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Resolution, Agreement, and Appropriation Adjustment —
<br />Tax Allocation Bonds, 2011 Series A
<br />October 4, 2016
<br />Page 2
<br />agreement with the City of Santa Ana, directing the transfer of funds to the City, and making
<br />certain findings in connection therewith.
<br />2. Authorize the City Manager and the Clerk of the Council to execute the Bond Proceeds
<br />Expenditure Agreement with the City of Santa Ana to transfer current excess bond proceeds
<br />in the amount of $260,695 and any future excess bond proceeds to the City for capital
<br />improvements, subject to non - substantive changes approved by the City Manager and City
<br />Attorney.
<br />DISCUSSION
<br />Pursuant to Part 1.85 of Division 24 of the California Health & Safety Code ( "Dissolution Law "),
<br />the City Council on January 9, 2012, elected for the City to act as the "Successor Agency" to the
<br />dissolved Community Redevelopment Agency ( "Agency "). On February 1, 2012, in accordance
<br />with the Dissolution Law and the California Supreme Court's decision in California
<br />Redevelopment Association v. Matosantos, Case No. S194861, the Agency was dissolved and
<br />the City began to serve as the "Successor Agency." The City Council serves as the governing
<br />body of the Successor Agency under the Dissolution Law as amended by AB 1484, AB 471, and
<br />SIB 107, to administer the enforceable obligations of the Agency and otherwise unwind the
<br />Agency's affairs. All actions of the Successor Agency are subject to the review and approval by
<br />the Oversight Board.
<br />The Agency previously issued its Merged Project Area, Tax Allocation Bonds, 2011 Series A, in
<br />the amount of $66,790,000 to: (1) defease the Santa Ana Financing Authority's Refunding
<br />Revenues Bonds Series A, B, C, and D, and (2) finance redevelopment activities related to the
<br />Merged Project area including certain public parking and infrastructure improvements. Of the
<br />original $66.79 million, $6.1 million was new bond proceeds for the public improvements.
<br />In 2011, the Agency, through a cooperative agreement with the City, took steps to begin the
<br />design phase of the improvements to the public parking structures in the downtown area.
<br />However, the Dissolution Law prohibited the Agency from creating new debts and incurring any
<br />new obligations. Therefore, bond proceeds in the amount of $6,092,482.68 are currently
<br />remaining as of August 31, 2016. Health and Safety Code Section 34191.4(c) allows a successor
<br />agency that has received a finding of completion to use bond proceeds from bonds issued prior to
<br />January 1, 2011, as well as a limited portion of bond proceeds from bonds issued on or after
<br />January 1, 2011 for the purposes for which the bonds were sold.
<br />The Successor Agency received its Finding of Completion on November 26, 2014, and
<br />accordingly it now has authority to expend five percent of the bond proceeds ($260,695) in a
<br />manner consistent with the original bond covenants. In order to accomplish this, the Successor
<br />Agency included this amount on the Recognized Obligation Payment Schedule (ROPS) 16 -17
<br />and planned to expend via transfer of funds to the City, as allowed by the Dissolution Law. On
<br />May 17, 2016, the State Department of Finance (DOF) pre- authorized the transfer of $260,695 of
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