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Home My Public Portal About12) 9C Reso No. 12-4791City Council January 17, 2012 Page2 functions of each former redevelopment agency. 5. On January 13, 2012, in the absence of any election to the contrary, the City of T ample City ("City") became the successor entity for the general functions of the Temple City Community Redevelopment Agency ("Agency''). On or before February 1, 2012, the City must either elect to be the housing successor to the Agency or select a housing authority to become the successor. FACTS: Legislation to Dissolve Redevelopment Agencies Upheld by the California Supreme Court Because of the Supreme Court's decision in CRA v. Matosantos upholding ABx1 26 as a constitutional exercise of the Legislature's power, the Agency will dissolve as required by ABx1 26. That legislation immediately suspended all new redevelopment activities and incurrence of debt and would have dissolved redevelopment agencies effective October 1, 2011 but for the stay put in place by the Supreme Court . That stay has now been dissolved and the Court set forth new dates for the effectiveness of the statutory scheme. Most importantly, the Agency will cease to exist on February 1 of this year, and its obligations will go to a successor entity and to a housing successor. The City will be the successor entity as to the general assets and obligations of the Agency, as previously discussed by the City Attorney. New Obligations for the Housing Successor In general, the primary obligations incurred by the Community Development and Housing Authority ("Authority") will be the obligation to use any remaining Agency housing assets to create affordable housing within the city and to monitor and enforce any covenants and agreements that were put in place by the Agency during its lifespan. The Authority will be able to use any funds held by the Agency to perform these obligations. Unfortunately, ABx1 26 states that the Low and Moderate Income Housing Fund of the Agency will go to the successor entity, and not the housing successor, to pay down the Agency's existing indebtedness. Because of this, and because the Agency holds very few other assets at this time, it is unlikely that any substantial work will be performed on behalf of the Agency absent changes to the law. A successor is required however. And California State Senator Steinberg has introduced Senate Bill 654 which, if enacted, would shift the Low and Moderate Income Housing Fund to the housing successor to continue the work of affordable housing. Given the uncertainty in the future financing of the housing successor, City staff recommends that the City itself not exercise its option under ABx1 26 to become the housing successor itself. But with the Authority duly organized and in place to undertake housing activities within the city, staff believes that the potential for Senator Steinberg's bill to be adopted and the Low and Moderate Income Housing Fund to be City Council January 17, 2012 Page3 returned to the housing successor makes the Authority a strong candidate for housing successor. If the City Council does not wish the Authority to take on the role of housing successor, then the Council should select the Housing Authority of the County of Los Angeles to be the housing successor, and should do so this evening. CONCLUSION: To consider for adoption a Resolution selecting the City of Temple City Community Development and Housing Authority as the successor entity for the housing functions of the Temple City Community Redevelopment Agency. FISCAL IMPACT: There will be no financial impact to the City in selecting the Authority to be the housing successor to the Agency. The Authority would receive all housing assets and obligations of the Agency (less the Low and Moderate Income Housing Fund) but there are currently very little of both. ATTACHMENT: A. Resolution No. 12-4791 LA #4841-2076-JI!iO vi RESOLUTION NO. 12-4791 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMPLE CITY, CALIFORNIA, DESIGNATING THE CITY OF TEMPLE CITY COMMUNITY DEVELOPMENT AND HOUSING AUTHORITY AS THE SUCCESSOR HOUSING AGENCY OF THE REDEVELOPMENT AGENCY OF THE CITY OF TEMPLE CITY WHEREAS, on January 1 0, 2011, Governor Jerry Brown released his Fiscal Year 2011-12 State budget proposal, which proposed to eliminate redevelopment agencies; and WHEREAS, on June 29, 2011, the Governor signed ABx1 26 eliminating redevelopment agencies and ABx1 27 which would have allowed cities to resurrect their redevelopment agency for a large payment in Fiscal Year 2011-12 and continuing payments for the life of the agency; and WHEREAS, the California Redevelopment Association and the League of California Cities filed a petition July 18, 2011, asking the California Supreme Court ("Court") to overturn ABx1 26 and ABx1 27 on the grounds that they violate the Constitution C'CRA v. Matosantos"); and WHEREAS, on December 29, 2011 the Court announced its decision in CRA v. Matosantos upholding ABx1 26 as a constitutional exercise of the Legislature's power, but striking down ABx1 27 as unconstitutional; and WHEREAS, as of February 1, 2012, every redevelopment agency will be dissolved and a successor agency will be created for each former redevelopment agency; and WHEREAS, the successor agency for the Redevelopment Agency of the City of Temple City ("Agency") will be the City of Temple City ("City'') because City did not elect prior to January 13, 2012 not to serve in that capacity; and WHEREAS, the City may also and separately elect to assign the housing functions, duties, and obligations of the Agency to a local housing authority and by doing so to also assign all of the housing assets of the Agency, excluding amounts in the Agency's Low and Moderate Income Housing Fund; and WHEREAS, there is operating within the City a Community Development and Housing Authority, which is a community development commission duly organized pursuant to Sections 34100 et seq. of the California Health and Safety Code and appointed to serve as the City of Temple City's Housing Authority pursuant to Ordinance No. 05-902 of the City of Temple City. LA #4848-7547-5726 v1 Resolution No. 12-4791 Page2 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TEMPLE CITY DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. The City of Temple City, having been appointed by operation of law as the successor agency of the Redevelopment Agency of the City of Temple City, confirms that it will undertake the duties and obligations of the successor agency. SECTION 2. The City of Temple City appoints the City of Temple City Community Development and Housing Authority to assume the housing functions and take over the housing assets of the Redevelopment Agency of the City of Temple City, along with all related rights, powers, liabilities, duties and obligations, thereby becoming the successor housing agency. SECTION 3. The City Clerk shall certify to the adoption of this resolution and shall cause a certified resolution to be filed in the book of original Resolutions, and the City Clerk shall transmit this resolution to the County of Los Angeles Auditor-Controller or the State Controller's office or State Department of Finance as requested by any or all of those offices. PASSED, APPROVED AND ADOPTED this 17'h day of January, 2012. Mayor ATTEST: City Clerk I hereby certify that the foregoing resolution, Resolution No. 12-4791, was duly passed, approved and adopted by the City Council of the City of Temple City at a regular meeting held on the 17'h day of January, 2012, by the following vote: AYES: NOES: ABSENT: ABSTAIN: Councilmember- Councilmember- Councilmember- Councilmember- LA 1#4848-7547·5726 v1 City Clerk