HomeMy WebLinkAbout7301_CCv0001.pdf RESOLUTION NO. 7301
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDLANDS
TAKING CERTAIN ACTIONS WITH RESPECT TO THE PROVISION OF A
LOAN TO THE SUCCESSOR AGENCY TO THE FORMER
REDEVELOPMENT AGENCY OF THE CITY OF REDLANDS
RECITALS
WHEREAS, pursuant to the Community Redevelopment Law (Health and Safety Code
section 33000 et seq.), the City Council of the City of Redlands created the Redevelopment
Agency of the City of Redlands; and
WHEREAS, on June 28, 2011, the State of California enacted Health and Safety Code
section 34161 et seq. as part of the State's enactment of Assembly Bill 1X 26 ("AB 1X 26"),
immediately prohibiting further redevelopment activity by redevelopment agencies and
dissolving all redevelopment agencies in the State of California on October 1,2011; and
WHEREAS, on July 18, 2011, a Petition for Writ of Mandate was filed in the Supreme
Court of the State of California in the matter of California Redevelopment Association, et al. v.
Ana Matosantos, et al., Case No. S194861 which, among other things, challenged the
constitutionality of AB IX 26, on behalf of cities, counties and redevelopment agencies and
requested a stay of enforcement of AB 1 X 26, pending the Supreme Court's determination of the
constitutionality of AB 1 X 26; and
WHEREAS, on December 29, 2011, the Supreme Court issued its opinion in the above
referenced case which, among other things, upheld AB IX 26 and dissolved all redevelopment
agencies throughout the State of California, effective February 1, 2012; and
WHEREAS, pursuant to Health and Safety Code section 34173(d), the City elected to
become the successor agency to the dissolved Redevelopment Agency of the City of Redlands,
confirmed by Resolution No. 7089 adopted on November 1, 2011; and
WHEREAS, on June 27, 2012, Assembly Bill 1484 was signed by the Governor of
California which,among other things, significantly modifies AB 1X 26; and
WHEREAS,on July 11, 2012, the Agency received a demand for payment in the amount
of $2,601,269 (the "Payment") from the County of San Bernardino Auditor-
Controller/Treasurer/Tax Collector pursuant to Health and Safety Code section
34183.5(b)(2)(A); and
WHEREAS, on July 12, 2012, the Agency made the Payment to the County of San
Bernardino Auditor-Controller/Treasurer/Tax Collector, using the$2,535,662 balance held in its
Redevelopment Obligation Retirement Fund and a$65,607 loan from the City; and
WHEREAS, after making the Payment, the Agency no longer had any fund balance in its
Redevelopment Obligation Retirement Fund and had enforceable obligations from July through
December 2012, as set forth in its Recognized Obligation Payment Schedule for July through
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December 2012("ROPS"), in the amount of$3,157,400; and
WHEREAS, pursuant to Health and Safety Code section 34173(h), the City may loan or
grant funds to the Agency for administrative costs, enforceable obligations, or project-related
expenses at the City's discretion; and
WHEREAS, the City and the Agency determined that it was in their respective best
interests that the Agency pay the enforceable obligations, which included $2,880,794 in bond
principal payments, as default by the Agency could potentially affect the creditworthiness of the
City and the Agency; and
WHEREAS, because the Agency had insufficient funds to make the payments required
pursuant to the ROPS out of existing Agency funds, the City Council of the City of Redlands
determined that the City would provide a loan to the Agency in the amount of$3,157,400 to
make these payments; and
WHEREAS, the Agency subsequently listed the loans as enforceable obligations on its
ROPS III(January 2013 through June 2013); and
WHEREAS, on October 22, 2012, the State Department of Finance ("DOF") issued its
determination regarding the Agency's ROPS III and identified several items that the DOF
disputed as enforceable obligations, including the loan from the City to the Agency in the
amount of$65,607; and
WHEREAS, the Agency subsequently participated in a "meet and confer" with the DOF
to further discuss the disputed items on the Agency's ROPS 111; and on December 18, 2012, and
in a follow-up contact on January 8, 2013, the Agency was notified that the DOF completed its
review of the Agency's ROPS 111, and that the DOF disallowed the$65,607 loan from the City to
the Agency as an enforceable obligation. The City's loan to the Agency in the amount of
$3,157,400 was neither questioned by the DOF, nor denied as an enforceable obligation as part
of the DOF's review of the Agency's ROPS 111; and
WHEREAS, on February 19, 2013, the Agency submitted its ROPS 13-14A to the DOF
using the template provided by the DOF, and on April 6, 2013, the DOF issued its determination
regarding the Agency's ROPS 13-14A and questioned the Agency's repayment terms for the
City's $3,157,400 loan to the Agency; and
WHEREAS, during April and May of 2013, the Agency participated in a "meet and
confer" with the DOF, and on May 17, 2013, the DOF issued its final determination which
denied as an enforceable obligation a significant portion of the City's $3,157,400 loan to the
Agency; and
WHEREAS, the Agency disputes the determinations of the DOF that City's loans to the
Agency are not enforceable obligations and has determined to pursue all legal remedies available
to the Agency; and
WHEREAS, the Agency and the City have further determined it is in their respective best
interests for the City to loan the Agency sufficient funds to enable the Agency to pay the
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estimated costs of the Agency's pursuit of such remedies; and
WHEREAS, the City now desires to loan to the Agency the amount of$75,000 for the
payment of enforceable obligations, administrative expenses, and project-related expenses of
Agency, including the costs of the Agency's pursuit of its aforementioned remedies;
NOW,THEREFORE, BE IT RESOLVED by the City Council of the City of Redlands as
follows:
Section 1. The above recitals are true and correct and are a substantive part of this
Resolution.
Section 2. This Resolution is adopted pursuant to Health and Safety Code Section
34173.
Section 3. The City Council hereby authorizes a loan to the Successor Agency in the
amount of $75,000 and authorizes the Mayor of the City of Redlands, or any City
Councilmember,to execute the loan documents.
Section 4. The adoption of this Resolution is not intended and shall not constitute a
waiver by the City or the Agency of any right the City or the Agency may have to challenge all
or any portion of Assembly Bill No. 1484 through administrative or judicial proceedings.
Section 5. This Resolution has been reviewed with respect to applicability of the
California Environmental Quality Act ("CEQA"), the State CEQA Guidelines (California Code
of Regulations, Title 14, Sections 15000 et seq., hereafter the "Guidelines"), and the City's
environmental guidelines. The City Council has determined that this Resolution is not a"project"
for purposes of CEQA, as the term is defined by Guidelines Section 15378, because this
Resolution is an administrative activity that will not result in a direct or indirect physical change
in the environment(Guidelines Section 15378(b)(5)).
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ADOPTED, SIGNED AND APPROVED this 16''day of July, 2013.
r
Peter Aguilar, Mayor
ATTEST:
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Sam Irwin, L-71ftyberk
I, Sam Irwin, City Clerk of the City of Redlands, hereby certify that the foregoing Resolution was duly
adopted by the City Council at a special meeting thereof, held on the 16`h day of July, 2013, by the
following vote:
AYES: Councilmembers Harrison,Foster, Gardner,Gilbreath; Mayor Aguilar
NOES: None
ABSENT: None
ABSTAIN: None
Sam Irwin,City Clerk
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