Title
Recommendation to Authorize the Interim City Manager to Submit the Recognized Obligations Payment Schedule (ROPS) and Administrative Budget for the Period from July 1, 2019 to June 30, 2020 to the Countywide Oversight Board. [SACIC] (Community Development 207)
Body
To: Honorable Chair and Member of the Successor Agency to the Community Improvement Commission
From: David L. Rudat, Interim City Manager
EXECUTIVE SUMMARY
Staff recommends authorizing the Interim City Manager to submit the Recognized Obligations Payment Schedule (“ROPS 2019-20”) and Administrative Budget for the Period from July 1, 2019 to June 30, 2020, to the Countywide Oversight Board.
BACKGROUND
State Law enacted by Assembly Bill x1 26 (2011), as modified by Assembly Bill 1484 (2012), and Senate Bill 107 (2015), dissolved all redevelopment agencies in California and established successor agencies to administer remaining obligations of the former redevelopment agencies. The City serves as the Successor Agency to the Community Improvement Commission of the City of Alameda, Alameda’s former redevelopment agency and the City Council serves as the Successor Agency Board.
Local oversight boards were established to direct the work of winding down the affairs and obligations of each former redevelopment agency. As of July 1, 2018, local oversight boards within Alameda County are now consolidated into the single County of Alameda Countywide Oversight Board (“Countywide Oversight Board”).
The Successor Agency is obligated to prepare a Recognized Obligations Payment Schedule (“ROPS”) for each fiscal year listing all enforceable obligations payable during that twelve-month period. The ROPS must be approved by the Countywide Oversight Board prior to submission to the California Department of Finance (“DOF”). The deadline for submission to DOF is February 1 of each year. ROPS 2019-20 will be the first ROPS schedule to be considered by the new Countywide Oversight Board for the period July 1, 2019 to June 30, 2020. The Successor Agency can only pay obligations listed on the ROPS as approved by the DOF.
Approval of the ROPS by the Successor Agency is not required by law. However, with the shift to the Countywide Oversight Board and elimination of local oversight boards, staff is implementing a practice of bringing the ROPS to the Successor Agency for consideration prior to submission to the Countywide Oversight Board.
DISCUSSION
Following is an overview of the major outstanding obligations listed on the Successor Agency’s ROPS schedule for Fiscal Year (FY) 2019-20. All items have been DOF-approved on previous ROPS schedules.
(1) Bonds (ROPS No. 56, 57, 58, 59, 13, 14)
The Successor Agency has two outstanding bond obligations:
• 2014 Bonds (ROPS No. 56 and 57). Approximately $56.1 million in debt service remains on the bonds. Debt service on the bonds continues through 2034.
• 2017 bonds (ROPS No. 58 and 59). Approximately $19.5 million in debt service remains on the bonds. Debt service on the bonds continues through 2042.
ROPS No. 56 and 58 identify payments to bond holders, while ROPS items 57 and 59 identify funds required to be reserved for payments due to bond holders in the subsequent fiscal year. The Successor Agency is also responsible for trustee fees (ROPS No. 13) and costs of compliance with continuing disclosure requirements (ROPS No. 14) in connection with the bonds.
(2) Alameda Landing Disposition and Development Agreement (ROPS 19 and 23)
The Alameda Landing Disposition and Development Agreement (“Alameda Landing DDA”) is listed as item No. 19 on the ROPS with related public improvement obligations included as item 23. The agreement provides for disposition of property for development of the Alameda Landing Project encompassing approximately 285,000 square feet of retail and 284 residential units that are nearing full completion. The Alameda Landing Project also includes maritime commercial uses, a 300-unit residential phase, and 4.5-acre park to be constructed along the waterfront portion of the property.
The Successor Agency is obligated under the Alameda Landing DDA to reimburse project costs for demolition of existing structures, installation of streets, utilities, and other horizontal improvements. Reimbursements are made from property taxes generated by the project and the adjacent Bayport residential project. The maximum reimbursement amount under the agreement is $35.5 million, of which $8 million is contingent upon financial performance of the project. Approximately $20 million remains to be paid under the agreement including the contingent amount. Full payment is projected to occur by FY 2022-23.
(3) Independence Plaza Agreement (ROPS 28)
The Independence Plaza agreement is a commitment by the Successor Agency to provide an operating subsidy for the 186-unit Independence Plaza affordable senior apartment property. Payments occur twice per year and reflect the subsidy required to operate and maintain the units.
(4) Boatworks Settlement Agreement (ROPS 33 and 34)
This settlement agreement obligation of up to $4.5 million to the developer of a residential project is the subject of pending litigation in which the City of Alameda has taken the position that the Agreement has expired. However, the Successor Agency is obligated to continue to list the agreement on its ROPS schedule, with no payment identified, until the litigation is resolved.
(5) Guyton Judgment and Settlement Agreement and Alameda Unified School District Pass Through Agreement (ROPS 36)
The Successor Agency is a party to a 1991 pass-through agreement with the Alameda Unified School District (AUSD), which provides that eight percent (8%) of property taxes allocated for the Business and Waterfront Improvement Project (BWIP) project area are designated for use by AUSD for affordable housing purposes. AUSD’s use of the funds must comply with the terms of a separate 1990 Guyton Judgement and Settlement Agreement (“Settlement Agreement”), which requires the City to undertake certain activities to further affordable housing production. AUSD has entered into a Memorandum of Understanding (MOU) with the Alameda Housing Authority to develop affordable housing, including for qualifying District employees.
Administrative Budget (ROPS 46)
Administrative costs are included on ROPS item 46 and are itemized in the proposed administrative budget. The proposed budget is within the applicable statutory maximum of $250,000.
Staff is recommending that the City Council authorize the Interim City Manager to submit the ROPS 2019-20 to the Countywide Oversight Board ahead of its January 23, 2019 meeting.
FINANCIAL IMIPACT
There is no financial impact from authorizing the Interim City Manager to submit the ROPS 2019-20 to the Countywide Oversight Board. All obligations approved by DOF are paid from Redevelopment Property Tax Trust Fund monies.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The ROPS schedule 2019-20 has been prepared on a template provided by DOF in accordance with State law. Following approval by the Countywide Oversight Board, the ROPS schedule will be submitted to DOF for its approval.
ENVIRONMENTAL REVIEW
This action is not a project under Public Resources Code section 21065 or CEQA Guidelines section 15378.
RECOMMENDATION
Authorize the Interim City Manager to submit the Recognized Obligation Payment Schedule (“ROPS 2019-20”) and Administrative Budget for the Period from July 1, 2019 to June 30, 2020 to the Countywide Oversight Board.
Respectfully submitted,
Debbie Potter, Base Reuse and Community Development Director
Financial Impact section reviewed,
Elena Adair, Finance Director
Exhibit:
1. ROPS and Administrative Budget