3 - CERTIFIED ROPS AND ADMIN BUDGET

Home Browse Search

Response to DOF May 3, 2012 Letter May 18, 2012 Page 8 Successor Agency. Therefore, these expenditures are EOs which require funding from the RPTTF. o Line items 49 through 79 - These pass-through payments totaling $5,330,156.61 were made by the Successor Agency as required for tax increment received by the former redevelopment agency through January 31, 2012. The former redevelopment agency had numerous contractual agreements with taxing entities for pass-throughs in five of the component project areas. These agreements are enforceable obligations as defined in ABXI 26 and as such, the Successor Agency is eligible for 5% of the total obligation during this ROPS period for the administrative cost allowance. o Line items 9 & 85 - As required by the settlement agreements for five of the component project areas, $415,852.45 was set aside and deposited into the LMIHF in January 2012 exclusively for low and moderate income housing and related activities. This amount is the total of the specified percentages of the tax increment received by the former redevelopment agency in January 2012. Twenty percent of the tax increment (net) received from the South Main project area in the amount of $1,482,119 is also an EO as required by the settlement agreement. Based on the fact that these settlement agreements are enforceable obligations, 5% of the obligations during this ROPS period should be allocated for administrative costs. See our response to this item on pages 5-6 for additional information. o Line items 92, 93 & 97 - These public employee benefit liability amounts are liabilities that transferred to the Successor Agency and constitute enforceable obligations and not "administrative costs", as recognized by DOF (set forth in "Exhibit 5" on the DOF webpage devoted to ABXI 26 issues), as well as pursuant to HSC Section 34171 (d)(1)(C), Section 34167(d) (3) and Section 34167(6)(g). The medical retiree subsidy for the FY 2011-2012 was paid in January 2012, as agreed upon by the City and the three employee unions and associations representing the City employees assigned to the former redevelopment agency. The accrued leave balances amount represents the estimated value of the leave benefits that will be paid out to the City employees assigned to the former redevelopment agency upon separation from employment, some of which has already occurred. In addition, one particular Memorandum of Understanding (MOU) between the City and SEIU Local 721 prohibited the layoff of any employees in the union prior to March 31, 2012. Therefore, City employees that were assigned to the former redevelopment agency could not be laid off for two months after the dissolution of the Agency, thus the estimated cost of the salaries and benefits for those employees is an EO. We would appreciate the opportunity to further discuss the outstanding items with DOF. As specified in the DOF Letter, my staff will be following up with a telephone call to Supervisor Evelyn Suess or Lead Analyst Doug Evans to schedule a time. Thank you for your time and consideration. We look forward to working with you to resolve these outstanding issues. 3-35