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<br />61 <br />moratorium, or other similar laws affecting creditors’ rights, by the application of equitable <br />principles and by the exercise of judicial discretion in appropriate cases. <br /> <br />Although bankruptcy proceedings would not cause the liens to become extinguished, <br />bankruptcy of a property owner could result in a delay in prosecuting superior court foreclosure <br />proceedings. Although such delay would increase the possibility of delinquent tax installments <br />not being paid in full and thereby increase the likelihood of a delay or default in payment of the <br />principal of and interest on the 2014 Bonds, the Successor Agency believes any such adverse <br />impact is unlikely in light of the debt service coverage provided by fiscal year 2013-14 net tax <br />increment. See “THE PROJECT AREAS - Projected Available Net Tax Increment and <br />Estimated Debt Service Coverage” for a description of the debt service coverage on the 2014 <br />Bonds. <br /> <br />Estimated Revenues <br /> <br />In estimating that net tax increment will be sufficient to pay debt service on the 2014 <br />Bonds, the Successor Agency has made certain assumptions with regard to present and future <br />assessed valuation in the Project Areas, future tax rates and percentage of taxes collected. The <br />Successor Agency believes these assumptions to be reasonable, but there is no assurance <br />these assumptions will be realized and to the extent that the assessed valuation and the tax <br />rates are less than expected, the net tax increment available to pay debt service on the 2014 <br />Bonds will be less than those projected and such reduced net tax increment may be insufficient <br />to provide for the payment of principal of, premium (if any) and interest on the 2014 Bonds. <br /> <br />See “THE PROJECT AREAS – Projected Available Net Tax Increment and Estimated <br />Debt Service Coverage” above. <br /> <br />Hazardous Substances <br /> <br />An additional environmental condition that may result in the reduction in the assessed <br />value of property would be the discovery of a hazardous substance that would limit the <br />beneficial use of taxable property within the Project Areas. In general, the owners and <br />operators of property may be required by law to remedy conditions of the property relating to <br />releases or threatened releases of hazardous substances. The owner or operator may be <br />required to remedy a hazardous substance condition of property whether or not the owner or <br />operator has anything to do with creating or handling the hazardous substance. The effect, <br />therefore, should any of the property within the Project Areas be affected by a hazardous <br />substance, could be to reduce the marketability and value of the property by the costs of <br />remedying the condition. <br /> <br />Natural Disasters <br /> <br />The value of the property in the Project Areas in the future can be adversely affected by <br />a variety of additional factors, particularly those which may affect infrastructure and other public <br />improvements and private improvements on property and the continued habitability and <br />enjoyment of such private improvements. Such additional factors include, without limitation, <br />geologic conditions such as earthquakes, topographic conditions such as earth movements, <br />landslides and floods and climatic conditions such as droughts. In the event that one or more of <br />such conditions occur, such occurrence could cause damages of varying seriousness to the <br />land and improvements and the value of property in the Project Areas could be diminished in