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08-01-2012 - Approval and Transmittal of a Revised Administrati - Item SA-1 (2).pdfCity of West Covina Memorandum AGENDA Item: SA-1 TO: Andrew G. Pasmant, City Manager Date: August 1, 2012 and City Council FROM: Thomas Bachman Assistant City Manager/Finance Director SUBJECT: APPROVAL AND TRANSMITTAL OF A REVISED ADMINISTRATIVE BUDGET FOR THE SUCCESSOR AGENCY TO THE WEST COVINA REDEVELOPMENT AGENCY, AND A REVISED SCHEDULE OF DISTRIBUTION OF FUTURE TAX REVENUES (RECOGNIZED OBLIGATIONS PAYMENT SCHEDULES "ROPS") PURSUANT TO AB1X 26 FOR THE PERIOD OF JANUARY 1— JUNE 30, 2013 RECOMMENDATION: It is recommended the City Council, acting as the Successor Agency to the West Covina Redevelopment Agency, adopt the attached resolution: RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST COVINA, ACTING AS SUCCESSOR AGENCY TO THE WEST COVINA REDEVELOPMENT AGENCY APPROVING AND AUTHORIZING THE TRANSMITTAL OF AN ADMINISTRATIVE BUDGET FOR THE SUCCESSOR AGENCY TO THE WEST COVINA REDEVELOPMENT AGENCY, AND SCHEDULES OF DISTRIBUTION OF FUTURE TAX REVENUES (RECOGNIZED OBLIGATIONS PAYMENT SCHEDULES "ROPS") FOR THE PERIOD JANUARY 1 — JUNE 30, 2013, PURSUANT TO ASSEMBLY BILL 1X 26 (AB1X 26) DISCUSSION: The Successor Agency is required to file a Schedule of Distribution of Future Tax Revenues "ROPS" schedule every six months in order to receive a distribution of property tax increment dollars with which to fund the obligations of the former redevelopment agency. These obligations include bond debt service payments, amounts due under existing agreements with commercial property owners, repayment of amounts borrowed from the Housing Fund to fund property tax shifts mandated by the state, cost of litigation to protect assets of the former redevelopment agency, repayment of loans to the City, and administrative costs of the successor agency to wind down the affairs of the former redevelopment agency. While many of these listed items are not necessarily debt, they are considered obligations for purposes of this mandated report and must be listed on this report if they are to be funded with distributions of future tax increment dollars. These items are not debt obligations of the City of West Covina. The ROPS schedule (Attachment 2) lists all amounts that will be paid in the period January 1 through June 30, 2013. Once approved by the Successor Agency, the ROPS must then be approved by the seven-member Successor Agency Oversight Board. The ROPS will be presented to the Oversight Board at their scheduled meeting on August 2, 2012. Once the ROPS is approved by the Oversight Board, it then must be sent to the State Department of Finance "DOF" by September 1, 2012. DOF holds final approval authority of the items listed on the ROPS and directs the Los Angeles County Auditor- Controller on which items to distribute tax increment funds for to the Successor Agency. The Successor Agency is also required to adopt an administrative budget for each upcoming six-month period. Attachment 3 to this report is the administrative budget for the Successor Agency for the period of January — June 2013. The January — June administrative budget is 1/2 of the fiscal year 2012-13 annual projected costs. This budget is to be funded by the administrative allowance, which is equal to an amount, which is the greater of 3% of the enforceable obligations, or $250,000 annually. Any administrative costs above this administrative allowance will be absorbed by the City. The Successor Agency previously approved a ROPS for the January — June 2013 period at their July 17, 2012, meeting. As that ROPS was prepared shortly after AB 1484 was adopted by the legislature and signed by the governor, staff had not had the full opportunity to analyze that legislation prior to preparing the ROPS. Based on further analysis, staff has made certain changes to the ROPS that was previously approved. AB 1484 now allows legal costs as an enforceable obligation. Therefore, staff has added item 16 to the ROPS, which is legal services for the oversight board in the amount of $10,000. This item was specifically requested by the oversight and staff has requested RFQ from legal firms to provide this service. Staff also added item 17, which is legal services for the Successor Agency in the amount of $60,000. Finally, AB 1484 requires that the Successor Agency retain an audit firm to perform a "due diligence" or cash audit of the former redevelopment agency housing funds which are to be turned over to the county auditor by November 28, 2012. Staff has added item 15 for these audit fees in the amount of $12,500. Also now included on this ROPS are items 23 — 25. The Fashion Plaza CFD Bonds, the Lakes Parking Structure Bonds, and the Developer Repayment to Westfield are paid for from sources other than property tax revenues. These items were included on the original ROPS and while not funded by property tax revenues, they still remain obligations of the Successor Agency and are therefore again included on this ROPS. The Successor Administrative Budget is also attached for approval. This budget has been modified to remove the legal services since those services are now included as a specific enforceable obligation. FISCAL IMPACT: The City, as successor agency, cannot receive or spend any funds unless the amounts are listed on a Recognized Obligations Payment Schedule. This schedule identifies all outstanding obligations that must be satisfied before the Agency can be dissolved. The obligations listed on this schedule will receive property tax allocations distributed by the county as their funding source. If the City's administrative costs exceed the administrative allowance, that amount will have to be absorbed by the City. Assistant City Manager/Finance Director Attachments: No. 1 — Resolution No. 2— Schedule of Distribution of Future Tax Revenues No. 3 — Successor Agency Administrative Budget Attachment 1 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST COVINA, ACTING AS SUCCESSOR AGENCY TO THE WEST COVINA REDEVELOPMENT AGENCY APPROVING AND AUTHORIZING THE TRANSMITTAL OF AN ADMINISTRATIVE BUDGET FOR THE SUCCESSOR AGENCY TO THE WEST COVINA REDEVELOPMENT AGENCY, AND SCHEDULES OF DISTRIBUTION OF FUTURE TAX REVENUES (RECOGNIZED OBLIGATIONS PAYMENT SCHEDULES "ROPS") FOR THE PERIOD JANUARY 1 — JUNE 30, 2013, PURSUANT TO ASSEMBLY BILL 1X 26 (AB1X 26) WHEREAS, the Community Development Commission of the City of West Covina ("Commission") is a community development commission organized and existing under and pursuant to the California Community Development Commission Law (Part 1.7 of Division 24, commencing with Section 34100, of the Health and Safety Code of the State of California) (the "CDCL"); and WHEREAS, the City Council of the City of West Covina ("City") approved and adopted the Redevelopment Plans for the following Redevelopment Projects ("Redevelopment Plans") covering certain properties within the City (the "Project Areas"): 1. On December 20, 1971 the West Covina City Council adopted the original Central Business District Redevelopment Project Area by adoption of Ordinance No. 1180. 2. On July 14, 1975 the West Covina City Council adopted the original Eastland Redevelopment Project Area by adoption of Ordinance No. 1269. 3. On December 21, 1993 the West Covina City Council approved the Merger of the Central Business District and the Eastland Redevelopment Project Areas by adoption of Ordinance No. 1927 and Ordinance No. 1928, which adopted the merged area as the West Covina Redevelopment Project Area and added three non-contiguous areas to the merged project area; and WHEREAS, as part of the 2011-12 State budget bill, the California Legislature has enacted and the Governor has signed, companion bills AB 1X 26 and AB 1X 27, requiring that each redevelopment agency be dissolved unless the community that created it enacts a resolution committing it to making certain payments; and WHEREAS, specifically, AB 1X 26 prohibits agencies from taking numerous actions, effective immediately and purportedly retroactively, and additionally provides that agencies are deemed to be dissolved as of October 1, 2011; and WHEREAS, additionally, AB 1X 26 which eliminates redevelopment agencies also requires all Agencies to wind-down their affairs unless the Agencies are extended through compliance with the requirements of AB 1X 27; and WHEREAS, the California Supreme Court on August 11, 2011 issued a partial stay ("Stay") on the operative effects of ABX1 26 in the case of California Redevelopment Association, et al. v. Ana Matsonantos, et al. Case No. S194861. WHEREAS, on December 29, 2011, the California Supreme Court upheld AB1X 26, which dissolved all of the redevelopment agencies in the State of California as of February 1, 2012, and struck down AB1X 27; and WHEREAS, at a meeting of January 10, 2012, the City of West Covina took action to designate itself as the Successor Agency and the Community Development Commission as the Housing Successor Agency, as provided in California Health and Safety Code §§ 34173 and 34176; and WHEREAS, Health and Safety Code Section 34169(h), which is set forth in Part 1.8, requires a Successor Agency to prepare and submit an approved Recognized Obligation Payment Schedule for the period from January 1, 2013 to June 30, 2013 to the State Department of Finance by September 1, 2012, which must list the minimum amounts that must be paid by the successor agency over that six (6) month period to fulfill its enforceable obligations during that period; and WHEREAS, the West Covina City Council, acting as Successor Agency to the West Covina Redevelopment Agency, reserves the right to appeal any determination of the California Director of Finance or other entity regarding the propriety of this resolution as well as any future determinations; and WHEREAS, while the West Covina City Council, acting as Successor Agency to the West Covina Redevelopment Agency, currently intends to comply with the state- mandated obligations established hereunder; and WHEREAS, all other legal prerequisites to the adoption of this resolution have occurred. NOW, THEREFORE, BE IT RESOLVED by the West Covina City Council, acting as Successor Agency to the West Covina Redevelopment Agency, as follows: SECTION 1. The foregoing Recitals are incorporated into this Resolution by this reference, and constitute a material part of this Resolution. SECTION 2. The Schedule of Distribution of Future Tax Revenues (Recognized Obligations Payment Schedule "ROPS") attached hereto as Attachment "2" is approved and the City Manager is authorized to transmit the same to the Los Angeles County Auditor-Controller, the State Controller and the State Department of Finance in accordance with Health and Safety Code Section 34169 subject to all reservations of rights and contingencies set forth above. SECTION 3. The Administrative Budgets for the Successor for the six-month period January — June 2013, attached hereto as Attachment "3" is approved and the City Manager is authorized to transmit the same to the Los Angeles County Auditor- Controller, the State Controller and the State Department of Finance in accordance with Health and Safety Code Section 34169 subject to all reservations of rights and contingencies set forth above. SECTION 5. The City Manager or designee is authorized to take all actions necessary to implement this Resolution, including without limitation, the posting of this Resolution and the Recognized Obligation Payment Schedule on the City's website, and the provision of notice of adoption of this Resolution and such Schedule to the County Auditor-Controller, the State Controller and the State Department of Finance. SECTION 6. The City Clerk shall certify as to the passage and adoption of this Resolution, and it shall thereupon take effect and be in full force, except that this Resolution shall not be effective during any period of time that the Stay remains effective. APPROVED AND ADOPTED at a regular meeting of the City Council of the City of West Covina this 1st day of August 2012. Mayor Mike Touhey ATTEST: Assistant City Clerk Susan Rush I SUSAN RUSH, ASSISTANT CITY CLERK, of the City of West Covina do hereby certify that the foregoing resolution was duly adopted by the West Covina City Council, acting as Successor Agency to the West Covina Redevelopment Agency, at a meeting thereof held on the 1st day of August 2012, by the following vote: AYES: NOES: ABSENT: ABSTAIN: Assistant City Clerk Susan Rush APPROVED AS TO FORM: City Attorney Name of Redevelopment Agency: West Covina Community Development Commission Project Area(s) Merged & Citywide FOR THE PERIOD: JANUARY - JUNE 2013 SCHEDULE OF DISTRIBUTION OF FUTURE TAX REVENUES RECOGNIZED OBLIGATION PAYMENT SCHEDULE Per AB 26 - Section 34167 and 34169 Adopted August 1,2012 Project Name / Debt Obligation Payee Description Total Outstanding Debt or Obligation Obligation Expiration Date Total Due During Fiscal Year 2012-13 ' Funding Source January February March April May June Total 1 1999 Tax Allocation Bonds US Bank Fund capital projects in Merged Area 5,622,275.00 June 2030 - 208,600.00 RPTTF 14,700.00 1,200.00 2,400:00 14,700.00 1,200.00 2,400.00 $ 36,600.00 2 2002 Tax Allocation Bonds US Bank Refund outstanding 1993 bonds 11,371,110.00 Sept. 2025 989,272.00 SPITE 5,000.00 206,536.00 $ 211,536.00 3 2006 Lease Revenues Bonds City of West Covina Reimburse City for BLD Debt Service 29,119,269.00 June 2036 1,126,990.00 RPTTF 93,915.00 93,915.00 93,915.00 93,915.00 93,915.00 93,915.00 $ 563,490.00 4 1998 Housing Set Aside Bonds US Bank Acquisition and rehab of a housing proj 5,737,595.00 Sept. 2025 438,907.00 SPITE 3,500.00 - 111,679.00 - - - $ 115,179.00 5 2001 Housing Set Aside Bonds US Bank Development of a senior housing proj 10,779,345.00 Sept. 2031 767,935.00 RPTrF - 179,718.00 - 3,500.00 $ 183,218.00 6 SERAF 2010 Housing Loan Housing Successor Agy Repay SERAF to the housing fund 4,080,818.00 June 2015 - RPTTF - - - - - - $ - 7 SERAF 2011 Housing Loan Housing Successor Agy Repay SERAF to the housing fund 943,085.00 June 2016 - RPTTF - - - - - - $ - 8 DDA - The Lakes Various Bond admin & maint for park structure 1,440,000.00 215,000.00 RPTTF - 30,000.00 - - 30,000.00 $ 60,000.00 9 CFD Tax Increment Pledge Plaza CFD Tax Increment pledged fto CFD 15,846,352.00 Sept. 2022 1,450,000.00 RPTTF - - - 1,450,000.00 $ 1,450,000.00 10 CSS - CFD CSS Corn Fac Dist CFD Assessment 4,656,641.00 ongoing 74,837.00 RPTTF 6,236.42 6,236.42 6,236.42 6,236.42 6,236.42 6,236.42 $ 37,418.50 11 Repay County Loan County of Los Angeles Repay Loan of Defered Tax Increment 8,274,862.00 Uncertain 1,350,000.00 RPTTF - - • - - - $ - 12 SA Adminstrative Budget Various Operations for both project areas 16,520,339.00 ongoing 484,361.00 RPTTF 40,363.42 40,363.42 40,363.42 40,363.42 40,363.42 40,363.42 $ 242,180.50 13 Anticipated/Existing Litigation Various Enforcement of obligations 3,856,434.00 ongoing 1,200,000.00 RPTTF 700,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 $ 1,200,000.00 14 Project Administrative Costs Vaiidus • • Prajectspecific'i-elated 'costs • " '350,000.00 ongoing' • • • 70,000.00 RPTTF - 5,833.33 ' • 5,833.33 "5,833.33 ' ' '5,833.33 5,833:33 5,833.33 $ ' " 35:000.00 • 15 AB 1484 Auditing Fees TBD AB 1464 Auditing Fees 12,500.00 June 2013 12,500.00 RPTrF 12,500.00 - - - $ . 12,500.00 16 Oversight Board Legal Services TBD Oversight Board Legal Services 50,000.00 June 2015 10,000.00 RPTTF 10,000.00 - - 10,000.00 17 Successor Agency Legal Services Alvarez-Glasman Colvin Successor Agency Legal Services 300,000.00 June 2015 60,000.00 RPTTF 35,000.00 5,000.00 5,000.00 5,000.00 5,000.00 • 5,000.00 $ 60,000.00 18 City Note - Administratien City of West Covina ' Repay City for admin & construction 12,859,463.04 - June 2025 - SPITE - • - - - - - $ 19 City Note - CIP City of West Covina Repay City for capital projects 2,252,898.18 June 2025 - RPTTF - - - - - - $ - 20 City Note Revolving City of West Covina Repay City for revolving credit 4,824,790.78 June 2025 - RPTTF - - - - - - $ - 21 Sales Tax Reimbursement City of West Covina Reimburse City for CFD Sales Tax 22,856,769.00 June 2025 - SPITE - - - - - $ - 22 Golf Course Agreement Various Golf Course Implementation Agreement 45,000,000.00 ongoing - RPTTF - - - - - $ - 23 1996 CFD Refunding Bonds US Bank Fund Fashion Plaza Improvements 44,687,400.00 Sept. 2022 3,774,000.00 Other - - 975,600.00 - - - $ 975,600.00 24 1988 Lease Rev Refunding Bonds Wells Fargo Bank Fund Lakes Parking Project 3,915,885.00 Aug. 2018 461,900.00 Other 14,840.00 1,340.00 2,690.00 14,840.00 1,340.00 2,690.00 $ 37,740.00 25 OPA - CFD Westfield Corporation CFD admin and developer repayment 93,836,711.00 Sept. 2022 885,000.00 Other - - - - - - $ - Total Enforceable Obligations $ 349,194,542.00 $ 13,579,302.00 $ 941,888.17 $ 283,888.17 $ 1,729,971.17 $ 280,888.17 $ 283,888.17 $ 1,709,938.17 $ 5,230,462.00 Total RPTTF Obligations $ 206,754,546.00 $ 8,458,402.00 SPITE $ 927,048.17 282,548.17 $ ' 751,681.17 256,048.17 $ 282,548 17 $ 1,707,248.17 $ 4,217,122.00 Total Other Obligations . 142,439,996.00 5,120,900.00 Other 14,840.00 1,340.00 978,290.00 14,840.00 1,340.00 2,690.00 1,013,340.00 ROPS 2013 Jan-June ROPS 07-17-12 7/30/2012 1 of 1 Attachment 3 Successor Agency to the West Covina Redevelopment Agency Administrative Budget Used for Jan. - June 2013 ROPS Jan - June 2013 Salaries & Benefits M & 0 from CDC Staff: Appraisals Escrow & Title Consultants Copying Subtotal Other M & 0 costs not included above: A & 0 Liability Insurance Phone Cell Phone Pooled Car usage Fuel Vehicle Maintenance Subtotal Total Non-Personnel Costs 166,740 10,000 12,500 7,500 1,250 31,250 32,467 8,400 454 360 120 990 1,400 44,191 75,441 Total Budget 242,181 ROPS 2013 Jan-JuneAdmin Budget7/30/2012