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HomeMy WebLinkAboutAGENDA REPORT 2017 0124 OB SPC ITEM 06A OVERSIGHT BOARD TO SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY OF THE CITY OF MOORPARK MEETING ITEM 6.A. of I ZNI 120 '1 ACTION: ARroWed s-r644 r w dalz() A,, 1 nCl116q ado2,av' of Pesot4tta.„ no. 013-ZD11J-16S 4( QrrP.(Id.to- BY ezatTO OVERSIGHT BOARD TO THE SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY OF THE CITY OF MOORPARK AGENDA REPORT To: Oversight Board to the Successor Agency From: Ron Ahlers, Finance Direct r /C- Date: January 20, 2017 (Special Meeting of January 24, 2017) Subject: Consider Resolution Approving the Successor Agency's Execution and Delivery of a Bond Proceeds Funding Agreement and Taking Related Actions BACKGROUND • Before dissolution, the former Redevelopment Agency of the City of Moorpark (the "Former Agency") issued the following (collectively, the "Bonds"): (i) its Moorpark Redevelopment Project, 1999 Tax Allocation Refunding Bonds, in the principal amount of $9,860,000, (ii) its Moorpark Redevelopment Project, 2001 Tax Allocation Bonds, in the principal amount of $11,625,000, and (iii) its Moorpark Redevelopment Project, 2006 Tax Allocation Bonds, in the principal amount of $11,695,000. The Bonds were issued and sold to finance and refinance projects of benefit to the Former Agency's Moorpark Redevelopment Project. There remain in the Successor Agency's accounts unspent proceeds of the Bonds issued in 2006. DISCUSSION Pursuant to Section 34191.4 of the Health and Safety Code, after the Successor Agency's receipt of a finding of completion (the "Finding of Completion") issued by the California State Department of Finance (the "DOF"), the unspent proceeds of the Bonds shall be used for the purposes for which the Bonds were sold, in a manner consistent with the bond covenants. The Successor Agency desires to use the remaining proceeds of the 2006 Bonds for the purpose of which the Bonds were sold,-namely projects of benefit to the Project Area that are consistent with the bond covenants. Because of the limited staffing of the Successor Agency and the City's traditional role and established procedures for the awarding of public works contracts, it is desirable for the Successor Agency to transfer the remaining unspent bond proceeds to the City, for the City to implement and perform the work required for the projects. Each transfer of bond proceeds to the City must be 1 Oversight Board to the Successor Agency January 24, 2017 Page 2 listed on a Recognized Obligation Payment CROPS"). Under current law, the Successor Agency prepares a ROPS once a year. Each ROPS must be submitted to the Oversight Board and the DOF for approval. While the Successor Agency may choose to transfer the bond proceeds over time based on actual contract needs for each ROPS period, it is preferable for all of the remaining unspent bond proceeds to be transferred to the City at once, to facilitate the effective and efficient implementation of the projects. The City of Moorpark approved of the agreement at its meeting of January 18, 2017. The Successor Agency approved of the agreement at its meeting of January 18, 2017. Pursuant to the Bond Proceeds Funding Agreement, the Successor Agency listed the transfer of all of the remaining bond proceeds on the ROPS 17-18 (which covers the 2017-18 fiscal year), and will transfer the bond proceeds to the City per the DOF- approved ROPS. The DOF informed the Successor Agency that it required the Oversight Board approval of the Bond Proceeds Funding Agreement in conjunction with the ROPS 17-18 review. The DOF stated that submitting the agreement sooner would increase the likelihood that the ROPS 17-18 would get approved with the Bond Proceeds Funding Agreement as listed. Exhibit A of the Bond Proceeds Funding Agreement contains a list of the anticipated projects, but also specifies that the actual projects to be funded may be different from those currently listed, as determined by the City. FISCAL IMPACT Assuming the Oversight Board's and the DOF's approval of the Bond Proceeds Funding Agreement and the relevant line item on the ROPS 17-18, the Successor Agency will transfer all of the remaining unspent bond proceeds'to the City at the commencement of fiscal year 2017-18. Thereafter, the City will use the bond proceeds for projects in a manner consistent with the bond covenants and the Bond Proceeds Funding Agreement, without additional review by the Oversight Board and the DOF. STAFF RECOMMENDATION (Roll Call Vote) Adopt Resolution No. OB-2017- approving the Successor Agency's execution and delivery of the Bond Proceeds Funding Agreement and taking related actions. Attachment: 1. Resolution No. OB-2017- 2. Bond Proceeds Funding Agreement (substantial final form) 2 RESOLUTION NO. OB-2017- A RESOLUTION OF THE OVERSIGHT BOARD TO THE SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY OF THE CITY OF ' MOORPARK APPROVING THE SUCCESSOR AGENCY'S EXECUTION AND DELIVERY OF A BOND PROCEEDS FUNDING AGREEMENT AND TAKING RELATED ACTIONS WHEREAS, Section 34179(e) of the Health and Safety Code requires all actions taken by the Oversight Board to the Successor Agency of the Redevelopment Agency of the City of Moorpark be adopted by resolution; and WHEREAS, before dissolution, the former Redevelopment Agency of the City of Moorpark (the "Former Agency") issued the following bonds (collectively, the "Bonds"): (i) its Moorpark Redevelopment Project, 1999 Tax Allocation Refunding Bonds, in the principal amount of $9,860,000, (ii) its Moorpark Redevelopment Project, 2001 Tax Allocation Bonds, in the principal amount of $11,625,000, and (iii) its Moorpark Redevelopment Project, 2006 Tax Allocation Bonds, in the principal amount of $11,695,000; and WHEREAS, the Bonds were issued pursuant to and are governed by an Indenture of Trust, dated as of May 1, 1999.(the "Master Indenture"), as supplemented and amended by a First Supplemental Indenture of Trust, dated as of December 1, 2001 (the "First Supplemental Indenture"), and a Second Supplemental Indenture of Trust, dated as of December 1, 2006 (the "Second Supplemental Indenture"), by and between the Former Agency and The Bank of New York Trust Company, N.A., as trustee (the 'Trustee"); and WHEREAS, the Bonds were issued and sold to finance and refinance projects of benefit to a project area known as the Moorpark Redevelopment Project (the "Project Area"); and WHEREAS, pursuant to AB X1 26 (enacted in June 2011), as modified by the California Supreme Court's decision in California Redevelopment Association, et al. v. Ana Matosantos, et al., 53 Cal. 4th 231 (2011), the Former Agency was dissolved as of February 1, 2012, the Successor Agency was constituted as the successor entity to the Former Agency, and an oversight board of the Successor Agency (the "Oversight Board") was established; and WHEREAS, pursuant to Section 34175(b) of the California Health and Safety Code ("HSC"), all assets, properties, contracts, books and records of the Former Agency, including the unspent proceeds of the Bonds, transferred to the control of the Successor Agency by operation of law; and • • 3 WHEREAS, pursuant to HSC Section 34191.4, after the receipt by the Successor Agency of a finding of completion (the "Finding of Completion") issued by the California State Department of Finance (the "DOF") under HSC Section 34179.7, the unspent proceeds of the Bonds shall be used for the purposes for which the Bonds were sold, in a manner consistent with the bond covenants; and WHEREAS, by DOF's letter, dated May 25, 2013, the DOF informed the Successor Agency that the DOF has issued a Finding of Completion to the Successor Agency; and • WHEREAS, the Successor Agency desires to use the remaining unspent proceeds of the Bonds (the "Remaining Bond Proceeds") for the purpose of which the Bonds were sold, namely projects of benefit to the Project Area that are consistent with the bond covenants (the "Projects"); and WHEREAS, because of the limited staffing of the Successor Agency and the City's traditional role and established procedures with respect to the awarding of public works contracts, the Successor Agency and the City desire to enter into a Bond Proceeds Funding Agreement, substantially in the form of Attachment 2 to Agenda Item 6.A. (the "Funding Agreement"); and WHEREAS, the Funding Agreement will provide for the transfer of the Remaining Proceeds to the City for the City to perform or cause to be performed the work required for the Projects; and WHEREAS, the Funding Agreement is in furtherance of the winding down of the Former Agency's affairs, with respect to the expenditure of unspent bond proceeds as permitted under HSC Section 34191.4; and WHEREAS, on January 24, 2017 the Funding Agreement was submitted to the Oversight Board for its review and consideration (Agenda Item 6.A.). NOW, THEREFORE, THE OVERSIGHT BOARD TO THE SUCCESSOR AGENCY OF THE REDEVELOPMENT AGENCY OF THE CITY OF MOORPARK DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. The above recitals are true and correct and are a substantive part of this Resolution. SECTION 2. This Oversight Board hereby approves the Successor Agency's execution and delivery of the Bond Proceeds Funding Agreement, substantially in the form of Attachment 2 of Agenda Item 6.A. SECTION 3. The members of the Oversight Board and officers and staff of the Successor Agency are hereby authorized and directed, jointly and severally, to do any 4 and all things which they.may deem necessary or advisable to effectuate this Resolution and the Funding Agreement. PASSED AND ADOPTED this 24th day of January, 2017. Bruce Hamous, Chairperson ATTEST: Maureen Benson, City Clerk . 5 ATTACHMENT 2 BOND PROCEEDS FUNDING AGREEMENT (in substantially final form) 6 • BOND PROCEEDS FUNDING AGREEMENT This BOND PROCEEDS FUNDING AGREEMENT (this "Agreement"), dated as of January , 2017, is entered into by and between the Successor Agency to the Redevelopment Agency of the City of Moorpark (the "Successor Agency") and the City of Moorpark (the "City," and together with the City, the "Parties"). RECITALS: A. Before dissolution, the former Redevelopment Agency of the City of Moorpark (the "Former Agency") issued the following bonds (collectively, the "Bonds"): (i) its Moorpark Redevelopment Project, 1999 Tax Allocation Refunding Bonds, in the principal amount of $9,860,000, (ii) its Moorpark Redevelopment Project, 2001 Tax Allocation Bonds, in the principal amount of $11,625,000, and (iii) its Moorpark Redevelopment Project, 2006 Tax Allocation Bonds, in the principal amount of $11,695,000. B. The Bonds were issued pursuant to and are governed by an Indenture.of Trust, dated as of May 1, 1999 (the "Master Indenture"), as supplemented and amended by a First Supplemental Indenture of Trust, dated as of December 1, 2001 (the "First Supplemental Indenture"), and a Second Supplemental Indenture of Trust, dated as of December 1, 2006 (the "Second Supplemental Indenture"), by and between the Former Agency and The Bank of New York Trust Company, N.A., as trustee (the "Trustee"). C. The Bonds were issued and sold to finance and refinance projects of benefit to a project area known as the Moorpark Redevelopment Project (the "Project Area"). D. Pursuant to AB X1 26 (enacted in June 2011), as modified by the California Supreme Court's decision in California Redevelopment Association, et al. v. Ana Matosantos, et al., 53 Cal. 4th 231 (2011), the Former Agency was dissolved as of February 1, 2012, the Successor Agency was constituted as the successor entity to the Former Agency, and an oversight board of the Successor Agency (the "Oversight Board") was established. E. Pursuant to Section 34175(b) of the California Health and Safety Code ("HSC"), all assets, properties, contracts, books and records of the Former Agency, including the unspent proceeds of the Bonds, transferred to the control of the Successor Agency by operation of law. F. Pursuant to HSC Section 34191.4, after the receipt by the Successor Agency of a finding of completion (the "Finding of Completion") issued by the California State Department of Finance (the "DOF") under HSC Section 34179.7, the unspent proceeds of the Bonds shall be used for the purposes for which the Bonds were sold, in a manner consistent with the bond covenants. -1- 7 • G. By DOF's letter, dated May 25, 2013, the DOF informed the Successor Agency that the DOF has issued a Finding of Completion to the Successor Agency. H. The Successor Agency desires to use the remaining unspent proceeds of the Bonds (the "Remaining Bond Proceeds") for the purpose of which the Bonds were sold, namely projects of benefit to the Project Area that are consistent with the bond covenants, including those listed in Exhibit A (collectively, the "Projects"). I. Because of the limited staffing of the Successor'Agency and the City's traditional role and established procedures with respect to the awarding of public works contracts, the Successor Agency and the City desire to enter into this Agreement, for the City to perform or cause to be performed the work required for the Projects, with payment therefor to be made from the Remaining Bond Proceeds. J. This Agreement provides for the transfer of Remaining Bond Proceeds to the City for the City to perform or cause to be performed the work required for the Projects. K. Pursuant to HSC Section 34177(o), the Successor Agency must prepare a Recognized Obligation Payment Schedule ("ROPS") each year, listing its expected expenditure and disbursement of moneys during each six month period covered by such ROPS. Each ROPS must be submitted to the Oversight Board of the Successor Agency and the DOF for approval. L. Pursuant to HSC Section 34191.4(c)(2), the expenditure of the Remaining Bond Proceeds for an obligation must be listed on a ROPS. M. This Agreement is in furtherance of the winding down of the Former Agency's affairs, with respect to the expenditure of unspent bond proceeds as permitted under HSC Section 34191.4. N. Resolution No. OB-2017- adopted by the Oversight Board on January , 2017 approving the Successor Agency's execution and delivery of this Agreement was approved [deemed approved] by the DOF pursuant to HSC Section 34179(h) on , 2017. O. In 2014 and 2016, the Successor Agency issued bonds (the "Successor Agency Bonds") pursuant to HSC Section 34177.5 to refund a portion of the Bonds. P. The Successor Agency Bonds were issued pursuant to, and are governed ' by, the Master Indenture, as previously supplemented and amended, and as further supplemented and amended by a Third Supplemental Indenture, dated as of November 1, 2014, and a Fourth Supplemental Indenture, dated as of July 1, 2016, each by and between the Successor Agency and the Trustee. The Master Indenture, supplemented and amended by its four supplements, is referred to herein as the Indenture. Q. Because the proceeds of the Successor Agency Bonds were used to refund the Bonds, covenants set forth in the Indenture (particularly pertaining to the -2- 8 requirements under the Code (as defined in the Indenture) relating to the tax-exempt status of the Successor Agency Bonds and the remaining outstanding Bonds) continue to apply to the Remaining Bond Proceeds. NOW, THEREFORE, THE PARTIES DO HEREBY AGREE AS FOLLOWS: Section 1. Subject to the provisions of this Agreement and with the funding provided pursuant to this Agreement, the City agrees to perform or cause to be performed the work required for the Projects, including but not limited to the preparation of designs, plans and specifications and all demolitions, construction and installations. The City shall perform such work in accordance with all applicable federal, state and local laws, rules and regulations. Subject to the covenants set forth herein, the City shall have the sole discretion with respect to the design, planning, specification and the timing with respect to all components of the Projects. Section 2. (a) When preparing the next ROPS after the execution and delivery of this Agreement (being "ROPS 17-18" for the period from July 1, 2017 through June 30, 2018 (the "ROPS 17-18 Period")), the Successor Agency shall list the transfer of the Remaining Bond Proceeds to the City. (b) As soon as practicable after the commencement of the ROPS 16-17 Period, the Successor. Agency shall transfer the Remaining . Bond Proceeds, as approved on ROPS 17-18, to the City. Section 3. The City shall use the Remaining Bond Proceeds transferred to it pursuant to this Agreement for costs of the Projects (or reimbursement to the City for any funds advanced for costs of the Projects) in a manner consistent with the covenants in the Indenture. Section 4. To the extent the City still holds unspent Remaining Bond Proceeds transferred pursuant to this Agreement after the completion of the Projects (as determined by the legislative body of the City), the City shall return such unspent Remaining Bond Proceeds to the Successor Agency within a reasonable time after such determination. Section 5. The City covenants that it shall use the Remaining Bond Proceeds in a manner consistent with the covenants in the Indenture, including, but not limited to, any covenants regarding the tax-exempt status of interest on the Bonds and the Successor Agency Bonds under the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder. Section 6. Each Party shall maintain books and records regarding its duties pursuant to this Agreement. Such books and records shall be available for inspection by the officers and agents of the other Party at all reasonable times. Section 7. The Parties agree to take all appropriate steps and execute any documents which may reasonably be necessary or convenient to implement the intent of this Agreement. -3- 9 Section S. This Agreement may be amended from time to time by written instrument executed by both Parties. Section 9. No official, agent, or employee of the Successor Agency or the City, or members of the City Council, or members of the Successor Agency Board of Directors or Oversight Board shall be individually or personally liable for any payment hereunder in the event of any default or breach by the Successor Agency or the City, or for any amount which may otherwise become due to the City or Successor Agency, or successor thereto, or on any obligations under the terms of this Agreement. Section 10. This Agreement is made in the State of California under the Constitution and laws of the State of California, and is to be so construed. IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized officers. SUCCESSOR AGENCY TO THE REDEVELOPMENT AGENCY OF THE CITY OF MOORPARK By Steven Kueny, Executive Director ATTEST: Maureen Benson, Secretary CITY OF MOORPARK By Janice Parvin, Mayor ATTEST: Maureen Benson, City Clerk -4- 10 EXHIBIT A Description of Projects 1. High Street Streetscape Project 2. Los Angeles Avenue Widening Project 3. Princeton Avenue Widening Project 4. any other programs, projects and activities of benefit to the Project Area, so long as the program or project is determined by the City to be consistent with the bond covenants under the Indenture. • -5- 11