HomeMy Public PortalAboutA 2012-06-05OB_LSAThis Agenda contains a brief general description of each item to be considered. Copies of the
Staff reports or other written documentation relating to each item of business referred to on the
Agenda are on file in the Office of the City Clerk and are available for public inspection. Any
person who has a question concerning any of the agenda items may call the City Manager at
(310) 603 -0220, ext. 200.
DEVELOPMENT A(
AGENDA
REGULAR MEETING
JUNE 5, 2012
3:00 P.M.
RECEIVED
MAY 3 1 2012
COUNCIL CHAMBERS
LYNWOOD CITY HALL
11330 BULLIS ROAD, LYNWOOD, CA 90262
LUIS VALENZUELA
CHAIR
DR. KEITH CURRY
VICE CHAIR
MALCOLM BENNETT
BOARD MEMBER
SARAH MAGANA WITHERS
BOARD MEMBER
OPENING CEREMONIES
1
2.
3.
CALL TO ORDER
CERTIFICATION OF AGENDA POSTING BY CITY CLERK
ROLL CALL OF BOARD MEMBERS
Michelle Banks - Ordone
Malcolm Bennett
Bruno Naulls
Sarah Magana Withers
Peter Wong
Dr. Keith Curry
Luis Valenzuela
PLEDGE OF ALLEGIANCE
CITY OF LYNWOOD
CITY CLERKS OFFICE
IV\ A f � U Q. N 4` '
C ; },, cl« k sn G.o-
MICHELLE BANKS - ORDONE
BOARD MEMBER
BRUNO NAULLS
BOARD MEMBER
PETER WONG
BOARD MEMBER
5. PRESENTATIONS
PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)
NON - AGENDA PUBLIC ORAL COMMUNICATIONS
THIS PORTION PROVIDES AN OPPORTUNITY FOR THE PUBLIC TO
ADDRESS THE OVERSIGHT BOARD ON ITEMS WITHIN THE JURISDICTION
OF THE OVERSIGHT BOARD AND NOT LISTED ON THE AGENDA. IF AN
ITEM IS NOT ON THE AGENDA, THERE SHOULD BE NO SUBSTANTIAL
DISCUSSION OF THE ISSUE BY THE BOARD, BUT THE BOARD MAY REFER
THE MATTER TO THE STAFF OR SCHEDULE SUBSTANTIVE DISCUSSION
FOR A FUTURE MEETING. (The Ralph M. Brown Act, Government Code
Section 54954.2 (a).)
NEW BUSINESS
6. MINUTES OF PREVIOUS MEETINGS:
Regular Meeting —April 23, 2012
Special Meeting — May 2, 2012
LEGAL STATUS AND ROLE OVERVIEW
Comments:
The Redevelopment Dissolution Act, ABx1 26 requires that each successor agency have
an Oversight Board, but does not make any provision for hiring separate legal counsel
for the Board. No funding is provided under the Dissolution Act for payment for either
the Successor Agency's costs related to Oversight Board meetings or for separate legal
counsel.
Recommendation:
Staff recommends the Oversight Board receive an overview from Successor Agency
legal counsel regarding the legal status, immunity and role of the Oversight Board for
informational purposes only. No legal advice will be given to, or shall be deemed to be
given to the Oversight Board. Upon conclusion, the Oversight Board will determine need
of outside legal counsel and take action as deemed necessary.
OVERSIGHT BOARD ITEMS
NONE
ADJOURNMENT
THE NEXT REGULAR OVERSIGHT BOARD MEETING WILL BE HELD ON JUNE 19, 2012 AT
3:00 P.M. IN THE COUNCIL CHAMBERS OF THE CITY HALL, 11330 BULLIS ROAD, CITY
OF LYNWOOD, CALIFORNIA.
Page 2
AGEN ST REP
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DATE: June 5, 2012
TO: Honorable Chair and Members of the O rsight Board
APPROVED BY: Roger L. Haley, City Manage
PREPARED BY: Rhonda Rangel, County Clerk to the Lynwood Oversight Board
SUBJECT: Notification of First Oversight Board Meeting
Recommendation:
Staff recommends the Lynwood Oversight Board approve the following minutes:
• Regular Meeting - April 23, 2012
• Special Meeting - May 2, 2012
Background: N/A
Discussion & Analysis: N/A
Fiscal Impact: N/A
Coordinated With: N/A
ITEM
A
OVERSIGHT BOARD TO THE SUCCESSOR AGENCY
TO THE DISSOLVED LYNWOOD REDEVELOPMENT AGENCY
MINUTES
MONDAY, APRIL 23, 2012
3:00 P.M.
COUNCIL CHAMBERS
LYNWOOD CITY HALL
11330 BULLIS ROAD, LYNWOOD, CA 90262
1. CALL TO ORDER
The meeting was called to order at 3:15 p.m.
2. CERTIFICATION OF AGENDA POSTING BY CITY CLERK
Ms. Kristina Santana, Deputy City Clerk confirmed that the Agenda was posted
correctly.
3. ROLL CALL OF BOARD MEMBERS
Board Members Present
Bruno Naulls
Sarah Magana Withers
Luis Valenzuela
Peter Wong
Dr. Keith Curry (joined the meeting at 3:32 p.m.)
4. PLEDGE OF ALLEGIANCE
Board Member Valenzuela led the Pledge of Allegiance
5. PRESENTATIONS
Board Members Naulls, Valenzuela, Withers, Wong, and Curry provided
brief introductions and the following staff members were also introduced:
• Roger Haley, City Manager
• Robert Torrez, Assistant City Manager
• Fred Galante, City Attorney
• Lorry Hempe, Budget & Intergovernmental Relations Manager, City of Lynwood
• Olivia Segura, Deputy Director of Community Development.
• Regina Brooks, Executive Assistant, Community Development.
• Susan Trejo, Administrative Assistant, Community Development.
• Annette Potts, Deputy Director of Administrative Services
Lynwood Oversight Board
4 -23 -12
Page 2
PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)
There were no public comments.
NEW BUSINESS
OVERVIEW OF LEGAL STATUS AND PURPOSE OF OVERSIGHT BOARD
Fred Galante, City Attorney, provided an overview of the legal status and
purpose of the oversight board. The following information was presented:
ABX1 26, passed in June 2011, effectively dissolved all of the redevelopment
agencies throughout California and also set forth legal requirements that the
successor agencies have to perform during the wind -down process. On February
1, 2012, the Matosantos case adjusted most of the deadlines by about four
months.
• ABX1 26 also has very specific parameters on who will serve on the Oversight
Board. The LA County has three appointments, there is one appointment for the
Chancellor of the Community College, one from the city's unified school district,
and lastly there are two appointments from the Mayor.
• Under ABX1 26, the Successor Agency is given the charge to wind down any
operations created by the former redevelopment agency. They are supposed to
dispose assets in a manner that would maximize value. T; eFe are alsa tornelines
due that will help the S ,eeessGr AgeRGy de what they a suppe to e
efficiently a poss
On motion of Board Member Wong, seconded by Board member Naulls,
unanimously carried, the report was received and filed.
7. ADOPTION OF RULES OF PROCEDURE OF THE OVERSIGHT BOARD
On motion of Board Member Withers, seconded by Board Member Wong, the
Board unanimously approved to adopt Robert's Rules of Order as the Board's
rules of parliamentary procedure.
8. ELECTION OF OVERSIGHT BOARD CHAIR AND VICE CHAIR AND
APPOINTMENT OF A SECRETARY
Lorry Hempe, Budget and Intergovernmental Relations Manger, reported that
ABX1 26 requires the Oversight Board to appoint a Chair for the Board and to
provide information to the Department of Finance. Therefore, a Chair and a Vice
Chair must be appointed as well as a direct contact person for the Department of
Finance. The County has already provided a clerk to serve as a secretary to the
Board.
Lynwood Oversight Board
4 -23 -12
Page 3
Board Member Withers recommended that an alternate secretary be assigned
from the City of Lynwood such as the City Clerk. Ms. Rhonda Rangel, County
Board of Supervisors, Executive Office, stated that the Board has the option to
decide what functions of the County clerk will be needed at meetings.
On Motion of Board Member Withers, seconded by Board Member Dr. Curry, the
Board approved to appoint the County Clerk as the main secretary for the Board
and the City Clerk or designee as the alternate with the following vote:
Ayes: Board Member Valenzuela, Board Member Withers, Board Member
Dr. Curry, Board Member Naulls, Board Member Wong.
Noes: None
Abstentions: None
Nominations were opened from the floor for Chair. Board Member Valenzuela
was elected as Chair of the Oversight Board by the following vote:
Ayes: Board Member Valenzuela, Board Member Withers, Board
Member Dr. Curry, Board Member Naulls, Board Member Wong.
Noes: None
Abstentions: None
Nominations were opened from the floor for Vice Chair. Board Member Curry
was elected as Vice Chair of the Oversight Board by the following vote:
Ayes: Board Member Valenzuela, Board Member Withers, Board
Member Dr. Curry, Board Member Naulls, Board Member Wong.
Noes: None
Abstentions: None
9. ADOPTION OF A FIRST RECOGNIZED OBLIGATION PAYMENT SCHEDULE
AND SCHEDULING A SPECIAL MEETING PRIOR TO MAY 4, 2012 TO
ADOPT A SECOND RECOGNIZED OBLIGATION PAYMENT SCHEDULE
Lorry Hempe, Budget and Intergovernmental Relations Manger, provided an
overview of the Staff Report "Adoption of a First Recognized Obligation Payment
Schedule (ROPS) and Scheduling a Special Meeting Prior to May 4, 2012 to
adopt a Second Recognized Obligation Payment Schedule." The ROPS is a
schedule of payments and is divided by several six month periods. The timing for
Lynwood Oversight Board
4 -23 -12
Page 4
the deadlines is off because of the time that his bill spent in the Supreme Court
causing these deadlines to be extended by four months. The ROPS is prepared
by the Successor Agency and then approved by the Oversight Board, and finally,
submitted to the Department of Finance, the County Auditor - Controller, and the
State Controller office for approval. The staff recommends that a special meeting
be called on May 4 so that the ROPS for the next six month can be prepared in a
timely manner. Fred Galante, City Attorney, also reiterated the importance of
adhering to the timelines and answered questions posed by the Board.
Board Member Naulls clarified the definition of the EOPS and the ROPS. He
explained that the EOPS are the "master plan" of the Successor Agency and that
it shows obligations that are needed to be paid during the wind -down process of
the Redevelopment Agencies (RDA's). The ROPS are the disbursements of the
funds that are needed to pay the obligations in the EOPS. Lorry Hempe, City
staff, further clarified that the ROPS does take over the EOPS. The purpose of
the EOPS is a road map of needs to be paid by the ROPS. Eventually the ROPS
will take over the EOPS and the EOPS will cease to exist.
Board Member Wong asked for clarification if the items listed in the ROPS were
all inherited from the former RDA. Ms. Hempe explained that the items on the
ROPS were inherited from the former RDA and that the Successor Agency has
not entered into any new agreements. However, the RDA is entitled to receive
funds for their administrative budget and that is the reason why the Board will
see items based on the staffing of the Successor Agency.
On Motion of Board Member Withers, seconded by Board Member Naulls, the
item was approved with the following vote:
Ayes: Chair Valenzuela, Vice Chair Dr. Curry, Board Member Withers,
Board Member Naulls, Board Member Wong.
Noes: None
Abstentions: Board Member Withers for Line Item 49 and Board Member
Naulls for all line items representing staffing costs.
10. APPROVAL OF THE ADMINISTRATIVE BUDGET FOR FY 2011 -12
Lorry Hempe, City Staff, provided information regarding the ABX1 26 and
administrative costs. It is the Successor Agency's responsibility to create and
present an administrative budget and that there is a minimum of $250,000 in
addition to the 5 % tax increment that the County Auditor will be providing.
Lynwood Oversight Board
4 -23 -12
Page 5
Board Member Wong asked for clarification regarding the costs of the Oversight
Board as to whether or not they are included in the budget since the items are
dated June 2011 through December 2011. Ms. Hempe explained that although
though the Oversight Board was just formed, former RDA staff and City staff
have been performing Administrative services since the passing of ABX1 26 in
June 2011.
Chair Valenzuela asked for clarification regarding the Administrative Budget
amount of $352, 744 as to whether or not it was the amount allotted by ABX 1
26. Ms. Hempe clarified that the amount is the allotted 5 %. She added that that
the actual costs for administrative services is closer to $500,000 and , due to this
administrative cap, the City will have to find a way to fund the gap.
On Motion of Board Member Wong, seconded by Board Member Withers the
item was approved with the following vote:
Ayes: Chair Valenzuela, Vice Chair Dr. Curry, Board Member Withers,
Board Member Naulls, Board Member Wong.
Noes: None
Abstentions: Board Member Withers for items related to Line Item 49 of the 1 5t
ROPS and Board Member Naulls for all line items representing
staffing costs.
11. DESIGNATING OF CONTACT PERSON FOR DEPARTMENT OF FINANCE
INQUIRIES
Lorry Hempe, City Staff, introduced Roger Haley, City Manger and Robert
Torrez, Assistant City Manager and recommended that the Oversight Board
designate the Lynwood City Manager as the official who shall serve as the
contact person to respond to the State Department of Finance inquiries
regarding Oversight Board actions.
On Motion of Board member Withers, seconded by Board Member Naulls the
item was approved with the following vote:
Ayes: Chair Valenzuela, Vice Chair Dr. Curry, Board Member Withers,
Board Member Naulls, Board Member Wong.
Noes: None
Lynwood Oversight Board
4 -23 -12
Page 6
12. ESTABLISHING THE DATE, TIME, AND LOCATION FOR REGULAR
MEETINGS OF THE OVERSIGHT BOARD
Lorry Hempe, City Staff, recommended that the meetings be set for the first and
third Tuesday of the month and reminded the Board that the second meeting will
only be necessary during the first few months.
Vice Chair Curry requested that meeting notifications be sent out three to four
weeks in advance if the meeting scheduled will or will not take place.
On motion of Board Member Withers, Seconded by Vice Chair Curry, the Board
approved to schedule a Special Meeting on May 2, 2012 and reserved the first
and third Tuesday of August to approve the second half of the Fiscal Year 2012-
2013 ROPS and reserved the first and third of each month as needed, with the
following vote:
Ayes: Chair Valenzuela, Vice Chair Dr. Curry, Board Member Withers,
Board Member Naulls, Board Member Wong.
Noes: None
13. ADOPTION OF RESOLUTION ADOPTING A CONFLICT OF INTEREST CODE
FOR THE OVERSIGHT BOARD
Fred Galante, City Attorney, provided a brief explanation regarding the need for a
conflict of interest code. Each Board member and the secretary of the Board
would need to file a 700 form to disclose if they have any financial interest in the
jurisdiction of this Oversight Board.
On Motion of Board Member Wong, seconded by Board Member Withers, the
item was approved with the following vote:
Ayes: Chair Valenzuela, Vice Chair Dr. Curry, Board Member Withers,
Board Member Naulls, Board Member Wong.
Noes: None
OVERSIGHT BOARD ITEMS
The Staff reassures the Board that the staff of the City of Lynwood is very organized
and that if they have any questions regarding the Oversight Board duties or the
ROPS, they are free to email the staff at any time.
Chair Valenzuela requested the information from ABX1 26 that indemnifies each
Lynwood Oversight Board
4 -23 -12
Page 7
Board member of their actions in the Oversight Board to be shared with each member.
The staff reminded the Board that even if the City Attorney assists with the process of
gathering information for the Board, he will not represent them legally because the
Oversight Board is a separate entity altogether.
Board Member Withers added that the Oversight Board does not have a final say
since everything they approve will be under the review of the State Department of
Finance.
ADJOURNMENT
On motion Board Member Wong, seconded by Board Member Withers, the meeting
adjourned at 4:29 p.m.
NEXT MEETING
A Special Meeting to approve the 2 nd ROPS is scheduled for May 2, 2012 at 3:00 p.m.
at Lynwood City Hall, Council Chambers,11330 Bullis Road, City of Lynwood,
California.
OVERSIGHT BOARD TO THE SUCCESSOR AGENCY
TO THE DISSOLVED LYNWOOD REDEVELOPMENT AGENCY
MINUTES
WEDNESDAY, May 2, 2012
3:00 P.M.
COUNCIL CHAMBERS
LYNWOOD CITY HALL
11330 BULLIS ROAD, LYNWOOD, CA 90262
1. CALL TO ORDER
The meeting was called to order at 3:09 p.m.
2. CERTIFICATION OF AGENDA POSTING BY CITY CLERK
Ms. Kristina Santana, Deputy City Clerk confirmed that the Agenda was posted
correctly.
3. ROLL CALL OF BOARD MEMBERS
Board Members Present
Bruno Naulls
Sarah Magana Withers
Luis Valenzuela
Dr. Keith Curry
Michelle Banks - Ordone
Malcolm Bennett
Peter Wong (joined the meeting at 3:17 p.m.)
4. PLEDGE OF ALLEGIANCE
Chair Valenzuela led the Pledge of Allegiance
5. PRESENTATIONS
Board Members Banks - Ordone and Bennett provided a brief introduction of
themselves. Chair Valenzuela also welcomed Roger Haley, City Manager.
PUBLIC ORAL COMMUNICATIONS
(Regarding Agenda Items Only)
There were no public comments.
Lynwood Oversight Board
5 -2 -12
Page 2
NEW BUSINESS
6. ADOPTION OF A SECOND RECOGNIZED OBLIGATION PAYMENT
SCHEDULE AND AMENDMENT TO THE FIRST RECOGNIZED OBLIGATION
PAYMENT SCHEDULE (ROPS)
Lorry Hempe, City Staff, reported to the Board that the Department of Finance
requested that the ROPS be in their suggested format which was different from
the ROPS that were reviewed at the April 23, 2012 Board meeting. Ms. Hempe
also refreshed the Board on the timeline and pertinent deadlines since the
passing of ABX1 26.
(Board Member Wong arrived at 3:17 p.m.)
Board Member Naulls pointed out that the Line Item 59 on the July 1, 2012 to
December 31, 2012 ROPS has an incorrect amount of $350,000 in the 'Total
FY13 (Jul -12 to Jun13)" column. The correct amount should be $323, 011 which
matches the amount in the 'Total Due During Fiscal Year (FY13)" Column. Staff
was instructed to make the correction.
Board Member Bennett and Wong asked for clarification as to whether the
amendments made to the first ROPS were just the formatting changes. Fred
Galante, City Attorney, responded that there have also been changes to the
dollar amounts on the ROPS and Ms. Hempe added that the Successor Agency
has adopted the First and Second ROPS and is asking for the Boards approval
as continues to go through the review process by the County and Department of
Finance.
Board Member Banks- Ordone, requested a detailed description of the vendors
and projects referenced in Line 57 'Bond Funded Projects" of the Second ROPS.
Mr. Galante, City Attorney, provided an example, referencing Line 26 of the
Second ROPS, stating that there has been extensive remediation on the project
and the bond document lists all of the various improvements. Board Member
Banks - Ordone requested to view the documents. She is also requesting that a
categorized listing of administration and staffing and how the relationship to the
projects. Additionally, Staff was instructed to breakdown the vendors /projects
specifically for the bond funded projects.
Chair Valenzuela voiced concerns that legal counsel is something that the Board
needs to consider and that a line item should be added to the ROPS for Legal
Counsel. Board Member Withers recommended that a discussion on adding a
line for Legal Counsel on the next ROPS be added to the next meeting agenda.
Board Member Wong suggested that staff be directed to start the process on
researching options for legal counsel for the Board.
Lynwood Oversight Board
5 -2 -12
Page 3
Board Member Dr. Curry also suggested that an item be place on the next
agenda to amend the first ROPS and that the Board should do research
regarding legal counsel and then they can go back and amend the First ROPS.
On Motion of Board Member Withers, seconded by Board Member Wong, the
Board approved the Second ROPS and the First ROPA with the following
amendments, directives, and vote:
Correct line item 59 in the First ROPS to reflect the Total FY13 (Jul -12 to
Jun13) as being $323, 011;
Instruct the Chair to certify the Cover Sheet for Exhibit A and B with his
signature
3. Note that the approval of the First and Second ROPS by the Oversight
Board is pending final review by the County, State Controller and
Department of Finance.
4. Instruct the Staff to agendize a discussion item regarding legal counsel for
Oversight Board on the May 24, 2012.
Ayes: Chair Valenzuela, Vice Chair Dr. Curry, Board Member Withers,
Board Member Naulls, Board Member Wong, Board Member
Banks - Ordone, Board Member Bennett
Noes: None
Abstentions: Board Member Withers for items related to Line Item 49 of the
First ROPS, Board Member Naulls for all line items representing staffing costs in
both ROPS and Board Member Bennett for items 21, 24, 29, and 30 in both
ROPS.
7. APPROVAL OF THE SUCCESSOR AGENCY PROPOSED ADMINISTRATIVE
BUDGET FOR FY 2012 -13
Lorry Hempe, staff member, provided a summary of the staff report regarding this
item. Staff recommends an Administrative Budget of $323, 011 for FY 2012-
2013 which is a reduced amount from what staff estimates the actual costs would
be. Staff also ensured that the 3% allowable funding cap for FY 2012 -13 has not
been exceeded. The current proposed budget is a bear minimum amount that
does not include items such as rent and audit fees for the preparation of the
ROPS. The staffing costs on the proposed Administrative Budget for FY 2012-
2013 are related to administration only.
The Board suggested that the item be amended to include that the approval of
the Administrative Budget is pending the final review by the County and the State
Department of Finance.
Lynwood Oversight Board
5 -2 -12
Page 4
On Motion of Board Member Bennett, seconded by Board Member Wong the
item was approved, as amended, with the following vote:
Ayes: Chair Valenzuela, Vice Chair Dr. Curry, Board Member Withers,
Board Member Naulls, Board Member Wong, Board Member
Banks - Ordone, Board Member Bennett
Noes: None
Abstentions: Board Member Withers for items related to Line Item 49 of the 1st
ROPS and Board Member Naulls for all line items representing
staffing costs.
OVERSIGHT BOARD ITEMS
There were none.
ADJOURNMENT
On motion of Chair Valenzuela, and by common consent, there being no objection,
the meeting was adjourned at 4:10 p.m.
NEXT MEETING
The next regular meeting is scheduled for May 24, 2012 at 3:00 p.m. at Lynwood City
Hall, Council Chambers, 11330 Bullis Road, City of Lynwood, California.
e
AGENDA STAFF REPORI
z:,kiv
DATE: June 5, 2012
TO: Honorable Chair and Members of the Ov rsight Board
APPROVED BY: Roger L. Haley, City Manag
PREPARED BY: Olivia Segura, Deputy Director 0
SUBJECT: Legal Status and Role Overview
Recommendation:
Staff recommends the Oversight Board receive an overview from Successor Agency
legal counsel regarding the legal status, immunity and role of the Oversight Board for
informational purposes only. No legal advice will be given to, or shall be deemed to be
given to the Oversight Board. Upon conclusion, the Oversight Board will determine
need of outside legal counsel and take action as deemed necessary.
Background:
The Redevelopment Dissolution Act, ABx1 26 requires that each successor agency
have an Oversight Board, but does not make any provision for hiring separate legal
counsel for the Board. In fact, no funding is provided under the Dissolution Act for
payment of either the Successor Agency's costs related to Oversight Board meetings or
for separate legal counsel.
For your reference, attached is California Health and Safety Code section 34179
through 34181 which regulates the formation and composition of oversight boards, the
public meeting process, and fiduciary responsibilities of oversight boards. Actions taken
by the Oversight Board are largely protected from legal action. Indeed, Section 34179
(d) clarifies that "Oversight board members shall have personal immunity from suit for
their actions taken within the scope of their responsibilities as oversight board
members." A copy of Section 34179 (d) of the Health and Safety Code is being
provided as part of this agenda.
ITEM
-7-
Discussion & Analysis:
At the May 2, 2012, meeting of the Oversight Board to the Successor Agency, the board
requested that the hiring of outside legal counsel be placed on a future agenda for
consideration.
As explained above, members of the Oversight Board are protected by the indemnity
clause found at Section 34179 (d) of the Health and Safety Code for all actions taken
within the scope of their duties. Accordingly, the Dissolution Act expressly protects the
individual members of the board.
Furthermore, given that the Dissolution Act does not provide any funding for the actions
and operations of the Oversight Agency for any item, including the preparation of
agendas, meeting minutes, travel, staff services, legal services or any other function,
there is no funding in place or available for the retention of separate legal counsel.
Should this Oversight Board seek such services, the funding would be a direct reduction
in funding available for the Successor Agency or Oversight Board to perform its
functions. Because these funds are already strained, as further explained in the
Successor Agency Budget and Administrative Staff agenda items discussed at the
meeting held on May 2, 2012, paying for separate legal counsel will use up the already
limited funding to perform all functions necessary to the wind down of the former
Lynwood Redevelopment Agency
Health and Safety Code Section 34171(b) establishes a $250,000 annual floor for the
Administrative Cost Allowance. It also establishes a ceiling calculated as 3% in FY 13
of property tax revenues. There is no guarantee that the Successor Agency will receive
even the floor based on the hierarchy on how the County Auditor Controller must
allocate property tax revenues. As such there is a direct relationship between the
Successor Agency Administrative Budget and Cost Allowance and the City's General
Fund. If less revenue is received by the City to fund staff salaries and benefits from the
Administrative Cost Allowance there will be inadequate funds to pay for such costs. For
example based on the funding the County Auditor Controller indicated it will provide to
the Successor Agency from July — December 2012 there will not be sufficient revenue
to cover the administrative costs, project costs, and payments to vendors listed on the
ROPS and to make the first of the two bond payments that is due in the fall of FY 2012-
13.
Additionally, on May 3, 2012 the County Auditor Controller issued a memo to all
Oversight Board Members referencing the use of independent counsel. Among other
details the memo states that if the OS Board legal fees exceed the administrative
budget, the fees will not be allowed. The memo is attached for reference.
Moreover, at this time, the Successor Agency does not foresee any legal disputes or
controversies between itself and the Oversight Board. As such, there does not seem to
be any pressing or foreseeable matters requiring attention or action by a separate legal
representative. Any legal questions about procedure and the like may be clarified
r
2
through the help of the Successor Agency's legal counsel. Obviously, if a controversy
arises, the Oversight Board may revisit this matter.
For this Board's reference, we attach some key legal provisions from the Dissolution Act
so that the Board may understand the legal requirements applicable to its functions.
Fiscal Impact:
Any action by this Oversight Board to retain separate legal counsel will have the fiscal
impact described above on the Successor Agency and Oversight Board.
Coordinated With:
City Attorney
Finance Department
Attachment
ABx1 26
May 3, 2012 County Auditor Memo "Miscellaneous Clarifications'
3
KEY COMPONENTS OF AB1X 26 REGARDING LEGAL STATUS AND ROLE OF THE
OVERSIGHT BOARD:
• Oversight Boards are deemed a local governmental entity for purposes of the
Brown Act, Political Reform Act, and Public Records Act.
• All notices (including agendas) required by law for proposed Oversight Board
actions are to be posted on the Successor Agency's website.
• A majority of the total membership of the Oversight Board (i.e., 4 members) shall
constitute a quorum for the transaction of business.
• A majority of the total membership of the Oversight Board (i.e., 4 members) is
required for the Oversight Board to take action.
• Oversight Board members have personal immunity from suit for their actions
taken within the scope of their responsibilities as Oversight Board members.
• Oversight Board members receive no compensation or reimbursement for
expenses for service on the Oversight Board.
• Oversight Board members serve at the pleasure of the entity that made the
appointment.
• Oversight Board members may serve on up to five (5) Oversight Boards.
• Notwithstanding Section 1099 of the Government Code, or any other law, any
individual may simultaneously be appointed to an oversight board and hold an
office in a city, county, city and county, special district, school district, or
community college district.
• The Successor Agency serves as the staff for the Oversight Board and Oversight
Board may direct the staff of the Successor Agency to perform work in
furtherance of the Oversight Board's duties and responsibilities. The cost for
noticing and holding Oversight Board meetings are to be borne by the Successor
Agency and may be included in the Successor Agency's administrative cost
allowance.
• Oversight Board must report the names of Chair, Vice Chair, and other members
of the Oversight Board to the Department of Finance ( "DOF ") by May 1, 2012.
The reporting will be done by the Board Secretary.
• DOF may review the actions /decisions of the Oversight Board.
• All Oversight Board actions shall not be effective for three (3) business days,
pending a request for review by the DOF. In the event DOF requests review of a
given Oversight Board action /decision, the DOF shall have ten (10) calendar
N
days from the date of its request to approve the action or reject it and return it to
the Oversight Board for reconsideration and resubmittal to DOF. The modified
Oversight Board action shall not be effective until approved by DOF.
• Oversight Board terminates the earlier of (i) when all of the indebtedness of the
former redevelopment agency has been repaid, or (ii) July 1, 2016.
• If outstanding indebtedness of the former redevelopment agency still needs to be
repaid as of July 1, 2016, on that date the existing Oversight Board terminates
and a new Oversight Board takes over. As of that date there is one Oversight
Board for all of the Successor Agencies within a county. The members of that
replacement Oversight Board are: 1) one member appointed by the county board
of supervisors; 2) one member appointed by the city selection committee; 3) one
member appointed by the independent special district selection committee; 4)
one member appointed by the county superintendent of education; 5) one
member appointed by the Chancellor the California Community Colleges; 6) one
member of the public appointed by the county board of supervisors; and 7) one
member appointed by the recognized employee organization representing the
largest number of successor agency employees in the county.
• Oversight Board has a fiduciary responsibility to holders of enforceable
obligations and the taxing entities that benefit from distributions of property tax
and other revenues pursuant to Health and Safety Code Section 34188
(distribution from the Redevelopment Property Tax Trust Fund).
• Oversight Board must approve Successor Agency actions set forth in Health &
Safety Code Section 34180 (see Attachment).
• Oversight Board is to direct the Successor Agency to perform the functions set
forth in Health & Safety Code Section 34181 (see Attachment).
5
COUNTY OF LOS ANGELES
DEPARTMENT OF AUDITOR - CONTROLLER
KENNETH HAHN HALL OF ADMINISTRATION
500 WEST TEMPLE STREET, ROOM 525
LOS ANGELES, CALIFORNIA 90012 -3873
PHONE: (213) 974 -8301 FAX: (213) 6265427
May 3, 2012
ALL OVERSIGHT BOARD MEMBERS
MISCELLANEOUS CLARIFICATIONS
ASST. AUDITOR- CONTROLLERS
ROBERT A DAMS
JOHN NAIMO
JAMES L. SCHNEIDERMAN
JUDI E. THOMAS
In order to expedite the process of the approval of the Recognized Obligation Payment
Schedules (`BOPS ") by Oversight Boards ( "OS Board "), and in anticipation of the June
1, 2012 distribution of taxes to the taxing entities, we are sharing the following
information, provided by the Department of Finance ( "DOF "), on specific issues that
have been raised by Oversight Boards or the DOR
BOPS Which Do Not Include January 2012 The DOF has returned to the OS
Board a ROPS as incomplete if it does not contain January 2012 in the schedule.
Thus, in order to prevent further delays, please ensure that the first ROPS
approved includes the months of January through June of 2012.
2. Independent Counsel For Oversight Boards We understand certain OS
Boards are making arrangements to hire independent legal counsel. A common
question is where the independent counsel legal fees for the OS Board should
appear on the ROPS. The DOF has informed us informally that these legal
counsel fees are part of the 5% or 3% administrative fees of the Successor (,
Agency and, as such, should be listed in that category. We further inquired as to
whether the DOF will line out those fees if listed as a separate line item on the
ROPS and the DOF has indicated that the DOF will line out the legal fees, to the
extent that they exceed the allowable administrative budget Thus, should the
OS Board legal fees exceed the 5% or 3% administrative budget, the fees will not
be allowed. Conversely, if they are within the administrative budget allowed, the
legal fees will be allowed to remain as a separate line item on a ROPS.
3. Housing Set -Aside Is Not A Continuina Obligation The low- moderate
income housing set -aside is not a continuing obligation. Therefore, payments
that would have been made for this purpose (if the redevelopment agency had
continued to exist) should not appear on the ROPS. However, funds which
RECEIVED
Help Conserve Paper— Print Double -Sided
MAy 0 9 2012 "To Enrich Lives Through Effective and Caring Service"
CITY OF IRWINOALE
1.�A.XIrc n5-PT.
All Oversight Board Members
May 3, 2012
Page 2
would have been deposited into the Low -Mod Housing Fund to pay for
enforceable housing obligations, such as payments for housing bond debt
service, should be placed on the ROPS.
Thank you for your cooperation in ensuring the ROPS approval proceeds in a timely
manner.
Very truly yours,
Wendy L. VManabe
Auditor- Controller
WLW:JN:mv
c: Each Supervisor
All Cities/Successor Agencies in the County of Los Angeles