Loading...
HomeMy WebLinkAboutAGENDA REPORT 2005 0615 CC REG ITEM 10KITEM 10-K- erry 6F nA000f RK, CALIFORNIA City Council Meeting ®i - ��-o?ooJ ACTION:, Al BY:�" MOORPARK CITY COUNCIL AGENDA REPORT TO: Honorable City Council FROM: Johnny Ea, Finance Director DATE: June 3, 2005 (City Council Meeting of June 15, 2005) SUBJECT: Consider Resolution Adopting Loan Agreement between the City of Moorpark and the Moorpark Redevelopment Agency BACKGROUND Community Development Law allows Redevelopment Agencies to borrow funds from the City in support of the Agency's mission and goals. Several times since the creation of the Moorpark Redevelopment Agency, the City has loaned funds to the Agency for specific purposes. All loans have been repaid, or will be repaid by June 30, 2005. DISCUSSION In the coming year, the Agency has budgeted approximately $7.6 million in expenditures, including $1.8 million for capital improvements. While the Agency's annual revenues and existing fund balances are sufficient to finance these expenditures, it is our practice for all expenditures to be paid by the City, then these "advances" are repaid by the Agency. This is a common practice intended to comply with state laws that require Redevelopment Agencies to incur debt and to assist with Agency cash flow. Staff is recommending a loan from the City to the Agency in the amount of $5,000,000 as an advance for anticipated operating and capital expenditures for the coming year. The Agency would be charged a rate equal to the rate earned on investments (the "LAIF" rate) plus 1%; currently this would be approximately 3.70. The loan would be provided by the City General Fund, 00('301 (' 01 Honorable City Council June 15, 2005 Page 2 which currently has sufficient cash available, and would be due no later than June 30, 2006. STAFF RECONMNDATION (Roll Call Vote) Adopt Resolution No. 2005- , approving a Loan Agreement with the Moorpark Redevelopment Agency. Attachment: Resolution No. 2005 - Loan Agreement �t���30 RESOLUTION 2005- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MOORPARK, CALIFORNIA, ADOPTING A LOAN AGREEMENT BETWEEN THE CITY OF MOORPARK AND THE MOORPARK REDEVELOPMENT AGENCY WHEREAS, the City of Moorpark has agreed to advance funds to the Moorpark Redevelopment Agency in accordance with the terms of a Loan Agreement dated July 1, 2005; and WHEREAS, the Moorpark Redevelopment Agency has agreed to accept the terms and conditions of the Loan Agreement dated July 1, 2005. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. The Loan Agreement between the City of Moorpark and the Moorpark Redevelopment Agency dated July 1, 2005, and attached as Exhibit "A" to this resolution, is hereby adopted. SECTION 2. The City Clerk shall certify to the adoption of this resolution and shall cause a certified resolution to be filed in the book of original Resolutions. PASSED AND ADOPTED this 15th day of June, 2005. Patrick Hunter, Mayor ATTEST: Deborah S. Traffenstedt, City Clerk Attachment: Exhibit "A" 000;30,3 EXHIBIT "A" LOAN AGREEMENT THIS LOAN AGREEMENT is entered into this 1st day of July, 2005, by and between the City of Moorpark ( "City ") and the Moorpark Redevelopment Agency (`Agency "). RECITALS WHEREAS, the Agency was created by Ordinance 87, adopted by the City Council on March 18, 1987, for the purpose of eliminating blighted conditions within specified project areas; and WHEREAS, in support of its mission, the Agency is developing and implementing plans to acquire and construct certain public facilities; and WHEREAS, the Agency has determined that, in order to undertake this redevelopment project, temporary financial assistance in the form of a loan is required from the City of Moorpark; and WHEREAS, Section 33600 et. seq. of the California Community Redevelopment Law authorizes the Agency to borrow money or accept financial or other assistance from the City. COVENANTS NOW, THEREFORE, THE CITY AND AGENCY AGREE AS FOLLOWS: SECTION 1. Amount and Use of Loan. The City, from its General Fund, will advance to the Agency the amount of $5,000,000 (five million dollars). Agency agrees to use such loan proceeds only for those purposes set forth in the Health and Safety Code and approved by the Agency. SECTION 2. Repayment of Funds. The Agency will repay this loan, both principal and interest, in full on or before June 30, 2006, unless extended by amendment to this Agreement. SECTION 3. Interest Payment. This loan will bear interest at a rate equivalent to the rate earned by City investments in the Local Agency Investment Fund, plus one percent. 00(430A Loan Agreement, Page 2 July 1, 2005 SECTION 4. Obligation Constitutes Indebtedness. This loan agreement shall constitute an obligation and debt of the Agency to use all available increment revenue to repay the City. Such indebtedness shall be subordinate to any and all other Agency indebtedness incurred by the Agency, including indebtedness incurred through the issuance of tax allocation notes or bonds or any other bonds of the Agency. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. MOORPARK REDEVELOPMENT AGENCY Patrick Hunter, Chair ATTEST: Deborah S. Traffenstedt, Agency Secretary CITY OF MOORPARK Steven Kueny, City Manager Deborah S. Traffenstedt, City Clerk