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HomeMy WebLinkAboutItem 2b - Resolution No. SA-7 approving ROPS",-�yiF ORS\ i��.o�ro� Boa i 7�h i DATE: TO: FROM: STAFF REPORT Development Services Department September 3, 2013 Honorable Mayor and City Council, Acting as Successor Agency to the Redevelopment Agency Jason Kruckeberg, Assistant City Manager /Development Services Director By: Jerry Schwartz, Economic Development Manager SUBJECT: SUCCESSOR AGENCY RESOLUTION NO. SA -7 APPROVING AND ADOPTING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR THE PERIOD OF JANUARY 1, 2014, THROUGH JUNE 30, 2014, PURSUANT TO HEALTH AND SAFETY CODE SECTION 34177(m) AND APPROVING PREPARATION OF A NOTICE OF EXEMPTION UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY ACT Recommendation: Adopt SUMMARY The City of Arcadia serves as the Successor Agency to the Arcadia Redevelopment Agency. One of the Successor Agency's responsibilities is to prepare a Recognized Obligation Payment Schedule (ROPS) for each six month period. This action would approve a ROPS covering debts and payment obligations for the period of January 1 — June 30, 2014, and includes $3,824,506 in expenditures. It is subject to the approval of the Successor Agency, the Oversight Board, and the Department of Finance before any of the listed obligations can be paid. BACKGROUND Redevelopment ended in California on February 1, 2012 with the adoption of Assembly Bill 1X 26. On June 27, 2012, the Governor signed AB 1484, which modified the process of dissolution. The ROPS is used by the Department of Finance and the Los Angeles County Auditor - Controller to determine how much will be dispersed from the tax increment trust fund to pay the enforceable obligations of the former agency. The Successor Agency has previously approved four ROPS documents, which covered all of the 2012 and 2013 calendar years, in six month increments. All four documents were approved by the Oversight Board and, with slight modifications, by the State Department of Finance (DOF). Successor Agency Resolution No. SA -7 September 3, 2013 Page 2 of 3 DISCUSSION Pursuant to Health and Safety Code Section 34177(m), the Successor Agency has prepared the ROPS for the six month period of January 1 — June 30, 2014. If approved, the ROPS will be presented to the Oversight Board at its September 24 meeting, and forwarded to the LA County Auditor - Controller, the State Controller, and the Department of Finance before the October 1, 2013, deadline. It will also be posted on the City's website. The ROPS that is included with this staff report covers the period of January 1 — June 30, 2014. The administrative portion of this ROPS reflects the limit of a $250,000 administrative cap that is allowed under AB 1X 26. The total amount covered is $3,824,506, which reflects the enforceable obligations that are part of two outstanding redevelopment bond issues and project - related costs to complete the sale of four adjoining properties to Rusnak Mercedes Benz for expansion of the dealership. These properties were detailed in the Long Range Property Management Plan which was approved by the Department of Finance on April 4, 2013 and the agreements, which were approved by the DOF on June 7, 2013. Specific project - related costs, which are over and above the administrative costs needed to run the Successor Agency and Oversight Board, can be included on the ROPS in the period when they are likely to occur. They are included in this ROPS because it is expected that escrow will close during this ROPS period. The final escrow documents will need to be sent to the DOF and the land sale proceeds forwarded to the LA County Auditor Controller for distribution to the taxing entities, including the City of Arcadia. FISCAL IMPACT A total of $3,824,506 has been identified in the proposed ROPS. The Los Angeles County Auditor - Controller would forward funds based on this ROPS to pay the Successor Agency's continuing obligations for January 1- June 30 2014. Under AB 1484, the payment will be made on January 2, 2014. If the ROPS is not approved, the General Fund may be the source to pay for staff costs that are included in the ROPS and outstanding bonds may go into default. Successor Agency Resolution No. SA -7 September 3, 2013 Page 3 of 3 RECOMMENDATION It is recommended that the City Council adopt Successor Agency Resolution No. SA -7 approving and adopting the Recognized Obligation Payment Schedule for the period of January 1, 2014, through June 30, 2014, pursuant to Health and Safety Code Section 34177(m) and approving preparation of a Notice of Exemption under the California Environmental Quality Act. Approved: Dominic Lazzar City Manager Attachment: Successor Agency Resolution No. SA -7 RESOLUTION NO. SA -7 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARCADIA, CALIFORNIA, AS THE SUCCESSOR AGENCY TO THE ARCADIA REDEVELOPMENT AGENCY, APPROVING AND ADOPTING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR THE PERIOD OF JANUARY 1, 2014 THROUGH JUNE 30, 2014, PURSUANT TO HEALTH AND SAFETY CODE SECTION 34177(m) AND APPROVING PREPARATION OF A NOTICE OF EXEMPTION UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY ACT WHEREAS, pursuant to Health and Safety Code Section 34173(d), on January 3, 2012, the City of Arcadia ( "Successor Agency ") elected to become the successor agency to the Arcadia Redevelopment Agency; and WHEREAS, Health and Safety Code Section 34177(m), was modified by the Supreme Court decision in California Redevelopment Association, et al. v. Ana Matosantos, et al., Case No. S194861, and AB 1484 requires the Successor Agency to prepare a recognized obligation payment schedule ( "ROPS ") for each six month period; and WHEREAS, Health and Safety Code Section 34177(m) requires the Successor Agency to submit the ROPS to the Oversight Board for approval; and WHEREAS, Health and Safety Code Section 34177(m) requires that upon approval of the ROPS by the Oversight Board, the Successor Agency is required to submit a copy of the approved ROPS ( "Approved ROPS ") to the Los Angeles County Auditor - Controller, the California State Controller, and the State of California Department of Finance, and post the Approved ROPS on the Successor Agency's website; and 1 WHEREAS, all other legal prerequisites to the adoption of this Resolution have occurred. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ARCADIA, CALIFORNIA, AS THE SUCCESSOR AGENCY TO THE ARCADIA REDEVELOPMENT AGENCY, DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS: SECTION 1. The Recitals set forth above are true and correct and are incorporated into this Resolution by this reference. SECTION 2. The approval of the ROPS through this Resolution does not commit the Successor Agency to any action that may have a significant effect on the environment. As a result, such action does not constitute a project subject to the requirements of the California Environmental Quality Act. City staff is authorized and directed to prepare a Notice of Exemption within five (5) days following the date of adoption of this Resolution. SECTION 3. The Successor Agency hereby approves and adopts the ROPS for January 1, 2014 through June 30 2014, in substantially the form attached to this Resolution as Exhibit A, as required by Health and Safety Code Section 34177. SECTION 4. The City Manager is hereby authorized and directed to take any action necessary to carry out the purposes of this Resolution and comply with applicable law regarding the ROPS, including submission of the ROPS to the Successor Agency's Oversight Board, and the submission of the Approved ROPS to the Los Angeles County Auditor - Controller, the California State Controller, and the State of 2 California Department of Finance, and posting the Approved BOPS on the Successor Agency's website. 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. SECTION 7. The Mayor is hereby authorized and directed to sign the Resolution and the City Clerk shall certify to the adoption of this Resolution. Passed, approved and adopted this day of , 2013. ATTEST: City Clerk APPROVED AS TO FORM: S-t� P. 4""-- Stepheh P. Deitsch City Attorney 3 Mayor of the City of Arcadia THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE [Attached behind this page] Recognized Obligation Payment Schedule (ROPS) 13 -14B - ROPS Detail January 1, 2014 through June 30, 2014 (Report Amounts in Whole Dollars) A B C D E F G H I J K L M N O P Item # Project Name / Debt Obligation Obligation Type Contract/Agreement Execution Date Contract/Agreement Termination Date Payee Description /Project Scope Project Area Total Outstanding Debt or Obligation Retired Funding Source Six -Month Total Non - Redevelopment Property Tax Trust Fund (Non- RPTTF) RPTTF Bond Proceeds Reserve Balance Other Funds Non - Admin Admin $ 38,188,566 $ - $ - $ - $ 3,700,249 $ 124,257 $ 3,824,506 1 2001A /Tax Allocation Bonds Bonds Issued On or Before 12/31 /10 6/5/2001 5/1/2023 Bank of New York Bonds issued to fund non - housing projects Central 7,846,866 N 889,725 $ 889,725 2 2010 Tax Allocation Bonds Bonds Issued On or Before 12/31 /10 9/1/2010 2/1/2027 Bank of New York Bonds issued to fund non - housing projects Central 26,834,368 N 1,777,449 $ 1,777,449 3 Successor Agency Employees Admin Costs 7/1/2013 6/30/2014 City Employees Payroll for Successor Agency employees Central 87,907 N 87,907 $ 87,907 4 Legal /Appraisal Costs Legal 7/1/2012 6/30/2013 Atty. /Appraiser Legal & Appraisal Costs to sell land Central 10,000 N 10,000 $ 10,000 5 Administrative Overhead Admin Costs 7/1/2013 6/30/2014 City of Arcadia Administrative Support services Central 26,350 N 26,350 $ 26,350 6 Bond Trustee Services Professional Services 6/5/2001 2/1/2027 Bank of New York Trustee & Bond Disclosure Services Central 1,700 N 1,700 $ 1,700 7 Contract for Consulting Services Professional Services 9/1/2010 2/1/2027 Fieldmann Rolapp Continuing Disclosure - ARA bonds Central - N $ - 8 Maintenance for Vacant Properties Property Maintenance 1/1/2010 7/31 /2015 S & S Fence Co. /Vargas Olson North Santa Anita Avenue and Lucile Street Properties Central 1,375 N 1,375 $ 1,375 9 Financial Auditing Professional Services 7/1/2013 6/30/2014 Caporicci & Larson, CPA Audit Agency Bonds & Agency Financial Audit Central - N $ - 10 Campus Commons OPA /DDA /Constructs on 10/1/2010 1/15/2015 Arcadia Commons L.P. Low Income Senior Housing Project L/M Housing 3,350,000 N 1,000,000 $ 1,000,000 11 Successor Agency Employees Project Management Costs 7/1/2013 6/30/2014 City Employees Staff Costs for Land Purchase Agreement With Rusnak Central 5,000 N 5,000 $ 5,000 12 Legal Costs Property Dispositions 7/1/2013 6/30/2014 City Attorney Legal Costs for Land Purchase Agreement With Rusnak Central 12,500 N 12,500 $ 12,500 13 Contract for Consulting Services Professional Services 7/1/2013 6/30/2014 Keyser Marston Associates Reuse Analysis for Land Purchase Agreement with Rusnak Central - Y $ - 14 Escrow /Title Services Property Dispositions 7/1/2013 6/30/2014 Escrow and Title Companies Escrow and Title for Land Purchase Agreement with Rusnak Central 12,500 N 12,500 $ 12,500 15 Remediaton /Demolition Services Remediation 7/1/2013 6/30/2014 Converse /American Wrecking Demolition North Santa Anita Avenue Buildings - Ready for sale Central - Y $ - $ - $ - $ - Recognized Obligation Payment Schedule 13 -14B - Notes January 1, 2014 through June 30, 2014 Item # Notes /Comments The bonds have a principal /interest payment due in May 2014 and an interest payment due in November 2014. There may not be sufficient funds in RPTTF to make 1 the payments. The bonds have an interest payment due in March 2014 and a principal /interest payment due in September 2014. There may not be sufficient funds in RPTTF to make 2 the payments. There is an existing agreement, first approved in September 2010, that requires a $3.35 million payment in January 2015. The DOF rejected the retention of housing funds to make the payment as recommended in the Housing DDR. The S.A. needs to accumulate funds to meet this obligation. The is the second increment 10 necessary to meet the obligation and honor the existing agreement. The primary goal in the Long Range Property Management Plan (approved by the DOF on April 4, 2013), is to sell the four contiguous properties to the Rusnak Group to expand their dealership in Arcadia and distribute the proceeds to the taxing entities. The S.A. and the Rusnak Group are in escrow on the land sale. Items 11, 121 & 11 14 are specific costs of completing the escrow and closing the land sale. Line 11 is the employee cost related to this specific project. 12 See Note 11. Legal costs to amend agreements and complete the land sale to to the Rusnak Group for expansion of the dealership. 14 See Note 11. Escrow and Title costs to complete the sale of four properties to the Rusnak Group for expansion of the dealership.