Loading...
HomeMy WebLinkAboutAgenda 082511 - CC SpcMtg Notice NOTICE OF A SPECIAL MEETING CITY OF ATASCADERO CITY COUNCIL Thursday, August 25, 2011 Immediately following the conclusion of the Community Redevelopment Agency Special Meeting which starts at 6:00 p.m. City of Atascadero Council Chambers 6907 EI Camino Real, Atascadero, California ROLL CALL: PUBLIC COMMENT: DISCUSSION: 1. Discussion of Continuation of Redevelopment Agency Projects by the City ■ Fiscal Impact: There is no impact as a result of this recommendation but should the City move forward supporting redevelopment projects, projects would move forward but funds could be at risk. ■ Recommendation: Council discuss and provide direction to staff on whether or not the City will continue certain redevelopment projects and activities on behalf of the Redevelopment Agency during the period the Supreme Court of California is reviewing legal challenges to ABx1 26 and 27. [City Manager] ADJOURNMENT: The City Council will adjourn to the next Regular Session scheduled on Tuesday, September 13, 2011, at 6:00 p.m. STATE OF CALIFORNIA ) COUNTY OF SAN LUIS OBISPO ) CITY OF ATASCADERO ) MARCIA MCCLURE TORGERSON, C.M.C., being fully sworn, deposes, and says: That she is the duly elected City Clerk of the City of Atascadero and that on Wednesday, August 24, 2011, she caused the above Notice to be posted on the doors of the City's Administration Building, 6907 EI Camino Real in Atascadero, California. ITEM NUMBER: 1 DATE: 8/25/11 � r df r�Ir.r- rF R � `ieis' r r , 11970�-7 Atascadero City Council Staff Report - City Manager's Office Discussion of Continuation of Redevelopment Agency Projects by the City RECOMMENDATION: Council discuss and provide direction to staff on whether or not the City will continue certain redevelopment projects and activities on behalf of the Redevelopment Agency during the period the Supreme Court of California is reviewing legal challenges to ABx1 26 and 27. DISCUSSION: On June 28, 2011 , Governor Jerry Brown signed ABx1 26 and 27. The bills effectively put an end to redevelopment and redevelopment agencies in California unless agencies "voluntarily" made payments to the State of California prior to January 15, 2011 . On July 18, 2011 , the League of California Cities and the California Redevelopment Association filed a lawsuit with the California Supreme Court challenging that the governor's and legislature's actions were unconstitutional based on the passage of Proposition 22 passed in November 2010. Proposition 22 stated that the state could no longer shift, borrow, take, or eliminate local funding sources including redevelopment funds. On August 9, 2011 , the Atascadero City Council adopted an ordinance stating it was the City's intent to make payments to the State of California in order to keep the Atascadero Redevelopment Agency in business. This step was a preventative measure if the court ruled against redevelopment agencies. By passing this ordinance, the Agency could continue to function as it normally was functioning. On August 11 , 2011 , the California Supreme Court voted to hear the lawsuit and placed a stay on ABx1 26 and 27. The stay has complicated the direction redevelopment agencies thought they could take and has resulted in several questions as to whether redevelopment agencies can continue activities or not. RaCPrI nn arlvir-P frnm the rite Attnrnav and the attnrnPv fnr the ('Alifnrnia ITEM NUMBER: 1 DATE: 8/25/11 Enforceable Obligations Payment Schedule (EOPS) (that was listed on the Redevelopment Agency agenda for a meeting to be held before this Council meeting), are frozen until the court rules on the case before them, possibly as late as January 15, 2012. Prior to the court stay, because the City Council had passed an ordinance stating that the Agency would make a "voluntary" contribution to the State, it seemed that agency activities could continue but now staff is receiving advice that they cannot. On August 23, 2011 the California Redevelopment Association asked the court to clarify whether or not agencies could continue to operate if they passed the continuation ordinance. It is not certain whether we will get clarification on this issue or not. In light of this, several redevelopment projects are at risk and may be immediately placed on hold until the court makes its ruling. These projects include: • Purchase of the Olsen property along Atascadero Creek • Construction of the pedestrian bridge between the Sunken Garden and Colony Square • Lake Park frontage improvements • Affordable housing strategy and program • Downtown wayfinding signage • Downtown stimulus programs There are several other projects that may be caught up as well. There is one alternative to continuing the activities of the Agency. As a result of the Agency contracting earlier this year with the City to do many of its activities, the City could at its own risk continue funding these projects in anticipation of either the court ruling in favor of redevelopment agencies, or that the law is constitutional in its entirety and that agencies could operate under the new law after "voluntary" payments were made. In this scenario, once the court ruled, the Agency could reimburse the City for expenses up to that date. If however in a more unlikely situation, the court ruled only that agencies could legally be shut down or some other combination, the funds the City forwarded could be at risk of not being paid back. The policy question the City Council is being asked to consider is: Does the benefit of continuing forward with redevelopment projects instead of postponing past January 15, 2012, outweigh the risk of spending city funds and potentially not being able to be reimbursed? Should Council be interested in continuing redevelopment projects a more thorough review of the specific projects being postponed, the funding required to continue them, an analysis of risk and an outline of how best to move forward would be presented at the September 13, 2011 City Council meeting. Should the Council choose not to move forward, several redevelopment projects will immediately be placed on hold. These projects are on hold now and will continue to be so until action is taken by the Council or ITEM NUMBER: 1 DATE: 8/25/11 FISCAL IMPACT: There is no impact as a result of this recommendation but should the City move forward supporting redevelopment projects, projects would move forward but funds could be at risk. ITEM NUMBER: 1 DATE: 8/25/11 r - i9is' �C F i i978 7 ►SCAD Atascadero City Council Staff Report — City Manager's Office Discussion of Continuation of Redevelopment Agency Projects by the City RECOMMENDATION: Council discuss and provide direction to staff on whether or not the City will continue certain redevelopment projects and activities on behalf of the Redevelopment Agency during the period the Supreme Court of California is reviewing legal challenges to ABx1 26 and 27. DISCUSSION: On June 28, 2011, Governor Jerry Brown signed ABx1 26 and 27. The bills effectively put an end to redevelopment and redevelopment agencies in California unless agencies "voluntarily" made payments to the State of California prior to January 15, 2011. On July 18, 2011, the League of California Cities and the California Redevelopment Association filed a lawsuit with the California Supreme Court challenging that the governor's and legislature's actions were unconstitutional based on the passage of Proposition 22 passed in November 2010. Proposition 22 stated that the state could no longer shift, borrow, take, or eliminate local funding sources including redevelopment funds. On August 9, 2011, the Atascadero City Council adopted an ordinance stating it was the City's intent to make payments to the State of California in order to keep the Atascadero Redevelopment Agency in business. This step was a preventative measure if the court ruled against redevelopment agencies. By passing this ordinance, the Agency could continue to function as it normally was functioning. On August 11 , 2011, the California Supreme Court voted to hear the lawsuit and placed a stay on ABx1 26 and 27. The stay has complicated the direction redevelopment agencies thought they could take and has resulted in several questions as to whether redevelopment agencies can continue activities or not. Based on advice from the City Attorney and the attorney for the California Redevelopment Association, it has been suggested that any activities not listed on the ITEM NUMBER: 1 DATE: 8/25/11 Enforceable Obligations Payment Schedule (EOPS) (that was listed on the Redevelopment Agency agenda for a meeting to be held before this Council meeting), are frozen until the court rules on the case before them, possibly as late as January 15, 2012. Prior to the court stay, because the City Council had passed an ordinance stating that the Agency would make a "voluntary" contribution to the State, it seemed that agency activities could continue but now staff is receiving advice that they cannot. On August 23, 2011 the California Redevelopment Association asked the court to clarify whether or not agencies could continue to operate if they passed the continuation ordinance. It is not certain whether we will get clarification on this issue or not. In light of this, several redevelopment projects are at risk and may be immediately placed on hold until the court makes its ruling. These projects include: • Purchase of the Olsen property along Atascadero Creek • Construction of the pedestrian bridge between the Sunken Garden and Colony Square • Lake Park frontage improvements • Affordable housing strategy and program • Downtown wayfinding signage • Downtown stimulus programs There are several other projects that may be caught up as well. There is one alternative to continuing the activities of the Agency. As a result of the Agency contracting earlier this year with the City to do many of its activities, the City could at its own risk continue funding these projects in anticipation of either the court ruling in favor of redevelopment agencies, or that the law is constitutional in its entirety and that agencies could operate under the new law after "voluntary" payments were made. In this scenario, once the court ruled, the Agency could reimburse the City for expenses up to that date. If however in a more unlikely situation, the court ruled only that agencies could legally be shut down or some other combination, the funds the City forwarded could be at risk of not being paid back. The policy question the City Council is being asked to consider is: Does the benefit of continuing forward with redevelopment projects instead of postponing past January 15, 2012, outweigh the risk of spending city funds and potentially not being able to be reimbursed? Should Council be interested in continuing redevelopment projects a more thorough review of the specific projects being postponed, the funding required to continue them, an analysis of risk and an outline of how best to move forward would be presented at the September 13, 2011 City Council meeting. Should the Council choose not to move forward, several redevelopment projects will immediately be placed on hold. These projects are on hold now and will continue to be so until action is taken by the Council or the Supreme Court. ITEM NUMBER: 1 DATE: 8/25/11 FISCAL IMPACT: There is no impact as a result of this recommendation but should the City move forward supporting redevelopment projects, projects would move forward but funds could be at risk.