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HomeMy WebLinkAboutJT75C - EDUCATIONAL REVENUE AUGMENTATION FUND REQUEST FOR COUNCIUAGENCY ACTION MEETING DATE: ~ ~ CLERK OF COUNCIL USE ONLY: MAY 2, 2005 TITLE: APPROVED D As Recommended D As Amended D Ordinance on 1 st Reading D Ordinance on 2nd Reading D Implementing Resolution D Set Public Hearing For PUBLIC HEARING - PAYMENT TO EDUCATIONAL REVENUE AUGMENTATION FUND AND AN ORDINANCE AMENDING THE MERGED REDEVELOPMENT PLAN TO EXTEND CERTAIN TIME LIMITS Uffi2, CITY MANAGER CONTINUED TO i ~ FILE NUMBER RECOMMENDED ACTION CITY COUNCIL ACTION 1. Adopt an ordinance extending time limi ts on the effectiveness of the redevelopment plans and extending the time limit on the use of tax increment to repay indebtedness by one year for eligible project areas and making certain required findings 2. Approve an appropriation adjustment transferring loan funds from the Low and Moderate-Income Housing Fund to redevelopment project area funds to make the necessary payment to the County Educational Revenue Augmentation Fund as required by legislation implementing the California State Budget for FY 2004-2005. COMMUNITY REDEVELOPMENT AGENCY ACTION Adopt a resolution finding that borrowing $3,401,346.78 in Housing Set- Aside Funds to make the FY 2004-2005 payment to the Educational Revenue Augmentation Fund is necessary due to the insufficiency of other revenue sources. JT75C-1 P.H. - Payment to ERAF and An Ordinance Amending the Merged Redevelopoment Plan to Extend Certain Time Limits May 2, 2005 Page 2 COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION RECOMMENDATION: 1. Recommended that the City Council: a) Adopt an ordinance extending time limits on the effectiveness of the redevelopment plans and extending the time limit on the use of tax increment to repay indebtedness by one year for eligible project areas and making certain required findings. b) Approve an appropriation adjustment transferring loan funds from the Low and Moderate-Income Housing Fund to redevelopment project area funds to make the necessary payment to the County Educational Revenue Augmentation Fund as required by legislation implementing the California State Budget for FY 2004-2005. 2. Recommended that the Community Redevelopment Agency adopt a resolution finding that borrowing $3,401,346.78 in Housing Set- Aside Funds to make the FY 2004-2005 payment to the Educational Revenue Augmentation Fund is necessary due to the insufficiency of other revenue sources. By a vote of 5:0 (Betancourt and Robles absent) at its Regular Meeting of April 19, 2005. DISCUSSION As a result of Senate Bill 1096 (SB 1096) implementing the California State Budget for FY 2004-2005, the Community Redevelopment Agency is required to make a $3,401,346.78 payment to the County Educational Revenue Augmentation Fund (ERAF) by May 10, 2005. The legislation allows the Agency to borrow up to 50 percent of the amount required to be allocated to the Low and Moderate-Income Housing Fund during FY 2004- 2005 to make this payment. The funds may be borrowed for up to ten years. As a condition of borrowing the funds from the Low and Moderate- Income Housing Fund, the Agency must adopt a resolution making a finding that there are insufficient other moneys to make the required payment. The legislation implementing the State's FY 2004-2005 budget authorized the County Auditor/Controller to withhold property tax revenue from the City's General Fund to the extent that the $3,401,346.78 payment is not JT75C-2 P.H. - Payment to ERAF and An Ordinance Amending the Merged Redevelopoment Plan to Extend Certain Time Limits May 2, 2005 Page 3 made by the Community Redevelopment Agency before May 10, 2005. SB 1096 also included a provision that allows the legislative body to adopt an ordinance to amend the redevelopment plan extending the time limit on the use of tax increment to repay indebtedness and extend the plan effectiveness by one year for a redevelopment agency making an ERAF payment. For Redevelopment plans with 10 to 20 years remaining, the legislation requires that the legislative body finds that the Agency is in compliance wi th the maj or housing requirements. These include the requirement to deposit 20 percent of the gross tax increment into the housing set-aside fund, the adoption of a housing implementation plan, compliance with housing replacement and inclusionary obligations, and certification that no excess surplus exists. Redevelopment plans with 20 years or more remaining cannot be extended. The City of Santa Ana has a merged redevelopment project area consisting of Central City, Inter-City, North Harbor, South Harbor, South Main and Bristol Corridor. The following time limits are proposed for amendment: TIME LIMIT ON TIME LIMIT ON TIME LIMIT ON TIME LIMIT ON PLAN PLAN PLAN RECE:IPT OF RECE:IPT OF EFFECTIVENESS EFFECTIVENESS TAX INCREMENT TAX :INCREMENT ( CURRENT (PROPOSED ( CURRENT (PROPOSED DATE) DATE) DATE) DATE) Central City July 2 , 2014 July 2, 2015 July 2, 2024 July 2, 2025 Inter-City July 6, 2023 July 6, 2024 July 6, 2033 July 6, 2034 North Harbor July 6, 2023 July 6, 2024 July 6, 2033 July 6, 2034 South Harbor July 6, 2023 July 6, 2024 July 6, 2033 July 6, 2034 South Main July 6, 2023 July 6, 2024 July 6, 2033 July 6, 2034 *Bristol December 4, December 4, December 4, December 4, 2030 2030 2040 2040 *Not eligible for one year extension under SB1096. JT75C-3 P.R. - Payment to ERAF and An Ordinance Amending the Merged Redevelopoment Plan to Extend Certain Time Limits May 2, 2005 Page 4 Notice of this public hearing was mailed to the governing body of each affected taxing entities on April 15, 2005, 30 days prior to the proposed ordinance adoption on May 16, 2005, and published in the Orange County Register on April 22, 2005, 10 days prior to the hearing. FISCAL IMPACT City/Agency approval of the appropriation adjustment and resolution will enable staff to make the $3,401,346.78 payment to the County Auditor for deposit into the ERAF on or before May 10, 2005. The amendment of these plans will enable the Corrnnuni ty Redevelopment Agency to collect tax increment for one addi tional year in the eligible proj ect areas. The actual amount received will depend on the valuation of property within the project area in any given fiscal year. APPROVED AS TO FUNDS AND ACCOUNTS: ~~:7~.~r~~ Executlve Dlrector '=\ ~~;~ ~L ') fu~ ~ Franci~co G~tierrez fl Executlve Dlrector Finance & Management Services Agency PCW/NTE/mlr H:\ACTIONS\2005 CCVT CC-CRA PymtERAF&OrdAmendMergedRedevPlanExtCertTimeLimts 5-2-05.doc JT75C-4 4/13/05 LES ORDINANCE NO. NS-2685 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA ANA EXTENDING THE TIME LIMIT OF THE EFFECTIVENESS OF THE MERGED REDEVELOPMENT PLANS AND THE TIME LIMIT FOR PAYMENT OF INDEBTEDNESS AND RECEIPT OF PROPERTY TAXES FOR EACH OF THE ELIGIBLE PROJECT AREAS AND MAKING CERTAIN FINDINGS IN CONNECTION THEREWITH THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES ORDAIN AS FOLLOWS: SECTION 1: The City Council of the City of Santa Ana hereby, finds, determines and declares as follows: A. The Community Redevelopment Agency for the City of Santa Ana ("Agency") is a community redevelopment agency duly created, established, and authorized to transact business and exercise its powers, all under and pursuant to the California Community Redevelopment Law (Part I of Division 24, commencing with Section 33000 of the Health & Safety Code of the State of California) ("CRL"). B. The Agency is engaged in activities necessary and appropriate to carry out the Redevelopment Plan for each of the six redevelopment project areas which have now been merged. C. Pursuant to California Health and Safety Code section 33333.6, a time limit of the effectiveness of the Redevelopment Plans and a time limit on the period of repayment of indebtedness and receipt of property taxes under the Redevelopment Plan have been established. D. By and through Senate Bill 1096, enrolled on July 29, 2004, and chaptered on August 5, 2004 ("SB 1 096"), Health and Safety Code section 33333.6 was amended to provide that as to Redevelopment Plans originally adopted before January 1, 1994, and when such redevelopment agency is required to make a payment to the Educational Revenue Augmentation Fund in fiscal year 2004-2005 pursuant to CRL section 33681.12, the City Council, as the legislative body of the Agency, may enact an ordinance to extend by one year the time limit on the effectiveness of the Redevelopment Plan and the time limit for payment of indebtedness and receipt of property taxes under the Redevelopment Plan, each and respectively. JT75C-5 E. SB 1096 further provides that such ordinance may be adopted without compliance with the normal procedures for redevelopment plan amendments. F. SB 1096 provides that the legislative body must make certain determinations and findings in the ordinance and must hold a noticed public hearing on the amendments. G. The City Council desires to adopt this Ordinance to amend and extend certain time limitations of the Redevelopment Plan, as more particularly set forth below, in accordance with section 33333.6, as amended by SB 1096. H. The enactment of this Ordinance is exempt from the California Environmental Quality Act (Public Resources Code section 21000 et seq.) ("CEQA") pursuant to CEQA Guidelines section 15378(b)(4) because it is a fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. SECTION 2: As used in this Ordinance, the following definitions shall apply: Agency shall mean the Community Redevelopment Agency of the City of Santa Ana. Bristol Plan shall mean the Santa Ana Bristol Redevelopment Plan originally adopted by Ordinance No. NS-2039 on or about December 4, 1989; amended by Ordinance No. NS-2231 and NS-2234 on or about October 3, 1994; Ordinance No. NS-2396 on or about August 2, 1999; and Ordinance No. NS-2652 on May 17, 2004. Central City Plan shall mean the Santa Ana Central City Redevelopment Plan originally adopted by Ordinance No. NS-1173 on or about July 2,1973, amended by Ordinance No. NS-1258 on or about June 2, 1975 ; Ordinance NS-1877 on or about December 1, 1986; Ordinance No. NS-2234 on or about October 3, 1994; Ordinance No. NS-2290 on April 6, 1996; Ordinance No. NS-2396 in August of 1999; and Ordinance No. NS-2652 on May 17, 2004. Community Redevelopment Law shall mean Part 1 (commencing with Section 33000) of Division 24 of the California Health & Safety Code, as amended from time to time. Inter City Plan shall mean the Santa Ana Inter City Redevelopment Plan originally adopted by Ordinance No. NS-1636 on or about July 6, 2 JT75C-6 1982, amended by Ordinance No. NS-2234 on or about October 3, 1994; Ordinance NS-2289 on or about May 6, 1996; Ordinance NS-2396 in August of 1999; and Ordinance No. NS-2652 on May 17, 2004. North Harbor Plan shall mean the Santa Ana North Harbor Boulevard Redevelopment Plan originally adopted by Ordinance No. NS- 1637 on or about July 6, 1982, amended by Ordinance No. NS-2234 on or about October 3, 1994; Ordinance NS-2396 in August of 1999; Ordinance NS-2641 on January 20,2004; and Ordinance No. NS-2652 on May 17, 2004. Merged Project Area shall mean the six project areas that were merged on or about September 20, 2004 by Ordinance No. NS-2662, Ordinance No. NS-2663, Ordinance No. NS-2664, Ordinance No. NS- 2665, Ordinance No. NS-2666, and Ordinance No. NS- 2667. South Harbor Plan shall mean the Santa Ana South Harbor Boulevard/Fairview Street Redevelopment Plan originally adopted by Ordinance No. NS-1638 on or about July 6,1982, amended by Ordinance No. NS-2167 on or about August 3, 1992; Ordinance No. NS-2234 on or about October 3, 1994; Ordinance NS-2396 in August of 1999; Ordinance NS-2641 on January 20,2004; and Ordinance No. NS-2652 on May 17, 2004. South Main Plan shall mean the Santa Ana South Main Street Redevelopment Plan originally adopted by Ordinance No. NS-1639 on or about July 6, 1982, amended by Ordinance No. NS-2234 on or about October 3,1994; Ordinance No. NS-2256 adopted on or about July 17, 1995; Ordinance NS-2396 in August of 1999; Ordinance NS-2641 on January 20,2004; and Ordinance No. NS-2652 on May 17, 2004. Tax increment shall mean property tax revenues allocated to the Agency pursuant to Section 333670 of the Community Redevelopment Law. Time limit on incurring indebtedness shall mean the expiration date of the time period during which the Agency may establish or incur loans, advances, and indebtedness to be paid with the proceeds of tax increment derived from the project area of a specified redevelopment plan, as described in subdivision (a) of Section 33333.6 of the Community Redevelopment Law, subject to all exceptions specified in the Community Redevelopment Law. Time limit on plan effectiveness shall mean the expiration date of the time period during which a specified redevelopment plan is effective, as described in subdivision (b) of Section 33333.6 of the Community 3 JT75C-7 Redevelopment Law, subject to all exceptions specified in the Community Redevelopment Law. Time limit on receipt of tax increment shall mean the expiration date of the time period during which the Agency may pay indebtedness and receive tax increment derived from the project area of a specified redevelopment plan, as described in subdivision (c) of Section 33333.6 of the Community Redevelopment Law, subject to all exceptions specified in the Community Redevelopment Law. SECTION 3: The current time limit on the effectiveness of each of the eligible Redevelopment Plans is hereby extended by one year and the Agency is hereby authorized to act with respect to the respective Redevelopment Plan at any time during which each of the Redevelopment Plans is effective. SECTION 4: The current time limit on paying indebtedness or receiving property taxes pursuant to each of the Redevelopment Plans and CRL(except for the Bristol Redevelopment Plan which is ineligible for the extension) is hereby extended by one year (from the existing time limit as set forth below) and the Agency is hereby authorized to act with respect thereto during such extended period. Central Cit Jul 2,2014 2,2015 2,2024 Inter-Cit Jul 6, 2023 6,2024 6,2033 North Harbor Jul 6, 2023 6, 2024 6, 2033 South Harbor Jul 6, 2023 6, 2024 6, 2033 South Main Jul 6, 2023 6, 2024 6, 2033 Bristol* Dec. 4, 2030 Dec. 4, 2030 Dec. 4, 2040 * Not eligible for one year extension under SB 1096 2,2025 6,2034 6,2034 6,2034 Jul 6,2034 Dec. 4, 2040 SECTION 5. The legislative body has determined that the Agency is in compliance with the requirements of section 33334.2; the Agency has adopted an implementation plan in accordance with the requirements of section 33490; the agency is in compliance with the requirements of subdivisions (a) and (b) of section 33413; and the Agency is not subject to sanctions for failure to expend, encumber, or disburse an excess surplus pursuant to section 33334.12(e). SECTION 6. The legislative body hereby finds that notice of the public hearing has been mailed to the governing bodies of the affected taxing entities and 4 JT75C-8 published in a newspaper of general circulation at least once, not less than ten (10) days prior to the date of the public hearing. SECTION 7. The legislative body hereby finds that funds used to make the payment to the county's Educational Revenue Augmentation Fund pursuant to section 33681.12 would otherwise have been used to pay the costs of projects and activities necessary to carry out the goals and objectives of the redevelopment plan. SECTION 8: If any section, subsection, sentence, clause, phrase or word of this Ordinance is for any reason held to be invalid by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed and adopted this Ordinance, and each and all provisions hereof, irrespective of the fact that one or more provisions may be declared invalid. 5 JT75C-9 ADOPTED this day of ,2005. Miguel A. Pulido Mayor APPROVED AS TO FORM: Joseph W. Fletcher City Attorney By: Lisa E. Storck Assistant City Attorney AYES: Councilmembers NOES: Councilmembers ABSTAIN: Councilmembers NOT PRESENT: Councilmembers CERTIFICATE OF ATTESTATION AND ORIGINALITY I, PATRICIA E. HEALY, Clerk of the Council, do hereby attest to and certify the attached Ordinance No. NS-2685 to be the original ordinance adopted by the City Council of the City of Santa Ana on , 2005, and that said ordinance was published in accordance with the Charter of the City of Santa Ana. Date: Clerk of the Council City of Santa Ana 6 JT75C-10