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HomeMy Public PortalAbout14) 11A Rocognized Obligation Pymt ScheduleCity of Temple City March 6, 2012 Page2 litigation had caused delay in the implementation of ABx1 26, the Supreme Court reformed the legislation to set new statutory deadlines, the most weighty of which is the dissolution of redevelopment agencies on February 1, 2012 instead of on October 1, 2011. 5. In August 2011 and January 2012, the Agency adopted an original and amended EOPS. 6. Now, the City, acting as successor agency, must adopt this ROPS as required by ABx1 26 and covering the period April through December 2012. With the dissolution pushed back four months, the Supreme Court pushed most other statutory deadlines back four months but left some deadlines in place, and in so doing created a great deal of confusion with respect to the adoption, audit, and State approval of financial documents related to the dissolution. Because of this, the ROPS, which was intended to take effect January 1 under the original ABx1 26 statutory scheme, now takes effect April 1 and apparently covers only April, May, and June of 2012. In an abundance of caution, however, City staff has prepared a ROPS that covers both that period and the first half of the 2012-2013 fiscal year. ANALYSIS: Pursuant to ABx1 26 and the CRA v. Matosantos decision, the Agency ceased operations and dissolved on February 1 of this year. At that time, the City became successor agency and is administering the dissolution of the Agency. Under ABx1 26, the City may make payments only as set forth in the ROPS. The ROPS was intended by ABx1 26 to cover the period of time from January 1, 2012 through June 30, 2012. Because of the Matosantos decision and the Court-ordered changes to some, but not all, statutory deadlines, the ROPS now covers the period April 1, 2012 through June 30, 2012. As this is a very short period of time, and as the ROPS must be audited by the County of Los Angeles and approved by the successor entity oversight board, City Staff and the City Attorney's office determined that a ROPS covering the remainder of the calendar year was advisable. Adoption of a ROPS that covers the remainder of the fiscal year and the first half of the next fiscal year will set the stage for later ROPS to be adopted by the City, as successor entity to the Agency, on a twice-a-year basis -once in the spring to correspond with the first half of each fiscal year and once in the fall to correspond with the second half. After adoption, the ROPS will be sent to the County of Los Angeles to be audited and will then be taken to the oversight board that will be set up to oversee the administration of the Agency's dissolution, approved by that Board, and used to pay the former Agency's obligations for the period of the ROPS. City of Temple City March 6, 2012 Page 3 The payment schedule provided by Exhibit 1 of Attachment A includes a list of existing enforceable obligations through December 31, 2012. CONCLUSION: ABx1 26 requires the City, acting as successor agency to the former Community Redevelopment Agency, to adopt a ROPS. The ROPS includes a list of the former Agency's existing financial obligations through December 31, 2012. -. Adoption of a recognized obligation payment schedule ensures that the City Council will be able to continue payment of former Agency obligations through the end of the fiscal year and the first half of the next fiscal year. FISCAL IMPACT: None. The ROPS will allow the City, as the successor to the Agency, to pay the former Community Redevelopment Agency's existing obligations on an ongoing basis. Payments will be made from former Agency funds and represent obligations previously incurred by the former Agency. ATTACHMENT: A. Resolution (with amended ROPS) Attachment A RESOLUTION NO. 12-4799-SA A RESOLUTION OF THE CITY OF TEMPLE CITY, ACTING AS SUCCESSOR AGENCY TO THE FORMER COMMUNITY REDEVELOPMENT AGENCY, ADOPTING A RECOGNIZED OBLIGATION PAYMENT SCHEDULE PURSUANT TO SECTION 34169(g) OF THE CALIFORNIA HEALTH AND SAFETY CODE WHEREAS, the Temple City Community Redevelopment Agency ("Agency") was a redevelopment agency organized and existing under the California Community Redevelopment Law (Health & Safety Code § 33000 et seq.) ("CRL") and formerly was authorized to transact business and exercise the powers of a redevelopment agency pursuant to action of the City Council of the City of Temple City ("City Council" or "City," as applicable); and WHEREAS, pursuant to the CRL, the City Council approved and adopted the Redevelopment Plan ("Redevelopment Plan") for the Rosemead Boulevard Redevelopment Project on May 16, 1972, by Ordinance No. 72-350, as amended to date, (the "Project"), and the Agency is vested with the responsibility for implementing and carrying out the Redevelopment Plan; and WHEREAS, in connection with approval and adoption of the State Budget for Fiscal Year 2011-12, the California Legislature approved, and the Governor signed ABx1 26 (Stats. 2011, chap. 5, "ABx1 26"), which purported to dissolve the Agency effective October 1, 2011; and WHEREAS, implementation of ABx1 26 was delayed by the pendency of the CRA v. Matosantos litigation, which litigation was concluded and a decision of the California Supreme Court issued on December 29, 2011; and WHEREAS, the Supreme Court upheld the validity of ABx1 26 but, delayed its implementation for a period equal to the length of the litigation, setting February 1, 2012 as the date for dissolution of redevelopment agencies and setting substantially all other short-term statutory deadlines back four months from their original dates; and WHEREAS, the Agency was dissolved on February 1, 2012, and the City of Temple City is currently serving as successor agency to the former Agency; and WHEREAS, under ABx1 26 the City, in its capacity as successor to the now- dissolved Agency, must adopt a Recognized Obligation Payment Schedule ("ROPS") twice per year, setting forth the enforceable obligations which it will pay during the six (6) month period covered by each ROPS; and OAK#4813-7410-9449 v2 1 WHEREAS, due to the timing of the Matosantos litigation, the Supreme Court · delayed most ABx1 26 statutory deadlines by a period of four (4) months, but the City desires that its ROPS be adopted, audited, and approved in a manner that will correspond with the two halves of the City's fiscal year; and WHEREAS, this Recognized Obligation Payment Schedule attached as Exhibit A includes all obligations of the Agency from April 1, 2012 through December 31, 2012, a period of eight (8) months but also a period that will allow future ROPS to correspond to the two halves of the City's fiscal year; NOW, THEREFORE, THE CITY COUNCIL, ACTING IN ITS CAPACITY AS THE SUCCESSOR AGENCY TO THE TEMPLE CITY COMMUNITY REDEVELOPMENT AGENCY, HEREBY FINDS, DETERMINES, RESOLVES, AND ORDERS AS FOLLOWS: Section .1. The City Council hereby adopts the Recognized Obligation Payment Schedule, attached hereto as Exhibit A. Section 2. The City Clerk is hereby directed to transmit a copy of the Recognized Obligation Payment Schedule to the County of Los Angeles Auditor Controller's Office and the Oversight Board for the successor entity to the former Agency in accordance with Section 34177 of the Health and Safety Code. Section 3. The City Clerk shall certify to the passage and adoption of this Resolution. PASSED, APPROVED AND ADOPTED this 6th day of March, 2012. Mayor ATIEST: City Clerk OAK #4813-7410-9449 v2 2 I hereby certify that the foregoing Resolution was duly passed and adopted by the City Council of the City of Temple City at its regular meeting held on the 6th day of March, 2012, by the following vote of the members: AYES: NOES: ABSENT: ABSTAIN: City Clerk Councilmember- Councilmember- Councilmember- Councilmember- OAK #4813-7410-9449 v2 3 1) 2) 3) 4) NAME: Temple Clly Community Redevelopment Agency PROJECT AREA: Rosemead Boulevard OTHER OBLIGATIONS I ASSETS FEBRUARY 2012 DRAFT INITIAL RECOGNIZED OBLIGATION PAYMENT SCHEDULE PREPARED BY CITY OF TEMPLE CITY, AS SUCCESSOR AGENCY Per AB 26-Section 34169 and 34177• Payment Total Outstanding Month Project Name I Debt Obligation Payee Description Source'"'* Debtor Obligation Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec FY 2011/12 Statutory Pass· City of Temple City Pursuant to HSC 33607.5 (E) $2,450 $2,450 Through Payments"' and 33607.7. FY 2011112 Statutory Pass· Other Taxing Pursuant to HSC 33607.5 (E) $32,450 $32,450 Through Payments'" Entities and 33607.7. City of Temple City, Repayment of deferred FY1985/86-FY1995/96 Housing Fund Deficit Repayment as Successor Housing Fund deposits (E) $753,736 $226,122 Housing Agency pursuant to HSC 33334.6. City of Temple City, Housing Bond Proceeds" .. " as Successor (B) $463,738 $463,738 Housing Agency Total Due During 2012 Year $2,450 $32,450 $226,122 $463,738 !~ot!Wri5bliQBiiOris-I I I--I I $724.76o! ____ r ___ I ___ T __ :::J ___ I I $724,760( • The draft Initial ROPS must be prepared by the Successor Agency by 3/1/11, subject to certification of an external auditor and approval of the Oversight Board. " Payment Sources [CAL §34177 (1)(1]: (A) Low and Moderate Income Housing Fund, (B) Bond proceeds, (C) Reserved balances, (D) Administrative cost allowance, (E) Redevelopment Property Tax Trust Fund, (F) Other revenue sources including rents, concessions, asset sale proceeds, Interest earnings, and any other revenues derived from the fanner Redevelopment Agency, as approved by the Oversight Board. "'Estimated for FY 2011/12 based on 50% of projected FY 2011/12 tax increment revenues (the 1st remittance portion only). The remaining pass through obligations for FY 2011/12 are assumed to be made by the County Auditor-Controller's Office . .... Unspent bond proceeds obligated by the 2005 TAB Covenants are to be spent on affordable housing (proceeds are housing assets, and must be transferred to the City of Temple City, as the Successor Housing Agency) • .... , Transfer to the Successor Housing Agency if SB 654 or AB 1585 are enacted.