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Home My WebLink AboutAdopt Successor Agency Resolution No. 2023-03 Approving an A (2) � NGro�� 2000 Main Street, Huntington Beach,CA " 92648 City of Huntington Beach v- - = APPROVED 7-0 ZCI. •°lµ.1A49'°-* COUNT File #: 23-727 MEETING DATE: 9/5/2023 REQUEST FOR SUCCESSOR AGENCY ACTION SUBMITTED TO: Honorable Chair and Board Members SUBMITTED BY: Al Zelinka, Executive Director VIA: Sunny Han, Chief Financial Officer PREPARED BY: Sunny Han, Chief Financial Officer Subject: Adopt Successor Agency Resolution No. 2023-03 approving an Amended Recognized Obligation Payment Schedule 23-24B for the FY 2023-24 Fiscal Period of January 1, 2024 to June 30, 2024, Subject to Submittal to, and Review by the Oversight Board and the State Department of Finance under California Health and Safety Code, Division 24, Part 1.85; and, Authorizing the Posting and Transmittal of the ROPS Statement of Issue: The Successor Agency is requested to approve the Amended Recognized Obligation Payment Schedule (ROPS) for the period January 1, 2024 through June 30, 2024. An approved ROPS must be submitted to the County of Orange Oversight Board by September 19, 2023, and then to the Department of Finance (DOF) by October 1, 2023. Financial Impact: The ROPS provides the County Auditor-Controller with the amount of the former Redevelopment Agency's enforceable obligations for which the Successor Agency anticipates incurring expenditures. Once approved by DOF, the Successor Agency will be entitled.to receive property tax revenue up to the amount of the DOF-approved enforceable obligations included in the Payment Schedule. The Amended ROPS requests an additional $10,000,000 in funds to support existing legally required enforceable obligations for FY 2023/24. Recommended Action: Adopt Successor Agency Resolution No. 2023-03, "A Resolution of The Successor Agency to the Redevelopment Agency of the City of Huntington Beach Approving an Amended Recognized Obligation Payment Schedule 23-24B for the FY 2023-24 Fiscal Period of January 1, 2024 to June 30, 2024, Subject to Submittal to, and Review by the Oversight Board and the State Department of Finance under California Health and Safety Code, Division 24, Part 1.85; and, Authorizing the Posting and Transmittal of the ROPS." Alternative Action(s): City of Huntington Beach Page 1 of 3 Printed on 8/31/2023 poweregn?y LegistarTM File #: 23-727 MEETING DATE: 9/5/2023 Do not approve the recommended action(s) and direct staff accordingly. Per Health and Safety Code Section 34177.7 (o)(1)(E), the Successor Agency may submit an amendment to the annual submitted ROPS to the Countywide Oversight Board and the Department of Finance no later than October 1st for the period under review. Analysis: As part of the 2011 Budget Act, as recommended by then Governor Jerry Brown, Legislature approved the dissolution of the State's Redevelopment Agencies. After litigation, the California Supreme Court's ruled on the Dissolution Act that all redevelopment agencies in California were dissolved effective February 1, 2012. The Dissolution Act, AB 1484, and related legislation describe the procedures to wind-down the affairs of the former redevelopment agencies. These provisions include the continued payment of recognized enforceable obligations as defined in the law. SB 107 modified the ROPS process and established an annual ROPS starting with ROPS 16-17 and provides for a one time amendment to annual ROPS. The ROPS is "the document setting forth the minimum payment amounts and due dates of payments required by enforceable obligations for each fiscal year as provided in subdivision (o) of Section 34177." The amendment to ROPS 23-24 covering the B period of January 1, 2024 to June 30, 2024, and the Amended ROPS 23-24B must be submitted to the DOF no later than October 1, 2023. The amended ROPS adds a request for funds in the amount of$10,000,000 to repay a portion of monies owed to the City to the former Redevelopment Agency for the purchase of real property in the Fiscal Year 1988-89. This loan was approved as an enforceable obligation by the California Superior Court on February 17, 2023. The total amount of the loan as of June 30, 2023 is $30,464,000, comprised of$22,400,000 in principal and $8,064,000 in accrued interest at the three percent interest rate permitted by Health and Safety Code Section 34191.4(3). The County Oversight Board and DOF has the authority to review the ROPS and return it to the Successor Agency for reconsideration and modification, or to disallow payment for a listed obligation. The County Oversight Board will review and approve the City's amended ROPS during its September 19, 2023 meeting. The City must submit the amendment to the State DOF by October 1, 2023. The State DOF will make its determination by April 15th. The City's ROPS will not be effective until approved by the State DOF. Environmental Status: Not applicable Strategic Plan Goal: Community Engagement Infrastructure and Parks Financial Sustainability, Public Safety or Other Attachment(s): 1. Resolution No. 2023-03, "A Resolution of The Successor Agency to the Redevelopment City of Huntington Beach Page 2 of 3 Printed on 8/31/2023 powered%LegistarM File #: 23-727 MEETING DATE: 9/5/2023 Agency of the City of Huntington Beach Approving an Amended Recognized Obligation Payment Schedule 23-24B for the FY 2023-24 Fiscal Period of January 1, 2024 to June 30, 2024, Subject to Submittal to, and Review by the Oversight Board and the State Department of Finance under California Health and Safety Code, Division 24, Part 1.85; and, Authorizing the Posting and Transmittal of the ROPS." 2. PowerPoint Presentation City of Huntington Beach Page 3 of 3 Printed on 8/31/2023 poweregi5}'LegistarTM RESOLUTION NO. 2023-03 A RESOLUTION OF THE SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH APPROVING AN AMENDED RECOGNIZED PAYMENT OBLIGATION SCHEDULE 23-24B FOR THE FY 2023-24 FISCAL PERIOD OF JANUARY 1, 2024 TO JUNE 3Q, 2024, SUBJECT TO SUBMITTAL TO, AND REVIEW BY THE OVERSIGHT BOARD AND THE STATE DEPARTMENT OF FINANCE UNDER CALIFORNIA HEALTH AND SAFETY CODE, DIVISION 24, PART 1.85; AND, AUTHORIZING THE POSTING AND TRANSMITTAL OF THE ROPS WHEREAS,the former Huntington Beach Redevelopment Agency ("Former Agency") previously was a community redevelopment agency that was previously organized and existing under the California Community Redevelopment Law,Health and Safety Code Section 33000, et seq., and previously authorized to transact business and exercise powers of a redevelopment agency pursuant to action of the City Council of the City of Huntington Beach ("City"); and WHEREAS, Assembly Bill xl 26 added Parts 1.8 and 1.85 to Division 24 of the California Health and Safety Code, which caused the dissolution of all redevelopment agencies and wind down of the affairs of former agencies, including as such laws were amended by Assembly Bill 1484 and by other subsequent legislation("Dissolution Law"); and WHEREAS, as of February 1, 2012 the Agency was dissolved pursuant to the Dissolution Law, and as a separate public entity, corporate and policy the Successor Agency to the Huntington Beach Redevelopment Agency("Successor Agency") administers the enforcement obligations of the Former Agency and otherwise unwinds the Former Agency's affairs; all subject to the review and approval by an oversight board("Oversight Board"); and WHEREAS, Section 34179 provides that the Oversight Board has fiduciary responsibilities to holders of enforceable obligations and the taxing entities that benefit from distributions of property tax and other revenues pursuant to Section 34188 of Part 1.85 of the Dissolution Law; and WHEREAS, Section 34177(m), 34177(o) and 34179 provide that each ROPS is submitted to, review and approved by the Successor Agency and then reviewed and approved by the Oversight Board final review and approval by the State Department of Finance ("DOF"); and WHEREAS, Section 34177(o)(1)(E) of the Dissolution Law authorizes that"[o]nce per period, and no later than October 1, a successor agency may submit one amendment to the [ROPS] approved by the department pursuant to this subdivision, if the oversight board makes a finding that a revision is necessary for the payment of approved enforceable obligations during the second one-half of the [ROPS] period,which shall be defined as January 1 to June 30, inclusive. A successor agency may only amend the amount requested for payment of approved enforceable obligations. The revised [ROPS] shall be approved by the oversight board and submitted to the department by electronic means in a manner of the department's choosing. The department shall notify the successor agency and the county auditor-controller as to the outcome of the department's review at least 15 days before the date of the property tax distribution"; and RESOLUTION NO. 2023-03 WHEREAS, pursuant to Sections 34179.6 and 34177(I)(2)(B),the Successor Agency is required to submit the ROPS to the DOF with copies to the County Administrative Officer,the County Auditor-Controller, and the State Controller's Office at the same time that the Successor Agency submits the ROPS to the Oversight Board for review; and WHEREAS,the Successor Agency has reviewed the draft Amended ROPS 23-24 B and desires to approve the Amended ROPS 23-24 B and to authorize the Successor Agency staff to transmit the Amended ROPS to the Oversight Board; and NOW, THEREFORE, the City Council of the City of Huntington Beach does hereby resolve as follows: SECTION 1. The foregoing recitals are incorporated into this Resolution by this reference, and constitute a material part of this Resolution. SECTION 2. Pursuant to the Dissolution Law,the Successor Agency approves the Amended ROPS 23-24 B,which schedule is incorporated herein by this reference; provided however, that the Amended ROPS 23-24 B is approved subject to transmittal of the Amended ROPS to the Oversight Board for review and approval with copies of the Amended ROPS to be sent concurrently to the DOF,the County Administrative Officer, the County Auditor-Controller, and the State Controller's Office. Further,the Community and Economic Development Director, or her designee, in consultation with legal counsel, is hereby authorized to make augmentations, modifications, additions or revisions as may be necessary or directed by DOF, and changes, if any, will be reported back to the Successor Agency and the Oversight Board. SECTION 3. After approval by the Oversight Board, the Successor Agency authorizes transmittal of the approved Amended ROPS 23-24 B to the DOF,the County Administrative Officer,the County Auditor-Controller, and the State Controller's Office. SECTION 4. The Chief Finance Officer, or her designee, is directed to post this Resolution, including the Amended ROPS 23-24 B, on the City/Successor Agency website pursuant to the Dissolution Law. SECTION 5. The Secretary of the Successor Agency shall certify to the adoption of this Resolution. /// /// /// /// /// /// /// /// /// 2 23-13370/317837 .RESOLUTION NO. 2023-03 PASSED AND ADOPTED by the Successor Agency to the Redevelopment Agency of the City of Huntington Beach at a regular meeting thereof held on the 5th day of September 2023. 1 :4"7 AIND Chairperson REVIE ' D ° D APP' •VED: ft, / Executive ire or APPROVED AS TO FORM: eneral Legal Counsel 3 23-13370/317837 RESOLUTION NO. 2023-03 EXHIBIT A RECOGNIZED OBLIGATION PAYMENT SCHEDULE 23-24 B FOR THE SIX-MONTH FISCAL PERIOD JANURY 1, 2024 TO JUNE 30, 2024 (attached) • 23-13370/317837 Huntington Beach ROPS 2023-24 Amended Summary. Detail Submission Authorized Requested Requested Funding for Obligations Amounts Adjustments Amended Total A Obligations Funded as Follows(B+c+D) 0 0 0 B Bond Proceeds 0 0 0 C Reserve Balance 0 0 0 D Other Funds 0 0 0 E Redevelopment Property Tax Trust Fund 3,520,500 10,000,000 13,520,500 (RPTTF)(F+G) F RPTTF 3,395,500 10,000,000 13,395,500 G Administrative RPTTF 125,000 0 125,000 H Current Period Obligations(A+E) 3,520,500 10,000,000 13,520,500 Huntington Beach ROPS 2023-24 Amended Summary Ode Submission Filter Export to EXCN AUTHORIZED AMOUNTS REQUESTED ADJUSTMENTS Total Outstanding Bond Reserve Other Admin Total Bond Reserve Other Admin Total Rem* Obligation Name Obligation Type Balance Proceeds Balance Funds RPTTF RPTTF Authorized Proceeds Balance Funds RPTTF RPTTF Adjusted Notes TOTAL 31,792,044 - - - 3,395,500 125,000 3,520,500 - - - 10,000,000 - 10,000,000 / 2 Hyatt Regency OPA/DDA/Construction - - - - - - - - - - - - - Huntington Beach Project / 3 2002 Tax Allocation Bonds Issued On or 2,575,000 - - - 19,500 - 19,500 - - - - - - Refunding Bonds Before 12/31/10 / 4 1999 Tax Allocation Bonds Issued On or 1,190,000 - - 9,000 - 9,000 - - - - - - Refunding Bonds Before 12/31/10 / 5 2002 Tax Allocation Fees 500 - - - - - . - - - - - Refunding Bonds / 6 1999 Tax Allocation Fees 500 - - - - - - - - - - - - Refunding Bonds / 8 2002 Tax Allocation Fees 1,600 - - - - - - - - - - - Refunding Bonds / 9 1999 Tax Allocation Fees 1,600 - - - - - - - - - - - - Refunding Bonds . / 12 Emerald Cove 2010 Bonds Issued On or 6,837,845 - - - - - - - - - - - Series A Lease Before 12/31/10 Revenue Refunding Bonds / 14 Strand Hotel and OPA/DDA/Construction 4,970,141 - - - - - - - - - - - Mixed-Use Project, Parking 8 Infrastructure / 15 Strand Project OPA/DDA/Construction 337,219 - - - - - - - - - - - Additional Parking / 17 Pacific City-Very Low OPA/DDA/Construcffon - - - - - - - - - - Income Units / 21 Abdelmudi Owner OPA/DDNConstruction - - - - - - - - - • Participation Agreement/Rent Differential Agreement / 29 Bella Terra Parking OPNDDA/Construction 3,487,056 - - - 1,939,365 - 1,939,365 - - - - - - Infrastructure Property Tax Sharing Agreement / 30 Belle Terra Phase II OPA/DDNConatructlon 12,130,583 - - - 1,417,635 - 1,417,635 - - - - - - Property Tax Sharing Agreement / 50 Enforcement of Admin Costs 250,000 - - - - - - - - - - - Successor Agency dissolution compliance and monitoring per AB 1 X26 and AB1484 / 64 Successor Agency Dissolution Audits 10,000 - - 10,000 - 10,000 - - - - - Financial Statement Audit / 76 Waterfront Hyatt Project Management - - - - - - - - - - Regency Hotel(Parcel Costs 5),Waterfront Hilton Hotel/Parcel C(Parcel 6 and 7) / 77 Waterfront Hyatt Project Management - - - - - - - - - - - Regency Hotel(Parcel Costs 5),Waterfront Hilton Hotel/Parcel C(Parcel 6 and 7) / 78 Waterfront Hyatt Project Management - - - - - - - - - - - - Regency Hotel(Parcel Costs 5),Waterfront Hilton Hotel/Parcel C(Parcel 6 and 7) / 79 Land Sale Emerald City/County Loan(Prior - - - - - - - - - - - Cove 06/28/11),Property transaction / 90 Unfunded CaIPERS Unfunded Liabilities - - - - - - - - - - - - Pension Liabilities • AUTHORIZED AMOUNTS REQUESTED ADJUSTMENTS Total • Outstanding • Bond Reserve Other Admin Total Bond Reserve Other •Admin Total Item#•• Obligation Name Obligation Type Balance Proceeds Balance Funds RPTTF RPTTF Authorized Proceeds Balance Funds RPTTF RPTTF Adjusted Notes • 91 Unfunded- Unfunded Liabilities - - - - - - - - - - - - Supplemental • Retirement Liabilities - 9 92 Unfunded OPEB Unfunded Liabilities - - - - - - - - - - - • • Liabilities /' 93 Land Sale Emerald City/County Loan(Prior - - - - - - - - - - - Cove 06/28/11),Property _ transaction 9' 95 Huntington Center City/County Loan(Prior - - - - - - - - - - -• - - Redevelopment Plan 06/28/11),Property development transaction • - ® 96 Main-Pier City/County Loan(Prior - - - - - - - - - - - - Redevelopment 06/28/11),Property • Project Phase II transaction • • - 9 97 Development of City/County Loan(Prior - - - - - - - - - - - - - Downtown Main-Pier 06/28/11),Property project area transaction • 6, 98 Third Block West - City/County Loan(Prior - - - - - - - - - - - - - commercial/residential 06/28/11),Property • • . . project .transaction 99 Second Block Alley City/County Loan(Prior - - - - - - - - - - - - and Street 06/28/11),Property _ Improvement Project transaction • 9 100 Strand Project City/County Loan(Prior - - - - - - - - - - - - - 06/28/11),Property • transaction • _ 6 101 Pierside City/County Loan(Prior - - - - - - - - - - - - Hotel/Retail/Parking 06/28/11),Property - Structure Project transaction . 6 102 Waterfront - City/County Loan(Prior - - - - - - - - - 10,000,000 -'10,000,000 Approved as Commercial Master 06/28/11),Property an • .- Site Plan transaction - - enforceable • obligation by DOF in letter dated 05/19/2023. • 0' 103 Strand Project , City/County Loan(Prior - - - - - - - - - - • - - . . .. .. 06/28/11),Property transaction '® 104 Operative Agreement City/County Loan(Prior - - - - - - - - - - - for the Huntington - 06/28/11),Other • Beach Redevelopment Project Successor Agency Res. No. 2023-03 STATE OF CALIFORNIA COUNTY OF ORANGE ) ss: CITY OF HUNTINGTON BEACH ) I, ROBIN ESTANISLAU the Clerk of the Successor Agency to the former City of Huntington Beach Redevelopment Agency, Huntington Beach, California, DO HEREBY CERTIFY that the foregoing resolution was duly adopted by The Successor Agency to the Redevelopment Agency of the City of Huntington Beach at a regular meeting held on September 5, 2023 and that is was so adopted by the following vote: AYES: Board Members: Kalmick, Moser, Van Der Mark, Strickland, McKeon, Bolton, Burns NOES: Board Members: None ABSENT: Board Members: None ABSTAIN: Board Members: None 9.6/417.14,1444) Clerk of The Successor Agency to the Redevelopment Agency of the City of Huntington Beach, California 1"\\ %IIAN G 7*/?'""--4._ 4/ -, _ ,.., • ••••• O P 0 RA7;•••. e ‘ ••• <<, • .. _____________________ _ _ __ _ __ _4, .17, ,,,,�raV/- C) Amended Recognized Obligation __ _ ' _` __ i _ Payment Schedule (ROPS) FY 2023-24 gp -7____ —- ____ ___ _ • % 'ice'%�" �' CityCouncil Meeting •. = •‹,0 01 September 5 2023 . � - o • p '••Fe, p.• .• °OUNTN C)\\ 1 I'�'/.# 573 1 Recognized Obligation Payment Schedule (ROPS) • The California Supreme Court ruled on the Dissolution Act (AB 1484) to dissolve all Redevelopment Agencies (RDAs) in California effective February 1 , 2012. • AB 1484 established procedures for payment of legally enforceable obligation of the former RDAs by establishing Successor Agencies (SAs) through the annual submission of the ROPS to the State Department of Finance (DOF). • SB 107 modified the ROPS process and established an annual ROPS starting with ROPS 16-17 and provides for a one time amendment to annual ROPS. • The Amended ROPS adds a request for $10M to repay a portion of monies owed to the City from the former RDA for the purchase of real property. The DOF is ordered to make this payment through a judgment issued by the California Supreme Court on February 17, 2023. • The total amount of the loan as of June 30, 2023 is $30,464,000, comprised of $22,400,000 in principal and $8,064,000 in accrued interest at the three percent interest rate permitted by Health and Safety Code Section 34191 .4(3). 574 2 Recommended Action 1 . Adopt Resolution No. 2023-01 , Resolution No. 2023-03, "A Resolution of The Successor Agency to the Redevelopment Agency of the City Of Huntington Beach Approving an Amended Recognized Obligation Payment Schedule 23- 24B for the FY 2023-24 Fiscal Period of January 1 , 2024 to June 30, 2024, Subject to Submittal to, and Review by the Oversight Board and the State Department of Finance under California Health and Safety Code, Division 24, Part 1 .85; and, Authorizing the Posting and Transmittal of the ROPS." Per Health and Safety Code Section 34177.7 (o)(1 )(E), the Successor Agency may submit an amendment to the annual submitted ROPS to the Countywide Oversight Board and the Department of Finance no later than October 1st for the period under review. 575 3