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AGENDA ITEM NO. 1.
CITY OF HAWTHORNE City Council AGENDA BILL For the meeting of 12/10/2024 Originating Department: Finance |
City Manager:
Department Head:
SUBJECT:
RESOLUTION NO. 2024-02
APPROVING A RECOGNIZED OBLIGATION PAYMENT SCHEDULE (“ROPS”) FOR THE TWELVE-MONTH FISCAL PERIOD FROM JULY 1, 2025 THROUGH JUNE 30, 2026 (“ROPS 25-26”) AND TAKING CERTAIN RELATED ACTIONS.
APPROVING A RECOGNIZED OBLIGATION PAYMENT SCHEDULE (“ROPS”) FOR THE TWELVE-MONTH FISCAL PERIOD FROM JULY 1, 2025 THROUGH JUNE 30, 2026 (“ROPS 25-26”) AND TAKING CERTAIN RELATED ACTIONS.
RECOMMENDED MOTION:
Staff recommends that the City Council adopt SA Resolution 2024-02 approving ROPS 25-26, a Recognized Obligation Payment Schedule for the twelve-month fiscal period from July 1, 2025 through June 30, 2026 and taking certain related actions.
DISCUSSION:
BACKGROUND:
Assembly Bill (“AB”) x1 26, AB 1484, and Senate Bill 107 (collectively, the “Dissolution Act”) dissolved Redevelopment agencies and require the Successor Agency to the Hawthorne Redevelopment Agency (“Successor Agency”) to wind down the obligations of the former Hawthorne Redevelopment Agency (“Former Agency”). The wind down is accomplished, in large part, through the preparation of an annual ROPS, covering the upcoming fiscal year. The ROPS lists the obligations to be funded and serves as a request for an allocation of property tax increment revenue deposited by the Auditor-Controller in the Redevelopment Property Tax Trust Fund (“RPTTF”).
The ROPS must be approved by the Oversight Board to the Successor Agency (“Oversight Board”) and submitted to the State Department of Finance (“DOF”). Pursuant to Health and Safety Code (“HSC”) Section 34177(l), DOF provides the ROPS form for successor agencies to use to report enforceable obligations. Pursuant to HSC Section 34177(l)(2)(C), a copy of the ROPS must also be submitted to the Los Angeles County Auditor-Controller (“Auditor-Controller”) and State Controller’s Office.
DISCUSSION:
The Successor Agency has already paid off several of the Former Agency’s obligations. Remaining obligations include the 2016 Tax Allocation Refunding Bonds and related costs, Oceangate Owner Participation Agreement (“OPA”) rebates, Gateway Disposition and Development Agreement rebates, as well as administrative expenses. The ROPS Detail page lists each of the remaining obligations, including the amount requested in the current year and an estimate of the total debt or obligation remaining for each item.
In total, the Successor Agency requests approval for $4,585,321 in expenditures, including $1,370,625 from a reserve balance set aside in the prior fiscal year and $3,214,696 in funds from the RPTTF. This represents a decrease from the amount requested on the prior year’s ROPS, mostly due to the lower debt service payment (item 38) and an adjustment to the calculation of the OPA rebate (item 35) as detailed in the OPA. There are no new items on the ROPS.
On the Report of Cash Balances, the Successor Agency identifies any available funds that can be used to pay enforceable obligations. After all available funds are allocated or exhausted, which they have been, the Successor Agency can request funding for enforceable obligations from RPTTF.
Assembly Bill (“AB”) x1 26, AB 1484, and Senate Bill 107 (collectively, the “Dissolution Act”) dissolved Redevelopment agencies and require the Successor Agency to the Hawthorne Redevelopment Agency (“Successor Agency”) to wind down the obligations of the former Hawthorne Redevelopment Agency (“Former Agency”). The wind down is accomplished, in large part, through the preparation of an annual ROPS, covering the upcoming fiscal year. The ROPS lists the obligations to be funded and serves as a request for an allocation of property tax increment revenue deposited by the Auditor-Controller in the Redevelopment Property Tax Trust Fund (“RPTTF”).
The ROPS must be approved by the Oversight Board to the Successor Agency (“Oversight Board”) and submitted to the State Department of Finance (“DOF”). Pursuant to Health and Safety Code (“HSC”) Section 34177(l), DOF provides the ROPS form for successor agencies to use to report enforceable obligations. Pursuant to HSC Section 34177(l)(2)(C), a copy of the ROPS must also be submitted to the Los Angeles County Auditor-Controller (“Auditor-Controller”) and State Controller’s Office.
DISCUSSION:
The Successor Agency has already paid off several of the Former Agency’s obligations. Remaining obligations include the 2016 Tax Allocation Refunding Bonds and related costs, Oceangate Owner Participation Agreement (“OPA”) rebates, Gateway Disposition and Development Agreement rebates, as well as administrative expenses. The ROPS Detail page lists each of the remaining obligations, including the amount requested in the current year and an estimate of the total debt or obligation remaining for each item.
In total, the Successor Agency requests approval for $4,585,321 in expenditures, including $1,370,625 from a reserve balance set aside in the prior fiscal year and $3,214,696 in funds from the RPTTF. This represents a decrease from the amount requested on the prior year’s ROPS, mostly due to the lower debt service payment (item 38) and an adjustment to the calculation of the OPA rebate (item 35) as detailed in the OPA. There are no new items on the ROPS.
On the Report of Cash Balances, the Successor Agency identifies any available funds that can be used to pay enforceable obligations. After all available funds are allocated or exhausted, which they have been, the Successor Agency can request funding for enforceable obligations from RPTTF.
ECONOMIC DEVELOPMENT STRATEGIC PLAN:
.
FISCAL IMPACT:
ROPS 25-26 must be approved by the Hawthorne Successor Agency’s Oversight Board and submitted to DOF for the Successor Agency to receive RPTTF, administered by the Los Angeles County Auditor-Controller (“Auditor-Controller”), and to pay enforceable obligations during the ROPS 25-26 period. In total, the Successor Agency requests approval for $4,585,321 in expenditures, including $1,370,625 from a reserve balance set aside in the prior fiscal year and $3,214,696 in funds from the RPTTF.
NOTICING PROCEDURE:
None.