HomeMy WebLinkAboutSA_2018_05_08 AgendaPacket1 On January 10, 2012, the Atascadero City Council adopted Resolution No. 2012 -002, electing to serve as the
successor to the Community Redevelopment Agency of Atascadero for redevelopment purposes, and also elected to
retain the housing assets and functions previously performed by the Community Redevelopment Agency of
Atascadero.
CITY OF ATASCADERO CITY COUNCIL IN
THE CAPACITY OF SUCCESSOR AGENCY
TO THE COMMUNITY REDEVELOPMENT
AGENCY OF ATASCADERO FOR
REDEVELOPMENT AND HOUSING
PURPOSES1
____________________________________________________________________________
AGENDA
Tuesday, May 8, 2018
(Immediately following the conclusion
of the City Council Regular Session)
City Hall Council Chambers, 4th floor
6500 Palma Avenue
Atascadero, California
(Enter from Lewis Avenue)
REGULAR SESSION – CALL TO ORDER: Immediately following
the conclusion of the City
Council Regular Session
ROLL CALL: Mayor O’Malley
Mayor Pro Tem Fonzi
Council Member Bourbeau
Council Member Moreno
Council Member Sturtevant
APPROVAL OF AGENDA: Roll Call
Page 1 of 21
A. CONSENT CALENDAR:
1. Successor Agency Draft Minutes – January 9, 2018
Recommendation: Council, in the capacity of the Successor Agency to
the Community Redevelopment Agency of Atascadero, approve the
Successor Agency Draft Action Minutes of January 9, 2018. [City Clerk]
COMMUNITY FORUM: (This portion of the meeting is reserved for persons wanting to
address the Board on any matter not on this agenda and over which the Board has
jurisdiction. Speakers are limited to three minutes. Please state your name and
address for the record before making your presentation. The Board may take action to
direct the staff to place a matter of business on a future agenda. A maximum of 30
minutes will be allowed for Community Forum, unless changed by the Board.)
B. PUBLIC HEARINGS: None.
C. MANAGEMENT REPORTS:
1. Agreement Authorizing the Repayment of Loans Made to the
Redevelopment Agency from the City
Fiscal Impact: This action by the Successor Agency will provide
repayment to the City in the amount of $180,000 in Fiscal Year 2019-20.
Recommendation: Successor Agency adopt Resolution approving an
“Agreement Regarding Reinstatement of Loans,” between the Successor
Agency to the Redevelopment Agency of the City of Atascadero and the
City of Atascadero authorizing the repayment of loans made from the City
to the Redevelopment Agency and, following approval by the Oversight
Board to the Successor Agency, direct the City Manager to execute the
agreement. [Administrative Services]
BOARD ANNOUNCEMENTS AND REPORTS: (On their own initiative, the Board
Members may make a brief announcement or a brief report on their own activities.
Board Members may ask a question for clarification, make a referral to staff or take
action to have staff place a matter of business on a future agenda . The Board may take
action on items listed on the Agenda.)
D. ADJOURN
Page 2 of 21
ITEM NUMBER: SA A-1
DATE: 05/08/18
Atascadero Successor Agency
January 9, 2018
Page 1 of 4
CITY OF ATASCADERO CITY COUNCIL IN
THE CAPACITY OF SUCCESSOR AGENCY
TO THE COMMUNITY REDEVELOPMENT
AGENCY OF ATASCADERO FOR
REDEVELOPMENT AND HOUSING
PURPOSES
____________________________________________________________________________
DRAFT MINUTES
Tuesday, January 9, 2018
(Immediately following the conclusion
of the City Council Regular Session)
City Hall Council Chambers, 4th floor
6500 Palma Avenue
Atascadero, California
(Enter from Lewis Avenue)
REGULAR SESSION – CALL TO ORDER: Immediately following
the conclusion of the City
Council Regular Session
Mayor O’Malley called the meeting to order at 7:23 p.m.
ROLL CALL:
Present: Council Members Bourbeau, Moreno, Sturtevant, Mayor Pro Tem
Fonzi and Mayor O’Malley.
Absent: None.
Staff Present: City Manager Rachelle Rickard, Administrative Services Director
Jeri Rangel, Public Works Director Nick Debar, Police Chief Jerel
Haley, Community Development Director Phil Dunsmore, Fire Chief
Casey Bryson, City Attorney Brian Pierik, Deputy City Manager/City
Clerk Lara Christensen.
Page 3 of 21
ITEM NUMBER: SA A-1
DATE: 05/08/18
Atascadero Successor Agency
January 9, 2018
Page 2 of 4
APPROVAL OF AGENDA:
MOTION: By Council Member Sturtevant and seconded by Mayor Pro
Tem Fonzi to:
1. Take Agenda Item #C-1 prior to Agenda Item #B-1; and
2. Approve this agenda as amended.
Motion passed 5:0 by a roll-call vote.
A. CONSENT CALENDAR:
1. Successor Agency Draft Minutes – May 23, 2017, June 13, 2017,
June 27, 2017, July 11, 2017, August 8, 2017, September 26, 2017, and
November 14, 2017
Recommendation: Council, in the capacity of the Successor Agency to
the Community Redevelopment Agency of Atascadero, approve the
Successor Agency Draft Action Minutes of May 23, 2017, June 13, 2017,
June 27, 2017, July 11, 2017, August 8, 2017, September 26, 2017, and
November 14, 2017. [City Clerk]
Deputy City Manager/City Clerk Christensen removed Draft Minutes for
November 14, 2017 for separate discussion and vote.
MOTION: By Council Member Bourbeau and seconded by Council Member
Moreno to approve the Consent Calendar excluding the
November 14, 2017 Draft Minutes.
Motion passed 5:0 by a roll-call vote.
Successor Agency Draft Minutes – November 14, 2017
Deputy City Manager/City Clerk Christensen provided the Council with a revised copy of
the Minutes (Exhibit A) and noted that the Minutes had been amended to reflect
Mayor Pro Tem Fonzi’s absence and City Attorney Pierik’s report that her absence was
due to a potential conflict of interest and inability to participate with regards to the
Closed Session item.
MOTION: By Council Member Bourbeau and seconded by Council Member
Moreno to approve the revised Draft Action Minutes of
November 14, 2017 as presented at the meeting.
Motion passed 5:0 by a roll-call vote.
COMMUNITY FORUM:
The following citizens spoke during Community Forum: None.
Mayor O’Malley closed the COMMUNITY FORUM period.
Page 4 of 21
ITEM NUMBER: SA A-1
DATE: 05/08/18
Atascadero Successor Agency
January 9, 2018
Page 3 of 4
C. MANAGEMENT REPORTS:
1. Approval of Recognized Obligation Payment Schedule 18-19
July 1, 2018 – June 30, 2019
Fiscal Impact: None for this action.
Recommendation: Successor Agency Board approve the Draft
Recognized Obligation Payment Schedule (ROPS) for the period of
July 1, 2018 through June 30, 2019 (ROPS 18 -19), including the
Administrative Budget, pursuant to Health and Safety Code.
[Administrative Services]
Administrative Services Director Rangel gave the presentation and answered questions
from the Council. She provided the Council with a revised ROPS for review and
approval (Exhibit B).
PUBLIC COMMENT:
The following citizens spoke on this item: None.
Mayor O’Malley closed the Public Comment period.
MOTION: By Mayor Pro Tem Fonzi and seconded by Council Member
Moreno to approve the Draft Recognized Obligation Payment
Schedule (ROPS) for the period of July 1, 2018 through
June 30, 2019 (ROPS 18-19), as revised and presented at the
meeting, including the Administrative Budget, pursuant to Health
and Safety Code.
Motion passed 5:0 by a roll-call vote.
B. PUBLIC HEARINGS:
1. Sale of Creekside Building
Ex-parte Communications:
Fiscal Impact: Closing costs and fees for the seller are estimated to be
$4,600. Following receipt of the proceeds of the sale, the Successor
Agency will transfer the appropriate funds to the County of San Luis
Obispo Auditor-Controller for distribution to the taxing agencies in
accordance with Health and Safety Code Division 24, Part 1.85.
Recommendation: Successor Agency adopt Draft Resolution approving a
Negative Declaration in accordance with CEQA requirements and
approving a purchase and sale agreement of the Creekside Building for
the purchase price of $2,200,000. [City Manager]
Mayor Pro Tem Fonzi noted that she works at the same office as the broker
representing Colony Creekside, LLC creating a potential conflict of interest and will step
down from the dais and recuse herself from the discussion and vote for this item.
City Manager Rickard gave the presentation and answered questions from the Council.
Page 5 of 21
ITEM NUMBER: SA A-1
DATE: 05/08/18
Atascadero Successor Agency
January 9, 2018
Page 4 of 4
PUBLIC COMMENT:
The following citizens spoke on this item: Clint Pearce and Susan Funk.
Mayor O’Malley closed the Public Comment period.
MOTION: By Mayor O’Malley and seconded by Council Member Moreno to
adopt Resolution No. SA2018-001 approving a Negative
Declaration in accordance with CEQA requirements and
approving a purchase and sale agreement of the Creekside
Building for the purchase price of $2,200,000.
Motion passed 4:0 by a roll-call vote. Fonzi abstained.
BOARD ANNOUNCEMENTS AND REPORTS: None.
D. ADJOURN
Mayor O’Malley adjourned the meeting at 7:58 p.m.
MINUTES PREPARED BY:
______________________________________
Lara K. Christensen
Deputy City Manager / City Clerk
The following exhibit is available for review in the City Clerk’s office:
Exhibit A – Revised Draft Action Minutes for November 14, 2017 provided by Deputy City
Manager/City Clerk Christensen.
Exhibit B – Revised Draft Recognized O bligation Payment Schedule provided by Administrative
Services Director Rangel.
APPROVED:
Page 6 of 21
ITEM NUMBER: SA C-1
DATE: 05/08/18
Successor Agency to the Community
Redevelopment Agency of Atascadero
Staff Report – Administrative Services
Agreement Authorizing the Repayment of Loans Made to the
Redevelopment Agency from the City
RECOMMENDATION:
Successor Agency adopt Resolution approving an “Agreement Regarding
Reinstatement of Loans,” between the Successor Agency to the Redevelopment
Agency of the City of Atascadero and the City of Atascadero authorizing the repayment
of loans made from the City to the Redevelopment Agency and, following approval by
the Oversight Board to the Successor Agency, direct the City Manager to execute the
agreement.
DISCUSSION:
Background:
Pursuant to authority granted under Community Redevelopment Law (California Health
and Safety Code Section 33000 et seq.) (“CRL”), the former Redevelopment Agency of
the City of Atascadero (“Redevelopment Agency”) had responsibility to implement the
Redevelopment Plans for the Redevelopment Project Area (“Project Area”).
Pursuant to Health and Safety Code Section 33220, the City was authorized to assist
the Redevelopment Agency for the purpose of aiding and cooperating in the planning,
undertaking, construction, and operation of redevelopment projects located within the
jurisdiction of the City, upon the terms and with or without consideration as the City
determined. The Redevelopment Agency, for its part, was authorized under Health and
Safety Code Sections 33132 and 33601 to borrow money and accept financial
assistance from the City for redevelopment projects located within the Redevelopment
Agency’s jurisdiction, Consistent with the foregoing authority, the City made the
following loans (collectively, the “Loans”) to the Redevelopment Agency:
(a) a loan in the original principal amount of $161,909, in accordance with the
terms set forth in City of Atascadero Contract #99027 for the purpose of
advancing funds to assist in the redevelopment of the Project Area,
including funding operating costs for the Redevelopment Agency. The
budget included expenditures for the Main Street Program, industrial
redevelopment of the Project Area, and operations activities. The loan
was shortly after the Redevelopment Agency was established, and before
Page 7 of 21
ITEM NUMBER: SA C-1
DATE: 05/08/18
tax increment revenues had sufficient time to build up. This loan provided
operating capital for the agency; and
(b) a loan in the original principal amount of $500,000, in accordance with the
terms set forth in City of Atascadero Contract #2001-009, for the purpose
of advancing funds to assist in the redevelopment of the Project Area,
including funding operating costs for the Redevelopment Agency. This
loan also provided operating capital in the early years of the Agency, prior
to build up of tax increment and prior to any debt issuance; and
(c) a loan in the original principal amount of $720,000, in accordance with the
terms set forth in City of Atascadero Contract #RA001 -2002, for the
purpose of advancing funds to assist in the redevelopment of the Project
Area, specifically the purchase of certain real property. These funds were
used for the purposes of removing blight through the purchase of a
downtown building that, at that time, housed an adult-oriented business
and the adjacent vacant lot.
The City agreed to serve as the successor agency to the former Redevelopment
Agency (“Successor Agency”) commencing upon dissolution of the Redevelopment
Agency on February 1, 2012. The Successor Agency came into being by operatio n of
law on February 1, 2012 as part of the State’s dissolution of redevelopment in California
pursuant to Assembly Bill Ext. 1 26 (ABx1 26).
The Successor Agency subsequently remitted all moneys in its accounts to the County
of San Luis Obispo, a sum in excess of eleven million dollars ($11,000,000)
representing both housing funds and non-housing funds, as required by the dissolution
legislation. The amount of non-housing funds remitted to the County exceeded the
amount of housing funds borrowed by th e former Redevelopment Agency to pay its
obligations under the Supplemental Educational Revenue Augmentation Fund
(“SERAF”) legislation of 2009; the payment of all funds of the Successor Agency
effectively mooted the SERAF loan because all funds, whether housing or non-housing,
were required to be remitted and in fact were remitted as the Successor Agency moved
toward completing its obligations under the dissolution legislation.
When the Redevelopment Agency was dissolved in February 2012, the legislatio n that
caused for the dissolution of redevelopment agencies made it so that all loans made by
cities to former Redevelopment Agencies were no longer eligible for repayment. In
June 2012, the dissolution law substantially changed with the passage of AB 148 4. AB
1484 provided a mechanism by which these loans could be repaid as long as the
Successor took a number of administrative steps to obtain a Finding of Completion.
Pursuant to Health and Safety Code Section 34191.4(b), once a successor agency
completed these specified obligations (including remittance of all moneys in its accounts
to the county in which it is located) the successor agency was eligible to receive a
Finding of Completion and any loan agreements entered into between the
redevelopment agency and the entity that created the redevelopment agency were to be
deemed to be enforceable obligations provided that the successor agency’s oversight
board made a finding that the Sponsoring Jurisdiction Loans were for legitimate
redevelopment purposes. The Successor Agency received a Finding of Completion on
March 8, 2013.
Page 8 of 21
ITEM NUMBER: SA C-1
DATE: 05/08/18
In addition to requiring a Finding of Completion, AB 1484 outlined the following
repayment criteria:
Interest rates have to be recalculated from origination at a statutory interest rate;
Loans have to be repaid in accordance with a defined schedule over a
reasonable term of years;
The annual amount of repayments are subject to specified limitations outl ined in
a complex formula; and
Twenty percent of repaid amounts have to be deposited into the City Housing
Successor Agency’s housing fund.
On September 22, 2015, Governor Brown signed Senate Bill 107, a budget bill
including, among other things, a modification to the language of Health and Safety Code
Section 34191.4(b) concerning the manner in which interest on these loans is to be
calculated. The modification, among other things, sets forth a single rate of interest and
means by which to calculate interest for all of the loans. Specifically, all outstanding
interest as of the date of dissolution is to be recalculated from the date of origination of
the loan as approved by the Redevelopment Agency on a quarterly basis, at a simple
interest rate of 3 percent (3%).
The total outstanding amount of the loans is $1,375,174.54. One of the key
requirements in 34191.4(b) states that the amount of property tax available to fund loan
repayments is one-half of the difference between the Redevelopment Property Tax
Trust Fund (“RPTTF”) funds available in the current fiscal year and the RPTTF
payments to the affected taxing entities in fiscal year 2012 -13. In fiscal year 2012-13,
the RPTTF payments to the affected taxing entities totaled $196,237.80. It is
anticipated that in fiscal year 2018-19 the affected taxing entities will receive in excess
of $1,592,981, so the amount available to pay the loan is one -half of the difference
between $1,592,981and $196,237.80. That amounts to $698,372.
The amount anticipated to be available in future fiscal years to repay the loan admittedly
will vary, as it continues to be subject to the repayment formula outlined in the law. This
takes into account whether former tax increment amounts increase or decrease,
enforceable obligations are reduced or eliminated, and any further legislative changes
that may occur. The Agreement takes these unknowns into account and allows for
repayment to be extended if financial needs warrant.
The Agreement also acknowledges that despite the $698,372 available for repayment, it
is fiscally prudent to repay a lesser amount each year and instead pass more property
tax money through to the taxing entities. In particular, as the taxing entities have come
to rely on the passed-through funds, the City does not desire to cause any undue harm
to any taxing entity’s budgetary process. The proposed agreement therefore assumes
that payments will begin with the ROPS19 -20, and will begin at $180,000, and increase
gradually. This lessens the fiscal impact on the affected taxing entities. With this
proposed schedule (Exhibit A to Attachment 1), it is anticipated that it will take until
2025/2026 for the entire $1,375,174.54 and interest to be repaid.
Page 9 of 21
ITEM NUMBER: SA C-1
DATE: 05/08/18
Upon approval by the City Council and the Successor Agency, the Successor Agency
must present the amendment to the Agreement to the Oversight Board. An Oversight
Board meeting is scheduled for May or June 2018 to consider this item. After the
Oversight Board has approved the amendment, it will be provided to the Department of
Finance, which has the ultimate approval authority. Upon approval by the Department
of Finance, the Successor Agency will list the Agreement as an enforceable obligation
on the Recognized Obligation Payment Schedules (ROPS) and receive future
allocations from the County Auditor-Controller’s Redevelopment Property Tax Trust
Fund (which was formally redevelopment tax increment) so that the loan can be fully
repaid.
FISCAL IMPACT:
This action by the Successor Agency will provide repayment to the City in the amount of
$180,000 in Fiscal Year 2019-20, of which $144,000 would be used to reimburse the
General Fund that made the loans originally, and $36,000 would be required to be
deposited in to the City’s Housing Successor Agency fund to be utilized to further
affordable housing efforts in the City. Additional amounts would be repaid in future
years until the full amount of the loan is repaid in Fiscal Year 2025-26.
ATTACHMENT:
Draft Resolution with Exhibit A (Agreement Regarding Reinstatement of Loans)
Page 10 of 21
ITEM NUMBER: SA C-1
DATE:
ATTACHMENT:
05/08/18
1
DRAFT RESOLUTION
RESOLUTION OF THE SUCCESSOR AGENCY TO THE
FORMER REDEVELOPMENT AGENCY OF THE CITY OF
ATASCADERO, CALIFORNIA, APPROVING AN AGREEMENT
REGARDING REINSTATEMENT OF CITY LOANS MADE TO
THE FORMER REDEVELOPMENT AGENCY
WHEREAS, pursuant to authority granted under Community Redevelopment Law
(California Health and Safety Code Section 33000 et seq.) (“CRL”), the former Redevelopment
Agency of the City of Atascadero (“Redevelopment Agency”) had responsibility to implement
the Redevelopment Plans for the Redevelopment Project Area (“Project Area”); and
WHEREAS, the City of Atascadero (“City”) agreed to serve as the Successor Agency to
the Redevelopment Agency (“Successor Agency”) commencing upon dissolution of the
Redevelopment Agency on February 1, 2012 pursuant to Assembly Bill Ext. 1 26 (ABx1 26); and
WHEREAS, pursuant to Health and Safety Code Section 33220, the City was authorized
to assist the Redevelopment Agency for the purpose of aiding and cooperating in the planning,
undertaking, construction, and operation of redevelopment projects located within the
jurisdiction of the City, upon the terms and with or without consideration as the City determined;
and
WHEREAS, pursuant to Health and Safety Code Section 33445, the Redevelopment
Agency was authorized to enter into agreements with the City pursuant to which the
Redevelopment Agency would agree to reimburse the City for funds provided by the City for the
cost of installation and construction of public improvements, structures and facilities located
within or outside the Project Areas; and
WHEREAS, pursuant to Health and Safety Code Sections 33132 and 33601, the
Redevelopment Agency was authorized to borrow money and accept financial assistance from
the City for redevelopment projects located within the Redevelopment Agency’s jurisdiction; and
WHEREAS, consistent with the foregoing authority, the City made the following loans
(collectively, the “Loans”) to the Redevelopment Agency:
(a) a loan in the original principal amount of $161,909, in accordance with the
terms set forth in City of Atascadero Contract #99027 for the purpose of
advancing funds to assist in the redevelopment of the Project Area, including
the funding operating costs for the Redevelopment Agency; and
(b) a loan in the original principal amount of $500,000, in accordance with the
terms set forth in City of Atascadero Contract #2001-009, for the purpose of
advancing funds to assist in the redevelopment of the Project Area, including
the funding operating costs for the Redevelopment Agency; and
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ITEM NUMBER: SA C-1
DATE:
ATTACHMENT:
05/08/18
1
(c) a loan in the original principal amount of $720,000, in accordance with the
terms set forth in City of Atascadero Contract #RA001-2002, for the purpose
of advancing funds to assist in the redevelopment of the Project Area,
specifically the purchase of certain real property; and
WHEREAS, the Successor Agency came into being by operation of law on
February 1, 2012 as part of the dissolution of redevelopment in California pursuant to ABx1 26.
The Successor Agency subsequently remitted all moneys in its accounts to the County of San
Luis Obispo, a sum in excess of Eleven Million Dollars ($11,000,000) representing both housing
funds and non-housing funds, as required by the dissolution legislation; and
WHEREAS, the amount of non-housing funds remitted to the County exceeded the
amount of housing funds borrowed by the former Redevelopment Agency to pay its obligations
under the Supplemental Educational Revenue Augmentation Fund (“SERAF”) legislation of
2009; the payment of all funds of the Successor Agency effectively mooted the SERAF loan
because all funds, whether housing or non-housing, were required to be remitted and in fact were
remitted as the Successor Agency moved toward completing its obligations under the dissolution
legislation;
WHEREAS, pursuant to Health and Safety Code Section 34191.4(b), once a successor
agency has received a Finding of Completion pursuant to Health and Safety Code Section
34179.7, loan agreements entered into between the redevelopment agency and the entity that
created the redevelopment agency (“Sponsoring Jurisdiction Loans”) shall be deemed to be
enforceable obligations provided that the successor agency’s oversight board makes a finding
that the Sponsoring Jurisdiction Loans were for legitimate redevelopment purposes; and
WHEREAS, the Successor Agency received a Finding of Completion on March 8, 2013;
and
WHEREAS, Health and Safety Code Section 34191.4(b)(3) as written after the adoption
of Senate Bill 107 now provides that: (i) interest on the remaining principal amount of the
Loans that was left unpaid after the original effective date thereof is to be recalculated from the
date of origination as approved by the former Redevelopment Agency on a quarterly basis, at a
simple interest rate of 3 percent, (ii) Sponsoring Jurisdiction Loans shall be repaid to the
sponsoring jurisdiction in accordance with a defined schedule over a reasonable term of years
and otherwise in compliance with the limitations of Section 34191.4(b)(3), and (iii) the annual
amount of repayments for Sponsoring Jurisdiction Loans provided for in the Recognized
Obligation Payment Schedule (“ROPS”) is subject to specified limitation; and
WHEREAS, the City and Successor Agency now wish to enter into an Agreement
Regarding Reinstatement of Loan (“Agreement”) pursuant to terms consistent with Health and
Safety Code Section 34191.4(b)(2) and other terms of the statutes governing dissolution of
redevelopment in California; and
WHEREAS, in May or June 2018, the Successor Agency’s Oversight Board (“Oversight
Board”) will consider a resolution pursuant to which the Oversight Board will be asked to
approve repayment of the Loans in accordance with the Agreement, Exhibit A, on file in the
City Clerk’s Office and incorporated herein by this reference, which findings are necessary
for final approval of the Agreement.
Page 12 of 21
ITEM NUMBER: SA C-1
DATE:
ATTACHMENT:
05/08/18
1
NOW, THEREFORE BE IT RESOLVED, by the Successor Agency to the Former
Redevelopment Agency of the City of Atascadero:
SECTION 1. The Successor Agency hereby finds that the facts set forth in the recitals to
this Resolution are true and correct, and establish the factual basis for the adoption of this
Resolution.
SECTION 2. The Agreement is approved contingent on the approval of the Oversight
Board, and consistent with the Oversight Board approval the City Manager of the City of
Atascadero or her designee is authorized to execute the Agreement on behalf of the Successor
Agency substantially in the form presented with the staff report accompanying this Resolution.
SECTION 3. Contingent on and consistent with the Oversight Board approval, the
Successor Agency is authorized and directed to list the Agreement and the repayment of the
Loans on the Successor Agency’s ROPS for the Fiscal Year 2018-2019 Period and for each
succeeding ROPS period until the Loans are repaid in full in accordance with the Agreement.
Due to the repayment of the SERAF loan by virtue of the remittance of all of the Successor
Agency’s funds on hand, including an amount of non-housing funds large enough to fully pay off
the SERAF loan, there is no need to comply with Health & Safety Code section 34191.4(b)(3)(B)
and the City may immediately apply the repayment funds toward the Loans subject to the terms
of Health & Safety Code section 34191.4(b)(3)(C).
SECTION 4. The City Manager of the City of Atascadero and her designees are
authorized to take such further actions as may be necessary to carry out the intent of this
Resolution.
SECTION 5. The City Clerk of the City of Atascadero shall certify to the adoption of this
Resolution.
PASSED AND ADOPTED at a regular meeting of the Successor Agency held on the
___day of ________________, 2018.
On motion by Council Member __________________ and seconded by Council Member
_____________________, the foregoing Resolution is hereby adopted in its entirety on the
following roll call vote:
AYES:
NOES:
ABSENT:
CITY OF ATASCADERO
________________________________
Tom O’Malley, Mayor
ATTEST:
Lara K. Christensen, City Clerk
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ITEM NUMBER: SA C-1
DATE:
ATTACHMENT:
05/08/18
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APPROVED AS TO FORM:
Brian Pierik, City Attorney
Page 14 of 21
ITEM NUMBER: SA C-1
DATE:
ATTACHMENT:
05/08/18
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1
AGREEMENT REGARDING REINSTATEMENT OF LOAN
(City of Atascadero/Successor Agency to the Atascadero Redevelopment Agency)
THIS AGREEMENT REGARDING REINSTATEMENT OF LOAN (this
“Agreement”) is entered into effective as of ___________________, 2018 (“Effective Date”)
by and between the Successor Agency to the City of Atascadero Redevelopment Agency
(“Successor Agency”) and the City of Atascadero, a municipal corporation (“City”). The
Successor Agency and the City are hereinafter collectively referred to as the “Parties.”
RECITALS
A. Pursuant to authority granted under Community Redevelopment Law (California
Health and Safety Code Section 33000 et seq.) (“CRL”), the former
Redevelopment Agency of the City of Atascadero (“Redevelopment
Agency”) had responsibility to implement the Redevelopment Plans for
the
B. Redevelopment Project Area (“Project Area”); and
B. The City agreed to serve as the successor agency to the former Atascadero
Redevelopment Agency commencing upon dissolution of the Redevelopment Agency on
February 1, 2012 pursuant to Assembly Bill X1 26; and
C. Pursuant to Health and Safety Code Section 33220, the City was authorized to
assist the Redevelopment Agency for the purpose of aiding and cooperating in the planning,
undertaking, construction, and operation of redevelopment projects located within the
jurisdiction of the City, upon the terms and with or without consideration as the City determined;
and
D. Pursuant to Health and Safety Code Section 33445, the Redevelopment Agency
was authorized to enter into agreements with the City pursuant to which the Redevelopment
Agency would agree to reimburse the City for funds provided by the City for the cost of
installation and construction of public improvements, structures and facilities located within or
outside the Project Area; and
E. Pursuant to Health and Safety Code Sections 33132 and 33601, the
Redevelopment Agency was authorized to borrow money and accept financial assistance from
the City for redevelopment projects located within the Redevelopment Agency’s jurisdiction;
and
F. Consistent with the foregoing authority, the City made the following loans
(collectively, the “Loans”) to the Redevelopment Agency:
(a) a loan in the original principal amount of $161,909, in accordance with the
terms set forth in City of Atascadero Contract #99027 for the purpose of
advancing funds to assist in the redevelopment of the Project Area, including
the funding of operating costs for the Redevelopment Agency; and
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ITEM NUMBER: SA C-1
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ATTACHMENT:
05/08/18
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2
(b) a loan in the original principal amount of $500,000, in accordance with the
terms set forth in City of Atascadero Contract #2001-009, for the purpose of
advancing funds to assist in the redevelopment of the Project Area, including
the funding of operating costs for the Redevelopment Agency; and
(c) a loan in the original principal amount of $720,000, in accordance with the
terms set forth in City of Atascadero Contract #RA001-2002, for the purpose
of advancing funds to assist in the redevelopment of the Project Area,
specifically the purchase of certain real property; and
G. The Successor Agency came into being by operation of law on February 1, 2012
as part of the dissolution of redevelopment in California pursuant to Assembly Bill 26 (1st
Extraordinary Session). The Successor Agency subsequently remitted all moneys in its accounts
to the County of San Luis Obispo, a sum in excess of Eleven Million Dollars ($11,000,000)
representing both housing funds and non-housing funds, as required by the dissolution
legislation; and
H. The amount of non-housing funds remitted to the County exceeded the amount of
housing funds borrowed by the former Redevelopment Agency to pay its obligations under the
Supplemental Educational Revenue Augmentation Fund (“SERAF”) legislation of 2009; the
payment of all funds of the Successor Agency effectively mooted the SERAF loan because all
funds, whether housing or non-housing, were required to be remitted and in fact were remitted as
the Successor Agency moved toward completing its obligations under the dissolution legislation;
I. Pursuant to Health and Safety Code Section 34191.4(b), once a successor agency
completed certain specified obligations (including remittance of all moneys in its accounts to the
county in which it is located) the successor agency was eligible to receive a Finding of
Completion pursuant to Health and Safety Code Section 34179.7; at such time any loan
agreements entered into between the redevelopment agency and the entity that created the
redevelopment agency (“Sponsoring Jurisdiction Loans”) shall be deemed to be enforceable
obligations provided that the successor agency’s oversight board makes a finding that the
Sponsoring Jurisdiction Loans were for legitimate redevelopment purposes; and
J. The Successor Agency received a Finding of Completion on March 8, 2013; and
K. Health and Safety Code Section 34191.4(b)(2) provides that: (i) interest on the
remaining principal amount of the Loans that was left unpaid after the original effective date
thereof is to be recalculated from the date of origination as a pproved by the former
Redevelopment Agency on a quarterly basis, at a simple interest rate of 3 percent, (ii)
Sponsoring Jurisdiction Loans shall be repaid to the sponsoring jurisdiction in accordance with a
defined schedule over a reasonable term of years and otherwise in compliance with the
limitations of Section 34191.4(b)(2), and (iii) the annual amount of repayments for Sponsoring
Jurisdiction Loans provided for in the Recognized Obligation Payment Schedule (“ROPS”) is
subject to specified limitations.
L. This Agreement provides for repayment of the Loans in accordance with the
requirements of Health and Safety Code Section 34191.4(b), and commits the City to use the
Loan repayment proceeds in accordance with Health and Safety Code Section 34191.4(b).
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ITEM NUMBER: SA C-1
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ATTACHMENT:
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M. On ______________, 2018, the Oversight Board for the Successor Agency
(“Oversight Board”) adopted Resolution No. ___ pursuant to which the Oversight Board
adopted findings determining that the Loans were made for legitimate redevelopment purposes
as authorized by and consistent with the CRL, authorized the Successor Agency to enter into this
Agreement, and authorized the Successor Agency to list this Agreement and repayment of the
Loans on the ROPS.
NOW, THEREFORE, the Successor Agency and the City agree as follows:
1. Reinstatement of Loans; Outstanding Principal Balances. The Parties acknowledge and
agree that pursuant to the facts stated in the foregoing Recitals, which by this reference are
incorporated into this Agreement, the Loans constitute enforceable obligations, eligible to be
listed on the Successor Agency’s ROPS and repaid pursuant to and in accordance with Health
and Safety Code Section 34191.4(b). The Parties acknowledge and agree that as of the Effective
Date, the outstanding principal balance of the Loans is as follows:
(a) The Loan evidenced by City of Atascadero Contract #99027 has an
outstanding principal balance in the amount of $155,174.54; and
(b) The Loan evidenced by City of Atascadero Contract #2001-009 has an
outstanding principal balance in the amount of $500,000;
(c) The Loan evidenced by City of Atascadero Contract #RA001-2002 has an
outstanding principal balance in the amount of $720,000.
Thus, the total amount outstanding is $1,375,174.54. The Parties acknowledge and agree that the
former Redevelopment Agency regularly made interest payments on the Loans but did not pay
off the principal as of the Redevelopment Dissolution Date.
2. Interest Rate. In accordance with Health and Safety Code Section 34191.4(b)(3),
commencing upon the Effective Date of the Amendment, interest shall be recalculated on the
outstanding principal balance of the Loans at a rate equal to the rate set forth in Health and
Safety Code Section 34191.4(b)(3) (the “Interest Rate”). Interest shall be calculated from
February 1, 2012, in light of the fact that the Redevelopment Agency was current on its interest
payments as of the date that its activities were frozen by Assembly Bill 26, and interest shall
continue to accrue in accordance with this Section until the total amount of the Loans is repaid in
full. Interest shall be calculated on the basis of a year of 365 days and charged for the actual
number of days elapsed.
3. Repayment Term. The Loans shall be repaid in in annual or semi-annual installments in
an amount not to exceed the sum determined pursuant to Health and Safety Code Section
34191.4(b)(3)(A) (i.e., in the aggregate, the payments made in each fiscal year shall not exceed
one-half of the increase between the amount distributed to the taxing entities pursuant to
paragraph (4) of subdivision (a) of Section 34183 in each fiscal year and the amount distributed
to the taxing entities pursuant to that paragraph in the 2012-13 base year). Payments shall be
applied first to outstanding principal, and then to accrued interest. Notwithstanding the
foregoing, if the amount of funds available to be distributed by the San Luis Obispo County
Auditor-Controller from the Redevelopment Property Tax Trust Fund for any ROPS period is
not sufficient to fully fund the other enforceable obligations on the Successor Agency’s ROPS,
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ITEM NUMBER: SA C-1
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payments due on the Loans, and the administrative costs of the Successor Agency for that period,
then the amount of the Loan payments due shall be reduced to the extent necessary to fully fund
the other enforceable obligations and administrative costs. The reduced Loan payments shall be
applied first to outstanding principal, and then to accrued interest. In that event, the unpaid
portion of the payment shall be deferred and the term for repayment of the Loans shall be
extended for additional, successive ROPS periods as necessary until all outstanding principal and
accrued interest has been repaid in full.
As reflected in the attached Exhibit A, based on current projections, the Parties anticipate
that the Loans will be repaid in full by not later than 2026.
4. Use of Loan Repayment Funds. The City shall use the required portion of Loan
repayments in accordance with the requirements of Health and Safety Code Section
34191.4(b)(2)(C) to fund the City’s Low and Moderate Income Housing Asset Fund established
by the City in its capacity as the housing successor to the Redevelopment Agency. The Parties
agree that the Successor Agency’s remittance of an amount in excess of $11,000,000 to the
County of San Luis Obispo pursuant to the redevelopment dissolution law, including an amount
of non-housing funds sufficient to fully retire all amounts previously borrowed from the Low and
Moderate Income Housing Fund of the Redevelopment Agency has eliminated the need for the
City to comply with Health and Safety Code Section 34191.4(b)(2)(B). Therefore, any
repayment amounts remaining after the City complies with Health and Safety Code Section
34191.4(b)(2)(C) may be used by the City for general purposes identified in the discretion of the
City Council.
5. Subordination. Notwithstanding any contrary provision hereof, the Parties agree that the
Successor Agency’s obligation to repay the Loans shall be subordinate to the pledge of tax
increment revenue for the payment of debt service on tax allocation bonds or other indebtedness
issued by the Redevelopment Agency, the payment of the Successor Agency’s other enforceable
obligations, and the payment of the Successor Agency’s administrative costs.
6. Amendments. No amendment to or modification of this Agreement shall be effective
unless and until such amendment or modification is in writing, properly approved in accordance
with applicable procedures, and executed by the Parties.
7. Severability. If any term, provision, covenant, or condition set forth in this Agreement is
held by the final judgment of a court of competent jurisdiction to be invalid, void, or
unenforceable, the remaining provisions, covenants, and conditions shall continue in full force
and effect to the extent that the basic intent of the Parties as expressed herein can be
accomplished. In addition, the Parties shall cooperate in good faith in an effort to amend or
modify this Agreement in a manner such that the purpose of any invalidated or voided provision,
covenant, or condition can be accomplished to the maximum extent legally permissible.
8. No Third-Party Beneficiaries; Assignments. Nothing in this Agreement is intended to
create any third-party beneficiaries to this Agreement, and no person or entity other than the
Successor Agency and the City, and the permitted successors and assigns of either of them, shall
be authorized to enforce the provisions of this Agreement.
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ATTACHMENT:
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9. Further Assurances. Each Party agrees to execute, acknowledge and deliver all additional
documents and instruments, and to take such other actions as may be reasonably necessary to
carry out the intent of the transactions contemplated by this Agreement.
10. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of California.
11. Counterparts. This Agreement may be executed in counterparts, each of which shall be
deemed an original and all of which shall constitute but one and the same instrument.
SIGNATURES ON FOLLOWING PAGES.
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ITEM NUMBER: SA C-1
DATE:
ATTACHMENT:
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IN WITNESS WHEREOF, the Parties have executed this Agreement effective as of the
date first written above.
CITY:
CITY OF ATASCADERO
By:
City Manager
Attest:__________________________
City Clerk
Approved as to form:
By:
City Attorney
SUCCESSOR AGENCY:
SUCCESSOR AGENCY TO THE
REDEVELOPMENT AGENCY OF THE
CITY OF ATASCADERO
By:________________________________
City Manager of the City of Atascadero
Attest:_____________________________
City Clerk of the City of Atascadero
Approved as to form:
By:________________________________
City Attorney and Legal Counsel to
Successor Agency
Page 20 of 21
Principal
Accrued Interest
Payable (Simple)
Outstanding Loan Amounts
Loan #1 155,174.54$ 34,488.13$
Loan #2 500,000.00 111,126.88
Loan #3 720,000.00 160,022.71
Total Outstanding 7/1/2019 1,375,174.54$ 305,637.71$
Maximum Payment Amount
1,592,981.00$
Less: 2012-2013 Residual RPTTF distributed (196,237.80)
1,396,743.20
Times .5 0.50
Maximum Payment Amount 698,372.00$
Date Payment
Amount to
Low/Mod
Principal
Payments
Interest
Payments
Interest
Earned Principal Balance
Accumulated
Interest
Beginning Balance 1,375,174.54$ 305,637.71$
7/1/2019 90,000.00$ (18,000.00)$ 72,000.00$ -$ -$ 1,303,174.54 305,637.71
10/1/2019 - - 9,854.14 1,303,174.54 315,491.86
1/1/2020 90,000.00 (18,000.00) 72,000.00 - 9,854.14 1,231,174.54 325,346.00
4/1/2020 - - 9,208.51 1,231,174.54 334,554.51
7/1/2020 115,000.00 (23,000.00) 92,000.00 - 9,208.51 1,139,174.54 343,763.02
10/1/2020 - - 8,614.03 1,139,174.54 352,377.05
1/1/2021 115,000.00 (23,000.00) 92,000.00 - 8,614.03 1,047,174.54 360,991.08
4/1/2021 - - 7,746.22 1,047,174.54 368,737.31
7/1/2021 140,000.00 (28,000.00) 112,000.00 - 7,832.29 935,174.54 376,569.60
10/1/2021 - - 7,071.46 935,174.54 383,641.06
1/1/2022 140,000.00 (28,000.00) 112,000.00 - 7,071.46 823,174.54 390,712.51
4/1/2022 - - 6,089.24 823,174.54 396,801.75
7/1/2022 165,000.00 (33,000.00) 132,000.00 - 6,156.89 691,174.54 402,958.64
10/1/2022 - - 5,226.42 691,174.54 408,185.06
1/1/2023 165,000.00 (33,000.00) 132,000.00 - 5,226.42 559,174.54 413,411.47
4/1/2023 - - 4,136.36 559,174.54 417,547.83
7/1/2023 190,000.00 (38,000.00) 152,000.00 - 4,182.32 407,174.54 421,730.15
10/1/2023 - - 3,078.91 407,174.54 424,809.06
1/1/2024 190,000.00 (38,000.00) 152,000.00 - 3,078.91 255,174.54 427,887.97
4/1/2024 - 1,908.57 255,174.54 429,796.54
7/1/2024 215,000.00 (43,000.00) 172,000.00 - 1,908.57 83,174.54 431,705.10
10/1/2024 - 628.94 83,174.54 432,334.04
1/1/2025 215,000.00 (43,000.00) 83174.54 88,825.46 628.94 - 344,137.51
4/1/2025 - - - 344,137.51
7/1/2025 215,000.00 (43,000.00) - 172,000.00 - - 172,137.51
10/1/2025 - - - 172,137.51
1/1/2026 215,171.89 (43,034.38) - 172,137.51 - - -
Exhibit A
SUCCESSOR AGENCY CASH FLOW FORECAST - CITY LOAN REPAYMENT SCHEDULE
3% Interest earned- simple interst calculated quarterly until principal is paid off (simple interest means no interest on outstanding interest
payments)
Estimated Residual RPTTF 2018
ITEM NUMBER: SA C-1
DATE: 05/08/18
ATTACHMENT: 1
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