HomeMy WebLinkAboutOB_2018-06-07_AgendaPacket
OVERSIGHT BOARD FOR SUCCESSOR
AGENCY TO THE COMMUNITY
REDEVELOPMENT AGENCY OF
ATASCADERO FOR R EDEVELOPMENT
AND HOUSING PURPOSES1
SPECIAL MEETING
AGENDA
Thursday, June 7, 2018
10:00 A.M.
Atascadero City Hall, Conference Room 106
6500 Palma Avenue
Atascadero, California
CALL TO ORDER:
ROLL CALL: Chairperson Fonzi
Vice Chairperson Clemens
Board Member Rickard
Board Member Arnold
Board Member Green
Board Member Johnson
Board Member Smith
APPROVAL OF AGENDA: Roll Call
PUBLIC COMMENT: (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 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
Public Comment, unless changed by the Board.)
1 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. Page 1 of 19
A. CONSENT AGENDA:
1. Oversight Board Meeting Draft Action Minutes of January 11, 2018
Recommendation: Board approve the Oversight Board Meeting Draft
Action Minutes of January 11, 2018.
B. BUSINESS ITEMS: 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: Oversight Board to the Successor Agency adopt Draft
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.
D. BOARD COMMENTS:
E. STAFF COMMENTS:
F. ADJOURNMENT:
In compliance with the Americans with Disabilities Act, if you need special assistance to participate in
an Oversight Board meeting, please contact the City Clerk’s Office at (805) 470-3400. Notification at
least 48 hours prior to the meeting or time when services are needed will assist the City staff in assuring
that reasonable arrangements can be made to provide accessibility to the meeting.
Page 2 of 19
ITEM NUMBER: OB A-1
DATE: 06/07/18
Atascadero Oversight Board
Minutes of January 11, 2018
Page 1 of 3
OVERSIGHT BOARD FOR SUCCESSOR
AGENCY TO THE COMMUNITY
REDEVELOPMENT AGENCY OF
ATASCADERO FOR REDEVELOPMENT
AND HOUSING PURPOSES
DRAFT MINUTES
Thursday, January 11, 2018
3:00 P.M.
Atascadero City Hall, Conference Room 106
6500 Palma Avenue
Atascadero, California
CALL TO ORDER:
Chairperson Fonzi called the meeting to order at 3:02 p.m.
ROLL CALL:
Present: Board Members Arnold, Green, Johnson, Rickard, Vice Chairperson
Clemens and Chairperson Fonzi
Absent: Board Member Smith
Staff Present: Administrative Services Director Jeri Rangel, Deputy Administrative
Services Director Cindy Chavez, Deputy City Manager Lara
Christensen and Board Secretary Amanda Muther
APPROVAL OF AGENDA: Roll Call
MOTION: By Board Member Arnold and seconded by Vice Chairperson
Clemens to approve Agenda.
Motion passed 6:0 by roll call vote. Smith Absent.
PUBLIC COMMENT:
The following citizens spoke during Public Comment: None.
Chairperson Fonzi closed the PUBLIC COMMENT period.
Page 3 of 19
ITEM NUMBER: OB A-1
DATE: 06/07/18
Atascadero Oversight Board
Minutes of January 11, 2018
Page 2 of 3
A. CONSENT AGENDA:
1. Oversight Board Meeting Draft Minutes of May 24, 2017
Recommendation: Board approve the Oversight Board Meeting Draft
Minutes of May 24, 2017.
MOTION: By Vice Chairperson Clemens and seconded by Board Member
Arnold to approve the Consent Calendar.
Motion passed 6:0 by voice vote. Smith Absent.
B. BUSINESS ITEMS: None.
Chairperson Fonzi advised that due to a potential conflict of interest she would need to
recuse herself from Item C-1, noting she works for the company representing the buyer.
Chairperson Fonzi recused herself at 3:05 p.m. and left the room.
C. MANAGEMENT REPORTS:
1. Sale of Creekside Building
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: Oversight Board approve the purchase and sale
agreement between the Successor Agency and Colony Creekside, LLC for
the purchase of the Creekside Building in the amount of $2,200,000 and the
transfer of two sub-parcels to the City of Atascadero.
Administrative Services Director Rangel gave the staff report and answered questions
from the Board. Board Member Rickard also answered questions.
Vice Chairperson Clemens asked if any member of the public would like to speak on the
matter. Hearing none, Vice Chairperson Clemens closed the public comment period.
MOTION: By Board Member Johnson and seconded by Board Member
Arnold to approve the purchase and sale agreement between
the Successor Agency and Colony Creekside, LLC for the
purchase of the Creekside Building in the amount of $2,200,000
and the transfer of two sub-parcels to the City of Atascadero.
Motion passed 5:0 by roll call vote. Fonzi abstained. Smith
Absent.
Chairperson Fonzi returned at 3:17 p.m.
Page 4 of 19
ITEM NUMBER: OB A-1
DATE: 06/07/18
Atascadero Oversight Board
Minutes of January 11, 2018
Page 3 of 3
2. Approval of Recognized Obligation Payment Schedule 18-19 July 1, 2018
through June 30, 2019
Fiscal Impact: None.
Recommendation: Oversight Board adopt Draft Resolution approving
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 Director Rangel gave the staff report and answered questions
from the Board.
Chairperson Fonzi asked if any member of the public would like to speak on the matter.
Hearing none, Chairperson Fonzi closed the public comment period.
MOTION: By Vice Chairperson Clemens and seconded by Board Member
Green to adopt Draft Resolution (Resolution No. OB 2018-001)
approving 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.
Motion passed 6:0 by roll call vote. Smith Absent
D. BOARD COMMENTS: None.
E. STAFF COMMENTS:
Chairperson Fonzi asked staff when the next meeting might be scheduled. Staff advised
they did not anticipate another meeting for a while.
F. ADJOURNMENT:
Chairperson Fonzi adjourned the meeting at 3:26 p.m.
MINUTES PREPARED BY:
______________________________________
Amanda Muther, Board Secretary
APPROVED:
Page 5 of 19
ITEM NUMBER: OB C-1
DATE: 06/07/18
Oversight Board to the 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:
Oversight Board to the Successor Agency adopt Draft 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 .
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 made shortly after the Redevelopment Agency was established, and
before tax increment revenues had sufficient time to build up. This loan
provided operating capital for the agency; and
Page 6 of 19
ITEM NUMBER: OB C-1
DATE: 06/07/18
(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 operation 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 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.
When the Redevelopment Agency was dissolved in February 2012, the legislation 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 1484. 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 F inding 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 e ligible 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 overs ight
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 7 of 19
ITEM NUMBER: OB C-1
DATE: 06/07/18
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 outlined 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 8 of 19
ITEM NUMBER: OB C-1
DATE: 06/07/18
If the Oversight Board approves the amendment, it will be provided to the State
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 would 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. These funds would not be available to the affected taxing entities, but would
reasonably and fairly repay the City for moneys still outstanding to it. 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 9 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
1
DRAFT RESOLUTION
RESOLUTION OF THE OVERSIGHT BOARD 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, the Oversight Board for Successor Agency to the Community
Redevelopment Agency of Atascadero (Oversight Board) has been established to direct the
Successor Agency to take certain actions to wind down the affairs of the Redevelopment Agency
in accordance with the California Health and Safety Code; and
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
Page 10 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
1
(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
(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, on May 8, 2018, the City adopted Resolution No. 2018-030 and the
Successor Agency adopted Resolution No. SA 2018-002 each of which authorized execution, by
the City Manager of the City of Atascadero or her designee, of an Agreement Regarding
Reinstatement of Loan (“Agreement”), which includes the terms and conditions for the repayment
of the Loans consistent with Health and Safety Code Section 34191.4(b)(2) and other terms of the
statutes governing dissolution of redevelopment in California.
Page 11 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
1
NOW, THEREFORE BE IT RESOLVED, by the Oversight Board of the Successor
Agency to the former Redevelopment Agency of the City of Atascadero:
SECTION 1. The Oversight Board 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 Oversight Board hereby approves the Agreement and the Successor
Agency’s authorization to the City Manager of the City of Atascadero or her designee for execution
of the Agreement on behalf of the Successor Agency substantially in the form presented with the
staff report accompanying this Resolution.
SECTION 3. The Successor Agency is hereby 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 Successor Agency is authorized to take such further actions as may be
necessary to carry out the intent of this Resolution.
SECTION 5. The Oversight Board Secretary shall certify to the adoption of this Resolution.
PASSED AND ADOPTED at a regular of the Oversight Board of the Successor Agency
held on the 7th day of June, 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
________________________________
Roberta Fonzi, Chairperson
ATTEST:
Amanda Muther, Board Secretary
Page 12 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
1
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
Page 13 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
1
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)(3) 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)(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 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).
Page 14 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
1
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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,
Page 15 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
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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.
Page 16 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
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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.
Page 17 of 19
ITEM NUMBER: OB C-1
DATE:
ATTACHMENT:
06/07/18
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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 18 of 19
________________________________
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: OB C-1
DATE: 06/07/18
ATTACHMENT: 1
Page 19 of 19