Laserfiche WebLink
Mr. Jeff Kay <br />June 23, 2015 <br />Page 2 <br />that formed the former RDA between January 1, 2011 through June 30, 2012 must be <br />evidenced by documentation of the enforceable obligation that required the transfer. <br />HSC section 34179.5 states enforceable obligation includes any of the items listed in <br />subdivision (d) of section 34171, contracts detailing specific work that were entered into <br />by the former redevelopment agency prior to June 28, 2011 with a third party other than <br />the city, county, or city and county that created the former RDA. Further, HSC section <br />34171 (d) (2) states enforceable obligation does not include any agreements, contracts, <br />or arrangements between the city that created the RDA and the former RDA. <br />The Plaza Project Area City loan was denied as an enforceable obligation in Finance's <br />April 11, 2012 letter related to the January through June 2012 Recognized Obligation <br />Payment Schedule. Additionally, the Agency confirmed this loan was not made within <br />two years of the former RDA's creation, nor was it entered into at the time of and solely <br />for the purpose of issuing debt. Therefore, the transfers were not made pursuant to an <br />enforceable obligation and are not permitted. <br />Finance notes the repayment of this loan may become an enforceable obligation after <br />the Agency receives a Finding of Completion from Finance. If the oversight board <br />makes a finding that the loan was for legitimate redevelopment purposes, this loan <br />should be placed on future Recognized Obligation Payment Schedules (ROPS) for <br />repayment. Refer to HSC section 34191.4 (b) for more guidance. <br />During the review of the OFA DDR, Finance noted a reserve amount of $825,000 related <br />to the 2002 Plaza Tax Allocation Bonds (TAB) that is legally restricted for a sinking fund <br />requirement. However, this amount was not included in the restricted cash held with a <br />fiscal agent balances. Our review of the 2002 Plaza TABs bond indentures indicates the <br />Agency is required to set aside funds to account for a forecasted shortage of property <br />tax increment toward the end of the bond's repayment period. Therefore, Finance <br />recommends that the Agency establish a separate reserve account and or escrow <br />account held with a trustee to set these funds aside in order to comply with bond <br />indenture requirements. <br />The Agency's OFA balance available for distribution to the affected taxing entities is $2,875,877 <br />million (see table below). <br />OFABalances Available For Distribution To Taxing Entities <br />Available Balance per DDR: $ 438,604 <br />Finance Adjustments <br />Disallowed transfers $ 2,437,273 <br />Total OFAavailable to be distributed: $ 2,875,877 <br />This is Finance's final determination of the OFA balances available for distribution to the taxing <br />entities. HSC section 34179.6 (f) requires successor agencies to transmit to the county auditor - <br />controller the amount of funds identified in the above table within five working days, plus any <br />interest those sums accumulated while in the possession of the recipient. Upon submission of <br />payment, it is requested you provide proof of payment to Finance within five business days. <br />If funds identified for transmission are in the possession of the successor agency, and if the <br />successor agency is operated by the city or county that created the former redevelopment <br />agency, then failure to transmit the identified funds may result in offsets to the city's or the <br />