CDC - Item 2A - Enforceable Obligations Payment Schedulei • :L 4 1 O ki I
TO: THE HONORABLE CHAIRMAN AND COMMISSIONERS
FROM: JEFF ALLRED, EXECUTIVE DIRECTOR
DATE: AUGUST 24, 2011
SUBJECT: ADOPTION OF THE ENFORCEABLE OBLIGATIONS PAYMENT
SCHEDULE PURSUANT TO AB 1X 26.
SUMMARY
On August 11, 2011, in response to a lawsuit filed by the League of California Cities and
the California Redevelopment Association, the California Supreme Court issued a stay
on the implementation of AB 1X 26 and its companion legislation AB 1X 27. AB 1X 26
mandates the elimination of redevelopment agencies by October 1, 2011, while AB 1X
27 allows for the continuation of redevelopment agencies indefinitely if a city agrees to
participate in a Voluntary Alternative Redevelopment Program by making significant
annual financial payments to the State. The Rosemead City Council has previously
adopted an Ordinance to participate in the Voluntary Alternative Redevelopment
Program. Last week, on August 17, 2011, the Supreme Court issued an order
modifying its stay on AB 1X 26 -27 to clarify ambiguities in its August 11 action. The
Supreme Court's most recent order makes it clear that all redevelopment agencies must
approve an Enforceable Obligation Payment Schedule (EOPS) prior to August 29,
2011. Accordingly, the Community Development Commission Board will consider
approval of the required EOPS for the remainder of 2011.
Recommendation:
Adopt the Enforceable Obligation Payment Schedule pursuant to AB 1X 26.
BACKGROUND /ANALYSIS
AB 1X 26 mandates the "winding down" of redevelopment activities through the end of
2011. As part of this process, redevelopment agencies are required to produce a
schedule of contractually obligated payments that are required to be paid between
August 28, 2011 and December 31, 2011. This schedule must include all payments to
be made from the Agency during this period. Per Health and Safety Code section
34169(g)(2), the adopted EOPS must be posted on the Agency's internet web site (or
the City's if the Agency does not have its own site). In addition, the EOPS must be
transmitted by mail or electronic means to the local County Auditor - Controller, to the
State Controller, and to the State Department of Finance. A notification to those offices
providing the web address at which the EOPS is posted is sufficient to meet the
requirement.
Rosemead Community Development Commission Meeting
August24,2011
Page 2 of 2
Also per Health and Safety Code Section 34169(8)(2), the EOPS may be amended at
any public meeting of the Agency. The amendment must be posted on the web site and
transmitted in the same fashion to the same offices.
The Department of Finance (DoF) has the right to review the EOPS, and so the EOPS
does not become effective for 3 business days, pending DoF's request for review. (See
section 34169(i)). If DoF requests a review of the agency's action, the DoF has 10 days
from the date of its request to approve the Agency action or return it to the agency for
reconsideration and "this action shall not be effective until approved by the
Department." The language "this action" appears to mean the entirety of the EOPS
approval action, and there is nothing in the statute that would expressly authorize the
agency to pay "enforceable obligations" that have not been challenged by the
Department. As an aside, there is also nothing in the statute authorizing agencies to pay
enforceable obligations during the 3 business day DoF review period, but that's another
issue.
While the legislation is not clear on this point, we believe the most reasonable
interpretation is: during pendency of the DoF review and approval process, the agency
may continue pay those "enforceable obligations" listed on the EOPS which have not
been challenged by the Department. "Enforceable Obligations" which have been
challenged by DoF should not be paid unless and until the obligation is ultimately
approved by the Department.
Attached for Board adoption is the Enforceable Obligation Payment Schedule for the
period of August 28, 2011 through December 31, 2011.
Prepared by:
Prepared by:
�c
Rachel Richman Matthew E. Hawkesworth
City Attorney Assistant City Manager
Attachment: Enforceable Obligation Payment Schedule
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