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File Number: 12 -063 (ROPS) for payments due through July 1, 2012. From May 1, 2012 forward, only payments listed on the ROPS may be made by the Successor Agency. ABx1 26 does not explicitly require the City Council, in its capacity as the Successor Agency, to take formal actions to approve the ROPS and plans for disposition of property. As a practical matter, however, staff intends to obtain City Council approval prior to forwarding a new ROPS or any other proposal to the Oversight Board. As its name suggests, the Oversight Board is required to oversee the activities of the Successor Agency with the goals of ensuring that the requirements of ABx1 26 are met and maximizing available revenues and assets for redistribution to the taxing entities. The Oversight Board can direct the staff of the Successor Agency to perform work in furtherance of the Oversight Board's duties and responsibilities. The Oversight Board will have fiduciary responsibilities to the holders of enforceable obligations and the taxing entities that benefit from distributions of property tax and other revenues. The Oversight Board's authority covers three main categories of Successor Agency activities: 1. Approval of Enforceable Obligations: The Successor Agency is required to prepare a ROPS by March 1, 2012 and twice annually thereafter. Before the County Auditor can disburse funds for the payment of enforceable obligations, the Oversight Board must approve the ROPS. Although most enforceable obligations (such as bond payments) cover a fixed period of time, others run indefinitely or for an undefined period. For those, the Oversight Board may direct the Successor Agency staff to terminate or renegotiate the agreements to minimize expenditures. 2. Direction Regarding Disposal of Assets: The dissolution bill requires successor agencies to dispose of assets "expeditiously and in a manner aimed at maximizing value." Although this requirement is subject to differing interpretations, the ultimate authority for approving transactions lies with the Oversight Board. Staff believes that selling properties in a manner that best assures a productive use of the site is consistent with the requirements because this approach would maximize tax revenues for all taxing agencies in the future. As appropriate, information regarding future plans for properties would be approved by the City Council (acting as the Successor Agency) and then forwarded to the Oversight Board. 3. Approval of the Successor Agency's Administrative Budget: ABx1 26 states that Successor Agencies are entitled to an administrative allowance. Subject to approval of the Oversight Board, the administrative allowance is up to five percent of property tax for 2011 -12 and three percent each year thereafter. The amount shall not be less than $250,000 for any fiscal year unless agreed to by the Successor Agency. For San Leandro, the Administrative Allowance is not expected to be substantially more than $250,000 in any fiscal year. Staff does not anticipate any difficulty in justifying $250,000 in costs related to winding down the affairs of the Agency, disposing City of San Leandro Page 2 Printed on 211012012