FY 1994-1995 RDA Financial StatementsLA QUINTA REDEVELOPMENT AGENCY
Financial Statements and
Supplemental Data
Year ended June 30, 1995
(with Independent Auditors' Report Thereon)
LA QUINTA REDEVELOPMENT AGENCY
Financial Statements and
Supplemental Data
Year ended June 30, 1995
TABLE OF CONTENTS
Page
Independent Auditors' Report
1
Financial Statements:
• Combined Balance Sheet - All Fund Types and Account Groups
2
• Combined Statement of Revenues, Expenditures and Changes
in Fund Balances - All Governmental Fund Types
3
• Combined Statement of Revenues, Expenditures and Changes
in Fund Balances - Budget and Actual - All
Governmental Fund Types
4
• Notes to Financial Statements
5
Supplemental Data:
Special Revenue Funds:
• Combining Balance Sheet
17
• Combining Statement of Revenues, Expenditures and Changes
in Fund Balances
18
Debt Service Funds:
• Combining Balance Sheet
19
• Combining Statement of Revenues, Expenditures and Changes
in Fund Balances
20
Capital Projects Funds:
• Combining Balance Sheet
21
• Combining Statement of Revenues, Expenditures and Changes
in Fund Balances
22
Supplemental Schedule of Tax Increment Shift to Educational Revenue
Augmentation Fund
23
Independent Auditors' Compliance Report
24
L 1SSOUL 11 ECJ, L.L.P.
A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS
Board of Directors
La Quinta Redevelopment Agency
La Quinta, California
CERTIFIED PUBLIC ACCOUNTANTS
INDEPENDENT AUDITORS' REPORT
1100 MAIN STREET, SUITE C
IRVINE, CALIFORNIA 92714
(714) 474-2020
We have audited the accompanying financial statements of the La Quinta Redevelopment
Agency, a component unit of the City of La Quinta, California as of and for the year ended
June 30, 1995, as listed in the table of contents. These component unit financial statements
are the responsibility of the management of the La Quinta Redevelopment Agency. Our
responsibility is to express an opinion on these component unit financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards and
Government Auditing Standards, issued by the Comptroller General of the United States.
Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the component unit financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures
in the component unit financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the
overall component unit financial statement presentation. We believe that our audit provides
a reasonable basis for our opinion.
In our opinion, the component unit financial statements referred to above present fairly, in
all material respects, the financial position of the La Quinta Redevelopment Agency at June
30, 1995, and the results of its operations for the year then ended, in conformity with
generally accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the component unit financial
statements taken as a whole. The supplemental data listed in the table of contents is
presented for purposes of additional analysis and is not a required part of the component unit
financial statements of the La Quinta Redevelopment Agency. Such information has been
subjected to the auditing procedures applied in the audit of the component unit financial
statements and, in our opinion, is fairly presented in all material respects in relation to the
component unit financial statements taken as a whole.
August 18, 1995
Gia 41.0( %/� S!� ev�t�
-1-
MEMBERS OF AICPA AND CALIFORNIA SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
MEMBER OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PRIVATE COMPANIES PRACTICE SECTION
LA QUINTA REDEVELOPMENT AGENCY
Combined Balance Sheet -Ali Fund Types and Account Groups
June 30, 1995
Assets and other debits
Cash and investments (note 3)
Cash with fiscal agent (note 3)
Accounts receivable
Accrued revenue
Prepaid expense
Notes receivable
Due from other funds
Due from other governments
Land held for resale
Advances to other funds
Property, plant and equipment
(note 15)
Other debits:
Amounts available in debt service
funds
Amount to be provided for
retirement of long-term debt
Total assets and other debits
5,879,910 - 5,879,910 5,879,910
- 2,340,653 2,340,653 4,146,998
69.987,536 69.987.536 68,975,202
$2.352,334 3.612.757 2.173.082 5.879.910 72.328.189 86.346.272 94.845.588
Liabilities, fund equity,
and other credits
Liabilities:
Accounts payable $ 5,600 - 8,532
Accrued expenses - 721,066 -
Due to other funds 217,891 39,135 124,190
Advances from other funds - 511,903 -
Advances payable to the City
of La Quinta (note 12) - - -
Obligations under pass-through
agreements (notes 9, 10, and 11) - - -
Tax allocation bonds payable
(notes 5, 6, 7 and 8) - - -
Notes payable - - -
Total liabilities
223,491 1,272,104 132,722 -
Fund equity and other credits:
Account
Groups
- - - 5,879,910
Fund balances:
Governmental Fund
Types
General
General
Totals
Advances to other funds
Special
Debt
Capital
Fixed
Long -Term
(Memorandum Only)
Revenue
Service
Projects
Assets
Debt
1995
1994
$1,154,348
3,082,986
6,100
-
-
4,243,434
1,972,650
-
529,771
1,953,166
-
-
2,482,937
6,304,023
-
-
89,626
-
-
89,626
-
597
-
-
-
-
597
-
-
_
_
-
-
-
399,971
67,120
-
-
-
-
67,120
67,120
257,026
-
124,190
-
-
381,216
5,646,114
-
_
-
-
-
-
1,092,260
361,340
-
-
-
-
361,340
361,340
511,903
-
-
-
-
511,903
-
5,879,910 - 5,879,910 5,879,910
- 2,340,653 2,340,653 4,146,998
69.987,536 69.987.536 68,975,202
$2.352,334 3.612.757 2.173.082 5.879.910 72.328.189 86.346.272 94.845.588
Liabilities, fund equity,
and other credits
Liabilities:
Accounts payable $ 5,600 - 8,532
Accrued expenses - 721,066 -
Due to other funds 217,891 39,135 124,190
Advances from other funds - 511,903 -
Advances payable to the City
of La Quinta (note 12) - - -
Obligations under pass-through
agreements (notes 9, 10, and 11) - - -
Tax allocation bonds payable
(notes 5, 6, 7 and 8) - - -
Notes payable - - -
Total liabilities
223,491 1,272,104 132,722 -
Fund equity and other credits:
Investment in general fixed assets
- - - 5,879,910
Fund balances:
Reserved for:
Bond reserve requirement
- 509,490 - -
Advances to other funds
511,903 - - -
Notes receivable
67,120 - - -
Land held for resale
361,340 - - -
TDC owner participation agreement
- - 1,820,357 -
Unreserved:
Designations
1,188,480 1,831,163 220,003 -
Total fund equity and
other credits 2,128,843 2,340,653 2,040,360 5,879,910
- 14,132 1,260,510
- 721,066 -
- 381,216 5,646,114
- 511,903 -
6,048,957 6,048,957 4,321,796
25,749,232 25,749,232 26,743,004
40,530,000 40,530,000 40,810,000
1,247,400
72,328,189 73,956,506 80,028,824
- 5,879,910 5,879,910
509,490 1,218,892
511,903 -
67,120 67,120
361,340 361,340
1,820,357 1,820,793
3.239.646 5.468.709
- 12,389,766 14,816,764
Total liabilities, fund
equity, and other credits $2.352.334 3.612,757 2.173.082 5.879,910 72.328.189 86.346.272 94 845.588
See accompanying notes to the financial statements.
-2-
LA QUINTA REDEVELOPMENT AGENCY
Combined Statement of Revenues, Expenditures and
Changes in Fund Balances - All Governmental Fund Types
Year ended June 30, 1995
Revenues:
Tax increment
Intergovernmental
Developer fees
Interest
Miscellaneous
Total revenues
Expenditures:
Administrative
Professional fees
Planning and development
Capital projects
Debt service:
Principal
Interest
Repayment of advances from City
Payments under pass through
agreements
Mandated education contribution
Total expenditures
Excess (deficiency) of revenues
over expenditures
Other financing sources (uses):
Operating transfers in
Operating transfers out
Transfers from the City of La Quinta
Transfers to the City of La Quinta
Proceeds of bonds (net of premium and
issuance costs)
Payment to refunded bond escrow agent
Proceeds of advances from City
Litigation settlement proceeds
Litigation settlement payments
Total other financing sources (uses)
Excess (deficiency) of revenues
and other sources over (under)
expenditures and other uses
Fund balances (deficit) at beginning
of year, as restated (note 18)
Fund balances at end of year
(2,046,455) (160,875) (2,448,335) (4,655,665) (12,025,371)
817,244 2,734,949 3,552,193 1,599,513
(265,611) (2,462,714) (823,868) (3,552,193) (1,599,513)
- - 175,343 175,343 1,488,654
- (481,635) (481,635) (23,400)
- - - 28,349,926
- - - (27,922,526)
2,621,457 2,621,457 -
353,118 353,118 3,431,561
- - (2,000,000)
(265,611) (1,645,470) 4,579,364 2,668,283 3,324,215
(2,312,066) (1,806,345) 2,131,029 (1,987,382) (8,701,156)
4.440,909 4,146.998 (90,669) 8,497,238 17.198,394
2.128.843 2.340.653 2.040.360 6.509.856 8.497.238
See accompanying notes to the financial statements.
-3-
Totals
Special
Debt
Capital
(Memorandum Only)
Revenue
Service
Projects
1995
1994
$2,813,394
11,338,868
-
14,152,262
13,233,435
-
-
10,650
10,650
2,536,134
-
-
-
-
75,537
123,813
169,676
70,721
364,210
403,598
5,067
5,067
3,995
2,942,274
11,508,544
81,371
14,532,189
16,252,699
404,880
-
917,177
1,322,057
1,042,199
401,125
191,094
350,217
942,436
1,136,847
3,574,904
-
168,436
3,743,340
2,115,775
-
-
178,474
178,474
11,975,561
607,820
280,000
810,491
1,698,311
850,000
-
2,798,708
104,911
2,903,619
3,415,713
-
894,295
-
894,295
973,935
-
6,954,152
-
6,954,152
6,217,002
551,170
551,170
551,038
4,988,729
11,669,419
2,529,706
19,187,854
28,278,070
(2,046,455) (160,875) (2,448,335) (4,655,665) (12,025,371)
817,244 2,734,949 3,552,193 1,599,513
(265,611) (2,462,714) (823,868) (3,552,193) (1,599,513)
- - 175,343 175,343 1,488,654
- (481,635) (481,635) (23,400)
- - - 28,349,926
- - - (27,922,526)
2,621,457 2,621,457 -
353,118 353,118 3,431,561
- - (2,000,000)
(265,611) (1,645,470) 4,579,364 2,668,283 3,324,215
(2,312,066) (1,806,345) 2,131,029 (1,987,382) (8,701,156)
4.440,909 4,146.998 (90,669) 8,497,238 17.198,394
2.128.843 2.340.653 2.040.360 6.509.856 8.497.238
See accompanying notes to the financial statements.
-3-
LA QUINTA REDEVELOPMENT AGENCY
Combined Statement of Revenues, Expenditures
and Changes in Fund Balances - Budget and Actual - All Governmental Fund Types
Year ended June 30, 1995
Revenues:
Tax increment
Intergovernmental
Interest
Miscellaneous
Total revenues
Expenditures:
Administrative
Professional fees
Planning and development
Capital projects
Debt service:
Principal
Interest
' Repayment of advances from City
Payments under pass through agreement:
Mandated education contribution
Total expenditures
Excess (deficiency) of revenues
over expenditures
Other financing sources (uses):
Operating transfers in
Operating transfers out
Transfers from the City of La Quinta
Transfers to the City of La Quinta
Proceeds of advances from City
Litigation settlement proceeds
Total other financing sources
(uses)
Excess (deficiency) of revenues
and other sources over (under)
expenditures and other uses
Fund balances (deficit) at beginning
of year, as restated (note 18)
Fund balances (deficit) at end of year
Special Revenue Funds
Debt Service Funds
Capital
Projects
Funds
(19,383)
-
Variance-
(894,295)
6,994,830
Variance-
40,678
551,035
Variance -
135)
(750,158)
Favorable
Favorable
-
Favorable
Budget
Actual
(Unfavorable )
Budget
Actual
(Unfavorable)
Budget
Actual
(Unfavorable)
$2,433,965
2,813,394
379,429
11,333,925
11,338,868
4,943
-
-
-
-
_
_
_
_
-
-
10,650
10,650
136,200
123,813
(12,387)
142,500
169,676
27,176
5,000
70,721
65,721
536,116
5,067
(531,049)
-
-
-
-
-
-
3,106,281
2,942,274
(164,007)
11,476,425
11,508,544
32,119
5,000
81,371
76,371
404,880 (404,880)
- 401,125 (401,125)
4,006,939 3,574,904 432,035
225,015 - 225,015
607,820 (607,820)
4,231,954 4,988,729 (756,775)
- 191,094 (191,094)
21,750 - 21,750
285,000
280,000
51000
2,779,325
2,798,708
(19,383)
-
894,295
(894,295)
6,994,830
6,954,152
40,678
551,035
551,170
135)
10,631,940 11,669,419 (1,037,479)
917,177 (917,177)
- 350,217 (350,217)
3,352,101 168,436 3,183,665
- 178,474 (178,474)
810,491 (810,491)
- 104,911 (104,911)
3,352,101 2,529,706 822,395
(1,125,673) (2,046,455) (920,782) 844,485 (160,875) (1,005,360) (3,347,101) (2,448,335) 898,766
- -
-
-
817,244
817,244
-
2,734,949
2,734,949
- (265,611)
(265,611)
-
(2,462,714)
(2,462,714)
(73,710)
(823,868)
(750,158)
-
175,343
175,343
-
(481,635)
(481,635)
-
2,621,457
2,621,457
353,118
353,118
- (265,611)
(265,611)
-
(1,645,470)
(1,645,470)
(73,710)
4,579,364
4,653,074
(1,125,673) (2,312,066)
(1,186,393)
844,485
(1,806,345)
(2,650,830)
(3,420,811)
2,131,029
5,551,840
4,440,909 4,440,909
4,146,998
4.146,998
-
(90,669)
(90,669)
-
JJJ15.236 2.128.843
(1.186.393)
4.991.483
2,340.653
(2.650.830)
(3.511,480)
2.040.360
5.551.840
See accompanying
notes to
the financial
statements.
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
June 30, 1995
(1) Summary of Significant Accounting Policies
The following is a summary of the significant accounting policies of the La Quinta
Redevelopment Agency:
(a) Fund Accounting
The basic accounting and reporting entity is a "fund". A fund is defined as an
independent fiscal and accounting entity with a self -balancing set of accounts,
recording resources, related liabilities, obligations, reserves and equities
segregated for the purpose of carrying out specific activities or attaining certain
objectives in accordance with special regulations, restrictions or limitations.
The accounting records of the Agency are organized on the basis of funds and
account groups classified for reporting purposes as follows:
GOVERNMENTAL FUNDS
Special Revenue Funds
The Special Revenue Funds consist of the Low and Moderate Income Housing
Funds of the Redevelopment Agency and are used to account for the portion of
the Agency's tax increment revenue that is legally restricted for increasing or
improving housing for low or moderate income households.
Debt Service Funds
The Debt Service Funds account for tax increment revenues and bond proceeds
required to be set aside for future debt service and related interest income. The
funds are used to repay principal and interest on indebtedness of the Agency.
Under provisions of the Health and Safety Code and the Agency's bond
resolutions, these funds are referred to as "Special Funds".
Capital Projects Funds
The Capital Projects Funds account for bond proceeds available for project
improvements, interest income on invested funds and certain other income. The
funds are expended primarily for redevelopment project costs and administrative
expenses. Under provisions of the Health and Safety Code and the Agency's bond
resolutions, these funds are referred to as "Redevelopment Funds".
-5-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(1) Summary of Significant Accounting Policies (Continued)
ACCOUNT GROUPS
General Long,—Term Debt Account Group
This account group is used to account for all long—term debt of the Agency. The
proceeds of the indebtedness is recorded in the Capital Projects (Redevelopment)
fund and serves as a financing source for redevelopment expenditures.
General Fixed Assets Account Group
The General Fixed Assets Account Group is used to account for the cost of fixed
assets acquired to perform general government functions.
Assets purchased are recorded as expenditures in the governmental funds and
capitalized at cost in the general fixed assets account group. Contributed fixed
assets are recorded in
received. Fixed assets
present value of future
general fixed assets.
(b) Basis of Accounting
general fixed assets at fair market value at the time
acquired under a capital lease are recorded at the net
lease payments. No depreciation has been provided on
The modified accrual basis of accounting is utilized by all funds of the Agency.
Under the modified accrual basis of accounting, expenditures are recorded when
a current liability is incurred and revenues are recorded when received in cash
unless susceptible to accrual (i.e., measurable and available to finance the
Agency's operations).
(c) Relationship to the City of La Quinta
The Agency is an integral part of the reporting entity of the City of La Quinta.
The funds and account groups of the Agency have been included within the scope
of the financial statements of the City because the City Council of the City of
La Quinta exercises oversight responsibility over the operations of the Agency.
Only the funds and account groups of the Agency are included herein and these
financial statements, therefore, do not purport to represent the financial position
or results of operations of the City of La Quinta, California.
(d) Cash and Investments
Investments are reported at cost. An estimated loss is accrued for an
impairment of investment market value when it is probable that the loss will
become realized and the amount of loss can be reasonably estimated.
-6-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(1) Summary of Significant Accounting Policies. (Continued)
(e) Land Held for Resale
Land held for resale represents property acquired by the Agency for resale. The
property is recorded at original cost. No write-down for a lower market value
has been reflected in the accompanying financial statements.
(f) Budgetary Reporting
The Agency adopts an annual budget prepared on the modified accrual basis for
all of its governmental funds.
(g) Memorandum Only Totals
Columns in the accompanying financial statements captioned "Totals
(Memorandum Only)" are not necessary for a fair presentation of the financial
statements in accordance with generally accepted accounting principles, but are
presented as additional analytical data.
(2) Organization and Tax Increment Financing
Redevelopment Goals and Objectives
The general objective of the Redevelopment Plan adopted by the Agency is to
encourage investment in the Redevelopment Project Areas by the private sector. The
Redevelopment Plan provides for the demolition of buildings and improvements, the
relocation of any displaced occupants, and the construction of streets, parking
facilities, utilities and other public improvements. The Redevelopment Plan also
includes the ability to redevelop land by private enterprise or public agencies, the
rehabilitation of structures, the rehabilitation or construction of single family and low
and moderate income housing, and participation by owners and tenants of properties in
the Redevelopment Project.
Redevelopment Project Areas
The Agency has established two redevelopment project areas. On November 29, 1983
the City Council approved and adopted the Redevelopment Plan for the La Quinta
Redevelopment Project Area No. 1. On May 16, 1989 the City Council approved and
adopted the Redevelopment Plan for the La Quinta Redevelopment Project Area
No. 2. These plans provide for the elimination of blight and deterioration which was
found to exist in the project areas.
-7-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(2) Organization and Tax Increment Financing, (Continued)
The Coachella Valley Water District is jointly financing projects with the Agency to
help prevent the potential flooding of the project areas.
Tax Increment Financing
The Law provides a means for financing redevelopment projects based upon an
allocation of taxes collected within a redevelopment project. The assessed valuation
of a redevelopment project last equalized prior to adoption of a redevelopment plan or
amendment to such redevelopment plan, or "base roll', is established and, except for
any period during which the assessed valuation drops below the base year level, the
taxing bodies thereafter receive the taxes produced by the levy of the current tax rate
upon the base roll. Taxes collected upon any increase in assessed valuation over the
base roll ("tax increment") are paid and may be pledged by a redevelopment agency to
the repayment of any indebtedness incurred in financing or refinancing a
redevelopment project. Redevelopment agencies themselves have no authority to levy
property taxes.
(3) Cash and Investments
Cash and investments are classified in the accompanying combined balance sheet as
follows:
Cash and investments $4,243,434
Cash with fiscal agent 2,482,937
Total cash and investments $6,726,371
The composition of the above balances consists of the following:
Cash and investments:
Equity in City cash and investment pool $4,243,434
Cash and investments held by fiscal agent:
Mutual funds 2,482,937
Total cash and investments $6,726,371
The market value of the mutual funds approximates the carrying amount.
The Agency is generally authorized under state statutes and local resolutions to invest
in the following investments:
Investment Type Maximum %
Savings/operating accounts 85%
Certificates of deposit 60%
U.S. government and agency securities 75%
Government pool 90%
Money market and short intermediate term bond funds 60%
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(4) Property Taxes
Under California law, property taxes are assessed and collected by the counties up to
1% of assessed value, plus other increases approved by the voters. The property taxes
are recorded initially in a pool, and are then allocated to the cities based on complex
formulas. Accordingly, the City of La Quinta accrues only those taxes which are
received from the County within sixty days after year end.
Lien date March 1
Levy date June 30
Due dates November 1 and February 1
Collection dates December 10 and April 10
The La Quinta Redevelopment Agency's primary source of revenues comes from
property taxes. Property taxes allocated to the Agency are computed in the following
manner:
(a) The assessed valuation of all property within the project area is determined on
the date of adoption of the Redevelopment Plan.
(b) Property taxes related to the incremental increase in assessed values after the
adoption of the Redevelopment Plan are allocated to the Agency; all taxes on the
"frozen" assessed valuation of the property are allocated to the City and other
districts.
The Agency has no power to levy and collect taxes and any legislative property tax
shift might reduce the amount of tax revenues that would otherwise be available to pay
the principal of, and interest on, debt. Broadened property tax exemptions could have
a similar effect. Conversely, any increase in the tax rate or assessed valuation, or any
reduction or elimination of present exemptions would increase the amount of tax
revenues that would be available to pay principal and interest on debt.
-9-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(5) General Long -Term Debt
Changes in general long-term debt for the year ended June 30, 1995, were as follows:
Balance at Balance at
July 1, 1994 Additions Deletions June 30, 1995
Project Area No. 1:
Tax allocation bonds
$35,000,000 -
200,000
34,800,000
Pass through agreements
payable:
Due to County of Riverside
10,517,138 -
-
10,517,138
Desert Sands Unified
School District
2,566,220 -
661,560
1,904,660
Coachella Valley Unified
School District
12,896,359 -
624,474
12,271,885
Notes payable - individuals
531,531 -
531,531
-
Advances from City of
La Quinta
- 2,621,457
281,014
2,340,443
Claims and settlements
payable
- -
-
-
Project Area No. 2:
Tax allocation bonds
5,810,000 -
80,000
5,730,000
Due to County of Riverside
763,287 292,262
-
1,055,549
Notes payable - individuals
715,869 -
715,869
-
Advances from City of
La Quinta
4,321,796 -
613.282
3,708,514
Total long-term debt
$73,122JM 2.913.719
3,707,730
.328.189
-10-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(6) Tax Allocation Bonds, Series 1991
La Quinta Redevelopment Project Tax Allocation Bonds, Series 1991, were issued by
the Agency, October 1, 1991, in the amount of $8,700,000 for Project Area No. 1.
Interest is payable semi-annually, on March 1, and September 1 of each year
commencing March 1, 1992. Interest rates are 6.375% per annum.
Term Bonds maturing on September 1, 2014 are subject to mandatory sinking fund
redemption, in whole or in part, on September 1, 2010 and on each September 1,
thereafter, through September 1, 2014, at a prepayment price equal to 100% of the
principal amount plus accrued interest.
Under the terms of the issue, the maximum annual debt service amount of $734,480 is
to be set aside in reserve funds unless the Agency elects to maintain the reserve
requirement by obtaining a letter of credit for the amount. In the current year, a
surety agreement was purchased to satisfy the bond reserve requirement. The amount
of principal outstanding on the 1991 Tax Allocation Bonds payable at June 30, 1995 was
$8,135,000.
(7) Tax Allocation Bonds, Series 1992
La Quinta Redevelopment Project Tax Allocation Bonds, Series 1992, were issued by
the Agency, December 1, 1992, in the amount of $5,845,000 for Project Area No. 2.
Interest is payable semi-annually on June 1 and December 1 of each year, commencing
June 1, 1993. The interest on and principal of the bonds are payable solely from
pledged tax increment revenues. Interest payments range from 5% to 6.9% per annum.
The bonds maturing on or after December 1, 1996 are subject to mandatory redemption
in part without premium on June 1, 1996.
Under the terms of the bond, the maximum annual debt service amount of $509,490
excluding the principal amount of the proceeds of the bonds held in the escrow fund, is
to be set aside in reserve funds unless the Agency elects to maintain the reserve
requirement by obtaining a letter of credit for the account. As of June 30, 1995, the
amounts deposited in the reserve and escrow funds were $524,602 and $167,660,
respectively. The principal balance of outstanding bonds at June 30, 1995 was
$5,730,000.
-11-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(8) Tax Allocation Refunding Bonds, Series 1994
Tax allocation refunding bonds, Series 1994, in the amount of $26,665,000 were issued
by the Agency to refund the outstanding aggregate principal amount of the Agency's
Tax Allocation Bonds, Series 1989 and 1990. The remaining proceeds were used to
finance certain capital improvements within the La Quinta Redevelopment Project
Area No. 1.
Interest rates on the bonds ranges from 3.80% to 8% and are payable semi-annually on
March 1 and September 1 of each year until maturity. The interest and principal of the
bonds are payable solely from pledged tax increment revenues. The bonds are not
subject to redemption prior to maturity. A portion of the proceeds was used to obtain
a surety agreement to satisfy the bond reserve requirement. The principal balance of
outstanding bonds at June 30, 1995 is $26,665,000.
A portion of the bond proceeds, in the amount of $27,922,526, was deposited in an
irrevocable trust with an escrow agent to provide for all future debt service payments
on the 1989 and 1990 Tax Allocation Bonds. As a result, the bonds are considered to be
defeased and the liability for those bonds has been removed from the general
long-term debt account group. As of June 30, 1995, $6,895,000 and $17,530,000 of the
1989 and 1990 defeased bonds are outstanding, respectively.
(9) Due to County of Riverside
Proiect Area No. 1
Based on an agreement amended December 21, 1993 between the Agency, the City of
La Quinta, and the County of Riverside (County), the Agency will pay to the County
$10,517,138 from tax increment revenue relating to Project Area No. 1. This
agreement is in consideration of the tax revenues lost by the County as a result of the
formation of Project Area No. 1. The tax increment is to be paid to the County over a
payment schedule through June 30, 2006 in annual amounts ranging from $386,764 to
$2,190,473. Unpaid balances accrue interest at 5.5% per annum. The balance at
June 30, 1995 was $10,517,138.
Project Area No. 2
Based on an agreement dated July 5, 1989 between the Agency and the County, until
the tax increment reaches $5,000,000 annually in Project Area No. 2, the Agency will
pay to the County 50% of the County portion of tax increment. At the County's
option, the County's pass-through portion can be retained by the Agency to finance
new County facilities or land costs that benefit the County and serve the La Quinta
population. Per the agreement, the Agency must repay all amounts withheld from the
County. The Agency is required to begin repayment in the year in which tax increment
reaches $5,000,000 in ten equal annual installments. Interest does not accrue on this
obligation. The balance at June 30, 1995 was $1,055,549.
-12-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(10) Notes Payable to Desert Sands Unified School District
Based on an agreement dated June 21, 1988 between the Agency, the City of La Quinta
and the Desert Sands Unified School District (District), the Agency identified tax
increment revenue associated with the District for Project Area No. 1. The tax
increment is paid to the District over a payment schedule through July 1, 1998 in
amounts ranging from $21,505 to $663,825 for a total amount of $4,132,020.
Alternatively, such tax increment revenues plus interest accrued required by this
agreement may be retained by the Agency to pay on behalf of the District principal
and interest on loans, construction projects or money advanced to finance a sports
complex and related amenities as specified by the District. Tax increment payments
outstanding at June 30, 1995 totaled $1,904,660.
(11) Notes Payable to Coachella Valley Unified School District
An agreement was entered into in 1991 between the Agency, the City of La Quinta and
the Coachella Valley Unified School District (District) which provides for the payment
to the District of a portion of tax increment revenue associated with properties within
District confines. Such payments are subordinate to other indebtedness of the Agency
incurred in furtherance of the Redevelopment Plan for Project Area No. 1. This tax
increment is paid to the District over a payment schedule through August 1, 2012 in
amounts ranging from $474,517 to $834,076 for a total amount of $15,284,042. Tax
increment payments outstanding at June 30, 1995 totaled $12,271,885. The District
agrees to use such funds to provide classroom and other construction costs, site
acquisition, school busses, expansion or rehabilitation of current facilities.
(12) Advances from the City of La Quinta
The following represents a summary of the various transactions between the City of La
Quinta and the Agency, accounted for as advances from the City:
Agency expenditures
incurred by the City:
Project Area No. 1
Project Area No. 2
Totals
Balances at Balances at
July 1, 1994 Proceeds Repayments June 30, 1995
$ - 2,621,457 281,014 2,340,443
4,321,796 - 613.282 3.708,514
4.321.796 2.621.457 DA,29 6 6.048.957
-13-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(13) Debt Service Requirements to Maturity
The minimum annual requirements (including sinking fund requirements) to amortize
the long-term debt of the Agency as of June 30, 1995 are as follows (advances payable
to the City and the passthrough obligation owed by Project Area No. 2 to the County
have been excluded since minimum annual debt service payments have not been
established):
Less:
Interest (6,243,249) (19.876,988) (5,893,106) - - (4,559.508) (36.572.851)
Total
Principal 8.135.000 26.665.000 .7 1.904.660 12.271.885 10.517.138 65.223.683
-14-
Pass-through Agreements
Redevelopment Agency
RDA
Project Area No. 1
Project
Area No. 1
PA #2
Desert
Coachella
Tax
Tax
Tax
Sands
Valley
Year
Allocation
Allocation
Allocation
Unified
Unified
County
Ending
Series
Series
Series
School
School
of
June 30
1991
1994
1992
District
District
Riverside
Total
1995-96
$ 722,675
2,306,582
493,857
628,000
474,517
386,764
5,012,395
1996-97
723,810
2,629,851
503,607
707,650
526,560
386,764
5,478,242
1997-98
723,988
2,632,040
502,127
569,010
580,683
773,528
5,781,376
1998-99
723,210
2,625,330
510,065
-
621,976
773,528
5,254,109
1999-00
721,475
2,624,696
501,805
-
649,927
773,528
5,271,431
2000-01
723,625
2,624,885
508,265
-
670,817
1,803,705
6,331,297
2001-02
724,500
2,620,315
503,500
-
684,233
1,803,705
6,336,253
2002-03
719,259
2,620,855
508,100
-
697,918
1,803,705
6,349,837
2003-04
722,744
2,599,465
501,550
-
711,877
2,190,473
6,726,109
2004-05
719,794
2,612,140
509,490
-
726,114
2,190,473
6,758,011
2005-06
720,409
2,597,700
505,890
-
740,636
2,190,473
6,755,108
2006-07
719,431
2,593,456
506,400
-
755,449
-
4,574,736
2007-08
716,860
2,590,816
505,650
-
770,558
-
4,583,884
2008-09
717,535
2,584,232
503,850
-
785,968
-
4,591,585
2009-10
716,297
2,578,160
506,000
-
801,688
-
4,602,145
2010-11
713,080
2,571,868
506,750
-
817,722
-
4,609,420
2011-12
712,720
2,569,442
506,100
-
834,076
-
4,622,338
2012-13
714,959
2,560,155
509,050
-
421,166
-
4,205,330
2013-14
709,799
-
505,250
-
-
-
1,215,049
2014-15
712,079
-
505,050
-
-
-
1,217,129
2015-16
-
-
503,100
-
-
-
503,100
2016-17
-
-
509,400
-
-
-
509,400
2017-18
-
-
508.250
-
-
-
508.250
Principal
and
interest
14,378,249
46,541,988
11,623,106
1,904,660
12,271,885
15,076,646
101,796,534
Less:
Interest (6,243,249) (19.876,988) (5,893,106) - - (4,559.508) (36.572.851)
Total
Principal 8.135.000 26.665.000 .7 1.904.660 12.271.885 10.517.138 65.223.683
-14-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(14) Pledged Tax Revenues
All tax revenues received by the Agency other than the amount required by law to be
deposited in a low and moderate income housing fund, are required to be used to meet
debt service requirements of the bond indentures before any payments may be made on
other obligations of the Agency.
(15) Changes in General Fixed Assets
The Agency has purchased land which is intended to be used for community facilities.
A summary of general fixed assets transactions for the fiscal year ended June 30, 1995
is as follows:
Balances at
July 1, 1994
Additions Deletions
(16) Commitments under Development Agreements
Washington Adams
Balances at
June 30. 1995
The Agency has entered into an Owner Participation Agreement (OPA) with
Washington/Adams, a California limited partnership. Washington/Adams is responsible
for the development of a retail center located at the intersection of Washington
Avenue and Highway 111. Certain infrastructure improvements will be necessary as a
result of this retail development project. Because of the regional benefit of these
improvements, the Agency has agreed to contribute toward the cost of certain of the
infrastructure improvements up to a maximum of $3,156,000.
E.G. Williams
On July 5, 1994, the Agency entered into a disposition and development agreement
with E.G. Williams Development Corporation. In this agreement, E.G. Williams is
responsible for the development of 60 detached single-family homes, 90 rental units
designed for occupancy by senior citizens, one manager unit, and streets, gutters,
drainage and other off-site facilities. In return, the Agency will convey title to the
property for an agreed upon price.
(17) Settlement Payments
Litigation settlement payments reflect the payments made to Iowa Trust in settlement
of a claim by Iowa Trust with regard to funds previously invested by the Agency with
an investment management company.
-15-
LA QUINTA REDEVELOPMENT AGENCY
Notes to Financial Statements
(Continued)
(18) Prior Period Adjustment
The accompanying financial statements reflect certain adjustments to the opening fund
balance of the Redevelopment Agency Project Area No. 2 capital projects fund. The
effect of this change on the beginning fund balance of the capital projects fund type is
as follows:
Capital Projects
Fund balance at beginning of year,
as previously reported $348,947
Adjustment of intergovernmental
receivable43( 9,616)
Fund balance at beginning of year,
as restated (90.669)
(19) Subsequent Events
On August 1, 1995, the Agency issued $22,455,000 of housing tax allocation bonds dated
July 1, 1995 to increase, improve, and preserve the supply of low and moderate income
housing in the City. Interest is payable semi—annually on September 1 and March 1 of
each year commencing September 1, 1997. Interest payments range from 4% to 5.6%.
-16-
LA QUINTA REDEVELOPMENT AGENCY
Special Revenue Funds
Combining Balance Sheet
June 30, 1995
-17-
Low Income
Low Income
Housing
Housing
Project
Project
Totals
Area #1
Area #2
1995
1994
Assets
Cash and investments
$ -
1,154,348
1,154,348
-
Accrued revenue
597
-
597
-
Notes receivable
67,120
-
67,120
67,120
Due from other funds
-
257,026
257,026
4,056,211
Land held for resale
361,340
-
361,340
361,340
Advances to other funds
511,903
-
511,903
-
Total assets
1.411.374
2.352.334
4.484,671
Liabilities and Fund Balances
Liabilities:
Accounts payable
$ 4,166
1,434
5,600
43,762
Due to other funds
217.891
-
217,891
-
Total liabilities
222,057
1,434
223,491
43,762
Fund balances:
Reserved for:
Advances to other funds
511,903
-
511,903
-
Notes receivable
67,120
-
67,120
67,120
Land held for resale
361,340
-
361,340
361,340
Unreserved:
Designations
(221,460)
1,409,940
1,188,480
4,012,449
Total fund balances
718,903
1,409,940
2,128,843
4,440,909
Total liabilities and
fund balances
$9AQ,9M
1.411.374
2.352,334
4 484.671
-17-
LA QUINTA REDEVELOPMENT AGENCY
Special Revenue Funds
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances
Year ended June 30, 1995
Low Income Low Income
Housing Housing
Project Project
Area #1 Area #2
Revenues:
Totals
1995 1994
Tax increment $2,301,158 512,236 2,813,394
Developer fees - - -
Interest 52,485 71,328 123,813
Miscellaneous 5,067 - 5,067
Total revenues 2,358,710 583,564 2,942,274
Expenditures:
Administrative
Professional fees
Planning and development
Debt service:
Principal
Payment of advances from City
Total expenditures
Excess (deficiency) of
revenues over expenditures
Other financing sources (uses):
Operating transfers out
Total other financing
sources (uses)
Excess (deficiency) of
revenues and other
sources over expenditures
and other uses
Fund balances at beginning of year
Fund balances at end of year
272,749
132,131 404,880
342,765
58,360 401,125
3,561,838
13,066 3,574,904
607,820
- 607,820
4,785,172 203,557 4,988,729
2,171,571
33,760
186,733
2,392,064
2,684,962
21,715
2,947,638
(2.426,462) 380,007 (2 046,455) (555,574)
(2,426,462)
3,145,365
$ 718.903
-18-
(265,611) (265,611) (7,020)
(265,611) (265,611) (7,020)
114,396 (2,312,066) (562,594)
1,295.544 4,440,909 5,003.503
1.409.940 2,128.843 4.440.909
LA QUINTA REDEVELOPMENT AGENCY
Debt Service Funds
Combining Balance Sheet
June 30, 1995
Redevelopment Redevelopment
Agency Agency Totals
PA #1 PA #2 1995 1994
Assets
Cash and investments $2,211,017 871,969 3,082,986 1,972,650
Cash with fiscal agent 4,910 524,861 529,771 1,382,449
Prepaid expense - - - 399,971
Due from other funds - - - 1,589,903
Total assets $2,215,927 1.396,830 3,612,757 5.344.973
Liabilities and Fund Balances
Liabilities:
Accounts payable
$ -
-
-
646,937
Accrued expenses
526,983
194,083
721,066
-
Due to other funds
-
39,135
39,135
551,038
Advances from other funds
511,903
-
511,903
-
Total liabilities
1,038,886
233,218
1,272,104
1,197,975
Fund balances:
Reserved for:
Bond reserve requirement
-
509,490
509,490
1,218,892
Unreserved:
Designations
1,177,041
654,122
1,831,163
2,928,106
Total fund balances
1,177,041
1,163,612
2,340,653
4,146,998
Total liabilities and
fund balances
2.215.927
1.396,830
3,612,757
5,344,973
-19-
LA QUINTA REDEVELOPMENT AGENCY
Debt Service Funds
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances
Revenues:
Tax increment
Interest
Miscellaneous
Total revenues
Expenditures:
Year ended June 30, 1995
Redevelopment Redevelopment
Agency Agency Totals
PA #1 PA #2 1995 1994
$9,289,918 2,048,950 11,338,868 11,061,864
94,878 74,798 169,676 164,628
OUR
9,384,796 2,123,748 11,508,544 11.230.487
Professional fees 153,754
Debt service:
Principal 200,000
Interest 1,980,982
Repayment of advances from City 281,013
Payments under pass-through
agreements 5,979,079
Mandated education
contribution 512.025
Total expenditures
Excess (deficiency)
of revenues over
expenditures
Other financing sources (uses):
Operating transfers in
Operating transfers out
Litigation settlement proceeds
Total other financing
sources (uses)
Excess (deficiency) of
revenues and other
sources over
expenditures and
other uses
Fund balances at beginning
of year
Fund balances at end of year
9,106,853
277,943
546,624
(2,462,714)
37,340
191,094
193,854
80,000
280,000
850,000
817,726
2,798,708
3,398,885
613,282
894,295
815,010
975,073 6,954,152 6,217,002
39,145 551.170 551.038
2,562,566 11,669,419 12,025,789
(438,818) (160,875) (795,302)
270,620 817,244 239,290
- (2,462,714) (842,768)
3.378.606
(1,916,090) 270,620 (1,645,470) 2,775,128
(1,638,147) (168,198) (1,806,345) 1,979,826
2,815,188 1,331,810 4,146,998 2,167,172
1.177.041 L163.6 2,340,653 4.146.998
-20-
LA QUINTA REDEVELOPMENT AGENCY
Capital Projects Funds
Combining Balance Sheet
June 30, 1995
Assets
Cash and investments
Cash with fiscal agent
Accounts receivable
Due from other funds
Due from other governments
Total assets
Liabilities and Fund Balances
Liabilities:
Accounts payable
Due to other funds
Total liabilities
Fund balances:
Reserved for:
TDC owner participation
agreement
Unreserved:
Designated for special
projects
Total fund balances
Total liabilities and
fund balances
Redevelopment Redevelopment
Agency Agency Totals
PA #1 PA #2 1995 1994
$ - 6,100 6,100 -
- 1,953,166 1,953,166 4,921,574
- 89,626 89,626 -
124,190 - 124,190 -
1,092,260
X4.190 2.048.892 2,173,082 6.013.834
$ 6,206 2,326 8,532 569,811
124,190 124,190 5,095,076
6,206 126,516 132,722 5,664,887
- 1,820,357 1,820,357 1,820,793
117,984 102,019 220,003 (1,471,846)
117,984 1,922,376 2,040,360 348,947
,0� 2.173.082 6.0
-21-
LA QUINTA REDEVELOPMENT AGENCY
Capital Projects Funds
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances
Year ended June 30, 1995
Revenues:
Intergovernmental
Developer fees
Interest
Total revenues
Expenditures:
Administrative
Professional fees
Planning and development
Capital outlay
Debt service:
Principal
Interest
Payment of advances
Total expenditures
Excess (deficiency)
of revenues over
expenditures
Other financing sources (uses):
Operating transfers in
Operating transfers out
Transfers from the
City of La Quinta
Transfers to the
City of La Quinta
Payment to refunded bond
escrow agent
Proceeds of advances from City
Litigation settlement proceeds
Litigation settlement payments
Total other financing
sources (uses)
Excess (deficiency) of
revenues and other
sources over (under)
expenditures and
other uses
Fund balances (deficit) at
beginning of year, as restated
Fund balances at end of year
Redevelopment Redevelopment
Agency
Agency
Totals
PA #1
PA #2
1995
1994
175,343 175,343
-
$ -
10,650
10,650
2,536,134
-
-
-
41,777
-
70,721
70,721
52,237
-
81,371
81,371
2,630,148
447,578 4,579,364
556,107
618,617
298,560
917,177
-
226,956
123,261
350,217
-
131,453
36,983
168,436
1,416,005
178,474
-
178,474
11,734,600
-
810,491
810,491
-
104,911
-
104,911
16,828
137,210
1,260,411
1,269,295
2,529,706
13,304,643
(1,260,411) (1.187,924) (2,448,335) (10,674,495)
2,462,714
272,235 2,734,949
2,848,877
(823,868)
- (823,868)
(773,125)
-
175,343 175,343
-
(481,635)
- (481,635)
28,349,926
-
- -
(27,922,526)
2,621,457
- 2,621,457
-
353,118
- 353,118
52,955
-
- -
(2,000,000)
4,131,786
447,578 4,579,364
556,107
2,871,375 (740,346) 2,131,029 (10,118,388)
(2,753,391) 2,662,722
$ 117.984 .922.376
-22-
(90,669) •
LA QUINTA REDEVELOPMENT AGENCY
Supplemental Schedule of
Tax Increment Shift to Educational Revenue Augmentation Fund
Year ended June 30, 1995
Total Tax Increment to be shifted to the Educational Revenue
Augmentation Fund (ERAF) per State Department of Finance
(DOF)
Funding sources:
Redevelopment Agency:
Agency tax increment 551,170
Other agency funds -
Total agency funds
Agency borrowing:
From current 20% low and moderate
income housing funds
From legislative body -
Total borrowed funds
Total tax increment shift to ERAF
-23-
$551,170
$551,170
1 CCN RAD CERTIFIED PUBLIC ACCOUNTANTS
S11VOCf LS, L.L.P. 11RV EAIN CALIFORNIA 9STREET,12714
A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS (714) 474-2020
Board of Directors
La Quinta Redevelopment Agency
La Quinta, California
INDEPENDENT AUDITORS' COMPLIANCE REPORT
We have audited the component unit financial statements of the La Quinta Redevelopment
Agency ("Agency") as of and for the year ended June 30, 1995 and have issued our report
thereon dated August 18, 1995. We conducted our audit in accordance with generally
accepted auditing standards and Government Auditing Standards. Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.
Compliance with laws and regulations applicable to the Agency is the responsibility of the
Agency's management. As part of obtaining reasonable assurance about whether the
component unit financial statements are free of material misstatement, we performed tests
of the Agency's compliance with provisions of laws and regulations contained in the
Guidelines for Compliance Audits of California Redevelopment Agencies issued by the State
Controller's Office, Division of Local Government Fiscal Affairs.
The results of our tests indicated that, with respect to the items tested, the La Quinta
Redevelopment Agency complied, in all material respects, with the provision referred to in
the preceding paragraph, except as follows:
During the year, the Agency was not in compliance with Health and Safety Code
Section 33302 in that the City's housing element did not include complete
quantified objectives for the element's planning period. The Agency revised its
housing element to eliminate the deficiencies noted by the State Department of
Housing and Community Development (HCD) and submitted these revisions to
HCD. On September 11, 1995, HCD formally accepted the City's revisions to its
housing element and informed the City that it was now in full compliance with
the law.
This report is intended for the information of the Agency and the State Controller's office.
However, this report is a matter of public record and its distribution is not limited.
August 18, 1995
-24-
MEMBERS OF AICPA AND CALIFORNIA SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
MEMBER OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PRIVATE COMPANIES PRACTICE SECTION