Attachment No. 1
RESOLUTION NO. 2023-77
&
SA RESOLUTION NO. 2023-01
A JOINT RESOLUTION OF THE CITY COUNCIL OF THE CITY POMONA AND THE SUCCESSOR AGENCY TO THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF POMONA, CALIFORNIA, APPROVING THE EXECUTION OF A SETTLEMENT AGREEMENT AND MUTUAL RELEASE BY AND AMONG THE CITY OF POMONA, THE SUCCESSOR AGENCY TO THE FORMER REDEVELOPMENT AGENCY OF POMONA, THE COUNTY OF LOS ANGELES, THE COUNTY LIBRARY, THE COUNTY FLOOD CONTROL DISTRICT, AND THE CONSOLIDATED FIRE PROTECTION DISTRICT (COLLECTIVELY, THE “COUNTY”) WHEREAS, prior to their dissolution in 2012 pursuant to AB 1X 26, Redevelopment Agencies received a portion of property taxes (tax increment) which was used to address “blight” through property acquisition, public improvements, affordable housing and economic development; and WHEREAS, when RDAs were established they entered into negotiated or statutory tax sharing pass through agreements with other taxing entities, such as Los Angeles County, who would receive a reduced portion of future property tax as a result of the creation of the RDA; and WHEREAS, following the dissolution of the Pomona RDA, the City Council stepped in as the Successor Agency to the former RDA; and WHEREAS, the Successor Agency was charged with paying all of the RDA’s enforceable obligations and winding down the affairs of the former RDA; and WHEREAS, the former Pomona RDA had entered into two pass-through agreements with Los Angeles County:
1988 Agreement (“Southwest Agreement”) relating to Southwest, Downtown I & II, Holt Avenue/Indian Hill, Reservoir Street Industrial and Mountain Meadow Project Areas 1991 Agreement (“South Garey Agreement”) relating to South Garey Avenue/Freeway Corridor Project Area WHEREAS, both Agreements provide for a portion of the RDA/Successor Agency’s tax increment to be paid annually to the County and both Agreements allowed the RDA/Successor Agency to defer payment of the portion of the County share; and WHEREAS, these deferred amounts are treated as loans and accrue interest of 7% per year compounded annually, and WHEREAS, in early 2017, the City Council directed staff to explore the possible refinancing of RDA/Successor Agency bonds. During that process, it became apparent that these historic pass-through agreements constituted an arguably unfair burden to Pomona due to the high interest rate that compounded annually. Therefore, in 2017, the City then began negotiating a lower interest rate for Pomona that would 1) significantly reduce the remaining amounts owed to the County and 2) shorten the payment schedule, which otherwise would continue until FY 2040-41; and WHEREAS, the parties have negotiated settlement that reduces the 7% interest rate to 3.39% for the 1988 “Southwest Agreement” and to 2.32% for the “South Garey Agreement”, to be applied retroactively and prospectively which will result in savings to the City of Pomona of approximately $103.2 million, and will result in the final payment being made in FY 2028-29.
NOW THEREFORE, the City Council of the City of Pomona acting as the City Council and as the Successor Agency to the former Redevelopment Agency does hereby resolve, find, determine, and order as follows:
SECTION 1. The recitals set forth above are true and correct and are hereby incorporated into this Resolution by this reference.
SECTION 2. The Settlement Agreement and Mutual Release is approved in substantially final form as attached hereto as Exhibit A and subject to minor modifications as approved by the City Manager and the City Attorney. The City Manager is authorized and directed to execute the Settlement Agreement and Mutual Release and take all actions reasonably necessary to effectuate the intent of this Resolution and the Agreement.
SECTION 3. CEQA. Approval of the Agreement is not a project under CEQA pursuant to State CEQA Guidelines section 15378(b)(4), which provides that governmental fiscal activity which does not involve a commitment to a specific project which may result in a significant environmental impact is not a project.
SECTION 4. This Resolution shall become effective immediately upon its adoption.
SECTION 5. The City Clerk shall certify adoption of this Resolution.
PASSED, APPROVED AND ADOPTED this 15th day of May, 2023.
ATTEST: CITY OF POMONA:
_________________________ _______________________________ ROSALIA A. BUTLER, MMC Tim Sandoval
City Clerk, MMC Mayor
ATTEST: SUCCESSOR AGENCY TO THE FORMER REDEVELOPMENT AGENCY:
_________________________ _______________________________ ROSALIA A. BUTLER, MMC Tim Sandoval
City Clerk, MMC Chair
APPROVED AS TO FORM:
Sonia Carvalho
City Attorney
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES)
CITY OF POMONA )
I, HEREBY CERTIFY that the foregoing resolution was duly adopted by the City Council of the City of Pomona at a regular meeting thereof held on May 15, 2023 by the following vote of the Council:
AYES:
NOES:
ABSTAIN:
ABSENT:
____________________________
Rosalia A. Butler, MMC
City Clerk
Exhibit A - Settlement Agreement and Mutual Release
65318.50014\41256431.1
65318.50014\41256431.1
65318.50014\41256431.1
65318.50014\41256431.1