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HomeMy WebLinkAboutAGENDA REPORT 1999 0303 CC REG ITEM 10FMOORPARK CITY COUNCIL AGENDA REPORT ITEM Oe • CI'T'Y OF MOORP_AR•K, CAI,TFORNIA City Councit i5IeeV2nP- of 3 -3 -qq ACTION: �'1Pftl 0.2 recom me ndc��iav &dD fed — By: i 7_�- TO: Honorable City Council FROM: John E. Nowak, Assistant City Manager DATE: 22 February 1999 (Council Meeting of 03- 03 -99) SUBJECT: Consider Resolution No. 99- Establishing an Endowment Trust Fund. BACKGROUND: As part of the dissolution of the Moorpark Mosquito Abatement District (MMAD), the development agreement with the Moorpark Country Club Estates project and the Settlement Agreement with the Carlsberg developers, the City of Moorpark is scheduled to receive approximately $5,700,000. To assure these one -time revenue sources are used for a community -wide benefit and not expended for on- going operational expenses, creation of an endowment trust fund is proposed. DISCUSSION: In December 1998 the City of Moorpark received $1,450,000 as its share of the principal assets of the MMAD dissolution. These funds have been placed in a separate fund at this time. The City is due to receive $3,050,000 as part of the development agreement for the Moorpark Country Club Estates project no later than May 15, 1999. The Settlement Agreement with Conejo- Freeway Properties, Ltd. and Simi - Moorpark Freeway Properties, Ltd. calls for $1,200,000 to be provided to the City for undesignated uses. Other similar payments may be received from future developments. The City Council has previously discussed placing these and other similar funds into a separate "endowment fund ". The interest earned could be transferred to the City's 0®00W) Endowment Trust Fund Meeting of 03 March 1999 Page 02 unrestricted General Fund for annual expenses or all or a portion retained in the trust fund to increase the principal amount. Using this approach the City would have a reserve to be used for special one -time projects of a community -wide basis, such as city hall construction or a municipal swimming pool, while generating interest income for annual operating expenses. The attached resolution would create an "Endowment Trust Fund" as a restricted special fund. The revenues received from the three sources mentioned above would be placed in the trust fund along with any future one -time sources of revenue designated by the City Council. The interest earned equal to a two - percent (2 %) return would remain in the trust fund with the balance of the interest income being transferred to the unrestricted General Fund interest account. $4.5 million is assured to be in the account by the end of this fiscal year. Based on current LAIF investment rates, the trust would increase by $90,000 and the General Fund would earn approximately $146,250 in FY 1999/00. The principal could be expended on any one -time capital expenditure of community -wide benefit. The appropriation would require a separate affirmative vote of the Council at a regular meeting. The Council Budget and Finance Committee has reviewed the proposed resolution and recommends its adoption. RECOMMENDATION: That the City Council adopt Resolution No. 99- establishing an Endowment Trust Fund. Attached: Resolution No. 99- ()0()() E U RESOLUTION NO. 99- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MOORPARK, CALIFORNIA ESTABLISHING AN ENDOWMENT TRUST FUND. WHEREAS, the City of Moorpark occasionally receives one- time payment of funds from developers and other sources; and WHEREAS, it is prudent financial planning that one -time revenue sources not be expended for on -going operational costs; and WHEREAS, establishment of an "endowment trust" fund would generate investment income that could be used for general purposes of the City as well as provide funding for one -time capital projects; and WHEREAS, establishment of such an endowment trust would provide the City Council and staff guidelines as to the use of one -time revenues; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. That an "Endowment Trust Fund" is herewith established within the City of Moorpark's Chart of Accounts as a restricted Special Fund. SECTION 2. That the revenues received from the dissolution of the Moorpark Mosquito Abatement District, from the development agreement with the Moorpark Country Club Estates project, and the Development Fee referenced in Section 5.b(4) of the Settlement Agreement and Mutual Release between Conejo- Freeway Properties, Ltd. and Simi - Moorpark Freeway Properties Ltd. and the City (the Carlsberg Settlement Agreement), shall be placed in said trust fund. The City Council may from time to time designate other one -time sources of revenue to be placed in said trust fund. € 00061, Resolution No. 99- Page 02 SECTION 3. That of the investment income earned by funds in said trust account in an amount equal to two - percent (2 %) investment return shall remain in said trust account. All other investment income earned by the trust account shall be transferred to the City's unrestricted General Fund interest account. SECTION 4. That the principal balance of the trust account may be expended on any one -time capital expenditure of community -wide benefit, including but not limited to city hall improvements, a municipal swimming pool, or other projects determined to provide community -wide benefit, upon three (3) affirmative votes of the City Council at a regular meeting. SECTION 5. 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 3rd day of March, 1999. Patrick Hunter, Mayor ATTEST: Deborah S. Traffenstedt, City Clerk 000062