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OB - Item 3C - ROPS Submittal - January through June 2013ROSEMEAD SUCCESSOR AGENCY STAFF REPORT TO: THE HONORABLE CHAIR AND BOARD MEMBERS FROM: MATTHEW HAWKESWORTH, ASSISTANT CITY MANAGER DATE: JULY 18, 2012 SUBJECT: ROPS SUBMITTAL —JANUARY THROUGH JUNE 2013 SUMMARY With the passage of Assembly Bill 1484 (AB 1484), new deadlines have been established for the submittal of the Recognized Obligation Payment Schedule (ROPS) on a semi - annual basis to the Department of Finance (DOF) and other State and County agencies. Per Health and Safety Code Section 34177(m) the ROPS for the period covering January through June 2013, must be submitted no later than September 1, 2012. All subsequent ROPS must be submitted no fewer than 90 days before the date of property tax distribution. Since the Rosemead Successor Agency's Oversight Board will only have two regularly scheduled meetings prior to the September Vt deadline, the ROPS is being presented for approval. In the event there are questions or additional information requested by the Oversight Board, staff will have the time to provide such information prior to the deadline. The proposed ROPS for January through June 2013 is virtually identical to the ROPS that have been previously approved. The debt service payments for the 2006 and 2010 series bonds have been modified according to the debt service payment schedule and the administrative costs have been modified to reflect those costs which are due in this six month period. The Administrative Cost Allowance for the entire fiscal year still remains within the $250,000 allowance. The one new item that has been added to the ROPS is the pre- funding of a reserve to make the necessary bond debt service payments in October and December 2013. This pre- funding of the reserve is necessary as we do not anticipate receiving sufficient funds through the regular tax increment period covering July through December 2013 to cover these payments. Staff Recommendation: That the Oversight Board approve Resolution 2012 -0008 approving the ROPS for the period of January through June 2013. BACKGROUND AB 1484 has provided new timelines and guidelines regarding the dissolution of the former redevelopment agencies by successor agencies. Included in AB 1484 is an improved timeline for the submittal of the semi - annual ROPS will should allow sufficient ITEM NO. Rosemead Successor Agency Oversight Board July 18, 2012 Page 2 of 3 time for the DOF and various other agencies to review the ROPS, request additional information, and allow successor agencies to appeal any adverse decisions. Also included in AB 1484 are defined processes for how to handle shortfalls in the event there is not sufficient tax increment funds in one six -month period to fund the enforceable obligations. Included with this report is the 'Redevelopment Property Tax Trust Fund Allocations & Distributions for June 1, 2012 Covering the Period 7/1/2012 through 12/31/2012" report provided by the County for the June 1, 2012 property tax distribution. As shown in this report, the Rosemead Successor Agency had $2,735,830.64 in Enforceable Obligations and an additional $119,505.00 in allowable Administrative Cost Allowance; however; the property tax distribution to the Successor Agency was only $2,331,698.56 for Enforceable Obligations and no funds were provided for the Administrative Cost Allowance. This resulted in a total shortfall of $523,637.08. Through AB 1484, Successor Agencies have the ability to request these funds through ROPS of periods outside the period in which the payments are due. Specifically to Rosemead, the necessary debt service payments can be requested in the preceding ROPS period to establish a reserve fund to anticipate the shortfall. The establishment of this reserve is specifically identified in H &S Code Section 34171(d)(1)(a). (d) (1) "Enforceable obligation" means any of the following: (A) Bonds, as defined by Section 33602 and bonds issued pursuant to Chapter 10.5 (commencing with Section 5850) of Division 6 of Title 1 of the Government Code, including the required debt service, reserve set - asides, and any other payments required under the indenture or similar documents governing the issuance of the outstanding bonds of the former redevelopment agency. A reserve may be held when required by the bond indenture or when the next property tax allocation will be insufficient to pay all obligations due under the provisions of the bond for the next payment due in the following half of the calendar year. In regards to the shortfall created by the non - funding of the Administrative Cost Allowance, the amount will be funded for this period with existing tax increment funds still being held by the Successor Agency. The balance of existing funds will not be returned to the County Auditor - Controller until April 10, 2013 per the deadlines established in AB 1484. For future ROPS periods, if the tax increment funds are insufficient to cover Administrative Cost Allowances, H &S Code Section 34173(h) permits the City to loan the Successor Agency funds for these costs and then can report the costs as an Enforceable Obligation and submitted on a future ROPS. 34173(h) The city, county, or city and county that authorized the creation of a redevelopment agency may loan or grant funds to a successor agency for administrative costs, enforceable obligations, or project - related expenses at the city's discretion, but the receipt and use of these funds shall be reflected on the Recognized Obligation Payment Schedule or the administrative budget and therefore are subject to the oversight and approval of the oversight board. An Rosemead Successor Agency Oversight Board July 18, 2012 Page 3 of 3 enforceable obligation shall be deemed to be created for the repayment of those loans. This option will be evaluated at a future time if it becomes necessary. PUBLIC NOTICE PROCESS This item has been noticed through the regular agenda notification process in accordance with the Brown Act. Prepared by: r� Matthew E. Hawkesworth Assistant City Manager Attachments: Resolution 2012 -0008 Redevelopment Property Tax Trust Fund Allocations & Distributions for June 1, 2012 Covering the Period 711/2012 through 12/31/2012 RESOLUTION: 2012 -0008 A RESOLUTION OF THE OVERSIGHT BOARD FOR THE SUCCESSOR AGENCY TO THE ROSEMEAD COMMUNITY DEVELOPMENT COMMISSION APPROVING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULES FOR THE PERIOD OF JANUARY 1, 2013 THROUGH JUNE 30, 2013 WHEREAS, California Health and Safety Code section 34179 requires that each Successor Agency have an Oversight Board; and WHEREAS, Section 34177 requires each Successor Agency to prepare a draft Obligation Payment Schedule ( "ROPS ") and section 34180 requires the Oversight Board to approve same; and WHEREAS, Section 34177 provides that each ROPS shall be forward looking to the next six months; and WHEREAS, section 34177 requires that the draft ROPS prepared by the Successor Agency be certified by an external auditor designated by the County Auditor - Controller and then submitted to the Oversight Board for approval, after which it is to be transmitted to the County Auditor - Controller, the State Controller and the State Department of Finance; and WHEREAS, notwithstanding the sequencing contemplated in section 34177, the Department of Finance is requesting the ROPS be considered by the Oversight Board and transmitted as soon as possible; and WHEREAS, the County will not make any payments of property taxes to the Successor Agency for use in payment of the obligations listed on the BOPS until the ROPS has been approved by the Oversight Board. Any delay in such payment could impair the Successor Agency's ability to make payments for the enforceable obligations; and WHEREAS, the Successor Agency prepared a draft ROPS for the period January 1, 2013 through June 30, 2013 is attached hereto as Exhibit A. NOW THEREFORE, THE OVERSIGHT BOARD FOR THE SUCCESSOR AGENCY TO ROSEMEAD COMMUNITY DEVELOPMENT COMMISSION HEREBY RESOLVES: 1. The BOPS for the period January 1, 2013 through June 30, 2013 attached hereto as Exhibit A is hereby approved. 2. Successor Agency staff is directed to provide a copy of this Resolution along with the approved ROPS to the County Auditor - Controller, the State Controller's Office and the State Department of Finance. PASSED, APPROVED AND ADOPTED this 18th day of July 2012. Chairperson ATTEST: Matthew E. Hawkesworth Successor Agency Staff Assistant City Manager HEREBY CERTIFY that the above and foregoing resolution was duly passed and adopted by the Oversight Board for the Successor Agency to the Rosemead Community Development Commission at its special meeting held on the 18th day of July 2013, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAINED: Matthew E. Hawkesworth Successor Agency Staff Assistant City Manager D n H w "'Amm�wm" N NA C ooAmJC JC (/i (](1 D6 D �OgNR O 9 a o <<mmo¢� $ n° `0: 3'e °_`R 'aa4 m m3� 2 v " o�afl�m�m a qo mm eGGm � 093 .� a556Ro,R. c, n >F 36aan" env go aaaw3 a' " RoNT.mNN= o a _ 6'G" No D a __nr All o m $ w0 t 'J mowwuN"� womouwn P _ _emNJ _. m.y � 3 a � � m y w, .iron ..... D n H w Name of Redevelopment Agency. PmjectArea(s) RECOGNIZED OBLIGATION PAYMENT SCHEDULE Per AS 26 - Section 34167 and 34169 For the Period of January through June 2013 Page 1 of 1 Pages Project Name /Debt Obligation Payee Description Category Funding Source Total Outstanding Debt or Obligation Total Due During Fiscal Year Pa menu by month Jan Feb Mar Apr May June Total ij 2006A Tax Increment Bonds US Bank Tax Increment Bond Debt Service 1 -Bands Redevelopment Property Tax Trust Fund 11906834.49 1,333,206.26 1]6,5]8.13 $ 1]65]8.13 20068 Tax Increment Bonds US Bank Tax Increment Bond Debt Service 1 -Bonds Redevelopment Property Tax Trust Fund 40403520.81 1110.048.76 514,068.13 $ 514068.13 _21 3 2010 Tax Increment Bonds US Bank Tax Increment Bond Debt Service 1 -Bonds Redevelopment Property Tax Trust Fund 15213737.58 688.793.76 220,646.88 $ 220646.88 4 Continuum Discolsure on Bonds Urban Futures Continuum duscolure service far2006A, 20068 and 2010A Bonds 8- Contracts or Agreements for continued o eration Administrative Cost Allowance 109200.00 5,200.00 $ 5 Stale ConMllerW Report RAMS Preparation ofannualreport 8- Contracts or Agreements for continued operation Administrative Cog Allowance 21000.00 1,000.00 1000.00 $ 1000.00 6 Bond Trustee Fees US Bank Banking fees related to Me 2006A B and 2010A Bonds 8- Contracts or Ameements for contlnuerloperation Administrative Cog Allowance 42294.00 2,014.00 2,014.00 $ 2014.00 7 Annual Audit RAMS Mnual audil services 8- Contractor Agreement for continued operation Administrative Cog Allowance 169596.00 8076.00 8076.00 $ 8076.00 B Finances m Bank of Me West Lease Obligation for Finance System 8- Contractor Agreement for continuedoperation Administrative Cog Allowance 47400.00 11600.00 966.67 966.67 966.67 966.67 966.67 966.65 $ 5800.00 9 Statement of Indebtedness Redevelopment Reporting Solutions Preparation of annual report 8- Contractor Agreement for contlneedoperation Administrative Cost Allowance 21000.00 1000.00 1 $ LDI Arbitrage Calculations Willdan Preparation of Arbitrage Rebate Calculation 8- Contractor Agreements for continued operation Administrative Cost Allowance 86,100.00 4100.00 4100.00 $ 4100.00 jjj Property Tax Audita/Moullorring HDL Monitor Property Tax Collections8 Appeals to ensure Bond Covens a 8- Contract orAgreements for continued operation Administrative Cost Allowance 264,600.00 12600.00 3,150.00 3150.00 $ 6300.00 12 Rosemead Community Center Parking Lot Boghossian Enginearina Community Center pa,*inQ lot cast n 7 -Agreements or related obligations Bond Proceeds 13670.00 13670.00 13,670.00 $ 13670.00 13 Rosemead Community Center Parking Lot Vatican Material Testing for parking lot en ineerin 7 -A reement or related obli ations Bond Proceeds 12,720.00 12720.00 12,720.00 $ 12720.00 141 Za o an Park Improvements 1 ADA accessibility &additional pinkina 7 -A reement or related obligations Bond Proceeds 1,050,000.00 1050000.00 $ 15 Rosemead Park lm rovements 1 ADA accessibility improvement 7 -A reements or related obli ations Bond Proceeds 280000.00 280000.00 $ 16 Rosemead Cogmunih, Center B Public Plaza Expansion t ADA accessibility, men center 8 outdoor plaza 7 -Agreements or related obligations Bond Proceeds 4000000.00 4000000.00 $ 1] New Park at Rush and Walnut Grove 1 Community Infrastructure lm royement 7 -Agreements or related obliffigons Bond Proceeds 500,000.00 500000.00 $ 18 Sewer System Ex anion 1 Sewer Main Replacamend/Upprode an Garrey Ave. 7 -Agreements or related obli rations Bond Proceeds 750,000.00 750 000.00 $ L91 Em Io ee/Ovelhead Cost Successor Agency - City of Rosemead Administrative COSt (Staffing. audits al supplies etc. 4- Balance B Benefit 8- Contracts or Agreements for continued operations Administrative Cost Allowance 4,292,610.00 204410.00 17,034.17 17,034.17 17,034.17 17034.17 17,034.17 17034.17 $ 102,205.02 20 Valley Blvd Street lm mvements 1 Infrastructure lm mvemenl- Downtown Corridor 7 -Agreements or related obligations Bond Proceeds 250,000.00 250000.00 g 21 Rosemead Park Turf Renovations t Community Infrastructure Improvement 7 -Agreements or related obli ations Bond Proceeds 784,000.00 784 000.00 $ 22 Senior Housing Land Lease -M elus Rosemead Housing Development Corp. Cost of annual land lease for property 7 -Agreements a related obligations Low and Moderate Income Housina Fund 2553,600.00 91200.00 7,600.00 7600.00 7,600.00 7600.00 7,600.00 7600.00 $ 45,600.00 23 Senior Housing 0 erabous/Overhead -M atus Rosemead Housing Development Corp. Cost of annual o orations and overhead sulasidly smide b City 7- Agreements or related oblituations, Low and Moderate Income Housina Fund 3.166,800.00 113100.00 9425.00 9425.00 9,425.00 9425.00 9,425.00 9425.00 $ 56,550.00 24 Senior Housing Shortfall Subsidy -M elus Rosemead Housing Development Corp. Cost to cover shoMall beNreen rent and o erationsimaintenance 7- Agreements or related obligations Low and Moderate Income Housina Fund 459340.00 16405.00 1367.08 1,367.08 1,367.08 136].08 1,367.08 1367.08 $ 8,20248 25 Senior Hougno Land Lease - Gary Rosemead Housing Development Corp. Cowl of annual land lease for property 7- Agreement or related obligati ns Low and Moderate Income Housina Fund 4,202783.31 92200.00 7.683.33 7683.33 7,683.33 768133 7,663.33 7683.33 $ 46,099.98 28 Senior Housing 0 ergions/Overthead - Garaey Rosemead Housing Development Corp. Cost of annual operations and overhead subsidy provide by City ]- Agreements or related obli ations Low and Moderate Income Housina Fund 5,155,475.00 113100.00 9425.00 9,425.00 9,425.00 9425.00 9,425.00 9425.00 $ 56,550.00 27 Senior Housing Shortfall Subsidy - Garver Rosemead Housing Development Corp. Cost b cover shormall between rents and o erationstmaii tenance' 7 - Agreements or related obligations Low and Moderate Income Housing Fund 1,495,589.19 32 810.00 2,734.1] 2,734.17 2,734.17 2,7M.17 2,734.17 2,7M.17 $ 16.405.02 28 Bond Ps men)Reserve Jul - December 2013 ROPS Debt Service funding shortfall from Me Jul - December 2013 ROPS" 1 -Bonds Redevelo ment Property Tax Trust Fund 404,151.44 404151.44 404,151.44 $ 404,151.44 29 $ 30 31 $ Totals -This Page Total Redevelopment Property Tax Trust Fund Total Administrative Cost Allowance Total Band Proceetls Total Low and Moderate Income Housing Funtl $ 97,658,021.82 $ 1186340522 $486776.86 $ 74fi881.68 $ 56,235.42 $ 295,22228 $1,700,737.08 $ - $ 351420022 $ $ $ $ $ _ 8 z5g Doo.gg 8 _ =235.42$ $ _ $ _ g $ - $ 7 640 390.00 $ $ $ $ $ $ 458,815.00 $ $ $ $ ' These figures are estimated based upon 201041 actual figures. The agreement states the out Incrementfund must otfael an shortfalls due to necessary maintenance and overhead costa. "AS Permitted by HBS Code Section 34171(dXlXa) -This amount is being requested to establish a reserve for the anticipated shortfall In funding in the July- Dec. M13 period based upon thefunding shortage realized with the July - December 2012 RODS. From the June 2, 2012 her distribution, the Successor Agency received $404,151.44less than necessary to made debt service Payments on bonds. (1) The City of Rosemead as the Success or Agency to Me Rosemead Community Development Commission anticipates receiving the°finding ofwmple8on In 2013 and will include expenditures for these projects through a revlsed BOPS as permitted under A 1484 for the use of Bond Proceeds once the Nfinding of completion' is recelved.