HomeMy WebLinkAboutDue Diligence Review of Non-Housing Redevelopment Funds Publ AGENDA REPORT
Oversight Board of the Huntington Beach Successor Agency
to the Redevelopment Agency
MEETING DATE: January 8, 2013
SUBJECT/ACTION: Public Comment Session on the Due Diligence Review of
the Non-Housing Redevelopment Funds, Pursuant to Health and Safety Code Section
34179.5 and 34179.6 [Assembly Bill 14841
RECOMMENDED ACTION: Motion to:
1) Receive public comment on the Due Diligence Review for the Non-Housing
Redevelopment Funds as required by Health and Safety Code Section 34179.6
(Assembly Bill 1484).
2) Receive and File the Due Diligence Review for the Non-Housing Redevelopment
Funds in anticipation of consideration of resolution of approval at January 15,
2013, Oversight Board meeting.
BACKGROUND:
The Oversight Board is to receive public comment on the due diligence review of the
Non-Housing Funds of the dissolved Huntington Beach Redevelopment Agency
(Agency) in anticipation of formal action by the Oversight Board to approve the due
diligence review at its meeting on January 15, 2013. State law requires the Oversight
Board to first receive public comment on the due diligence review and then hold a
second meeting at least five business days later to take formal action to approve the
due diligence review.
The attached Independent Accountant's Report on Applying the Agreed-Upon
Procedures on the Successor Agency to the dissolved Huntington Beach
Redevelopment Agency, except its Low and Moderate Income Housing Fund (Report)
presents the results of this review.
The Report was provided to the County Auditor-Controller, the State Controller and the
Department of Finance (Department) on January 7, 2013 in accordance with the
provisions of AB 1484. By January 15, 2013, the Oversight Board is required to review,
approve, and transmit to the Department and the County Auditor-Controller the
determination of the due diligence review for the Non-Housing Funds including the
amount of cash that is available for disbursement (which, in Huntington Beach's case, is
zero).
Oversight Board Meeting
January 8, 2013
Page 2 of 3
ANALYSIS:
On June 27, 2012, the Governor signed AB 1484 modifying provisions of the Dissolution
Act and imposing new requirements on successor agencies. Section 34177(d) of the
Health and Safety Code requires successor agencies to remit unobligated balances of
redevelopment agency funds to the County Auditor-Controller for distribution to the
taxing entities. Section 34179.5 to the Health and Safety Code requires successor
agencies to hire a licensed accountant, approved by the County Auditor-Controller and
with experience and expertise in local government accounting, to conduct two due
diligence reviews as noted below to determine the unobligated balances available for
transfer to taxing entities. The accounting firm Vavrinek, Trine, Day & Co., LLP (VTD)
was retained by the City and approved by the County of Orange to perform the required
due diligence reviews.
Two due diligence reviews are required to be performed: one for the Housing Funds,
and one for Non-Housing funds. The report for the Housing Funds was completed and
approved by the Oversight Board at its last meeting held on November 16, 2012. The
Department completed its review of that report and made adjustments that the
Successor Agency is challenging through the Meet and Confer process. This report is
for the Non-Housing Funds review and has been completed and submitted to the
County and State and is now being presented to the Oversight Board as required by
State law.
Section 34179.5 of the Health and Safety Code identifies the general requirements of
the due diligence reviews. After its review of the law, the Governmental Accounting and
Auditing Committee of the California Society of Certified Public Accountants developed
Agreed-Upon Procedures to satisfy these requirements with input from the State
Controller's Office and the Department. The procedures include identifying assets
transferred to the Successor Agency, the City, other public agencies or private parties;
identifying assets remaining; and calculating the remaining balance available. The firm
followed these procedures in determining there are no Non-Housing Funds of the
dissolved Agency to be distributed to the taxing entities.
As required by Section 34179.6 of the Health and Safety Code, staff submitted the due
diligence review for the Non-Housing Funds to: the Oversight Board, the State
Controller, the Department, and the County Auditor-Controller. By January 15, 2013,
the Oversight Board is required to review, approve, and transmit to the Department and
the County Auditor-Controller the determination of the amount of cash that is available
for disbursement from the Non-Housing Funds. As confirmed in Exhibit C-5 of the
Report, there is no cash available for disbursement.
The Oversight Board is required to convene a public comment session at least five
business days prior to the Oversight Board approving the due diligence review. Today's
meeting is being held to convene the public comment session as required by law. The
next Oversight Board meeting is scheduled for January 15, 2013 for the purpose of
requesting the Oversight Board's approval of the due diligence review for transmittal to
the required parties.
ATTACHMENT:
Independent Accountant's Report on Applying Agreed-Upon Procedures on the
Successor Agency to the Huntington Beach Redevelopment Agency, except its Low
and Moderate Income Housing Fund was not available in time for distribution with the
packet so will be made available as a Supplemental Communication upon its
completion.
�o
A�
o�
0
City of Huntington Beach
Redevelopment Successor Agency
Independent Accountants' Report on Applying
Agreed-Upon Procedures pursuant to
AB 1484 (All Other Funds)
September 30,2012
zt
o4)—
INDEPENDENT ACCOUNTANTS' REPORT ON
APPLYING AGREED-UPON PROCEDURES
Oversight Board of the
City of Huntington Beach Redevelopment Successor Agency
Huntington Beach, California
We have performed the Agreed-Upon Procedures enumerated in Exhibit A, which were agreed to by the
California State Controller's Office,the California Department of Finance,the County Auditor-Controller, and the
City of Huntington Beach Redevelopment Successor Agency (Successor Agency) to determine the Successor
Agency's Redevelopment Funds, ("All Other Funds") unobligated balances that are available for transfer to taxing
entities, solely to assist you in ensuring that the Successor Agency is complying with its statutory requirements
with respect to Health and Safety Code Section 34179.5. Management of the Successor Agency is responsible for
the accounting records pertaining to statutory compliance pursuant to Health and Safety Code Section 34179.5.
This Agreed-Upon Procedures engagement was conducted in accordance with attestation standards established by
the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the
responsibility of those parties specified in the report. Consequently, we make no representation regarding the
sufficiency of the procedures described below either for the purpose for which this report has been requested or
for any other purpose. If
Exhibit A,Exhibit B and Exhibits C through C-5 identify the procedures and findings.
We were not engaged to and did not conduct an audit, the objective of which would be the expression of an I
opinion as to the appropriateness of the results summarized in Exhibit A, Exhibit B, and Exhibits C through C-5.
Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might
have come to our attention that would have been reported to you.
This report is intended solely for the information and use of the Successor Agency Oversight Board, the
Successor Agency, the California State Controller's Office,the California Department of Finance, and the County
Auditor-Controller, and is not intended to be and should not be used by anyone other than these specified parties.
This restriction is not intended to limit distribution of this report,which is a matter of public record.
Laguna Hills, California,
December 26,2012
'i
1
I
EXHIBIT A
CITY OF HUNTINGTON BEACH REDEVELOPMENT SUCCESSOR AGENCY C011�
AGREED UPON PROCEDURES
PURSUANT TO AB 1484-ALL OTHER FUNDS �7r0
70
Our findings and procedures are as follows:
A.. All other funds of the Successor Agency
For the Successor Agency Funds(excluding the Low and Moderate Income Housing Fund),the following
procedures were performed:
1. Obtain from the Successor Agency a listing of all assets that were transferred from the former
redevelopment agency to the Successor Agency on February 1,2012. Agree the amounts on this listing to
account balances established in the accounting records of the Successor Agency. Identify in the Agreed-
Upon Procedures (AUP) report the amount of the assets transferred to the Successor Agency as of that
date.
Findings - We obtained from the Successor Agency a listing of all assets that were transferred
from the former redevelopment agency(RDA) to the Successor Agency's Redevelopment Funds
on February 1,2012. We agreed the amounts on this listing to account balances established in the
accounting records of the Successor Agency noting the total balance of all assets that were
transferred to the Successor Agency on Feburaryl, 2012, was $ 12,246,191.80 and consisted of
cash and cash equivalents, cash with fiscal agent, loans receivables and land held for resale.
Additionally, we noted that capital assets in the form of real property were transferred on
September 30, 2012, in the amount of$6,988,462 consisting of land held for resale and parcel of
land from the former Redevelopment Agency to the Successor Agency Redevelopment Funds.
2. If the State Controller's Office has completed its review of transfers required under both Sections 34167.5
and 34178.8 and issued its report regarding such review, attach a copy of that report as an exhibit to the
AUP report. If this has not yet occurred, perform the following procedures.
A. Obtain a listing prepared by the Successor Agency of transfers (excluding payments for goods and
services) from the former redevelopment agency to the city, county, or city and county that formed
the redevelopment agency for the period from January 1, 2011 through January 31, 2012. For each
transfer,the Successor Agency should describe the purpose of the transfer and describe in what sense
the transfer was required by one of the Agency's enforceable obligations or other legal requirements.
Provide this listing as an attachment to the AUP report.
B. Obtain a listing prepared by the Successor Agency of transfers (excluding payments for goods and
services) from the Successor Agency to the city, county, or city and county that formed the
redevelopment agency for the period from February 1, 2012 through September 30, 2012. For each
transfer,the Successor Agency should describe the purpose of the transfer and describe in what sense
the transfer was required by one of the Agency's enforceable obligations or other legal requirements.
Provide this listing as an attachment to the AUP report.
2
O
EXHIBIT A
CITY OF HUNTINGTON BEACH REDEVELOPMENT SUCCESSOR AGENCY CO,o
AGREED UPON PROCEDURES O7
PURSUANT TO AB 1484-ALL OTHER FUNDS
C. For each transfer, obtain the legal document that formed the basis for the enforceable obligation that �70
required any transfer. Note in the AUP report the absence of any such legal document or the absence
of language in the document that required the transfer.
Findings — The Successor Agency noted that the State Controller's Office has not completed a
review of transfers required under both Health and Safety Code (HSC) Sections 34167.5 and
34178.8. The Successor Agency also asserted that transfers were made from the former RDA to
the City in the amount of$18,840,952 during the period of January 1, 2011 to January 31, 2012. I�
$4,817,951 was for loan payments to the General Fund for land purchases made on the RDA's f
behalf by the General Fund, pursuant to Health and Safety Code (HSC) Sections 33220, 33600,
33601 & 336610. In addition, on March 30, 2011, pursuant to Resolution# 2011-17 (City) and
388 (RDA), the RDA transferred $14,023,000 worth of capital assets to the City. A list of the
transfers for the period of January 1, 2011 to January 31, 2012 is included as Exhibit C of the
AUP Report.
The Successor Agency asserted between February 1, 2012 and September 30, 2012, the City
transferred assets back to the Successor Agency Fund from the City in accordance with
Resolution # 2012-98. This resolution required the City to transfer assets of the former RDA,
from the City of Huntington Beach to the Successor Agency Redevelopment Fund. This
resolution reversed the transfer made in accordance with Resolution # 2011-17, as noted
previously. We noted the total assets transferred back from the City of Huntington Beach to the
Successor Agency was $14,023,000. A listing of the transfer for the period February 1, 2012 I
through September 30, 2012,is included as Exhibit C of the AUP Report.
3. If the State Controller's Office has completed its review of transfers required under both Sections 34167.5
and 34178.8 and issued its report regarding such review, attach a copy of that report as an exhibit to the
AUP report. If this has not yet occurred, perform the following procedures:
A. Obtain a listing prepared by the Successor Agency of transfers (excluding payments for goods and
services) from the former redevelopment agency to any other public agency or to private parties for
the period from January 1, 2011 through January 31, 2012. For each transfer, the Successor Agency
should describe the purpose of the transfer and describe in what sense the transfer was required by
one of the Agency's enforceable obligations or other legal requirements. Provide this listing as an
attachment to the AUP report.
B. Obtain a listing.prepared by the Successor Agency of transfers (excluding payments for goods and
services) [from the Successor Agency to any other public agency or private parties for the period 4
from February 1,2012 through September 30,2012. For each transfer,the Successor Agency should
describe the purpose of the transfer and describe in what sense the transfer was required by one of
the Agency's enforceable obligations or other legal requirements. Provide this listing as an
attachment to the AUP report.
3
EXHIBIT A
CITY OF HUNTINGTON BEACH REDEVELOPMENT SUCCESSOR AGENCY �01.0
AGREED UPON PROCEDURES
PURSUANT TO AB 1484-ALL OTHER FUNDS �77
C. For each transfer, obtain the legal document that formed the basis for the enforceable obligation that 70
required any transfer. Note in the AUP report the absence of any such legal document or the absence
of language in the document that required the transfer.
Findings — The Successor Agency asserted the State Controller's Office has not completed a
review of transfers required under both Sections 34167.5 and 34178.8. The Successor Agency
also asserted no transfers were made from the former RDA or the Successor Agency to any other
public agency or to private parties for the period from January 1, 2011 through January 31,2012,
and the period from February 1,2012 through September 30,2012, respectively.
4. Perform the following procedures:
A. Obtain from the Successor Agency a summary of the financial transactions of the Redevelopment
Agency and the Successor Agency in the format set forth in the attached schedule for the fiscal
periods indicated in the schedule. For purposes of this summary, the financial transactions should be
presented using the modified accrual basis of accounting. End of year balances for capital assets (in
total) and long-term liabilities (in total) should be presented at the bottom of this summary schedule
for information purposes.
B. Ascertain that for each period presented, the total of revenues, expenditures, and transfers accounts
fully for the changes in equity from the previous fiscal period.
C. Compare amounts in the schedule relevant to the fiscal year ended September 30, 2010, to the State
Controller's Report filed for the Redevelopment Agency for that period.
D. Compare amounts in the schedule for the other fiscal periods presented to account balances in the
accounting records or other supporting schedules. Describe in the report the type of support provided
for each fiscal period.
Findings—We obtained from the Successor Agency a summary of the financial transactions. We
determined through recalculation that the total of revenues, expenditures and transfers fully
accounts for the changes in equity from the previous fiscal periods. The amounts in the schedule
for September 30, 2010 and September 30, 2011, were agreed to the State Controller's Report
filed by the Redevelopment Agency. In addition, we agreed the amounts from fiscal year ending
September 30, 2011 to the audited Component Unit Financial Report, rounded to the thousands.
We agreed the periods ended January 31,2012 and September 30,2012,to the accounting records
of the former Redevelopment Agency and the Successor Agency, respectively. The summary of
financial transactions is included as Exhibit B of the AUP Report.
4
0
EXHIBIT A
CITY OF HUNTINGTON BEACH REDEVELOPMENT SUCCESSOR AGENCY c04
AGREED UPON PROCEDURES
PURSUANT TO AB 1484- ALL OTHER FUNDS �j
�O
5. Obtain from the Successor Agency a listing of all assets of the Low and Moderate Income Housing Fund
as of September 30, 2012 for the report that is due October 1, 2012 and a listing of all assets of all other
funds of the Successor Agency as of September 30, 2012 (excluding the previously reported assets of the
Low and Moderate Income Housing Fund) for the report that is due December 15, 2012. When this
procedure is applied to the Low and Moderate Income Housing Fund, the schedule attached as an exhibit I
will include only those assets of the Low and Moderate Income Housing Fund that were held by the
Successor Agency as of September 30, 2012 and will exclude all assets held by the entity that assumed
the housing function previously performed by the former redevelopment agency. Agree the assets so
listed to recorded balances reflected in the accounting records of the Successor Agency. The listings
should be attached as an exhibit to the appropriate AUP report.
Findings — For the Successor Agency Other Funds, we agreed the assets listed to the recorded
balances reflected in the Successor Agency's accounting records. We noted the asset balances of
the "All Other Funds" as of September 30, 2012, was $30,097,087 consisting of cash and cash
equivalents, cash with fiscal agent, loans receivables, land, and land held for resale. See Exhibit
C-1 for the listing of assets of the"All Other Funds" as of September 30,2012.
6. Obtain from the Successor Agency a listing of asset balances held on September 30, 2012, that are
restricted for the following purposes:
A. Unspent bond proceeds:
i. Obtain the Successor Agency's computation of the restricted balances (e.g., total proceeds less
eligible project expenditures, amounts set aside for debt service payments,etc.).
ii. Trace individual components of this computation to related account balances in the accounting
records, or to other supporting documentation (specify in the AUP report a description of such
documentation).
iii. Obtain from the Successor Agency a copy of the legal document that sets forth the restriction
pertaining to these balances. Note in the AUP report the absence of language restricting the use
of the balances that were identified by the Successor Agency as restricted.
B. Grant proceeds and program income that are restricted by third parties:
i. Obtain the Successor Agency's computation of the restricted balances (e.g., total proceeds less
eligible project expenditures).
ii. Trace individual components of this computation to related account balances in the accounting
records, or to other supporting documentation (specify in the AUP report a description of such
documentation).
iii. Obtain from the Successor Agency a copy of the grant agreement that sets forth the restriction
pertaining to these balances. Note in the AUP report the absence of language restricting the use
of the balances that were identified by the Successor Agency as restricted.
C. Other assets considered to be legally restricted:
i. The Successor Agency's computation of the restricted balances (e.g., total proceeds less eligible
project expenditures).
ii. Trace individual components of this computation to related account balances in the accounting
records, or to other supporting documentation (specify in the AUP report a description of such
documentation).
iii. Obtain from the Successor Agency a copy of the legal document that sets forth the restriction
pertaining to these balances. Note in the AUP report the absence of language restricting the use
of the balances that were identified by Successor the Agency as restricted.
5
o,�
EXHIBIT A
CITY OF HUNTINGTON BEACH REDEVELOPMENT SUCCESSOR AGENCY �0.6
AGREED UPON PROCEDURES 0
PURSUANT TO AB 1484-ALL OTHER FUNDS 0_7
D. Attach the above mentioned Successor Agency prepared schedule(s) as an exhibit to the AUP report. 70
For each restriction identified on these schedules, indicate in the report the period of time for which
the restrictions are in effect. If the restrictions are in effect until the related assets are expended for
their intended purpose,this should be indicated in the report.
Findings —The Successor Agency asserted that assets totaling $2,422,613 were restricted as the
assets represented debt service reserve requirements. We were provided copies of the official
statements related to the bond reserves.- We traced the recorded balances to the accounting
records of the Successor Agency, noting no exceptions. See Exhibit C-2 of the AUP Report for a
listing of assets that are legally restricted.
7. Perform the following procedures:
A. Obtain from the Successor Agency a listing of assets as of September 30, 2012, that are not liquid or
otherwise available for distribution(such as capital assets, land held for resale, long-term receivables,
etc.) and ascertain if the values are listed at either purchase cost(based on book value reflected in the
accounting records of the Successor Agency) or market value as recently estimated by the Successor
Agency.
B. If the assets listed at 7(A) are listed at purchase cost, trace the amounts to a previously audited
financial statement(or to the accounting records of the Successor Agency) and note any differences.
C. For any differences noted in 7(B), inspect evidence of disposal of the asset and ascertain that the
proceeds were deposited into the Successor Agency trust fund. If the differences are due to additions
(this generally is not expected.to occur), inspect the supporting documentation and note the
circumstances.
D. If the assets listed at 7(A) are listed at recently estimated market value, inspect the evidence (if any)
supporting the value and note the methodology used. If no evidence is available to support the value
and/or methodology,note the lack of evidence.
Findings — The Successor Agency asserted that the Successor Agency Redevelopment Funds
have land parcels totaling $15,033,359, land held for resale totaling $5,978,103, and notes
receivables totaling $.158,988 that are considered non-liquid assets. The parcels have been
transferred to the Successor Agency at historical cost and notes receivables were transferred at
current receivable value. We traced the non-liquid assets to the accounting records of the
Successor Agency noting no exceptions. The total of non-liquid assets is $21,170,451. A listing
of the non-liquid assets is included at Exhibit C-3 of the AUP Report.
6
t
f
O !
EXHIBIT A /X
CITY OF HUNTINGTON BEACH REDEVELOPMENT SUCCESSOR AGENCY O,o
AGREED UPON PROCEDURES D
PURSUANT TO AB 1484-ALL OTHER FUNDS 7,D I
8. Perform the following procedures: 70
A. If the Successor Agency believes that asset balances need to be retained to satisfy enforceable
I
obligations, obtain from the Successor Agency an itemized schedule of asset balances (resources) as
of September 30, 2012 that are dedicated or restricted for the funding of enforceable obligations and
perform the following procedures. The schedule should identify the amount dedicated or restricted, j
the nature of the dedication or restriction, the specific enforceable obligation to which the dedication
or restriction relates, and the language in the legal document that is associated with the enforceable
obligation that specifies the dedication of existing asset balances toward payment of that obligation.
4
i. Compare all information on the schedule to the legal documents that form the basis for the
dedication or restriction of the resource balance in question. I
ii. Compare all current balances to the amounts reported in the accounting records of the Successor
Agency or to an alternative computation.
iii. Compare the specified enforceable obligations to those that were included in the final Recognized
Obligation Payment Schedule approved by the California Department of Finance.
iv. Attach as an exhibit to the report the listing obtained from the Successor Agency. Identify in the
report any listed balances for which the Successor Agency was unable to provide appropriate
restricting language in the legal document associated with the enforceable obligation.
B. If the Successor Agency believes that future revenues together with balances dedicated or restricted to
an enforceable obligation are insufficient to fund future obligation payments and thus retention of
current balances is required, obtain from the Successor Agency a schedule of approved enforceable i
obligations that includes a projection of the annual spending requirements to satisfy each obligation
and a projection of the annual revenues available to fund.those requirements and perform the G
following procedures:
i. Compare the enforceable obligations to those that were approved by the California Department of
Finance. Procedures to accomplish this may include reviewing the letter from the California I
Department of Finance approving the Recognized Enforceable Obligation Payment Schedules for
the six month period from January 1, 2012 through September 30, 2012, and for the six month
period July 1,2012 through December 31,2012.
ii. Compare the forecasted annual spending requirements to the legal document supporting each
enforceable obligation.
a. Obtain from the Successor Agency its assumptions relating to the forecasted annual spending
requirements and disclose in the report major assumptions associated with the projections.
iii. For the forecasted annual revenues:
a. Obtain from the Successor Agency its assumptions for the forecasted annual revenues and
disclose in the report major assumptions associated with the projections.
7
EXHIBIT A �z..
CITY OF HUNTINGTON BEACH REDEVELOPMENT SUCCESSOR AGENCY 004
AGREED UPON PROCEDURES
PURSUANT TO AB 1484-ALL OTHER FUNDS �77;
C?
C. If the Successor Agency believes that projected property tax revenues and other general purpose �7�
revenues to be received by the Successor Agency are insufficient to pay bond debt service payments
(considering both the timing and amount of the related cash flows), obtain from the Successor
Agency a schedule demonstrating this insufficiency and apply the following procedures to the
information reflected in that schedule.
i. Compare the timing and amounts of bond debt service payments to the related bond debt service
schedules in the bond agreement.
ii. Obtain the assumptions for the forecasted property tax revenues and disclose major assumptions
associated with the projections.
iii. Obtain the assumptions for the forecasted other general purpose revenues and disclose major
assumptions associated with the projections.
D. If procedures A, B, or C were performed, calculate the amount of current unrestricted balances
necessary for retention in order to meet the enforceable obligations by performing the following
procedures.
i. Combine the amount of identified current dedicated or restricted balances and the amount of
forecasted annual revenues to arrive at the amount of total resources available to fund enforceable
obligations.
ii. Reduce the amount of total resources available by the amount forecasted for the annual spending
requirements. A negative result indicates the amount of current unrestricted balances that needs
to be retained.
iii. Include the calculation in the AUP report.
Findings — We obtained the schedule of asset balances that need to be retained to satisfy
enforceable obligations. The Successor Agency identified that $6,494,023 needed to be retained
to satisfy enforceable obligations on the ROPS II & III. The ROPS items were approved by the
Department of Finance. A schedule of asset balances retained is at Exhibit C-4 of the AUP
Report including two items that are the subject of meet and confer procedures with the DOF.
9. If the Successor Agency believes that cash balances as of September 30, 2012, need to be retained to
satisfy obligations on the Recognized Obligation Payment Schedule (ROPS) for the period of July 1,
2012 through September 30,2013, obtain a copy of the final ROPS for the period of July 1,2012 through
December 31, 2012, and a copy of the final ROPS for the period January 1, 2013 through September 30,
2013. For each obligation listed on the ROPS, the Successor Agency should add columns identifying(1)
any dollar amounts of existing cash that are needed to satisfy that obligation, and (2) the Successor
Agency's explanation as to why the Successor Agency believes that such balances are needed to satisfy
the obligation. Include this schedule as an attachment to the AUP report.
Findings — The Successor Agency asserted that cash balances as of September 30, 2012, do not
need to be retained to satisfy obligations on the ROPS for the period of October 1, 2011 through
September 30,2012. As such,the procedures noted above were not performed.
8
EXHIBIT A 1>1 C
CITY OF HUNTINGTON BEACH REDEVELOPMENT SUCCESSOR AGENCY �O,o
AGREED UPON PROCEDURES
PURSUANT TO AB 1484-ALL OTHER FUNDS 0
�D
10. Include (or present) a schedule detailing the computation of the Balance Available for Allocation to &I.,��
Affected Taxing Entities. Amounts included in the calculation should agree to the results of the procedures
performed in each section above. The schedule should also include a deduction to recognize amounts
already paid to the County Auditor-Controller on July 12, 2012, as directed by the California Department
of Finance. The amount of this deduction presented should be agreed to evidence of payment. The
attached example summary schedule may be considered for this purpose. Separate schedules should be
completed for the Low and Moderate Income Housing Fund and for all other funds combined (excluding
the Low and Moderate Income Housing Fund).
Findings — We have included a schedule detailing the computation of the Balance Available for
Allocation to Affected Taxing Entities. See Exhibit C-5.
11. Obtain a representation letter from Successor Agency management acknowledging their responsibility for
the data provided to the practitioner and the data presented in the report or in any attachments to the
report. Included in the representations should be an acknowledgment that management is not aware of
any transfers (as defined by Section 34179.5) from either the former redevelopment agency or the
Successor Agency to other parties for the period from January 1, 2011 through September 30, 2012 that
have not been properly identified in the AUP report and its related exhibits. Management's refusal to sign
the representation letter should be noted in the AUP report as required by attestation standards.
Findings — The Successor Agency provided a management representation letter. No exceptions
were noted.
9
City of Huntington Beach Redevelopment Successor Agency Exhibit B�O
Pursuant To AB 1484-All Other Funds A—
Summary of Financial Transactions
Unaudited Unaudited 07/0
Redevelopment Redevelopment Redevelopment Successor
Agency Agency Agency Agency 7�
12 Months Ended 12 Months Ended 4 Months Ended 8 Months Ended
9/30/10 9/30/11 1/31/2012 9/30/12
(modified accrual) (modified accrual) (modified accrual) (full accrual)
Assets
Cash and Investments $ 11,175,988 $ 6,795,373 $ 14,001,933 $ 6,494,023
Cash with Fiscal Agent 2,402,319 2,450,681 3,039,273 2,422,613
Tax Increment Receivable 4,509,650 3,866,063 - -
Accounts Receivable 753,399 78,826 -
Accrued Interest Receivable 37,060 19,239 -
Loans Receivable 8,070,000 10,334,925 10,383,647 158,988
Due from Capital Projects Fund 1,823,575 1,836,536 1,362,614 -
Due from Debt Service Fund 4,507,706 5,514,257 3,927,706
Other Assets(Advances to Other Funds) 302,489 - - -
Land Held for Resale 6,158,399 - - 5,978,103
Total Assets $ 39,740,585 $ 30,895,900 $ 32,715,173 $ 15,053,727
Liabilities
Accounts Payable $ 217,065 $ 3,226,481 $ 923,638 $ 8,846
Deposits Payable - - 114,981 114,981
Other Liabilities 3,773,291 - - -
Deferred Revenue 10,353,740 10,219,516 10,219,516
Due to Capital Projects Fund 659,961 1,570,473 -
Due to Debt Service Fund 1,081,000 5,780,320 - -
Due to Low/Mod Income housing Fund 4,590,320 - 5,290,320 5,290,320
Total Liabilities $ 20,675,377 $ 20,796,790 $ 16,548,455 $ 5,414,147
Equity 19,065,208 10,099,110 16,166,718 9,639,580
Total Liabilities+Equity $ 39,740,585 $ 30,895,900 $ 32,715,173. $ 15,053,727
Total Revenues: $ 22,823,373 $ 19,236,576 $ 7,313,828 $ 3,491,464
Total Expenditures/Expenses: $ 31,336,767 $ 28,202,674 $ 1,246,220 $ 5,691,012
Total Transfers: $ - $ $ - $
Total Extraordinary Items: $ $ $ - $ 11,839,128
Net change in equity $ (8,513,394) $ (8,966,098) $ 6,067,608 $ 9,639,580 .
Beginning Equity: $ 27,578,602 $ 19,065,208 $ 10,099,110 $
Ending Equity: $ 19,065,208 $ 10,099,110 $ 16,166,718 $ 9,639,580
Otber Information(show year end balances for all three years presented):
Capital assets as of end of year $ 48,777,000 $ - $ - $ 15,033,359
Long-term debt as of end of year $ 139,237,000 $ 133,399,000 $ 129,490,040 $ 140,033,942
*amounts are net of accumulated depreciation.
10
111>1
Cityof Huntington Beach Redevelopment Successor Agency Exhibit C Pursuant To All O
1484-All Other Funds
Schedule of Asset Transfers to the City,County,or City and County,and Other Public Agencies or Private Parties
S VALUE OF S VALUE OF ASSETS SOURCE DOC OJT
DATE OF TRANSFER DESCRIPTION OF ASSETS RECIPIENT ASSETS TRANSFERRED NOT SUPPORTED PURPOSE OFTRANSFER BASIS FOR TRANSFER 01�
Period of Jan 1,2011 Ilvrough Jan 31,2012 CT 7
1/1/2011 Cash City of Huntington Beach $ 409,483 Payment of loan oustanding to Health and Safely Code Sections 33220,
General Fund the City for thejoint purchase 33600,33601,336610
ofland
2/28/2011 Cash City of Huntington Beach 409,483 Payment of loan oustanding to Health and Safely Code Sections 33220,
General Fund the City for the joint purchase 33600,33601,336610
ofland
3/7/2011 Cash City of Huntington Beach 2,456,900 Payment of loan oustanding to Health and Safely Code Sections 33220,
General Fund the City for the joint purchase 33600,33601,336610
ofland
3/312011 Cash City of Huntington Beach 409,483 payment of loan oustanding to Health and Safety Code Sections 33220,
General Fund the City for the joint purchase 33600,33601,336610
ofland
9/29/2011 Cash City of Huntington Beach 1,132,602 Payment of loan oustanding to Health and Safety Code Sections 33220,
General Fund the City for the joint purchase 33600,33601,336610
ofland
3/7/2011 Waterfront City of Huntington Beach 14,023,000 Resolution#2011-17 Ground lease by and between the
See Footnote 1 Redevelopment Agency of the City of
Huntington Beach and PCH Beach Resort,
LLC dated April 4,2001,City Council
Resolutions#2011-17&2011-18 and
Redevelopment Agency Resolution#'s 387
&388.
Period of Feb 1,2012 through September 30,2012
9/30/2012 Waterfront City of Huntington Beach (14,023,000) Footnote 1 Reversal of transfer for ground lease
TOTAL $ 4,817,952 $
Footnote 1 City of Huntington Beach adopted resolution#2012-98.This resolution required the City to transfer certain assets of the former
Redevelopment Agency(RDA)to the Successor Agency Fund on September 30,2012.This resolution reversed the transfer
made in accordance with Resolution#2011-17,as noted above.
11
ibit C-1
City of Huntington Beach Redevelopment Successor Agency 11�—
All Other Funds-Listing of Assets 07
�O
As of September 30,2012-Unaudited Cp,
70
Note: Excludes all assets held by the entity that assumed the housing function of the former RDA
Assets
Cash and investments
Cash with Treasurer $ 6,494,023
Total $ 6,494,023
Cash/investments w/Fiscal Agent
1999 TABS Cash with Fiscal Agent 753,775
202 TABS Cash with Fiscal Agent 1,668,838
Total 2,422,613
Other assets
Auto BID Loan Receivable 43,572
NF Loan Receivable 115,416
Land 15,033,359
Land Held for Resale 5,978,104
Total 21,170,451
TOTAL ASSETS AT 9/30/2012; $ 30,087,087
* Includes the$14,023,000 land as noted in Exhibit C.
12
0
City of Huntington Beach Redevelopment Successor Agency C&hibit C-2
Pursuant To AB 1484-All Other Funds �4�
Legally Restricted Amounts QJ
PERIOD OfOo
ITEM DESCRIPTION ACCOUNT AMOUNT PURPOSE/DOC SOURCE/LEGAL DOCUMENT RESTRICTION
A Unspent Bond Proceeds
None
B Grant proceeds and program income restrict by third parties
None
C Other assets/Debt Service
a 1999 TABS Bond Reserve 35010835 $ 753,775 1999 Tax Allocation Bonds Official Statement dated January August 1, 2024
held with Fiscal Agent 12, 1999 debt reserve funds
b 2002 TABS Bond Reserve 35010845 1,668,838 2002 Tax Allocation Bonds Official Statement dated June 19, August 1, 2024
held with Fiscal Agent 2002 debt reserve funds
Total $ 2,422,613
13
off,
City of Huntington Beach Redevelopment Successor Agency Eit C-3
Pursuant To AB 1484-All Other Funds ��—
Non Liquid Assets-All Other Funds �7
ITEM DESCRIPTION GL ACCT NO AMOUNT VALUE METHOD(COST OR MARKET)
A Capital Assets
a 10 foot remnant of land 661.18100 $ 259,000 Cost
b Surf Museum, 411 Olive Avenue 661.18100 286,301 Cost
c Gothard/Center(Westminster Parcel) 661.18100 465,059 Cost
d Waterfront 661.18100 14,023,000 Cost
B Land Held for Resale
a Center Ave. near McFadden 350.18160 1,084,074 Cost
b South side of Edinger Avenue and East of Parkside 350.18160 664,582 Cost
c Northwest corner of Aldrich and Parkside 350.18160 753,180 Cost
d 7872 Edinger Avenue 350.18160 3,476,267 Cost
C Long Term Receivables
a Auto BID Loan Receivable 350.14100, 350.14102 43,572 Current balance as of September 30, 2012
b NF Huntington Loan Receivable 350.14100,350,13299 115,416 Current balance as of September 30, 2012
Total $ 21,170,451
14
r
City of Huntington Beach Redevelopment Successor Agency `6xhibit C-4
Pursuant To AB 1484-All Other Funds �Q�
Schedule of Balances for Funding Enforceable Obligations O
Oc/,
OBLIGATION PROJECTION AMOUNT NEEDED TO
AMOUNT AS OF ANNUAL BE RETAINED FROM
APPROVED BY REV AVAIL TO SEPTEMBER 30,2012
ITEM PROJECT NAME/DEBT OBLIGATION ROPS LINE NO. DOF FUND RE,Q BALANCE
Note:Schedule should list only those obligations where future revenues together with balances dedicated/restricted are insufficient to fund future obligation payments
I ROPE II Enforceable Obligations Various $ 5,747,947 $ 3,428,586 $ -
2 ROPS III Enforceable Obligations Various 13,917,324 7,012,392 6,494,023.
$ 19,665,271 $ 10,440,978 $ 6,494,023
$ 6,494,023
15
City of Huntington Beach Redevelopment Successor Agency Exhib 5
Pursuant To AB 1484-All Other Funds
Summary of Balances Available for Allocation to Affected Taxing Entities Q
7iO
Reference: /�.
Total amount of assets held by the successor agency as of September 30,2012(procedure 5) $ 30,087,087 Exhibit C-1
Add the amount of any assets transferred to the city or other parties for which an enforceable
obligation with a third party requiring such transfer and obligating the use
of the transferred assets did not exist(procedures 2 and 3) -
Less assets legally restricted for uses specified by debt
covenants,grant restrictions,or restrictions imposed by other
governments(procedure 6) (2,422,613) Exhibit C-2
Less assets that are not cash or cash equivalents (e.g.,physical assets)-(procedure 7) (21,170,451) Exhibit C-3
Less balances that are legally restricted for the funding of an enforceable
obligation(net of projected annual revenues available to fund those obligations)-(procedure 8) (6,494,023) Exhibit C-4
Less balances needed to satisfy ROPS for the 2012-13 fiscal year(procedure 9)
Less the amount of payments made on July 12,2012 to the County Auditor-Controller as
directed by the California Department of Finance -
Amount to be remitted to county for disbursement to taxing entities $ (0)
16