HomeMy WebLinkAboutItem 3a - Successor Agency Resolution No. SA-8 (ROPS)STAFF REPORT
Development Services Department
DATE: February 4, 2014
TO: Honorable Mayor and City Council, Acting as the Successor Agency to the
Arcadia Redevelopment Agency
FROM: Jason Kruckeberg, Assistant City Manager /Development Services Director
By: Jerry Schwartz, Economic Development Manager
SUBJECT: SUCCESSOR AGENCY RESOLUTION NO. SA -8 APPROVING AND
ADOPTING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE
(ROPS) FOR THE PERIOD OF JULY 1, 2014, THROUGH DECEMBER
31, 2014, PURSUANT TO HEALTH AND SAFETY CODE SECTION
34177(m), AND APPROVE THE SUCCESSOR AGENCY
ADMINISTRATIVE BUDGET FOR FISCAL YEAR 2014 -15
Recommendation: Adopt
SUMMARY
As the Successor Agency to the Arcadia Redevelopment Agency, the City must prepare
a Recognized Obligation Payment Schedule (ROPS) for each six month period. The
ROPS sets forth the debts and payment obligations of the former Arcadia
Redevelopment Agency for the specified period. It is subject to the approval of the
Successor Agency and the Oversight Board before any of the listed obligations can be
paid. Additionally, at the beginning of each Fiscal Year, the Administrative Budget for
the Successor Agency must be approved. The budget corresponds to the ROPS for the
first six months of the new Fiscal Year.
BACKGROUND
The City of Arcadia chose to become the Successor Agency to the Arcadia
Redevelopment Agency at the January 3, 2012, meeting. Redevelopment ended on
February 1, 2012. The Successor Agency is complying with two bills that impact the
unwinding process, including the timing of the ROPS and the Successor Agency
Administrative Budget. The two bills are AB 1X 26 and AB 1484, which were signed
into law in June 2011 and June 2012 respectively.
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. The Successor Agency has previously approved five
Successor Agency Resolution SA — 8
February 4, 2014
Page 2 of 3
ROPS documents, which covered all of the 2012 and 2013 calendar years and the first
six months of 2014, in six months increments. All five documents were approved by the
Oversight Board, and with slight modifications, by the State Department of Finance
(DOF). In June 2013, the Successor Agency received a payment of $2.478 million from
the Los Angeles County Auditor - Controller based on the approved ROPS for July 1 —
December 31, 2013, and in January 2014, a check for $1.833 million for the ROPS
covering January 1 — June 30, 2014. These funds are to pay the existing obligations
that appear on each of those ROPS.
DISCUSSION
The ROPS that is included with this staff report covers the period of July 1 — December
31, 2014, reflecting the first six months of Fiscal Year 2014 -5. The administrative
portion of this ROPS is based on a proposed Successor Agency administrative budget
for FY 2014 -15 that is also included for approval. With the success of the unwinding
process, staff is spending less time on Successor Agency activities than it did when the
process was more complex and the Oversight Board met often. As a result, the
administrative budget includes reduced staffing, dropping from 1.2 Full Time Equivalent
(FTE) Positions to 0.8 FTE. The Successor Agency's total budget, which in the past
two years was $248,514 per fiscal year, has been reduced to $176,750 for FY 2014 -15.
The administrative budget for FY 2014 -15 includes staff time, overhead, legal costs,
office supplies, and costs to operate the Oversight Board. The proposed breakdown of
the administrative budget and staffing levels are shown in Exhibit A. These details will
be included in the overall Development Services Department budget package for FY
2014 -15.
The ROPS additionally reflects the enforceable obligations that are part of two
outstanding redevelopment bond issues, including principal and interest payments,
annual audit, annual continuing obligation reports, and payments for bond trustee
services. All of these payments would be required if the Redevelopment Agency was
still in existence. This ROPS is pared down from the past two ROPS because all of the
costs to demolish the two Santa Anita Avenue buildings and to complete the escrow
with Rusnak are no longer included since those benchmarks have been reached. The
one item that will be included again is the request for $1 million as part of the accrual to
meet the January 2015 obligation to the Campus Commons affordable housing complex
developers. This will be the third time that the $1 million request has been included on
the ROPS. The first two times, the DOF approved it without any changes. The amount
that has accrued for this purpose has been based on payments from the Los Angeles
County Auditor - Controller, which have been less than what was approved on the ROPS.
Successor Agency Resolution SA — 8
February 4, 2014
Page 3 of 3
If approved, the ROPS will be presented to the Oversight Board at its February 18
meeting, and forwarded to the Department of Finance, the State Controller, and the LA
County Auditor - Controller before the March 1, 2014, deadline. It will also be posted on
the City's website. The Successor Agency administrative budget will also be presented
to the Oversight Board at the February 18 meeting.
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA)
The ROPS and Successor Agency Administrative Budget are exempt from the
California Environmental Quality Act under Section 15061(b)(3) because they are
considered to be "not a project ".
FISCAL IMPACT
The proposed ROPS calls for $2,505,549 in funding for the period of July 1 — December
31, 2014. The Los Angeles County Auditor - Controller would forward funds based on
this ROPS to pay the Successor Agency's continuing obligations. The payment should
be forwarded June 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.
RECOMMENDATION
It is recommended that the City Council, acting as the Successor Agency to the Arcadia
Redevelopment Agency, adopt Successor Agency Resolution No. SA -8 approving and
adopting the Recognized Obligation Payment Schedule (ROPS) for the period of July 1,
2014, through December 31, 2014, pursuant to Health and Safety Code Section
34177(m), and approve the Successor Agency Administrative Budget for FY 2014 -15.
Approved:
Dominic Lazza
City Manager
Attachments: Successor Agency Resolution No. SA - 8
Exhibit A: Successor Agency Administrative Budget for Fiscal Year
2014 -15
RESOLUTION NO. SA - 8
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 JULY 1, 2014 THROUGH DECEMBER
31, 2014, PURSUANT TO HEALTH AND SAFETY CODE
SECTION 34177(m)
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
WHEREAS, all other legal prerequisites to the adoption of this Resolution have
occurred.
1
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
July 1, 2014 through December 31 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 BOPS to the Successor
Agency's Oversight Board, and the submission of the Approved BOPS to the Los
Angeles County Auditor - Controller, the California State Controller, and the State of
California Department of Finance, and posting the Approved ROPS on the Successor
Agency's website.
2
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 City Clerk shall certify to the adoption of this Resolution.
Passed, approved and adopted this day of February, 20
ATTEST:
City Clerk
APPROVED AS TO FORM:
Stephen P. Deitsch
City Attorney
3
Mayor of the City of Arcadia
EXHIBIT "A"
THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE
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EXHIBIT "A''
Exhibit A
Successor Agency Budget — Fiscal Year 2014 -2015
Line Item
Amount
Staff *
$117,215
Legal Services
$20,000
Office Supplies
$1,500
General Liability Insurance
$9,000
Workers Compensation Insurance
$1,200
Vehicle Maintenance
$500
Oversight Board administration, financial assistance, admin.
$27,335
Total
$176,750
*Staff Breakdown:
Title
Assistant City Manager /Development Services Director
Economic Development Manager
Senior Administrative Assistant
Total
Percentage of Overall Salary
(15 %)
(45 %)
(20 %)
0.8 (Full Time Equivalents)