Agenda Report
Fullerton Successor Agency
MEETING DATE: JANUARY 17, 2023
TO: CITY COUNCIL / SUCCESSOR AGENCY
SUBMITTED BY: SUNAYANA THOMAS, INTERIM DIRECTOR OF COMMUNITY AND ECONOMIC DEVELOPMENT PREPARED BY: TAYLOR SAMUELSON, ADMINISTRATIVE ANALYST II SUBJECT: RECOGNIZED OBLIGATION PAYMENT SCHEDULE 2023-24 AND ADMINISTRATIVE BUDGET ALLOWANCE PER ASSEMBLY BILLS 1X26 AND 1484 AND SENATE BILL 107 ______________________________________________________________________
SUMMARY
Request that City Council, acting as the Fullerton Successor Agency (Successor Agency), approve the proposed Recognized Obligation Payment Schedule for Fiscal Year 2023-24 (ROPS 2023-24) and Administrative Budget Allowance for July 1, 2023 through June 30, 2024, per Assembly Bills 1X 26 (AB 26) and 1484 (AB 1484) and Senate Bill 107 (SB 107).
RECOMMENDATION
Adopt Resolution No. SA 2023-XX.
RESOLUTION NO. SA 2023-XX – A RESOLUTION OF THE SUCCESSOR AGENCY OF THE CITY OF FULLERTON, CALIFORNIA, APPROVING AND ADOPTING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE 2023-24 AND ADMINISTRATIVE BUDGET ALLOWANCE (PERIOD COVERING JULY 1, 2023 – JUNE 30, 2024)
CITY MANAGER REMARKS
The recommended action is to remain in compliance with AB 26, AB 1484 and SB 107.
PRIORITY POLICY STATEMENT
This item matches the following Priority Policy Statement:
Fiscal and Organizational Stability.
FISCAL IMPACT
This item has no impact to the City’s General Fund. The City will make all approved payments on ROPS 2023-24 from property tax increment revenue allocated by the Orange County Auditor-Controller to the Fullerton Successor Agency’s Redevelopment Property Tax Trust Fund (RPTTF) per the State mandated dissolution process.
DISCUSSION
The Recognized Obligation Payment Schedule (ROPS) identifies the funds needed to carry out the dissolution process of the former Fullerton Redevelopment Agency and to set forth the payment amounts and due dates for all existing financial obligations. ROPS shall look forward and staff will prepare the ROPS annually until the Agency has fulfilled its obligations and repaid all debt. Staff has attached the proposed ROPS 2023-24 for July 1, 2023, through June 30, 2024. Staff must submit ROPS 2023-24 to the Orange County Oversight Board and then to the State Department of Finance (DOF) for review and approval by February 1, 2023.
The ROPS 2023-24 includes the enforceable obligations of the Successor Agency requiring payments during Fiscal Year 2023-24. These obligations include bond debt service payments, leases, development agreement obligations, a purchase and sale agreement, administering ongoing affordable housing and loan programs, a stipulated judgment and an administrative cost allowance. Staff continued to list previously denied items per the advice of legal counsel in prior years. This ROPS lists only two items related to affordable housing with previous denials. Relevant lawsuits and/or proposed legislation may cause the DOF to change their determination to continue to deny these items. Staff will complete all currently approved Successor Agency enforceable obligations in FY 2027-28.
The administrative cost allocation (ACA) covers the costs associated with administration of the ROPS including former redevelopment agency loans, bond disclosure, continuing disclosure, clearing titles for seismic and rehabilitation loans as well as work on relevant long-term covenants. Per State dissolution law, the ACA is limited to 3% of RPTTF revenue received in the preceding fiscal year or $250,000 whichever is greater, not to exceed 50% of the RPTTF distributed in the preceding fiscal year. The work encompasses staff across various departments including Community and Economic Development and Administrative Services.
Staff recommends that City Council, acting as the Fullerton Successor Agency, adopt the attached resolution approving ROPS 2023-24 for July 1, 2023, through June 30, 2024. Staff will forward the ROPS 2023-24 to the County Oversight Board for its consideration, if approved. If a Successor Agency does not submit their ROPS by the February 1, 2023 deadline, the Successor Agency becomes subject to a $10,000 per day civil penalty for every day the Agency does not submit the schedule to the DOF. Additionally, if a Successor Agency does not submit its ROPS within ten days of the deadline, the maximum administrative cost allowance for that period shall reduce by 25 percent.
Attachments:
Attachment 1 – Resolution No. SA 2023-XX
Attachment 2 – ROPS 2023-24
cc: City Manager Eric J. Levitt
Recognized Obligation Payment Schedule and Administrative Budget Allowance January 17, 2023 - Page PAGE \* MERGEFORMAT 2