Loading...
HomeMy WebLinkAboutAGENDA REPORT 2009 0617 CC REG ITEM 10HITEM 10.H. City OF MOORPARK, CALIFORNIA City Council Meeting AC1'IOM-- (1Awry t. d A, Q, MOORPARK CITY COUNCIL AGENDA REPORT W, T V - - N TO: Honorable City Council FROM: Ron Ahlers, Finance Director6-74- DATE: May 22, 2009 (City Council Meeting of June 17, 2009) SUBJECT: Consider Resolution Adopting Loan Agreement between the City of Moorpark and the Moorpark Redevelopment Agency BACKGROUND The California Health and Safety Code on Community Redevelopment Law Section 33610 allows the legislative body of the community to appropriate to the agency such amounts as necessary for administrative and overhead expenses of the agency. These appropriations may be paid to the agency as a loan and will be repaid upon such terms and conditions as provided by the legislative body. Several times since the creation of the Moorpark Redevelopment Agency, the City has loaned funds to the Agency. All loans have been repaid by June 30th of each fiscal year. DISCUSSION For FY 2009/2010, the Agency has budgeted approximately $25.7 million in expenditures, including $16.6 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 and 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 $5.0 million 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 3.9 %. The loan would be provided by the City's Special Projects Fund, which will have sufficient cash available, and would be due no later than June 30, 2010. 214 Honorable City Council June 17, 2009 Page 2 STAFF RECOMMENDATION (Roll Call Vote) Adopt Resolution No. 2009 - Redevelopment Agency. Attachment: Resolution No. 2009- Loan Agreement , approving a Loan Agreement with the Moorpark 215 RESOLUTION 2009- 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 from the Special Projects Fund (4004) to the Moorpark Redevelopment Agency in accordance with the terms of a Loan Agreement dated July 1, 2009; and WHEREAS, the Moorpark Redevelopment Agency has agreed to accept the terms and conditions of the Loan Agreement dated July 1, 2009. 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, 2009, 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 17'h day of June, 2009. Janice S. Parvin, Mayor ATTEST: Deborah S. Traffenstedt, City Clerk Attachment: Exhibit "A" 216 EXHIBIT "A" LOAN AGREEMENT THIS LOAN AGREEMENT is entered into this 1st day of July, 2009, 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 Special Projects 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, 2010, 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. 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. 217 Loan Agreement, Page 2 July 1, 2009 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. MOORPARK REDEVELOPMENT AGENCY CITY OF MOORPARK Janice S. Parvin, Chair ATTEST: Deborah S. Traffenstedt, Agency Secretary Steven Kueny, City Manager Deborah S. Traffenstedt, City Clerk 218