gt,- . f'`/i2>- By
City Clerk gency Secretary
APPROVED AS TO FORM: APPROVED AS TO FORM:
By: By:
Stephen P. Deitsch Stephen P. Deitsch
City Attorney Agency Counsel
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