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