HomeMy WebLinkAboutF-1 Staff Report - OB 18-19 ROPS and Admin Budget1
Oversight Board Staff Report
ROPS 16-17-July 1, 2016 to June 30, 2017
January 27, 2016
Page 1
SUCCESSOR AGENCY ITEM
F-1
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE SUCCESSOR
AGENCY BOARD
VIA: DON PENMAN, INTERIM CITY MANAGER
FROM: KURT E. CHRISTIANSEN, ECONOMIC AND COMMUNITY
DEVELOPMENT DIRECTOR
DATE: JANUARY 16, 2018
SUBJECT: APPROVAL OF RECOGNIZED OBLIGATION PAYMENT SCHEDULE AND
ADMINISTRATIVE BUDGET FOR JULY 1, 2018 THROUGH JUNE 30, 2019
AND ADOPTION OF RESOLUTIONS
SUMMARY:
Pursuant to Health and Safety Code Section 34177, the Successor Agency of the former
Redevelopment Agency of the City of Azusa (“Agency”) is required to continue to make
payments due for enforceable obligations of the former Redevelopment Agency. The Agency is
to prepare a “Recognized Obligation Payment Schedule” (“ROPS”) for the period of July 1,
2018 through June 30, 2019 (“ROPS 18-19”) that identifies these obligations for the period. In
addition, the Agency is required to prepare a proposed administrative budget and submit to the
Oversight Board (“Board”) for approval. This action requests the approvals of Resolution No.
2018-R01, approving and adopting ROPS 18-19 and Resolution No. 2018-R02, approving and
adopting the proposed administrative budget for the period of July 1, 2018 through June 30,
2019.
RECOMMENDATION:
Staff recommends the City Council take the following actions:
1) Adopt the attached Resolution No. 2018-R01, approving and adopting the
“Recognized Obligation Payment Schedule” for the period of July 1, 2018 through
June 30, 2019 (ROPS 18-19) pursuant to AB x1 26 as amended by AB 1484.
2) Adopt the attached Resolution No. 2018-R02, approving and adopting the proposed
Administrative Budget for July 1, 2018 through June 30, 2019.
DISCUSSION:
The Agency is required to adopt a ROPS setting forth the nature and amount of all existing
Agency recognized obligations (as defined in the law). Each ROPS previously reflected a six-
month interval of obligations. However, the new procedure requires the Successor Agencies to
prepare a ROPS for a 12-month interval, for the full fiscal year.
Approved
Council Meeting
1/16/2018
2
Successor agency Staff Report
ROPS 18-19-July 1, 2018 to June 30, 2019
January 16, 2018
Page 2
The obligations of the Agency may include the following: bonds; loans legally required to be
repaid pursuant to a payment schedule with mandatory repayment terms; payments required by
the federal government, preexisting obligations to the state or obligations imposed by state law;
judgments, settlements or binding arbitration decisions that bind the agency; legally binding and
enforceable agreements or contracts; and contracts or agreements necessary for the continued
administration or operation of the agency, including agreements to purchase or rent office space,
equipment and supplies.
The following is a summary of the enforceable obligations listed in ROPS 18-19:
1. Bond Debt Service
• 2014 Series A Subordinate Tax Allocation Refunding Bond
• 2015 Series A Subordinate Tax Allocation Refunding Bond
• 2015 Series A Subordinate Tax Allocation Refunding Bond
• 2017 Series A Subordinate Tax Allocation Refunding Bond
• 2017 Series B Subordinate Tax Allocation Refunding Bond
• 2003 Certificate of Participation Refunding Bond
2. Administrative Cost Allowance
These include costs for staff, audit services, maintenance of properties and legal
counsel that are required in the dissolution of the Agency to comply with AB x1 26
as amended by AB1484. The amount of the annual administrative cost allowance is
capped at three percent of the total amount allocated to the Redevelopment
Obligation Retirement Fund or $250,000, whichever is greater.
3. Loan Repayment
The loan from the City to the Successor Agency for the former Enterprise site was
approved by the State Department of Finance as an enforceable obligation. The loan can
now be repaid provided there is a residual balance available from the Redevelopment
Property Tax Trust Fund revenues remitted to the Successor Agency.
Upon the approval of ROPS 18-19 by the Board, it is submitted to the DOF, State Controller’s
Office and the County of Los Angeles Auditor-Controller by February 1, 2018. It will also be
posted on the City website. The DOF must complete its review of ROPS 18-19 by April 15, 2018
and issue a Determination Letter. If the Agency disagrees with DOF’s determination, the
Agency can request a Meet and Confer session with DOF, within five days of receipt of the
letter, to allow for a two-way dialogue between the Agency and the DOF. At the conclusion of
the Meet and Confer meeting, the DOF will issue a final Determination Letter by May 15, 2018.
This is a statutory deadline as the tax increment must be distributed to the Agency by June 1,
2018 to fund the ROPS 18-19 obligations.
The attached Resolution No. 2018-R01, approves and adopts ROPS 18-19, setting forth the
recognized obligations of the Agency and the amount of payments to be made for each
obligation from July 1, 2018 through June 30, 2019. It also authorizes staff to amend the ROPS
in order to remove line items which are subsequently disapproved by the Board and/or DOF.
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Oversight Board Staff Report
ROPS 18-19-July 1, 2018 to June 30, 2019
January 16, 2018
Page 3
Resolution No. 2018-R02 approves and adopts the proposed administrative budget reflecting
the estimated costs to perform the administrative functions for the purpose of winding
down the former Redevelopment Agency’s affairs. The Successor Agency is entitled to
receive a maximum amount of $250,000 annually.
FISCAL IMPACT:
The resources to fund the obligations of ROPS 18-19 will come from the Redevelopment
Property Tax Trust Fund (“RPTTF”). Approval of ROPS 18-19 will facilitate the ability of the
Agency to continue payment of the enforceable obligations of the former Redevelopment
Agency for the next fiscal year. Failure to approve and submit the ROPS 18-19 to the DOF by
the February 1, 2018 deadline, as required by AB1484, may result in penalties of $10,000 per
day to the Successor Agency.
Prepared by: Reviewed and Approved by:
Talika Johnson Kurt Christiansen
Director of Finance Director of Economic and
Community Development
Reviewed and Approved: Reviewed and Approved:
Louie F. Lacasella Don Penman
Senior Management Analyst Interim City Manager
Attachments:
1) Resolution No. 2018-R01 – Successor Agency of the former Redevelopment Agency of the City
of Azusa Adopting a Recognized Obligation Payment Schedule-July 1, 2018 to June 30, 2019
(ROPS 18-19)
Exhibit A – ROPS 18-19, July 1, 2018 to June 30, 2019
2) Resolution No. 2018-R02 – Successor Agency of the former Redevelopment Agency of the City
of Azusa Adopting an Administrative Budget -July 1, 2018 to June 30, 2019
Exhibit B – Proposed Administrative Budget, July 1, 2018 to June 30, 2019
RESOLUTION NO. 2018-R01
A RESOLUTION OF THE SUCCESSOR AGENCY OF THE FORMER
REDEVELOPMENT AGENCY OF THE CITY OF AZUSA APPROVING
AND ADOPTING THE RECOGNIZED OBLIGATION PAYMENT
SCHEDULE FOR THE PERIOD OF JULY 1, 2018 THROUGH JUNE 30,
2019 PURSUANT TO AB x1 26 AS AMENDED BY AB 1484
WHEREAS, Health and Safety Code Section 34169(h), enacted by AB x1 26, requires
successor agencies to prepare a Recognized Obligation Payment Schedule (“ROPS”) annually.
WHEREAS, because the Successor Agency of the former Redevelopment Agency of
the City of Azusa (“Board”) previously adopted a ROPS, Resolution No. 2017-R02, dated
February 6, 2017, is operative only through June 30, 2018, so that the Successor Agency of the
former Redevelopment (“Agency”) may continue to meet the Agency’s recognized obligations,
and
NOW, THEREFORE, BE IT RESOLVED, determined and ordered by the Oversight
Board as follows:
Section 1. The Recitals set forth above are true and correct and incorporated
herein by reference.
Section 2. The Agency staff is hereby authorized to administratively amend
the ROPS in order to remove line items which are subsequently
disapproved by the Board, the California State Department of
Finance (“DOF”) and the County of Los Angeles Auditor-
Controller and to format the ROPS to conform with DOF
requirements and to take all necessary and appropriate actions to
prepare and submit the ROPS, provided, however, that neither such
authorization nor such removal shall be deemed to be, nor are they
intended as, an acknowledgement of the validity of AB x1 26 and
AB 1484 or such action by the Board and/or the DOF. The Agency
reserves all rights of the Agency to challenge the validity and/or
application of any or all provisions of AB x1 26 and AB 1484 in
any administrative or judicial proceeding, without prejudice to the
Agency’s right to list any such removed item on this or a future
ROPS. The Agency reserves the right to pursue any and all appeals
and any available legal or equitable remedy provided or available
by law to obtain the correction of any erroneous decision regarding
the ROPS.
Section 3. The Agency staff is authorized to include on the ROPS any items
which were approved on previous ROPS but not fully expended.
Section 4. The Board hereby approves and adopts ROPS 18-19, in
substantially the form attached to this Resolution as Exhibit A, so
that the Agency may continue to meet its recognized obligations, all
as required by Health and Safety Code section 34177, during the
time period from July 1, 2018 through June 30, 2019. The Agency
reserves the right to further amend the ROPS in the future in order
to provide an accurate schedule.
Section 5. The Board hereby directs that copies of this Resolution be submitted to
the California State Department of Finance, the California State
Controller’s Office and the Los Angeles County Auditor-Controller
and to be posted on the Agency’s website.
Section 6. Pursuant to Health and Safety Code Section 34179(h), all actions taken
by the Oversight Board, may be reviewed by the California Department
of Finance, and therefore, this Resolution shall not be effective for five
(5) business days, pending a request for review by the California
Department of Finance.
APPROVED AND ADOPTED THIS 16th day of January, 2018.
Joseph Romero Rocha, Chairperson
Successor Agency to the Former Redevelopment Agency
of the City of Azusa
ATTEST:
Jeffrey Lawrence Cornejo, Jr., Secretary
Successor Agency to the Former Redevelopment Agency
of the City of Azusa
I HEREBY CERTIFY that the foregoing Resolution No. 2018-R01 was duly adopted
by the Board Members of the Oversight Board of the City of Azusa at a regular meeting thereof
on the 16th day of January 2018, by the following vote of Board Members:
AYES: BOARD MEMBERS:
NOES: BOARD MEMBERS:
ABSENT: BOARD MEMBERS:
Jeffrey Lawrence Cornejo, Jr., Secretary
Successor Agency to the Former Redevelopment Agency
of the City of Azusa
7
EXHIBIT A
RECOGNIZED OBLIGATION PAYMENT SCHEDULE 18-19
July 1, 2018 through June 30, 2019
RESOLUTION NO. 2018-R02
A RESOLUTION OF THE SUCCESSOR AGENCY OF THE FORMER
REDEVELOPMENT AGENCY OF THE CITY OF AZUSA APPROVING
AND ADOPTING THE ADMINISTRATIVE BUDGET FOR THE
PERIOD OF JULY 1, 2018 THROUGH JUNE 30, 2019 PURSUANT TO
AB x1 26 AS AMENDED BY AB 1484
WHEREAS, Health and Safety Code Section 34177(J), enacted by AB x1 26, requires a
successor agency to a former redevelopment agency to prepare administrative budgets to the
Oversight Board for approval.
WHEREAS, the Successor Agency of the Former Redevelopment Agency of the City of
Azusa (“Agency”) has submitted to the Oversight Board of the Agency (“Board”) an annual
proposed administrative budget (“Budget”) that commences on July 1, 2018 through June 30,
2019. Attached hereto as Exhibit B, and
NOW, THEREFORE, BE IT RESOLVED, determined and ordered by the Oversight
Board as follows:
Section 1. The Recitals set forth above are true and correct and incorporated
herein by reference.
Section 2. The Board hereby approves the Budget, in substantially the form
attached to this Resolution as Exhibit B, so that the Agency may
continue to meet its recognized obligations, all as required by Health
and Safety Code section 34177, during the time period from July 1,
2018 through June 30, 2019. The Agency reserves the right to further
amend the Budget in the future in order to provide an accurate
schedule.
Section 3. The Agency staff is authorized and directed to enter into any
agreements and amendments to agreements necessary to memorialize
and implement the agreements and obligations in the Budget herein
approved by the Board.
Section 4. The Board hereby directs that copies of this Resolution be submitted to
the California State Department of Finance, the California State
Controller’s Office and the Los Angeles County Auditor-Controller
and to be posted on the Agency’s website.
Section 5. Pursuant to Health and Safety Code Section 34179(h), all actions taken
by the Board, may be reviewed by the California Department of
Finance, and therefore, this Resolution shall not be effective for five (5)
business days, pending a request for review by the California
Department of Finance.
APPROVED AND ADOPTED THIS 16th day of January, 2018.
Joseph Romero Rocha, Chairperson
Successor Agency to the Former Redevelopment Agency
of the City of Azusa
ATTEST:
Jeffrey Lawrence Cornejo, Jr., Secretary
Successor Agency to the Former Redevelopment Agency
of the City of Azusa
I HEREBY CERTIFY that the foregoing Resolution No. 2018-R02 was duly adopted
by the Board Members of the Oversight Board of the City of Azusa at a regular meeting thereof
on the 16th day of January 2018, by the following vote of Board Members:
AYES: BOARD MEMBERS:
NOES: BOARD MEMBERS:
ABSENT: BOARD MEMBERS:
Jeffrey Lawrence Cornejo, Jr., Secretary
Successor Agency to the Former Redevelopment Agency
of the City of Azusa
EXHIBIT B
PROPOSED ADMINISTRATIVE BUDGET
July 1, 2018 through June 30, 2019