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HomeMy WebLinkAboutItem 13a - Recognized Obligation Payment Schedule ("ROPS") DATE: December 17, 2019 TO: Honorable Mayor and City Council, as the Successor Agency to the Arcadia Redevelopment Agency FROM: Jason Kruckeberg, Assistant City Manager/Development Services Director By: Tim Schwehr, Senior Management Analyst SUBJECT: SUCCESSOR AGENCY RESOLUTION NO. SA-17 APPROVING AND ADOPTING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE (“ROPS”) FOR THE PERIOD OF JULY 1, 2020, THROUGH JUNE 30, 2021, PURSUANT TO HEALTH AND SAFETY CODE SECTION 34177(m) Recommendation: Adopt SUMMARY As the Successor Agency to the Arcadia Redevelopment Agency, the City must prepare a Recognized Obligation Payment Schedule (“ROPS”) for each fiscal year. The ROPS sets forth the debts and payment obligations of the former Arcadia Redevelopment Agency for the specified period. Each ROPS is subject to the approval of the Successor Agency and the Oversight Board before any of the listed obligations can be paid. It is recommended that the City Council, serving as the Successor Agency to the Arcadia Redevelopment Agency, adopt Resolution No. SA-17 (Attachment 1) approving and adopting the Recognized Obligation Payment Schedule (“ROPS”) for the period of July 1, 2020, through June 30, 2021. BACKGROUND Following the dissolution of Redevelopment in 2012, the City of Arcadia chose to become the Successor Agency to the Arcadia Redevelopment Agency. 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 ROPS documents that have covered February 1, 2012, through June 30, 2020. All previous ROPS documents were approved by the local Oversight Board, and, with slight modifications, by the State Department of Finance (“DOF”). Funds received have successfully paid all obligations of the Successor Agency to date. Successor Agency Resolution No. SA-17 Recognized Obligation Payment Schedule (“ROPS”) December 17, 2019 Page 2 of 3 Effective July 1, 2018, all local oversight boards in LA County were dissolved and consolidated into five district oversight boards. The Arcadia Successor Agency is assigned to the Fifth District Consolidated Oversight Board. Following approval by the Arcadia Successor Agency, the ROPS is scheduled to be presented to the Fifth District Consolidated Oversight Board in January 2020. DISCUSSION This ROPS covers the period of July 1, 2020, through June 30, 2021, reflecting the 2020- 21 Fiscal Year. The ROPS includes the enforceable obligations that are part of the outstanding redevelopment bond issues, including principal and interest payments, maintenance costs for the last remaining Successor Agency property, legal costs, and payments for bond trustee services. All of these payments would be required if the Redevelopment Agency was still in existence. The ROPS also includes costs for Successor Agency staffing and administrative functions. All of the above-mentioned obligations are standard items that have been included on all previous ROPS documents. The ROPS 20-21 also carries over two line-items from the previous ROPS for funding for legal costs and escrow, title, and other related services for the sale of the final agency- owned property at 33 W. Huntington Drive (Arcadia Self Storage Building). It is anticipated that escrow to sell this property will close on January 31, 2020, with Northeast Development Enterprises II, LLC, in which case these funds will not be needed. However, these items are included in the ROPS 20-21 to ensure adequate funding is available in the event that the sale of the property does not transact and the property needs to be sold to an alternate buyer. Following the sale of the self-storage property, the Agency will be eligible to submit a Last & Final ROPS, at which time these two line-items can be adjusted or eliminated as appropriate based on the timing of the sale. Following Successor-Agency approval, the ROPS 20-21 will be presented to the Fifth District Consolidated Oversight Board at their January 9, 2020, meeting. Once approved by the Oversight Board, the ROPS will be forwarded to the Department of Finance, the State Controller, and the LA County Auditor-Controller, and posted on the City’s website, prior to the February 1, 2020 deadline. ENVIRONMENTAL ANALYSIS The ROPS is exempt from the California Environmental Quality Act under Section 15061(b)(3) because it is considered to be “not a project.” FISCAL IMPACT The proposed ROPS calls for $ 2,822,030 in funding for the period of July 1, 2020, through June 30, 2021. The Los Angeles County Auditor-Controller will forward funds based on Successor Agency Resolution No. SA-17 Recognized Obligation Payment Schedule (“ROPS”) December 17, 2019 Page 3 of 3 this ROPS to pay the Successor Agency’s continuing obligations. 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, as the Successor Agency to the Arcadia Redevelopment Agency, determines that this project is exempt under the California Environmental Quality Act (“CEQA”); and adopt Successor Agency Resolution No. SA- 17 approving and adopting the Recognized Obligation Payment Schedule (“ROPS”) for the period of July 1, 2020, through June 30, 2021, pursuant to Health and Safety Code Section 34177(m). Attachment: Successor Agency Resolution No. SA-17