Item No. 2.
| MEETING DATE: 01/19/2021 |
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| TO: | HONORABLE CHAIR AND DIRECTORS |
| FROM: | JIM SADRO, EXECUTIVE DIRECTOR By: Miranda Cole-Corona, Housing and Economic Dev Manager |
| SUBJECT: | APPROVE A RESOLUTION APPROVING AND ADOPTING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE (ROPS 21-22) FOR THE PERIOD OF JULY 1, 2021 THROUGH JUNE 30, 2022 PURSUANT TO HEALTH AND SAFETY CODE SECTION 34177(I) AND 34177(o) AND AUTHORIZE EXECUTIVE DIRECTOR TO SUBMIT ROPS 21-22 TO THE ORANGE COUNTYWIDE OVERSIGHT BOARD FOR APPROVAL
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RECOMMENDATION:
That the Successor Agency to the Redevelopment Agency of the City of La Habra:
A. Approve a resolution approving and adopting the Recognized Obligation Payment Schedule (ROPS) for the period of July 1, 2021, through June 30, 2022, (ROPS 21-22) pursuant to Health and Safety Code Section 34177(l) and 34177(o); and authorize staff to submit the approved ROPS to the Orange Countywide Oversight Board for approval; authorize Executive Director to forward the approved Recognized Obligation Payment Schedule (ROPS 21-22) to the Orange Countywide Oversight Board for their review and approval with a copy to the California State Department of Finance, Orange County Auditor Controller, and the County Administrative Office, and upon approval of ROPS 21-22 by the Orange Countywide Oversight Board, for submittal to the California State Department of Finance, California State Controller, Orange County Auditor Controller, and the Council Administrative Office for their approval; and
B. APPROVE AND ADOPT RESOLUTION NO. _______ ENTITLED: A RESOLUTION OF THE SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY OF THE CITY OF LA HABRA APPROVING AND ADOPTING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE FOR THE PERIOD OF JULY 1, 2021 THROUGH JUNE 30, 2022 (ROPS 21-22) PURSUANT TO HEALTH AND SAFETY CODE SECTION 34177(I) AND 34177(O).
DISCUSSION:
AB X1 26 (the “Dissolution Act”) was enacted in June 2011 as part of the Fiscal Year 2011-2012 State budget package. Under the Dissolution Act, all redevelopment agencies in the State of California were dissolved as of February 1, 2012. The City of La Habra City Council assumed the duties of unwinding the affairs of the La Habra Redevelopment Agency as the Successor Agency to the Redevelopment Agency of the City of La Habra. Also, pursuant to the same Dissolution Act, local agency oversight boards dissolved on June 30, 2018, and a County oversight board was established July 1, 2019.
On January 12, 2012, the City Council elected to become the Successor Agency to the Redevelopment Agency of the City of La Habra (Successor Agency) by adopting Resolution No. 5508. One of the responsibilities of the Successor Agency is to prepare a ROPS, which sets forth the nature, amount, and source(s) of payment of all “enforceable obligations” of the Redevelopment Agency (as defined by law) to be paid by the Successor Agency after the Redevelopment Agency’s dissolution.
With the enactment of Senate Bill 107, the ROPS period has changed from six months to twelve months and covers the period between July and June of each year. To maintain continuity of Redevelopment Property Tax Trust Fund (RPTTF) distribution, the new annual ROPS will continue to separate the A Period (July to December) and B Period (January to June). In addition, pursuant to Health and Safety Code Section 34177(m)(1)(A), the law provides that the Successor Agency shall complete the ROPS in the manner provided for by the Department of Finance. Pursuant to Health and Safety Code Section 34177(I)(2), the Successor Agency is required to prepare the ROPS covering the period July 1, 2021, through June 30, 2022 (ROPS 21-22). The Department of Finance released the new ROPS 21-22 template on November 24, 2020, and all Successor Agencies must submit their ROPS by February 1, 2021.
The “enforceable obligations” listed in the ROPS may include: bonds; loans legally required to be repaid pursuant to a payment schedule with mandatory repayment terms; payments required by the federal government; preexisting obligations to the state or obligations imposed by state law, judgments, settlements or binding arbitration decisions that bind the Redevelopment Agency; legally binding and enforceable agreements or contracts, contracts or agreements necessary for the continued administration or operation of the Redevelopment Agency, including agreements to purchase or rent office space, equipment and supplies; and amounts borrowed from or payments owed to the Low and Moderate Income Housing Fund of the former Redevelopment Agency. The remaining obligations of the Redevelopment Agency are listed in ROPS 20-21 (see Attachment 1).
Finally, pursuant to HSC section 34191.6(a), beginning January 1, 2016, agencies that have received a Finding of Completion may submit a Last and Final ROPS if each of the following conditions are met:
On January 12, 2012, the City Council elected to become the Successor Agency to the Redevelopment Agency of the City of La Habra (Successor Agency) by adopting Resolution No. 5508. One of the responsibilities of the Successor Agency is to prepare a ROPS, which sets forth the nature, amount, and source(s) of payment of all “enforceable obligations” of the Redevelopment Agency (as defined by law) to be paid by the Successor Agency after the Redevelopment Agency’s dissolution.
With the enactment of Senate Bill 107, the ROPS period has changed from six months to twelve months and covers the period between July and June of each year. To maintain continuity of Redevelopment Property Tax Trust Fund (RPTTF) distribution, the new annual ROPS will continue to separate the A Period (July to December) and B Period (January to June). In addition, pursuant to Health and Safety Code Section 34177(m)(1)(A), the law provides that the Successor Agency shall complete the ROPS in the manner provided for by the Department of Finance. Pursuant to Health and Safety Code Section 34177(I)(2), the Successor Agency is required to prepare the ROPS covering the period July 1, 2021, through June 30, 2022 (ROPS 21-22). The Department of Finance released the new ROPS 21-22 template on November 24, 2020, and all Successor Agencies must submit their ROPS by February 1, 2021.
The “enforceable obligations” listed in the ROPS may include: bonds; loans legally required to be repaid pursuant to a payment schedule with mandatory repayment terms; payments required by the federal government; preexisting obligations to the state or obligations imposed by state law, judgments, settlements or binding arbitration decisions that bind the Redevelopment Agency; legally binding and enforceable agreements or contracts, contracts or agreements necessary for the continued administration or operation of the Redevelopment Agency, including agreements to purchase or rent office space, equipment and supplies; and amounts borrowed from or payments owed to the Low and Moderate Income Housing Fund of the former Redevelopment Agency. The remaining obligations of the Redevelopment Agency are listed in ROPS 20-21 (see Attachment 1).
Finally, pursuant to HSC section 34191.6(a), beginning January 1, 2016, agencies that have received a Finding of Completion may submit a Last and Final ROPS if each of the following conditions are met:
- The remaining debt is limited to administrative costs and payments pursuant to enforceable obligations with defined payment schedules including, but not limited to debt service, loan agreements, and contracts;
- All remaining obligations have been previously listed on the ROPS and approved for payment by Finance pursuant to HSC section 34177(m) or (o); and
- The agency is not a party to outstanding/unresolved litigation, except as specified in HSC section 34191.6(a)(3).
The Successor Agency has not submitted a Last and Final ROPS. Initially, Last and Final ROPS was not submitted due to 1998 B&C Certificates of Participation Loan Agreement. Finance was recouping previous years payments on this loan; however, the final payment for this loan is expected to be received during the current Fiscal Year. Due to the possibility of losing administrative cost reimbursement, staff recommends not submitting a Last and Final ROPS at this time.
Upon approval by the Successor Agency, the ROPS will be submitted to the Orange Countywide Oversight Board for its review and approval, with a copy transmitted to the County Administrative Office, the County Auditor-Controller, and the California State Department of Finance. The “Approved ROPS” is submitted to the Orange County Auditor Controller, the California State Controller’s Office, and the California State Department of Finance for consideration and approval, and the document is also posted on the Successor Agency’s website. Staff will submit the ROPS to the Countywide Oversight Board on their regularly scheduled meeting on January 26, 2021.
It is recommended that the Successor Agency to the Redevelopment Agency of the City of La Habra approve the ROPS for the period of July 1, 2021, through June 30, 2022, pursuant to Health and Safety Code Section 34177(I) and authorize staff to forward the approved ROPS to the Countywide Oversight Board for approval.
Upon approval by the Successor Agency, the ROPS will be submitted to the Orange Countywide Oversight Board for its review and approval, with a copy transmitted to the County Administrative Office, the County Auditor-Controller, and the California State Department of Finance. The “Approved ROPS” is submitted to the Orange County Auditor Controller, the California State Controller’s Office, and the California State Department of Finance for consideration and approval, and the document is also posted on the Successor Agency’s website. Staff will submit the ROPS to the Countywide Oversight Board on their regularly scheduled meeting on January 26, 2021.
It is recommended that the Successor Agency to the Redevelopment Agency of the City of La Habra approve the ROPS for the period of July 1, 2021, through June 30, 2022, pursuant to Health and Safety Code Section 34177(I) and authorize staff to forward the approved ROPS to the Countywide Oversight Board for approval.
FISCAL IMPACT/SOURCE OF FUNDING:
Funding received through ROPS payments is used to cover existing debt obligations of the former La Habra Redevelopment Agency as well as the cost of administering Successor Agency to the Redevelopment Agency of the City of La Habra activities.
GENERAL PLAN RELEVANCE:
ED 9.1-Balanced Fiscal Practices