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2012 04 04 OB�a 111�•1111�' 4 aCP cFM OF'rti�9 OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO LA QUINTA REDEVELOPMENT AGENCY AGENDA La Quinta City Council Chambers 78-495 Calle Tampico, La Quinta, California Regular Meeting WEDNESDAY, APRIL 4, 2012 2:00 p.m. Beginning Resolution No. 2012-004 CALL TO ORDER Roll Call: Board Members: Ellis, Marshall, Maysels, McDaniel, Nelson, Osborne and Chairperson Pena PLEDGE OF ALLEGIANCE PUBLIC COMMENT This is the time set aside for public comment on any matter not listed on the agenda. Please complete a "Request to Speak" form and limit your comments to three minutes. When addressing the Oversight Board, please state your name and address. CONFIRMATION OF AGENDA PRESENTATIONS — None APPROVAL OF MINUTES 1. Approval of Oversight Board Minutes of Special Meeting on March 7, 2012 WRITTEN COMMUNICATIONS — None CONSENT ITEMS - None BUSINESS ITEMS 1. Consideration of Adoption of a Resolution Adopting a Conflict of Interest Code for the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency 2. Consideration of Adoption of a Resolution Approving Recognized Obligation Payment Schedules of the Former La Quinta Redevelopment Agency for the periods of January 2012 through June 2012 and July 2012 through December 2012 3. Consideration of Successor Agency Administrative Budget for the periods of February 2012 through June 2012 and July 2012 through December 2012 4. Consideration of an Owner Participation Agreement Between the Former La Quinta Redevelopment Agency and Mega Dealer LLC/Robert N. La Torre, Inc. (dba Torre Nissan) 5. Consideration of Disposition and Development Agreement Between the Former La Quinta Redevelopment Agency and Coral Mountain Partners, L.P. STUDY SESSION - None REPORTS AND INFORMATIONAL ITEMS 1. Update on the Debts and Obligations of the Former La Quinta Redevelopment Agency DEPARTMENT REPORTS 1. Response to Public Comment CHAIR AND BOARD MEMBERS' ITEMS - None ADJOURNMENT Oversight Board Agenda April 4, 2012 2 DECLARATION OF POSTING I, Lori Lafond, Executive Assistant of the City of La Quinta, do hereby declare that the foregoing Agenda for Oversight Board for the Successor Agency to La Quinta Redevelopment Agency meeting of April 4, 2012, was posted on the outside entry to the Council Chamber, 78-495 Calle Tampico, the bulletin board at the La Quinta Post Office located at 51-321 Avenida Bermudas, La Quinta, California and 78-630 Highway 111, La Quinta, California on March 29, 2012. Dated: March 29, 2012 • • •WON • Public Notices The La Quinta City Hall Council Chambers is handicapped accessible. If special equipment is needed for the hearing impaired, please call the City Clerk's office at (760) 777-7123, twenty-four (24) hours in advance of the meeting and accommodations will be made. If special electronic equipment is needed to make presentations to the Oversight Board, arrangements should be made in advance by contacting the City Clerk's office at (760) 777-7123. A one (1) week notice is required. If background material is to be presented to the Oversight Board during a Board meeting, please be advised the ten (10) copies of all documents, exhibits, etc., must be supplied to the Oversight Board Secretary for distribution. It is requested that this take place prior to the beginning of the meeting. Any, writings or documents provided to a majority of the Oversight Board regarding any item on this agenda will be made available for public inspection at the City Clerk's counter at City Hall located at 78-495 Calle Tampico, La Quinta, CA 92253, during normal business hours. Oversight Board Agenda April 4, 2012 3 OVERSIGHT BOARD OF SUCCESSOR AGENCY TO LA QUINTA REDEVELOPMENT AGENCY MINUTES MARCH 7, 2012 A special meeting of the Oversight Board of Successor Agency to La Quinta Redevelopment Agency was called to order at 4:00 p.m. by Interim City Manager, Mark Weiss. PRESENT: Board Members Ellis, Marshall, Maysels, McDaniel, Nelson, Osborne, Chairperson Pena ABSENT: None PUBLIC COMMENT — None. CONFIRMATION OF AGENDA — Confirmed. PRESENTATIONS 1. Introduction of Board Members: Wade Ellis, Director of Fiscal Services, Desert Community College District; Appointed by Chancellor of California Community College Heidi Marshall, Asst. Director, Economic Development Agency for County of Riverside; Appointed by Supervisor John Benoit Susan Maysels, City of La Quinta Employee; Appointed by Mayor of La Quinta Cindy McDaniel, Asst. Superintendent, Business Services, Desert Sands Unified School District; Appointed by Riverside County Office of Education Peter Nelson, President of Coachella Valley Water District Board of Directors; Appointed by Coachella Valley Water District Board of Directors Lee Osborne, City of La Quinta Council Member; Appointed by Mayor of La Quinta John Pena, Resident of City of La Quinta, Appointed by Supervisor John Benoit 2. Swearing in of Board Members Board Members were sworn in by the City of La Quinta Interim City Clerk. BUSINESS ITEMS 1. Election of Chair and Vice -Chair The vote was done by ballot. Chairperson: Board Member Pena - 5 votes; Board Member Ellis - 1. vote; Board Member Marshall - 1 vote. MOTION: A motion was made by Board Members Osborne/Maysels to elect John Pena as Chairperson of the Oversight Board. Motion carried by a vote of 7 ayes, 0 nays. Vice Chairperson: Board Member Osborne - 6 votes; Board Member Maysels - 1 vote MOTION: A motion was made by Board Members Nelson/Ellis to elect Board Member Osborne as Vice Chairperson of the Oversight Board. Motion carried by a vote of 7 ayes, 0 nays 2. Designation of Contact Person for Department of Finance Inquiries Motion to appoint Interim Executive Director as Contact Person Pursuant to the Health & Safety Code, the Board must designate a person for the Department of Finance for any inquiries regarding actions taken by the Board. Staff recommended the Interim Executive Director as contact person. MOTION: A motion was made by. Board Members Maysels/McDaniel to appoint the Interim Executive Director as contact person for Department of Finance inquiries. Motion carried unanimously. 3. Consideration of a Resolution Establishing the Date, Time and Location for Meeting of the Oversight Board of Successor Agency to La Quinta Redevelopment Agency The Board adopted a resolution to meet on the Wednesday after the first and third Tuesday of the month at 2:00 p.m. beginning Wednesday, March 21, 2012. However, staff recommended canceling the March 21, 2012 meeting due to complex issues on the next agenda. Therefore, the next OVERSIGHT BOARD MINUTES 2 MARCH 7, 2012 Board meeting will be Wednesday, April 4, 2012. MOTION: A motion was made by Board Members Nelson/Osborne to adopt Resolution No. OB 2012-001 establishing the date, time and location of Oversight Board meetings as the Wednesday after the first and third Tuesday of the month at 2:00 p.m. at La Quints City Hall, 78495 Calls Tampico, La Quints, California. Motion carried by vote of 7 ayes, 0 nays. 4. Consideration of a Resolution Adopting Bylaws and a Resolution Adopting Rules of Procedure of the Oversight Board of Successor Agency to La Quints Redevelopment Agency Board Member Maysels commented that the local practice of numbering minute actions is obsolete and of no use to the Board minutes. Maysels recommended that the reference to minute actions in Section 9 be deleted from the Rules of Procedures and as well as the word "Minute Order" on the first line of Section 9(a). MOTION: A motion was made by Chairperson Pena/Vice Chair Osborne to adopt Resolution No. 2012-002 Bylaws and Resolution No. 2012-003 Rules of Procedure as amended. Motion carried by vote 7 ayes, 0 nays. Public comment: Kay Wolff, 77-927 Calle Ensenada, La Quinta Ms. Wolff had questions regarding understanding the Oversight Board: 1. How is the public to be educated on the responsibilities of the Board, the disposition of money and property that were under the Redevelopment Agency? 2. When will Conflict of Interest Statements be filed and available to the public? 3. How can a member of the Successor Agency oversee himself on this Board? 4. How can former council members now oversee actions relating to his or her prior RDA decisions? Interim Executive Director Weiss indicated that the Board can add these items to the next agenda packet to address these questions. OVERSIGHT BOARD MINUTES 3 MARCH 7, 2012 Chairperson Pena stated that meetings are open to the public and will be advertised. He indicated that Conflict of Interest Form 700 will be completed by all Board members and must be filed by April 2, 2012. Vice Chairperson Osborne added that the State Legislature dictates the composition of the Board. INFORMATIONAL ITEMS 1. Purpose of Oversight Board Staff presented staff report. Board Member Nelson asked if the attachments to the staff report were the actual law and if it was a complete summary of Oversight Board responsibilities. Staff indicated that it is complete. Board Member Nelson asked if the total amount of indebtedness of the Successor Agency will be presented to the Board. Staff stated that it will be presented in the annual budget and a summary report would be prepared for the Board at the next meeting. Vice Chairperson Osborne noted that there may be differences in interpretation of the law between the City and County with regard to sending property tax funds to the city for debt service on bonds. He asked if the resolution to those issues would come before the Oversight Board. Kathy Jenson explained how the bond payments are made. The bond payments are listed on the Recognized Obligation Payment Schedule. The payment schedule will come before the Board for approval. 2. Overview of Former La Quinta Redevelopment Agency Frank Spevacek, Principal, RSG, Inc., presented report. Vice Chairperson Osborne asked about the changing laws in Sacramento and was concerned that the Board Members would be in a position of making a decision and the laws could change and could possibly negate what the Board has done. Mr. Spevacek explained that one of the duties of the Oversight Board is to look at existing bond issues and determine if it makes economic sense to either pay off those bond issues or restructure them to lower the amount of property tax revenue needed to retire that debt. There are currently OVERSIGHT BOARD MINUTES 4 MARCH 7, 2012 legislative proposals in Sacramento to allow the Successor Agency to keep non -housing bond proceeds as well as potentially housing bond proceeds. At this time, this Agency has approximately $12 million/$13 million of non - housing bond proceeds available and approximately $28 million of housing bond proceeds available. If these legislative proposals are successful and the Successor Agency and the La Quinta Housing Authority can keep those funds, than decisions regarding those bonds would not be part of the Board's oversight. Mr. Spevacek mentioned the Recognized Obligation Payment Schedule ("ROPS" ), needs to move forward. A project known as the Coral Mountain development proposal must also be addressed shortly. The Developer is going to be applying for tax credits on March 16, 2012. They will not get the award of tax credits until May 2012. The former Redevelopment Agency, when it was in existence, was looking to fund a $29 million commitment to facilitate that development through housing fund cash that the Agency was accruing over about the last three years. So that proposal will be brought forward by staff to see if 1) it meets with the Board's approval and 2) if it does and because it is on the BOPS, it would then be sent up to the State for their blessing or contention. If the legislation passes, then it will be a non -issue; if it doesn't pass and the Board looked favorably on it and the State didn't, than we get into a gray area, which is one of the facets of ABx 1 26 (the legislation the Board is operating under). The second project is the Torre Nissan remodel. Currently, that facility has been demolished. The showroom is a series of tents and temporary structures and inventory is now displayed throughout their blacktop facility. The Agency committed through an owner participation agreement to provide $1.5 million to facilitate the remodel. The fund designated for that are taxable Project Area No. 2 bonds, of which out of the $3.9 million proceeds amount, $1.5 million is designated for the Torre Nissan remodel. This issue will be brought forward in April to seek Board approval. If the Board agrees with that proposal and it is approved, then those funds would be designated for Torre Nissan, sent up to the State Department of Finance for review. If they do not give it their blessing, then we fall into the gray area again. At this point, staff is trying to balance moving some proposal forward for Board consideration because third parties that are under contract, are on a set time frame to move forward. The Board needs to facilitate their time frames and their funding needs and at the same time, there are no absolute guarantees in terms of what the State's position will be or what the Board's collective position will be on blessing or not blessing pending projects. Vice Chairperson Osborne asked for clarification on the State's review of all Board decisions. The State has three days after each Board meeting to OVERSIGHT BOARD MINUTES 5 MARCH 7, 2012 question any decision and ten days to approve the action or return it to the Board for reconsideration. If the Board does not hear anything from the State, it is assumed that they have agreed or allowed the Board to move forward with what they decided. CHAIR AND BOARD MEMBERS' ITEMS - None. ADJOURNMENT There being no further business, it was moved by Board Members Nelson/McDaniel to adjourn. Motion carried unanimously. Respectfully submitted, LORILAFOND Oversight Board Secretary OVERSIGHT BOARD MINUTES 6 MARCH 7, 2012 4W / I AGENDA CATEGORY: OVERSIGHT BOARD MEETING DATE: April 4, 2012 BUSINESS SESSION: ITEM TITLE: Consideration of Adoption of a Resolution Adopting a Conflict of Interest Code for the Oversight CONSENT CALENDAR: Board of the Successor Agency to La Quinta STUDY SESSION: Redevelopment Agency PUBLIC HEARING: OTHER: RECOMMENDATION: Adopt a Resolution of the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency adopting a Conflict of Interest Code. FISCAL IMPLICATIONS: None for this action. BACKGROUND AND OVERVIEW: The Political Reform Act of 1974, Government Code Section 87300 at seq., requires that a newly formed Board must adopt a Conflict of Interest Code promulgated by Section 18730 of Title 2 of the California Code of Regulations (Attachment 1). The attached resolution adopts the Fair Political Practices Commission model code, designates the Oversight Board members as the persons required to file Form 700's, designates the reporting categories as all.categories, and directs that Form 700's be filed with the Clerk of the County Board of Supervisors (which is the code reviewing body). The adopted resolution needs to be submitted to the Clerk of the County Board of Supervisors for formal approval by the Board of Supervisors in its capacity as the code reviewing body. Once adopted, staff will forward the resolution and the Oversight Board's Form 700s to the Clerk of the County of Riverside Board of Supervisors. Respectfully submitted, Debbie Powell Economic Development/Housing Manager Approved for submission by: Mark Weiss Interim Executive Director of the Successor Agency to La Quinta Redevelopment Agency Attachment: 1. Section 18730 of Title 2 of the California Code of 2 ATTACHMENT § 18730. Provisions of Conflict -of -Interest Codes. (a) Incorporation by reference of the terms of this regulation along with the designation of employees and the formulation of disclosure categories in the Appendix referred to below constitute the adoption and promulgation of a conflict -of -interest code within the meaning of Section 87300 or the amendment of a conflict -of -interest code within the meaning of Section 87306 if the terms of this regulation are substituted for terms of a conflict -of -interest code already in effect. A code so amended or adopted and promulgated requires the reporting of reportable items in a manner substantially equivalent to the requirements of article 2 of chapter 7 of the Political Reform Act, Sections 81000, et seq. The requirements of a conflict -of -interest code are in addition to other requirements of the Political Reform Act, such as the general prohibition against conflicts of interest contained in Section 87100, and to other state or local laws pertaining to conflicts of interest. (b) The terms of a conflict -of -interest code amended or adopted and promulgated pursuant to this regulation are as follows: (1) Section 1. Definitions. The definitions contained in the Political Reform Act of 1974, regulations of the Fair Political Practices Commission (Regulations 18110, et seq.), and any amendments to the Act or regulations, are incorporated by reference into this conflict -of -interest code. (2) Section 2. Designated Employees. The persons holding positions listed in the Appendix are designated employees. It has been determined that these persons make or participate in the making of decisions which may foreseeably.have a material effect on economic interests. (3) Section 3. Disclosure Categories. This code does not establish any disclosure obligation for those designated employees who are also specified in Section 87200 if they are designated in this code in that same capacity or if the geographical jurisdiction of this agency is the same as or is wholly included within the jurisdiction in which those persons must report their economic interests pursuant to article 2 of chapter 7 of the Political Reform Act, Sections 87200, et seq. In addition, this code does not establish any disclosure obligation for any designated employees who are designated in a conflict -of -interest code for another agency, if all of the following apply: (A) The geographical jurisdiction of this agency is the same as or is wholly included within the jurisdiction of the other agency; (B) The disclosure assigned in the code of the other agency is the same as that required under article 2 of chapter 7 of the Political Reform Act, Section 87200; and (C) The filing officer is the same for both agencies.l' Such persons are covered by this code for disqualification purposes only. With respect to all other designated employees, the disclosure categories set forth in the Appendix specify which kinds of economic interests are reportable. Such a designated employee shall disclose in his or her statement of economic interests those economic interests he or she has which are of the kind described in the disclosure categories to which he or she is assigned in the Appendix. It has been determined that the economic interests set forth in a designated employee's disclosure categories 2 are the kinds of economic interests which he or she foreseeably can affect materially through the conduct of his or her office. (4) Section 4. Statements of Economic Interests: Place of Filing. The code reviewing body shall instruct all designated employees within its code to file statements of economic interests with the agency or with the code reviewing body, as provided by the code reviewing body in the agency's conflict -of -interest code.Z (5) Section 5. Statements of Economic Interests: Time of Filing. (A) Initial Statements. All designated employees employed by the agency on the effective date of this code, as originally adopted, promulgated and approved by the code reviewing body, shall file statements within 30 days after the effective date of this code. Thereafter, each person already in a position when it is designated by an amendment to this code shall file an initial statement within 30 days after the effective date of the amendment. (B) Assuming Office Statements. All persons assuming designated positions after the effective date of this code shall file statements within 30 days after assuming the designated positions, or if subject to State Senate confirmation, 30 days after being nominated or appointed. 1. (C) Annual Statements. All designated employees shall file statements no later than April (D) Leaving Office Statements. All persons who leave designated positions shall file statements within 30 days after leaving office. (5.5) Section 5.5. Statements for Persons Who Resign Prior to Assuming Office. Any person who resigns within 12 months of initial appointment, or within 30 days of the date of notice provided by the filing officer to file an assuming office statement, is not deemed to have assumed office or left office, provided he or she did not make or participate in the making 3 of, or use his or her position to influence any decision and did not receive or become entitled to receive any form of payment as a result of his or her appointment. Such persons shall not file either an assuming or leaving office statement. (A) Any person who resigns a position within 30 days of the date of a notice from the filing officer shall do both of the following: (1) File a written resignation with the appointing power; and (2) File a written statement with the filing officer declaring under penalty of perjury that during the period between appointment and resignation he or she did not make, participate in the making, or use the position to influence any decision of the agency or receive, or become entitled to receive, any form of payment by virtue of being appointed to the position. (6) Section 6. Contents of and Period Covered by Statements of Economic Interests. (A) Contents of Initial Statements. Initial statements shall disclose any reportable investments, interests in real property and business positions held on the effective date of the code and income received during the 12 months prior to the effective date of the code. (B) Contents of Assuming Office Statements. Assuming office statements shall disclose any reportable investments, interests in real property and business positions held on the date of assuming office or, if subject to State Senate confirmation or appointment, on the date of nomination, and income received during the 12 months prior to the date of assuming office or the date of being appointed or nominated, respectively. (C) Contents of Annual Statements. Annual statements shall disclose any reportable investments, interests in real property, income and business positions held or received during the 4 previous calendar year provided, however, that the period covered by an employee's first annual statement shall begin on the effective date of the code or the date of assuming office whichever is later, or for a board or commission member subject to Section 87302.6, the day after the closing date of the most recent statement filed by the member pursuant to Regulation 18754. (D) Contents of Leaving Office Statements. Leaving office statements shall disclose reportable investments, interests in real property, income and business positions held or received during the period between the closing date of the last statement filed and the date of leaving office. (7) Section 7. Manner of Reporting. Statements of economic interests shall be made on forms prescribed by the Fair Political Practices Commission and supplied by the agency, and shall contain the following information: (A) Investment and Real Property Disclosure. When an investment or an interest in real property3 is required to be reported,° the statement shall contain the following: 1. A statement of the nature of the investment or interest; 2. The name of the business entity in which each investment is held, and a general description of the business activity in which the business entity is engaged; 3. The address or other precise location of the real property; 4. A statement whether the fair market value of the investment or interest in real property equals or exceeds $2,000, exceeds $10,000, exceeds $100,000, or exceeds $1,000,000. (B) Personal Income Disclosure. When personal income is required to be reported,5 the statement shall contain: 1. The name and address of each source of income aggregating $500 or more in value, or $50 or more in value if the income was a gift, and a general description of the business activity, if any, of each source; 2. A statement whether the aggregate value of income from each source, or in the case of a loan, the highest amount owed to each source, was $1,000 or less, greater than $1,000, greater than $10,000, or greater than $100,000; 3. A description of the consideration, if any, for which the income was received; 4. In the case of a gift, the name, address and business activity of the donor and any intermediary through which the gift was made; a description of the gift; the amount or value of the gift; and the date on which the gift was received; 5. In the case of a loan, the annual interest rate and the security, if any, given for the loan and the term of the loan. (C) Business Entity Income Disclosure. When income of a business entity, including income of a sole proprietorship, is required to be reported,6 the statement shall contain: entity; 1. The name, address, and a general description of the business activity of the business 2. The name of every person from whom the business entity received payments if the filer's pro rats. share of gross receipts from such person was equal to or greater than $10,000. (D) Business Position Disclosure. When business positions are required to be reported, a designated employee shall list the name and address of each business entity in which he or she is a director, officer, partner, trustee, employee, or in which he or she holds any position of management, a description of the business activity in which the business entity is engaged, and the designated employee's position with the business entity. (E) Acquisition or Disposal During Reporting Period. In the case of an annual or leaving office statement, if an investment or an interest in real property was partially or wholly acquired or disposed of during the period covered by the statement, the statement shall contain the date of acquisition or disposal. (8) Section 8. Prohibition on Receipt of Honoraria. (A) No member of a state board or commission, and no designated employee of a state or local government agency, shall accept any honorarium from any source, if the member or employee would be required to report the receipt of income or gifts from that source on his or her statement of economic interests. This section shall not apply to any part-time member of the governing board of any public institution of higher education, unless the member is also an elected official. Subdivisions (a), (b), and (c) of Section 89501 shall apply to the prohibitions in this section. This section shall not limit or prohibit payments, advances, or reimbursements for travel and related lodging and subsistence authorized by Section 89506. (8.1) Section 8.1. Prohibition on Receipt of Gifts in Excess of $420. (A) No member of a state board or commission, and no designated employee of a state or local government agency, shall accept gifts with a total value of more than $420 in a calendar year from any single source, if the member or employee would be required to report the receipt of income or gifts from that source on his or her statement of economic interests. This section shall not apply to any part-time member of the governing board of any public institution of higher education, unless the member is also an elected official. Subdivisions (e), (f), and (g) of Section 89503 shall apply to the prohibitions in this section. (8.2) Section 8.2. Loans to Public Officials. (A) No elected officer of a state or local government agency shall, from the date of his or her election to office through the date that he or she vacates office, receive a personal loan from any officer, employee, member, or consultant of the state or local government agency in which the elected officer holds office or over which the elected officer's agency has direction and control. . (B) No public official who is exempt from the state civil service system pursuant to subdivisions (c), (d), (e), (f), and (g) of Section 4 of Article VII of the Constitution shall, while he or she holds office, receive a personal loan from any officer, employee, member, or consultant of the state or local government agency in which the public official holds office or over which the public official's agency has direction and control. This subdivision shall not apply to loans made to a public official whose duties are solely secretarial, clerical, or manual. (C) No elected officer of a state or local government agency shall, from the date of his or her election to office through the date that he or she vacates office, receive a personal loan from any person who has a contract with the state or local government agency to which that elected officer has been elected or over which that elected officer's agency has direction and control. This subdivision shall not apply to loans made by banks or other financial institutions or to any indebtedness created as part of a retail installment or credit card transaction, if the loan is made or the indebtedness created in the lender's regular course of business on terms available to members of the public without regard to the elected officer's official status. 9 (D) No public official who is exempt from the state civil service system pursuant to subdivisions (c), (d), (e), (f), and (g) of Section 4 of Article VII of the Constitution shall, while he or she holds office, receive a personal loan from any person who has a contract with the state or local government agency to which that elected officer has been elected or over which that elected officer's agency has direction and control. This subdivision shall not apply to loans made by banks or other financial institutions or to any indebtedness created as part of a retail installment or credit card transaction, if the loan is made or the indebtedness created in the lender's regular course of business on terms available to members of the public without regard to the elected officer's official status. This subdivision shall not apply to loans made to a public official whose duties are solely secretarial, clerical, or manual. office. (E) This section shall not apply to the following: 1. Loans made to the campaign committee of an elected officer or candidate for elective 2. Loans made by a public official's spouse, child, parent, grandparent, grandchild, brother, sister, parent -in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, or first cousin, or the spouse of any such persons, provided that the person making the loan is not acting as an agent or intermediary for any person not otherwise exempted under this section. 3. Loans from a person which, in the aggregate, do not exceed five hundred dollars ($500) at any given time. 4. Loans made, or offered in writing, before January 1, 1998. (8.3) Section 8.3. Loan Terms. (A) Except as set forth in subdivision (B), no elected officer of a state or local government agency shall, from the date of his or her election to office through the date he or she vacates office, receive a personal loan of $500 or more, except when the loan is in writing and clearly states the terms of the loan, including the parties to the loan agreement, date of the loan, amount of the loan, term of the loan, date or dates when payments shall be due on the loan and the amount of the payments, and the rate of interest paid on the loan. (B) This section shall not apply to the following types of loans: 1. Loans made to the campaign committee of the elected officer. 2. Loans made to the elected officer by his or her spouse, child, parent, grandparent, grandchild, brother, sister, parent -in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, or first cousin, or the spouse of any such person, provided that the person making the loan is not acting as an agent or intermediary for any person not otherwise exempted under this section. 3. Loans made, or offered in writing, before January 1, 1998. (C) Nothing in this section shall exempt any person from any other provision of Title 9 of the Government Code. (8.4) Section 8.4. Personal Loans. (A)Except as set forth in subdivision (B), a personal loan received by any designated employee shall become a gift to the designated employee for the purposes of this section in the following circumstances: 1. If the loan has a defined date or dates for repayment, when the statute of limitations for filing an action for default has expired. 2. If the loan has no defined date or dates for repayment, when one year has elapsed from the later of the following: a. The date the loan was made. 10 b. The date the last payment of $100 or more was made on the loan. c. The date upon which the debtor has made payments on the loan aggregating to less than $250 during the previous 12 months. (B) This section shall not apply to the following types of loans: 1. A loan made to the campaign committee of an elected officer or a candidate for elective office. 2. A loan that would otherwise not be a gift as defined in this title. 3. A loan that would otherwise be a gift as set forth under subdivision (A), but on which the creditor has taken reasonable action to collect the balance due. 4. A loan that would otherwise be a gift as set forth under subdivision (A), but on which the creditor, based on reasonable business considerations, has not undertaken collection action. Except in a criminal action, a creditor who claims that a loan is not a gift on the basis of this paragraph has the burden of proving that the decision for not taking collection action was based on reasonable business considerations. 5. A loan made to a debtor who has filed for bankruptcy and the loan is ultimately discharged in bankruptcy. (C) Nothing in this section shall exempt any person from any other provisions of Title 9 of the Government Code. (9) Section 9. Disqualification. No designated employee shall make, participate in making, or in any way attempt to use his or her official position to influence the making of any governmental decision which he or she knows or has reason to know will have a reasonably foreseeable material financial effect, distinguishable from its effect on the public generally, on the official or a member of his or her immediate family or on: (A) Any business entity in which the designated employee has a direct or indirect investment worth $2,000 or more; (B) Any real property in which the designated employee has a direct or indirect interest worth $2,000 or more; (C) Any source of income, other than gifts and other than loans by a commercial lending institution in the regular course of business on terms available to the public without regard to official status, aggregating $500 or more in value provided to, received by or promised to the designated employee within 12 months prior to the time when the decision is made; (D) Any business entity in which the designated employee is a director, officer, partner, trustee, employee, or holds any position of management; or (E) Any donor of, or any intermediary or agent for a donor of, a gift or gifts aggregating $420 or more provided to, received by, or promised to the designated employee within 12 months prior to the time when the decision is made. (9.3) Section 9.3. Legally Required Participation. No designated employee shall be prevented from making or participating in the making of any decision to the extent his or her participation is legally required for the decision to be made. The fact that the vote of a designated employee who is on a voting body is needed to break a tie does not make his or her participation legally required for purposes of this section. (9.5) Section 9.5. Disqualification of State Officers and Employees. In addition to the general disqualification provisions of section 9, no state administrative official shall make, participate in making, or use his or her official position to influence any 12 governmental decision directly relating to any contract where the state administrative official knows or has reason to know that any party to the contract is a person with whom the state administrative official, or any member of his or her immediate family has, within 12 months prior to the time when the official action is to be taken: (A) Engaged in a business transaction or transactions on terms not available to members of the public, regarding any investment or interest in real property; or (B) Engaged in a business transaction or transactions on terms not available to members of the public regarding the rendering of goods or services totaling in value $1,000 or more. (10) Section 10. Disclosure of Disqualifying Interest. When a designated employee determines that he or she should not make a governmental decision because he or she has a disqualifying interest in it, the determination not to act may be accompanied by disclosure of the disqualifying interest. (11) Section 11. Assistance of the Commission and Counsel. Any designated employee who is unsure of his or her duties under this code may request assistance from the Fair Political Practices Commission pursuant to Section 83114 and Regulations 18329 and 18329.5 or from the attorney for his or her agency, provided that nothing in this section requires the attorney for the agency to issue any formal or informal opinion. (12) Section 12. Violations. This code has the force and effect of law. Designated employees violating any provision of this code are subject to the administrative, criminal and civil sanctions provided in the Political Reform Act, Sections 81000-91014. In addition, a decision in relation to which a violation of the disqualification provisions of this code or of Section 87100 or 87450 has occurred may be set aside as void pursuant to Section 91003. 13 'Designated employees who are required to file statements of economic interests under any other agency's conflict -of -interest code, or under article 2 for a different jurisdiction, may expand their statement of economic interests to cover reportable interests in both jurisdictions, and file copies of this expanded statement with both entities in lieu of filing separate and distinct statements, provided that each copy of such expanded statement filed in place of an original is signed and verified by the designated employee as if it were an original. See Section 81004. 2See Section 81010 and Regulation 18115 for the duties of filing officers and persons in agencies who make and retain copies of statements and forward the originals to the filing officer. 3For the purpose of disclosure only (not disqualification), an interest in real property does not include the principal residence of the filer. °Investments and interests in real property which have a fair market value of less than $2,000 are not investments and interests in real property within the meaning of the Political Reform Act. However, investments or interests in real property of an individual include those held by the individual's spouse and dependent children as well as a pro rata share of any investment or interest in real property of any business entity or trust in which the individual, spouse and dependent children own, in the aggregate, a direct, indirect or beneficial interest of 10 percent or greater. 5A designated employee's income includes his or her community property interest in the income of his or her spouse but does not include salary or reimbursement for expenses received from a state, local or federal government agency. 6Income of a business entity is reportable if the direct, indirect or beneficial interest of the filer and the filer's spouse in the business entity aggregates a 10 percent or greater interest. In 14 addition, the disclosure of persons who are clients or customers of a business entity is required only if the clients or customers are within one of the disclosure categories of the filer. Note: Authority cited: Section 83112, Government Code. Reference: Sections 87103(e), 87300- 87302, 89501, 89502 and 89503, Government Code. HISTORY 1. New section filed 4-2-80 as an emergency; effective upon filing (Register 80, No. 14). Certificate of Compliance included. 2. Editorial correction (Register 80, No. 29). 3. Amendment of subsection (b) filed 1-9-81; effective thirtieth day thereafter (Register 81, No. 2). 4. Amendment of subsection (b)(7)(B)l. filed 1-26-83; effective thirtieth day thereafter (Register 83, No. 5). 5. Amendment of subsection (b)(7)(A) filed 11-10-83; effective thirtieth day thereafter (Register 83, No. 46). 6. Amendment filed 4-13-87; operative 5-13-87 (Register 87, No. 16). 7. Amendment of subsection (b) filed 10-21-88; operative 11-20-88 (Register 88, No. 46). 8. Amendment of subsections (b)(8)(A) and (b)(8)(B) and numerous editorial changes filed 8-28-90; operative 9-27-90 (Reg. 90, No. 42). 9. Amendment of subsections (b)(3), (b)(8) and renumbering of following subsections and amendment of Note filed 8-7-92; operative 9-7-92 (Register 92, No. 32). 10. Amendment of subsection (b)(5.5) and new subsections (b)(5.5)(A)-(A)(2) filed 2-4-93; operative 2-4-93 (Register 93, No. 6). 15 11. Change without regulatory effect adopting Conflict of Interest Code for California Mental Health Planning Council filed 11-22-93 pursuant to title 1, section 100, California Code of Regulations (Register 93, No. 48). Approved by Fair Political Practices Commission 9-21-93. 12. Change without regulatory effect redesignating Conflict of Interest Code for California Mental Health Planning Council as chapter 62, section 55100 filed 1-4-94 pursuant to title 1, section 100, California Code of Regulations (Register 94, No. 1). 13. Editorial correction adding History 11 and 12 and deleting duplicate section number (Register 94, No. 17). 14. Amendment of subsection (b)(8), designation of subsection (b)(8)(A), new subsection (b)(8)(B), and amendment of subsections (b)(8.1)-(b)(8.1)(B), (b)(9)(E) and Note filed 3-14-95; operative 3-14-95 pursuant to Government Code section 11343.4(d) (Register 95, No. 11). 15. Editorial correction inserting inadvertently omitted language in footnote 4 (Register 96, No. 13). 16. Amendment of subsections (b)(8)(A)-(B) and (b)(8.1)(A), repealer of subsection (b)(8.1)(B), and amendment of subsection (b)(12) filed 10-23-96; operative 10-23-96 pursuant to Government Code section 11343.4(d) (Register 96, No. 43). 17. Amendment of subsections (b)(8.1) and (9)(E) filed 4-9-97; operative 4-9-97 pursuant to Government Code section I I343.4(d) (Register 97, No. 15). 18. Amendment of subsections (b)(7)(B)5., new subsections (b)(8.2)-(b)(8.4)(C) and amendment of Note filed 8-24-98; operative 8-24-98 pursuant to Government Code section 11343.4(d) (Register 98, No. 35). 19. Editorial correction of subsection (a) (Register 98, No. 47). 20. Amendment of subsections (b)(8.1), (b)(8.1)(A) and (b)(9)(E) filed 5-11-99; operative 16 5-11-99 pursuant to Government Code section 11343.4(d) (Register 99, No. 20). 21. Amendment of subsections (b)(8.1)-(b)(8.1)(A) and (b)(9)(E) filed 12-6-2000; operative 1-1- 2001 pursuant to the 1974 version of Government Code section 11380.2 and Title 2, California Code of Regulations, section 18312(d) and (e) (Register 2000, No. 49). 22. Amendment of subsections (b)(3) and (b)(10) filed 1-10-2001; operative 2-1-2001. Submitted to OAL for filing pursuant to Fair Political Practices Commission v. Office of Administrative Law, 3 Civil C010924, California Court of Appeal, Third Appellate District, nonpublished decision, April 27, 1992 (FPPC regulations only subject to 1974 Administrative Procedure Act rulemaking requirements) (Register 2001, No. 2). 23. Amendment of subsections (b)(7)(A)4., (b)(7)(B)L-2., (b)(8.2)(E)3., (b)(9)(A)-(C) and footnote 4. filed 2-13-2001. Submitted to OAL for filing pursuant to Fair Political Practices Commission v. Office of Administrative Law, 3 Civil C010924, California Court of Appeal, Third Appellate District, nonpublished decision, April 27, 1992 (FPPC regulations only subject to 1974 Administrative Procedure Act rulemaking requirements) (Register 2001, No. 7). 24. Amendment of subsections (b)(8.1)-(b)(8.1)(A) filed 1-16-2003; operative 1-1-2003. Submitted to OAL for filing pursuant to Fair Political Practices Commission v. Office of Administrative Law, 3 Civil C010924, California Court of Appeal, Third Appellate District, nonpublished decision, April 27, 1992 (FPPC regulations only subject to 1974 Administrative Procedure Act rulemaking requirements) (Register 2003, No. 3). 25. Editorial correction of History 24 (Register 2003, No. 12). 26. Editorial correction removing extraneous phrase in subsection (b)(9.5)(B) (Register 2004, No. 33). 17 27. Amendment of subsections (b)(2)-(3), (b)(3)(C), (b)(6)(C), (b)(8.1)-(b)(8.1)(A), (b)(9)(E) and (b)(11)-(12) filed 1-4-2005; operative 1-1-2005 pursuant to Government Code section 11343.4 (Register 2005, No. 1). 28. Amendment of subsection (b)(7)(A)4. filed 10-11-2005; operative 11-10-2005 (Register 2005, No. 41). 29. Amendment of subsections (a), (b)(1), (b)(3), (b)(8.1), (b)(8.1)(A) and (b)(9)(E) filed 12-18-2006; operative 1-1-2007. Submitted to OAL pursuant to Fair Political Practices Commission v. Office of Administrative Law, 3 Civil C010924, California Court of Appeal, Third Appellate District, nonpublished decision, April 27, 1992 (FPPC regulations only subject to 1974 Administrative Procedure Act rulemaking requirements) (Register 2006, No. 51). 30. Amendment of subsections (b)(8.1)-(b)(8.1)(A) and (b)(9)(E) filed 10-31-2008; operative 11- 30-2008. Submitted to OAL for filing pursuant to Fair Political Practices Commission v. Office of Administrative Law, 3 Civil C010924, California Court of Appeal, Third Appellate District, nonpublished decision, April 27, 1992 (FPPC regulations only subject to 1974 Administrative Procedure Act rulemaking requirements and not subject to procedural or substantive review by OAL) (Register 2008, No. 44). 31. Amendment of section heading and section filed 11-15-2010; operative 12-15-2010. Submitted to OAL for filing pursuant to Fair Political Practices Commission v. Ojfice of Administrative Law, 3 Civil C010924, California Court of Appeal, Third Appellate District, nonpublished decision, April 27, 1992 (FPPC regulations only subject to 1974 Administrative Procedure Act rulemaking requirements and not subject to procedural or substantive review by OAL) (Register 2010, No. 47). UM RESOLUTION NO. OB 2012 - A RESOLUTION OF THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO LA QUINTA REDEVELOPMENT AGENCY ADOPTING A CONFLICT OF INTEREST CODE FOR THE OVERSIGHT BOARD WHEREAS, the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency has been appointed pursuant to the provisions of Health & Safety Code Section 34179; and WHEREAS, the Oversight Board is deemed a local entity for purposes of the Political Reform Act; and WHEREAS, pursuant to the Political Reform Act and regulations promulgated thereunder by the Fair Political Practices Commission ("FPPC"), a newly established local entity is required to adopt a conflict of interest code; and WHEREAS, the Oversight Board finds and determines that it is appropriate to adopt as its conflict of interest code the model conflict of interest code promulgated by the FPPC as set forth in this Resolution; NOW, THEREFORE, BE IT RESOLVED by the Oversight Board as follows: SECTION 1. Pursuant to the Political Reform Act of 1974, Government Code Section 87300 at seq., and Section 18730 of Title 2 of the California Code of Regulations, the Board adopts the model conflict of interest code promulgated by the Fair Political Practices Commission of the State of California as set forth in Section 18730 of Title 2 of the California Code of Regulations, which model conflict of interest code is incorporated herein by reference, and which, together with the list of designated positions and the disclosure categories applicable to each designated position as set forth in Sections 3 and 6 of this Resolution, collectively constitutes the Board's conflict of interest code. As the model conflict of interest code set forth in Section 18730 of Title 2 of the California Code of Regulations is amended from time to time by State law, regulatory action of the Fair Political Practices Commission, or judicial determination, the portion of the Board's conflict of interest code comprising the model conflict of interest code shall be deemed automatically amended without further action to incorporate by reference all such amendments to the model conflict of interest code so as to remain in compliance therewith. Nothing in the Resolution shall supersede the independent applicability of Government Code Section 87200. Resolution No. OB 2012- Adoption of Conflict of Interest Code Adopted: April 4, 2012 Page 2 SECTION 2. The definitions contained in the Political Reform Act of 1974 and in the regulations of the Fair Political Practices Commission, and any amendments to either of the foregoing, are incorporated by reference into this conflict of interest code. SECTION 3. The following are the designated Board positions, the holders of which shall be required to file statements of economic interests: Oversight Board Members. SECTION 4. The code reviewing body for this conflict of interest code shall be the Board of Supervisors of the County of Riverside. This conflict of interest code shall be promptly submitted after its adoption by the Oversight Board Secretary to the Clerk of the Board of Supervisors. Statements of economic interests shall be filed by Oversight Board Members with the Clerk of the Board of Supervisors of the County of Riverside. SECTION 5. The Board finds and determines that the persons holding the positions set forth in Section 3 make or participate in the making of decisions which may foreseeable have a material effect on financial interests. SECTION 6. Each person holding a designated position set forth in Section 3 shall report in every disclosure category set forth in the statement of economic interests promulgated by the FPPC to the extent such category is applicable to such person pursuant to the rules and regulations of the FPPC. The disclosure categories as promulgated by their FPPC may be amended from time to time and such amendments shall not require an amendment to this code or Resolution. SECTION 7. Sections 3 and 6 of this Resolution constitute the Appendix referred to in subdivision (b)(2) of Section 18730 of Title 2 of the California Code of Regulations. SECTION 8. Nothing contained in this Resolution is intended to modify or abridge the provisions of the Political Reform Act of 1974, Government Code Section 87000 et seq., or FPPC the regulations, Title 2 California Code of Regulations including Sections 18700 et seq. The provisions of this Resolution are additional to the Political Reform Act and FPPC Regulations. This Resolution shall be interpreted in a manner consistent with the Political Reform Act and FPPC regulations. In the event of any inconsistency between the provisions of this Resolution, on the one hand, and the Political Reform Act and/or the FPPC regulations, on the other hand, the provisions of the Political Reform Act and FPPC regulations shall govern. Resolution No. 08 2012- Adoption of Conflict of Interest Code Adopted: April 4, 2012 Page 3 SECTION 9. If any section, subsection; sentence, clause, or phrase of this Resolution is for any reason held by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remaining portions of this Resolution. The Board hereby declares that it would have adopted this Resolution and each section, subsection, sentence, clause, or phrase thereof irrespective of the fact that any one or more section, subsection, sentence, clause, or phrase be declared invalid. PASSED, APPROVED AND ADOPTED at a regular meeting of the Oversight Board held on this 4" day of April, 2012, by the following vote: AYES: NOES: ABSENT: r_1:1-3r_ ul John Pena, Chairperson Oversight Board of the Successor Agency to La Quinta Redevelopment Agency ATTEST: Lori Lafond, Secretary Oversight Board STATE OF CALIFORNIA COUNTY OF RIVERSIDE CITY OF LA QUINTA I, Lori Lafond, Secretary to the Oversight Board, hereby certify that the foregoing resolution was duly adopted at a meeting of the Oversight Board, held on the 4" day of April, 2012. Lori Lafond, Secretary Oversight Board i OVERSIGHT BOARD MEETING DATE: April 4, 2012 ITEM TITLE: Consideration of Adoption of a Resolution Approving Recognized Obligation Payment Schedules of the Former La Quinta Redevelopment Agency for the Periods of January 2012 through June 2012 and July 2012 through December 2012 RECOMMENDATION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: IN Adopt a Resolution of the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency approving the Recognized Obligation Payment Schedules (BOPS) for the periods of January 2012 through June 2012 and July 2012 through December 2012. FISCAL IMPLICATIONS: Adoption of the resolution will allow the Successor Agency to pay the obligations listed on the BOPS. It should be noted the former La Quinta Redevelopment Agency ("LQRDA") received its normal property tax distribution from the County Auditor -Controller ("County") in January 2012. The former LQRDA transferred the funds to the Successor Agency just prior to redevelopment dissolution in late January 2012. These funds will cover the items listed on the January 2012 through June 2012 BOPS. The approved ROPS for the period July 2012 through December 2012 will be submitted to the County. The County will make its next property tax distribution in June 2012. ABx1 26 provides that the County will distribute to the Successor Agency the total amount listed on the BOPS. The Successor Agency will then pay the obligations listed on the BOPS. BACKGROUND AND OVERVIEW: Both schedules have been previously approved by the Successor Agency ("SA"). The ROPS for the period covering January through June was approved by the SA on February 21, 2012; the BOPS for the period July through December was previously approved on March 20, 2012, but was be reviewed once again to include changes required by the Department of Finance on April 3, 2012. The schedules are required to list all of a redevelopment agency's monetary obligations that are "enforceable" within the meaning of the Dissolution Act and must include, for each obligation: a. The project name associated with the obligation; b. The payee; C. A short description of the nature of the work, product, service, facility, or other thing of value for which payment is to be made; d. The amount of payment obligated to be made, by month; and e. The funding source for the obligation. The Successor Agency may only pay the obligations listed on the BOPS. This will become an ongoing process — an updated Schedule will be prepared every six months for Successor Agency and Oversight Board consideration 'and approval. FINDINGS AND ALTERNATIVES: The alternatives available to the Oversight Board include: 1. Adopt a Resolution of the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency approving the Recognized Obligation Payment Schedules (BOPS) for the periods of January 2012 through June 2012 and July 2012 through December 2012; or 2. Do not adopt a Resolution of the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency approving the Recognized Obligation Payment Schedules (BOPS) for the periods of January 2012 through June 2012 and July 2012 through December 2012; or 2 3. Provide staff with alternative direction. Respectfully submitted, Debbie Powell Economic Development/Housing Manager Approved for submission by: Mark Weiss, Interim Executive Director of the Successor Agency to La Quinta Redevelopment Agency 3 RESOLUTION NO. OB 2012 - A RESOLUTION OF THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO LA QUINTA REDEVELOPMENT AGENCY ADOPTING RECOGNIZED OBLIGATION PAYMENT SCHEDULES FOR THE PERIODS OF JANUARY 2012 THROUGH JUNE 2012 AND JULY 2012 THROUGH DECEMBER 2012 WHEREAS, the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency ("Oversight Board" as applicable) has been established to direct the Successor Agency to take certain actions to wind down the affairs of the Redevelopment Agency in accordance with the California Health and Safety Code; and; and WHEREAS, the La Quinta Redevelopment Agency ("Agency") was engaged in activities to execute and implement the Project Area No. 1 Redevelopment Plan and the Project Area No. 2 Redevelopment Plan (collectively, the "Redevelopment Plans") pursuant to the provisions of the California Community Redevelopment Law (Health and Safety Code § 33000, at seq.) ("CRL"); and WHEREAS, as part of the 2011-12 State budget bill, the California Legislature enacted and the Governor signed, companion bill ABx1 26 requiring that each redevelopment agency be dissolved; and WHEREAS, an action challenging the constitutionality of ABx1 26 and ABx1 27 was filed in the California Supreme Court by the California Redevelopment, Association, the League of California Cities, and two individual cities; and WHEREAS, on December 29, 2011, the Court upheld ABx1 26; and WHEREAS, Health & Safety Code Section 34169 requires successor agencies to prepare and adopt a "Recognized Obligation Payment Schedule" that lists all obligations of the former redevelopment agency that are enforceable within the meaning of subdivision (d) of Section 34167 for six month periods including January 2012 through June 2012 and July 2012 through December 2012; and WHEREAS, on March 20, 2012, the City of La Quinta acting as the Successor Agency to the La Quinta Redevelopment Agency adopted by Resolution Number SA 2012-003 approving a Recognized Obligation Payment Schedule for the period of January 2012 through June 2012; and Resolution No. OB 2012- Adoption of Recognized Obligation Payment Schedules Adopted: April 4, 2012 Page 2 WHEREAS, on April 3, 2012, the City of La Quinta acting as the Successor. Agency to the La Quinta Redevelopment Agency adopted by Resolution Number SA 2012-004 approving a Recognized Obligation Payment Schedule for the period of July 2012 through December 2012; and WHEREAS, all other legal prerequisites to the adoption of this Resolution have occurred. NOW THEREFORE, BE IT RESOLVED, by the Oversight Board of Successor Agency to La Quinta Redevelopment Agency, does hereby resolve as follows: Section 1. Recitals. The Recitals set forth above are true and correct and incorporated herein by reference. Section 2. Adoption of a Recognized Obligation Payment Schedule. In order to enable the City of La Quinta as Successor Agency to strictly comply with ABx1 26, and based on the Recitals set forth above, the Oversight Board hereby adopts the Schedules a ttached hereto as Exhibits A a nd B a s the Recognized .Obligation Payment Schedule for the periods of January 2012 through June 2012; and for July 2012 through December 2012. Pursuant to Health & Safety Code Section 34173(e), the Successor Agency's liability, including, but not limited to, its liability for the obligations on the attached schedule is limited to the total sum of property tax revenues it receives pursuant to Part 1.85 of AB x1 26. Section 3. Implementation. The Oversight Board hereby establishes the Recognized Obligation Payment Schedules, pursuant to Health & Safety Code Section 34180(g), for the periods of January 2012 through June 2012 and July 2012 through December 2012. Section 4. Severability. If any provision of this Resolution or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Resolution which can be given effect without the invalid provision or application, and to this end the provisions of this Resolution are severable. The Oversight Board hereby declares that it would have adopted this Resolution irrespective of the invalidity of any particular portion thereof. Section 5. The Oversight Board Secretary shall certify to the adoption of this Resolution. MEMORANDUM TO: Honorable Chairperson and Members of the Oversight Board FROM: Debbie Powell, Economic Development/Housing Manager DATE: April 4, 2012 SUBJECT: Oversight Board Business Item No. 2 Attached are revised Recognized Obligation Payment Schedules ("ROPS" ), which are Exhibits A and B to the resolution contained within this agenda item. The ROPS schedules have been changed for the following reasons: Exhibit A (January 2012-June 2012): Staff was informed late afternoon on Friday, March 30th that the DOF has added several requirements for the BOPS format. Initially, the DOF directed that payments for January 2012 be removed from the BOPS; now, the DOF wants January payments to be reflected on the BOPS, or they will not approve the BOPS. In addition, the DOF is requiring that total obligations be shown for every line item, including estimates for the total obligation for project - specific items such as staff time and consulting services within the "Total Outstanding Debt or Obligation" column. Because staff received the information after the agenda had been posted and the BOPS for this period must be submitted to the DOF and the County Auditor -Controller by April 15, 2012, staff is adding this item for action today. In an effort to include all obligations, in the PA2 schedule, staff added two deeds of trusts for the Washington Street Apartments; the payments are made to Provident Savings Bank and USDA -Rural Development. The payments for the Coral Mountain project in PA 2 have been increased to reflect the completion of entitlements, the cost of building permits, financing costs, and the initiation of construction activities. In addition, the monthly figures for building rent were incorrect on the last BOPS; the correct figures have been included in this BOPS. The last page is simply for informational purposes only - it lists the pass - through payments made by the former La Quinta Redevelopment Agency in January 2012; from now on, the County Auditor -Controller will handle all property tax distribution payments to taxing agencies. Approval of the amended Recognized Obligation Payment Schedule ("ROPS") will result in an administrative allowance (5% of total BOPS for this period) of approximately $853,847: This amount is subject to change, pending State Department of Finance final review of the ROPS. Exhibit B (July 2012-December 2012): The ROPS for this period has also been changed to reflect the State Department of Finance's requirement that each line item must include a total, whether actual or estimated, within the "Total Outstanding Debt or Obligation" column. In addition, on page 3, lines 3a, 3b, and 3c related to the Torre Nissan OPA have been corrected to track estimated payments for the OPA. This reduces the administrative allowance (3% of total BOPS for this period) slightly by $341. Staff will answer questions of the Oversight Board at the April 4, 2012 meeting. Thank you. 2 Resolution No. OB 2012- Adoption of Recognized Obligation Payment Schedules Adopted: April 4, 2012 Page 3 PASSED, APPROVED, AND ADOPTED at the meeting of the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency held this 4th day of April, 2012, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAIN: JOHN PENA, Chairperson Oversight Board of the Successor Agency to La Quinta Redevelopment Agency ATTEST: LORI LAFOND Oversight Board Secretary m_ x n � s 8 a o s s yyyyy yyy��y� W W W W W W W 0 W 10 Ram 9 9 E $ caQi 2 �- ¢ y a o o @ A eH '� E E tEn1, S � e � F fiXi p� rl z .T g' E - a= IR F ¢ ¢ w = x E x x i y c 8 g s I RE \ $ } k k [ } \ � # ( 5 § ) !§ .Lq !) . ,w .|k © \ ,#! �4� k t}k / !§ £\t|! tjt!| \\||( %\!a< LE §� § § | ! I °! \ ■ ! — r l|�!.2 § \ � \E§ \ ■ \ \. 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( \ $ i # # # ! i .12 \ / § { k ) k k k § ) ) is §123 a.2 G22 o �e N m A O Z 0 E c » d M � _ d a pm N N N ff 1] a E Q v e y$ y N N N O £ O p a Fl CO F- riia y°� `e9i b d' o o o � d m rn A y O 's4 0 o N O N 0 C O E G yd 60 C 7 j p U IL 'SR V d O � T.. C d 3 q C Ia J� U 2Q8 RE C c d 'EQT 8 d d O LL O l.Eyq J 0.2 Q L !C a_ m UJ fn fn N d. N a a p q yy qd S FE p p p 19 0 N C mm ¢ O 6 m U U W u N N d AGENDA CATEGORY: OVERSIGHT BOARD MEETING DATE: April 4, 2012 BUSINESS SESSION: ITEM TITLE: Consideration of . Successor Agency Administrative Budget for the Periods of February 2012 CONSENT CALENDAR: through June 2012 and July 2012 through December STUDY SESSION: 2012 PUBLIC HEARING: Approve the Successor Agency Administrative Budgets for the periods of February 2012 through June 2012 and July 2012 through December 2012. FISCAL IMPLICATIONS: Per ABx1 26, the Successor Agency will be reimbursed for administrative costs related to Successor Agency (SA) and Oversight Board administration. For the period of February 1, 2012 through June 30, 2012, ABx1 26 provides for an administrative allowance of 5% of the amount listed on the BOPS covering the same time period. The Recognized Obligation Payment Schedule (BOPS) for this period totals $10,825,400. Five percent of this total is $541,270. The total administrative costs for this time period are estimated at $2,409,879, which includes items listed on the ROPS such as building rent, direct project management, and consulting services. Of this total, $501,127 can be covered by the administrative allowance (Attachment 1). For the period of July 2012 through December 2012, ABx1 26 provides for an administrative allowance of 3% of the amount listed on the ROPS covering the same time period. At this time, the Recognized Obligation Payment Schedule (BOPS) totals $13,045,750. Three percent of this total is $391,373. The total administrative costs for this time period are estimated at $648,197 (Attachment 2), which includes items listed on the BOPS such as direct project management, and consulting services. Of this total, $391,373 can be covered by the administrative allowance. The balance is covered by the BOPS. BACKGROUND AND OVERVIEW: ABx1 26, the "Dissolution Act," provides an administrative budget for the successor agencies to carry out wind -dowry activities of the former redevelopment agencies and to administer the Oversight Board. The Dissolution Act requires the successor agencies to prepare an administrative budget every six months. The estimates include staff time required to carry out Successor Agency and Oversight Board activities and administration, the cost of information technology support, supplies, printing of agendas and agenda packets, legal advertising, training, facility rental, and legal and consulting costs. The Successor Agency has reviewed and approved these budgets, on March 20, 2012 and April 3, 2012. FINDINGS AND ALTERNATIVES: The alternatives available to the Successor Agency include: 1. Approve the Successor Agency Administrative Budgets for the periods February 2012 through June 2012 and July 2012 through December 2012; or 2. Do not approve the Successor Agency Administrative Budgets; or 3. Provide staff with alternative direction. Respectfully submitted, Debbie Powell Economic Development/Housing Manager Approved for submission by: Mark Weiss, Interim Executive Director Attachment: 1. SA Administrative Budget for February 2012 through July 2012 2. SA Administrative Budget for July 2012 through December 2012 2 ATTACHMENT LAQUINTA SUCCESSOR AGENCY ADMINISTRATIVE BUDGET Feb -Jun 2012 Total Cost Administrative Allowance Charges (Paid by Admin Allowance) Successor Agency Weekly Staff Meetings $ 22,350 Staff Reports & Research $ 32,722 Agendas & Minutes $ 11,818 ROPS & Administrative Budget Preparation $ 27,727 Overall SA Management $ 40,555 Records Management $ 4,195 Maintenance of SA Property Info $ 3,346 General Correspondence $ 4,859 Attend SA Meetings $ 11,401 Coordinate & Prep SA Mtgs $ 1,200 Financial Management/Budgeting/Accounts Payable $ 49,509 Annual Reporting $ 21,834 Subtotal Successor Agency $ 231,516 Oversight Board Weekly Staff Meetings $ 12,436 Staff Reports & Research $ 32,065 Agendas & Minutes $ 9,950 Overall OB Management $ 23,669 Records Management & Website $ 3,315 Oversight Board Preparation & Meetings $ 18,719 Financial Management $ 16,886 Annual Reporting $ 19,651 General Correspondence $ 1,172 Subtotal Oversight Board $ 137,861 Infrastructure Building Rent Successor Agency Supplies & Publications $ 2,000 Oversight Board Supplies and Publications $ 750 IT Support $ 10,000 Other Consulting/Outside Services .. $ 50,000 Printing/Mailing $ 5,000 Risk Management/Insurance $ 50,000 Edcuational Expenses Related to ABx126 Implementation $ 14,000 Subtotal Infrastructure $ 131,750 Total Administrative Allowance Charges $ 501,127 Successor Agency Direct Charges (individual ROPS) Additional Staff Costs Pursuant to Agreements None Requested this Period Building Rental $ 1,074,348 Project Based Activities Home Purchase and Rehab Program Management $ - Habitat For Humanity Program Management $ - Torre Nissan Project Management $ 5,216 Coral Mountain Project Management $ 11,188 Washington Street Project Management $ - Total Direct Charges $ 1,090,752 Administrative Support (Individual ROPS) Legal Support Successor Agency Contract $ 513,000 Successor Agency Implementation Support Contract $ 305,000 Total Contracted Administrative Support $ 818,000 TOTAL ADMINISTRATIVE BUDGET $ 2,409,879 ATTACHMENT 2 SUCCESSOR AGENCY/OVERSIGHT BOARD JULY-DEC 2012 ADMINISTRATIVE BUDGET PERSONNj $259,647 Includes baa lus benefits.iyministration898 rsipMBp,{Admini trabon (Project Specific Staff Costs -Torre Nissan (Project Specific Staff Costs -Coral Mountain $_60,Us $12,402 $16.902 - SUPPLIES & SERVICES CONTRACT SERVICES $241,620 This account provides for legal, consulting, and audit services plus a portion of League of California Cities and Calfomia Redevelopment Agency dues related to technical assistance and tmnining for implementation of ABxi 26 udrta as requi y x League of Galifomia Cities Dues & SeminarsNJebinars related to ABx1 26 2012-13 CRA Dues & SeminarslWebI" related to ABxi 26 Legal Services for Successor Agency Legal Services -Coral Mountain (Legal Services -Torre Nissan (Consulting Services for Succes§or Agency IConsulting Services -Torre Nissan IConsulting Services -Coral Mountain 8,000 51,500 $4,50 $120,000 $7,2001 $6,000 1 $66,000 $4,3201 $24,0001 SUPPLIES AND PUBLICATIONS $2,100 This account provides for various office supplies and publications to be used by SA and OB staff and board members uccessor ency upplies u goons i9verei hl Board Su lies & Publications 9,350 750 PRINTING1111i IN This account provides for required mailings, agenda printing, and legal advertising INAORMATIONMECHNOY This account provides for annual replacement charges for information technology items such as computers, printers, and computer related items attributable to SA/OB; and supporUhosting for SA/OB web pages, which are required by ABxi 26 NTAL F P I HA (Per previous a reement between C� of La Ouinta and former RDA $129 930 TOTAL ADMINISTRATIVE BUDGET $648,197 FUNDING SOURCES: AD INI T TI ALL WAN 7 E JULY 2012-DECEMBER 2012 ROPSI $258,824 TOTAL ADMINISTRATIVE BUDGET 1 $648 197 AGENDA CATEGORY: OVERSIGHT BOARD MEETING DATE: April 4, 2012 BUSINESS SESSION: 4 ITEM TITLE: Consideration of an Owner Participation Agreement Between the Former La Quinta CONSENT CALENDAR: Redevelopment Agency and Mega Dealer LLC/Robert STUDY SESSION: N. LaTorre, Inc. (dba Torre Nissan) PUBLIC HEARING: RECOMMENDATION: Adopt a resolution of the Oversight Board to the Successor Agency of La Quinta Redevelopment Agency approving a change to the schedule of performance to an Owner Participation Agreement between the former La Quinta Redevelopment Agency, Mega Dealer, LLC, and Robert N. LaTorre, Inc., and authorizing the continued administration and implementation of the same FISCAL IMPLICATIONS: The Owner Participation Agreement with Torre Nissan provides $1,500,000 of financial assistance in the form of a loan secured by a deed of trust. The funding source is 2011 Project Area No. 2 taxable bond proceeds. The loan will be "repaid" by crediting the future net increase in sales tax and property tax revenue generated by the remodeled and expanded dealership. (The revenue would not directly pay the principal and interest on the loan, but the receipts would be credited against the loan, and when the cumulative receipts equal the loan principal and accrued interest, the loan would be forgiven.) BACKGROUND AND OVERVIEW: On June 14, 2011, the former La Quinta Redevelopment Agency ("Agency") entered into an Owner Participation Agreement ("OPA") with the owners of the Torre Nissan dealership. The Agency had been in negotiations with the owner of Torre Nissan since 2006.With the dissolution of redevelopment agencies on February 1, 2012, by operation of law, the OPA transferred to the Successor Agency to the La Quinta Redevelopment Agency. The OPA provides for a Successor Agency investment of $1,500,000 to partially fund building rehabilitation and expansion improvements. Torre Nissan will upgrade and expand the facility to incorporation the new corporate image required by Nissan Motor Company's "Nissan Retain Environmental Design (NREDI)" program, and to accommodate a new line of electric automobiles (the Nissan Leaf) and heavy duty commercial vehicles. The sales building is currently 15,193 square feet; the project will remodel the building and add another 11,377 square feet at a total estimated cost of $2,600,000. Nissan Motor Company is requiring all dealers to remodel their facilities and in order to obtain the Leaf and commercial vehicles, provide sales and service facilities that exclusively accommodate these vehicles. In discussing this proposal with Nissan Motor Company representatives (City staff met with Nissan Motor Company staff in order to confirm these requirements) Nissan Motor Company representatives indicated that if dealers did not comply with these requirements then the dealership franchise agreement would not be renewed. Due to the great Recession, Torre Nissan did not have sufficient income to both operate the dealership and fully fund these improvements. In order to retain this dealership in La Quinta and facilitate its expansion, the Agency elected to invest in this proposal. It should be noted that prior to entering into the OPA, Agency staff and consultants carefully reviewed the projected return on investment to ensure it met the parameters established by the City's Economic Development Plan, and reviewed Torre Nissan's financial statements to confirm the need for financial assistance. The Economic Development Plan requires a 10%-15% return on investment (as generated by increased sales tax and property tax valuation) by the fifth to eighth year of operation — Torre Nissan is anticipated to meet the 10% return mark by the fifth operational year once the improvements are complete. In regards to loan payoff, staff ,estimated the additional sales tax revenue and property tax valuation would provide for a loan payoff in approximately 11 years. While this exceeds the return on investment timeframe, staff believes the investment will maintain the La Quinta Auto Mall's competitive edge, and increase property tax values, which benefits the entire community. The OPA also places a ten year operating covenant on Torre Nissan, whereby Torre Nissan agrees to operate the expanded and refurbished dealership for a period of ten years after project completion. The operating covenant terminates at the end of the ten year period, or if Nissan Motors Corporation ceases to exist. Upon operating covenant termination, any amounts owed under the note would be forgiven. The project is well underway — the showroom interior has been demolished and the dealership is operating out of temporary office trailers. Grading for the building addition is also underway. However, due to various factors, including the uncertainty associated with the dissolution of the Agency and the need to accommodate new storm water retention requirements, delays occurred. Per the Schedule of Performance contained in the OPA (Attachment 1), a Certificate of i7 Occupancy must be obtained from the City within 12 months from the Effective Date of the OPA, or by June 14, 2012. Torre Nissan cannot achieve this schedule; they anticipate completion by the end of August 2012. The Successor Agency is scheduled to consider this request on April 3, 2012; staff will brief the Oversight Board regarding the Successor Agency's determination at the April 4t' meeting. The requested extension would extend the schedule to complete the improvements and obtain the Certificate of Occupancy to October 14, 2012. This should allow sufficient time to accommodate this and any other unanticipated construction delays. This project is several years in the making — the former Agency had been working with Torre Nissan for several years to structure an agreement. While Torre Nissan could have moved to the 1-10 auto mall, the dealer chose to stay in La Quinta and expand the operation. This will increase sales and property tax values in the City of La Quinta, therefore providing additional funding for vital City services and increasing property tax values, which in turn, benefits all taxing agencies. Staff is requesting the Oversight Board review the project and adopt the attached resolution affirming it does not wish to direct the City as Successor Agency to terminate the OPA with Mega Dealer, LLC/Robert. N. LaTorre, Inc. dba Torre Nissan and also approving the modification to the schedule of performance. FINDINGS AND ALTERNATIVES: The alternatives available to the Oversight Board include: 1. Adopt a resolution of the Oversight Board to the Successor Agency of La Quinta Redevelopment Agency approving a change to the schedule of performance to an Owner Participation Agreement between the former La Quinta Redevelopment Agency, Mega Dealer, LLC, and Robert N. LaTorre, Inc., and authorizing the continued administration and implementation of the same; or 2. Do not adopt a resolution of the Oversight Board to the Successor Agency of La Quinta Redevelopment Agency approving a change to the schedule of performance to an Owner Participation Agreement between the former La Quinta Redevelopment Agency, Mega Dealer, LLC, and Robert N. LaTorre, Inc., and authorizing the continued administration and implementation of the same; or t-1 2. Provide staff with alternative direction. Respectfully submitted, Debbie Powell Economic Development/Housing Manager Approved for submission by: Mark Weiss Interim Executive Director Attachments: 1. Original Schedule of Performance 2. Amended Schedule of Performance 4 ATTACHMENT SCHEDULE OF PERFORMANCE Item of Performance Time for Completion 1. Developer's execution and acknowledgement Concurrently with Developer's execution of of the Operating Covenant. Agreement. 2. Agency recordation of the Operating Within five (5) days after Effective Date. Covenant. 3. Developer's preparation and submission of During the week of September 19-23, 2011. Developer Applications, including a complete application for a Site Development Permit (SDPA), which shall include: • Detailed Site Plans • Revised Site Plans • Lighting Plans (photometric) • "Conceptual" Landscaping Plans • Preliminary Grading Plans • "Conceptual" Floor Plans • "Conceptual" Elevations 4. Review of Developer Applications by Agency will use reasonable efforts to cause such applicable City departments and provision of review, and to obtain and provide to Developer any comments to Developer. any comments, during the week of September 26- 30, 2011. 5. Developer to revise and resubmit (as During the week of October 10-14, 2011. necessary to address City comments) Developer Applications. 6. Re -review of Developer Applications by During the week of October 17-21, 2011. applicable City departments and preparation of conditions of approval. 7. Architectural and Landscape Review Agency will use reasonable efforts to cause such Committee to review Developer Applications review and comment, and shall use reasonable and provide any comment; Agency prepares efforts to cause City to prepare such report, during staff report. the week of October 17-21, 2011. Item of Performance Time for Completion 8. Planning Commission hearing and During the week of November 7-11, 2011. consideration of Developer Applications. 9. Developer's submission of application for During the week of November 7-11, 2011. building permits. 10. Plan check review by applicable City Agency will use reasonable efforts to cause such departments and preparation of any review, and to obtain and provide to Developer corrections to Developer. any corrections, during the week of November 14- 18, 2011. 11. Developer to correct and resubmit (as During the period of November 21-December 2, necessary to address City commentsplans. 2011. 12. Developer to submit to Agency proposed list No later than November 14, 2011. of Eligible Project Costs 13. Review of Developer's proposed list of Within 10 days after Agency's receipt. Eligible Project Costs by Agency 14. Developer to revise and resubmit (if Within 10 days after receipt of Agency comments. necessary) and obtain Agency approval of list of Eligible Project Costs 15. Plan check re -review by applicable City Agency will use reasonable efforts to cause such departments; Developer obtains issuance of re -review and the issuance of building permits (if building permits (if Developer entitled to Developer is entitled to issuance) during the week issuance). of December 5-December 9, 2011. 16. Developer constructs Project. During the period of December 5, 2011—April 5, 2012. 17. Developer obtains certificate of occupancy for During the week of April 5-9, 2012. Project. This Schedule of Performance represents the parties' target dates. However, subject to Section 2.4 of the Agreement, this Schedule of Performance may be adjusted by the Agency Executive Director so long as Developer moves the Project forward and obtains a certificate of occupancy for the Project by no later than twelve (12) months from the Effective Date. This Schedule of Performance does not include the time of performance for all obligations arising under the Agreement; rather this schedule focuses only on the development schedule of the Project. The parties are referred to the Agreement for the total description of the parties' obligations and times for performance of matters not identified in this Schedule. The Developer understands that obligations contained in the Agreement may be conditions precedent to the Agency's obligations under this schedule. Nothing herein shall be construed to limit the City's legislative authority, which City may exercise, in City's sole and absolute discretion. In all cases where City action is required, Agency shall use reasonable efforts to cause City to take such action in the time prescribed herein. ATTACHMENT 2 TORRE NISSAN AMENDED SCHEDULE OF PERFORMANCE Item of Performance Time for Completion 1. Developer's execution and acknowledgement Concurrently with Developer's execution of of the Operating Covenant. Agreement. 2. Agency recordation of the Operating Within five (5) days after Effective Date. Covenant. 3. Developer's preparation and submission of During the week of September 19-23, 2011. Developer Applications, including a complete application for a Site Development Permit (SDPA), which shall include: • Detailed Site Plans • Revised Site Plans • Lighting Plans (photometric) • "Conceptual" Landscaping Plans • Preliminary Grading Plans • "Conceptual" Floor Plans • "Conceptual" Elevations 4. Review of Developer Applications by Agency will use reasonable efforts to cause such applicable City departments and provision of review, and to obtain and provide to Developer any comments to Developer. any comments, during the week of September 26- 30, 2011. 5. Developer to revise and resubmit (as During the week of October 10-14, 2011. necessary to address City comments) Developer Applications. 6. Re -review of Developer Applications by During the week of October 17-21, 2011. applicable City departments and preparation of conditions of approval. 7. Architectural and Landscape Review Agency will use reasonable efforts to cause such Committee to review Developer Applications review and comment, and shall use reasonable and provide any comment; Agency prepares efforts to cause City to prepare such report, during staff report. I the week of October 17-21, 2011. Item of Performance Time for Completion 8. Planning Commission hearing and During the week of November 7-11, 2011. consideration of Developer Applications. 9. Developer's submission of application for During the week of November 7-11, 2011. building permits. 10. Plan check review by applicable City Agency will use reasonable efforts to cause such departments and preparation of any review, and to obtain and provide to Developer corrections to Developer. any corrections, during the week of November 14- 18, 2011. 1 I . Developer to correct and resubmit (as During the period of November 21-December 2, necessary to address City commentsplans. 2011. 12. Developer to submit to Agency proposed list No later than November 14, 2011. of Eligible Project Costs 13. Review of Developer's proposed list of Within 10 days after Agency's receipt. Eligible Project Costs by Agency 14. Developer to revise and resubmit (if Within 10 days after receipt of Agency comments. necessary) and obtain Agency approval of list of Eligible Project Costs 15. Plan check re -review by applicable City Agency will use reasonable efforts to cause such departments; Developer obtains issuance of re -review and the issuance of building permits (if building permits (if Developer entitled to Developer is entitled to issuance) during the week issuance). of December 5-December 9, 2011. 16. Developer constructs Project. During the period of December 5, 2011—April 5, 2012. 17. Developer obtains certificate of occupancy for Deritig the week of April 5 9, 2012. During the Project. I week of October 8, 2012 This Schedule of Performance represents the parties' target dates. However, subject to Section 2.4 of the Agreement, this Schedule of Performance may be adjusted by the Agency Executive Director so long as Developer moves the Project forward and obtains a certificate of occupancy for the Project by no later than tw sixteen (16) months from the Effective Date. This Schedule of Performance does not include the time of performance for all obligations arising under the Agreement; rather this schedule focuses only on the development schedule of the Project. The parties are referred to the Agreement for the total description of the parties' obligations and times for performance of matters not identified in this Schedule. The Developer understands that obligations contained in the Agreement may be conditions precedent to the Agency's obligations under this schedule. Nothing herein shall be construed to limit the City's legislative authority, which City may exercise, in City's sole and absolute discretion. In all cases where City action is required, Agency shall use reasonable efforts to cause City to take such action in the time prescribed herein. RESOLUTION NO. OB 2012- A RESOLUTION OF THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO LA QUINTA REDEVELOPMENT AGENCY APPROVING A CHANGE TO THE SCHEDULE OF PERFORMANCE TO AN OWNER PARTICIPATION AGREEMENT BETWEEN THE FORMER LA QUINTA REDEVELOPMENT AGENCY, MEGA DEALER, LLC, AND ROBERT N. LA TORRE, INC., AND AUTHORIZING THE CONTINUED ADMINISTRATION AND IMPLEMENTATION OF THE SAME WHEREAS, the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency ("Oversight Board") has been established to direct the City of La Quinta, in its capacity as "successor agency," to take certain actions to wind down the affairs of the former La Quinta Redevelopment Agency ("Agency") in accordance with the requirements of Assembly Bill 26, also known as chapter 5, Statutes 2011, First Extraordinary Session, which added Part 1 .8 and Part 1.85 of Division 24 of the California Health and Safety Code ("ABx1 26"); and WHEREAS, on or about June 14, 2011, the former Agency entered into an Owner Participation Agreement ("Agreement") with Mega Dealer, LLC and Robert N. La Torre, Inc, pursuant to which the Agency agreed to provide financial assistance in an amount up to One Million Five Hundred Thousand Dollars ($1,500,000) towards the costs to expand the existing Torre Nissan automobile dealership; and WHEREAS, the Agreement contains a Schedule of Performance (the "Schedule") that requires the expansion project to be completed by June 14, 2012; and WHEREAS, due to anticipated delays, including, without limitation, the uncertainty caused by the dissolution of the Agency, the developer has requested a revision to the Schedule that would extend the project completion date until October 14, 2012; and WHEREAS, the City, as the Successor Agency to the former Agency, has approved the requested revision to the Schedule; and NOW, THEREFORE, the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency does hereby resolve as follows: SECTION 1. The above Recitals are true and correct. Resolution No. OB 2012- Approval of Revision to Nissan OPA Schedule Adopted: April 4, 2012 Page 2 SECTION 2. The Oversight Board approves the approval by the City, as Successor Agency to the former Agency, of the revised Schedule, which revised Schedule is on file with the Secretary of the Oversight Board. SECTION 3. The City, as Successor Agency to the former Agency, has the right and authority to continue administering and implementing the Agreement, and no further approvals or authorizations are required by the Oversight Board with respect to the same. SECTION 4. The Oversight Board has not determined to terminate or renegotiate the Agreement pursuant to its authority under Health and Safety Code Section 34181(e). PASSED, APPROVED and ADOPTED at a regular meeting of the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency held this 41h day of April, 2012 by the following vote, to wit: AYES: NOES: ABSENT: ABSTAIN: JOHN PENA, Chairperson Oversight Board of the Successor Agency to La Quinta Redevelopment Agency ATTEST: LORI LAFOND Oversight Board Secretary C&hf 4 4 a" AGENDA CATEGORY: OVERSIGHT BOARD MEETING DATE: April 4, 2012 BUSINESS SESSION: ED ITEM TITLE: Consideration of Disposition and Development Agreement Between the Former La CONSENT CALENDAR: Quinta Redevelopment Agency and Coral Mountain STUDY SESSION: _ Partners, L.P. PUBLIC HEARING: OTHER: RECOMMENDATION: Adopt a resolution of the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency making certain acknowledgements and confirming that the Oversight Board does not intend to direct the City of La Quinta as Successor Agency to La Quinta Redevelopment Agency to terminate the Disposition and Development Agreement with Coral Mountain Partners, L.P., pursuant to Health & Safety Code Section 34181(e), and approving the implementation of the Agreement. FISCAL IMPLICATIONS: The Disposition and Development Agreement ("DDA") with Coral Mountain Partners, L.P. (the "Developer") provides for a loan of up to $29,000,000 of former La Quinta Redevelopment Agency housing funds to facilitate the development of 176 affordable multi -family units. The DDA also provides that the La Quinta Housing Authority (the "Authority") as the "housing successor" to the former La Quinta Redevelopment Agency, will lease an approximately 9.89 acre parcel to the Developer for a minimum of 55 years, with two 10 year extensions. At the conclusion of the ground lease, the real property and all of the improvements will revert to the Authority. The source of funds for the $29,000,000 is the former Redevelopment Agency's Low- and Moderate -Income Housing Fund, which is available for this investment. As of January 31, 2012, there was $30,779,771 on deposit in this Fund. . BACKGROUND AND OVERVIEW: Per the Redevelopment Law, the Agency had the mandate to insure the substantial rehabilitation or the development of housing affordable to very low-, low- and moderate -income households. These units were also required to remain affordable for 45 years for single family dwellings and for 55 years for multi -family dwellings. Per the Agency's Fourth Five Year Implementation Plan, the Agency was mandated to insure the production of 2,307 affordable dwellings by 2029, of which 40% or 925 dwellings were to be affordable to very low-income households (the 2012 annual household income for very low-income households is $23,450 to $36,200). Since 1994, the Agency secured 1,059 affordable dwellings of which 53% are affordable to very low-income households. In 2007, the Agency purchased a 19.97 acre parcel located south of Highway 111, east of Dune Palms Road, west of the Costco Center and north of the Desert Sands Unified School District Administrative Offices. The acquisition was the culmination of years of negotiation with the former property owners that date back to the 1990s. With the assistance of Michael Shovlin of the Shovlin Companies, the former owners were finally able to end years of litigation that had prevented the property from being sold. The Agency purchased the property to facilitate commercial development on the northern half of the site, and affordable residential development on the southern half. Following acquisition, the Agency entered into an Exclusive Negotiation Agreement with an affiliate of the Shovlin Companies to design an affordable housing complex on the southern section. Once an initial design was completed, the Agency, as property owner, processed an Environmental Impact Report; this process was completed July 11, 2011. The Agency purchased the housing portion of the land .for $9,547,677, and expended $300,000 on the environmental and entitlement process. Concurrent with processing entitlements, the Agency and the Developer initiated negotiations to structure the DDA. The final DDA was completed in November 2010, and the public hearing to consider the final DDA was scheduled for January 4, 2011; there was no opposition voiced at the public hearing and the DDA was approved. (The DDA will be included with this staff report electronically; however, due to the size of the DDA, staff will not print copies. Please contact staff if you require a printed copy of the DDA.) The DDA also facilitates the construction of a secondary access road to Costco, the "A" Street/Dune Palms Road signalized intersection, and the reconfiguration (to ensure safer access) of the Desert Sands Unified School District's bus yard. The total estimated development cost (not including land) is $52,854,685. This cost will be funded through a combination of the $29,000,000 of former Agency funds, $13,416,581 of 4% tax credit equity, and $7,933,689 of mortgage revenue 2 bond funds. The Developer has applied for tax credits and mortgage revenue bonds, which are scheduled to be awarded on May 16, 2012. Construction would then commence in August, 2012. The DDA is set up so the Developer is reimbursed for actual expenditures. To date, the Developer has expended $2,887,201 in soft costs, including architecture, permits, and construction documents, and was reimbursed for these costs. In summary, this project has been in process for many years. The Developer has shown a strong commitment to completing this project. The development team has previously developed the following affordable housing in the City of La Quinta: the Mira Flores Senior Apartments (118 very low-, low- and moderate -income dwellings), the Mira Flores single family homes (23 moderate -income family dwellings), and Watercolors (149 single-family homes affordable to moderate - income seniors); they have also completed commercial development in the City as well. A market study indicates a strong need for affordable multi -family housing in La Quinta. The location is ideal - close to schools and school bus access, within walking distance of retail centers, and close to public transportation. This project will complement an already successful affordable housing program in La Quinta, which includes such projects as Vista Dunes Courtyard Homes, Wolff Waters Place, Seasons Senior Housing, Hadley Villas Senior Housing, Watercolors, and Miraflores Family and Senior Housing. Staff is bringing this item to the Oversight Board in order to provide for certain acknowledgements to be made regarding the status of the City as the Successor Agency to the former Agency, and the Authority as the "housing successor" to the former Agency, and to confirm that this development should proceed. Per Health & Safety Code Section 34181 (a), the Oversight Board's purview includes directing the Successor Agency to, "Determine whether any contracts, agreements, or other arrangements between the dissolved redevelopment agency and any private parties should be terminated or renegotiated to reduce liabilities and increase net revenues to the taxing entities, and present proposed termination or amendment agreements to the oversight board for its approval. The board may approve any amendments to or early termination of such agreements where it finds that amendments or early termination would be in the best interests of the taxing entities." The Developer has applied for mortgage revenue bond financing and 4% tax credit per the time period outlined in the Schedule of Performance contained in the DDA. In addition, in order to transfer the property to the Developer for construction of this development, the Authority as the "housing successor" must secure title insurance. The passage of AB x1 26 has resulted in title companies refusing to issue title insurance for properties that were in the domain of former redevelopment agencies unless the title company is provided with proof that an oversight board, and subsequently the State Department of Finance, has sanctioned the transaction. 3 Since this is an affordable housing development that was in process far in advance of the legislation that abolished redevelopment agencies, and to insure that a quality affordable housing development that benefits the greater community continues, staff is requesting the Oversight Board review the project and affirm the DDA and this project and confirm that it does not wish to direct the City as Successor Agency to attempt to terminate or renegotiate the DDA. FINDINGS AND ALTERNATIVES: The alternatives available to the Oversight Board include: 1. Adopt a resolution making certain acknowledgements and confirming that the Oversight Board does not intend to direct the City of La Quinta as Successor Agency to La Quinta Redevelopment Agency to terminate the Disposition and Development Agreement with Coral Mountain Partners, L.P., pursuant to Health & Safety Code Section 34181(a), and approving the implementation of the Agreement. 2. Provide staff with alternative direction. Respectfully submitted, Debbie Powell Economic Development/Housing Manager Approved for submission by: Mark Weiss Interim Executive Director of Successor Agency to La Quinta Redevelopment Agency 0 RESOLUTION NO. OB 2012- A RESOLUTION OF THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO LA QUINTA REDEVELOPMENT AGENCY MAKING CERTAIN ACKNOWLEDGMENTS AND APPROVALS WITH RESPECT TO THE CORAL MOUNTAIN PROPERTY AND DDA AND AUTHORIZING THE CONTINUED ADMINISTRATION AND IMPLEMENTATION OF THE SAME WHEREAS, the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency ("Oversight Board") has been established to direct the City of La Quinta, in its capacity as "successor agency," to take certain actions to wind down the affairs of the former La Quinta Redevelopment Agency ("Agency") in accordance with the requirements of Assembly Bill 26, also known as chapter 5, Statutes 2011, First Extraordinary Session, which added Part 1.8 and Part 1.85 of Division 24 of the California Health and Safety Code ("ABx1 26"); and WHEREAS, the Agency and Coral Mountain Partners, L.P. (the "Developer"), entered into a Disposition and Development Agreement dated January 4, 2011 (the "DDA"), pursuant to which the Agency agreed to lease to the Developer certain real property owned by the Agency and located in the City of La Quinta (the "Property"), and to provide the Developer with certain financial assistance, and the Developer agreed to develop and operate on said real property an affordable housing rental project (the "Project"); and WHEREAS, on January 2, 2012, the City Council of the City of La Quinta ("City Council" or "City," as applicable) adopted City Council Resolution No. 2012- 002, affirmatively electing to be the "successor agency" to the former Agency; and WHEREAS, on January 17, 2012, the La Quinta Housing Authority ("Authority") adopted Housing Authority Resolution No. 2012-02, electing to be the "housing successor" to the former Agency; and WHEREAS, pursuant to Health and Safety Code section 34175(b), added by Part 1.85 of Division 24 of the California Health and Safety Code ("Part 1.85"), on February 1, 2012, the DDA and the Property were transferred to the control of the City, in its capacity as "successor agency" to the former Agency; and WHEREAS, pursuant to Health and Safety Code Section 34177(g), added by Part 1.85, on March 7, 2012, the City, in its capacity as the "successor agency" to the former Agency, (i) assigned all of its interests in the DDA to the Authority; and (ii) quitclaimed all of its interests in the Property to the Authority; and Resolution No. OB 2012- Approval of Coral Mountain DDA Adopted: April 4, 2012 Page 2 NOW, THEREFORE, the Oversight Board of the Successor Agency to La Quinta Redevelopment Agency does hereby resolve as follows: SECTION 1. The above Recitals are true and correct. SECTION 2. The City of La Quinta is the "successor agency" to the former La Quinta Redevelopment Agency. SECTION 3. The La Quinta Housing Authority is the "housing successor" to the former La Quinta Redevelopment Agency. SECTION 4. The DDA and the Property are both "housing assets" of the former La Quinta Redevelopment Agency, as that term is used in Health and Safety Code Sections 34176(a) and 34177(g). SECTION 5. The Authority has the right and authority to administer and implement the DDA, including, without limitation, the leasing of the Property and the provision of financial assistance to the Developer pursuant to the terms thereof, and no further approvals or authorizations are required by the Oversight Board with respect to the same. SECTION 6. The Oversight Board has not determined to terminate or renegotiate the DDA pursuant to its authority under Health and Safety Code Section 341811e►. PASSED, APPROVED and ADOPTED at a regular meeting of the Oversight Board of the Successor Agency to the La Quinta Redevelopment Agency held this 41h day of April, 2012 by the following vote, to wit: AYES: NOES: ABSENT: ABSTAIN: Resolution No. OB 2012- Approval of Coral Mountain DDA Adopted: April 4, 2012 Page 3 JOHN PENA, Chairperson Oversight Board of the Successor Agency to La Quinta Redevelopment Agency ATTEST: LORI LAFOND Oversight Board Secretary Department Report: D1 c&Y/ 4 4 Qu&r(v MEMORANDUM TO: Chairperson Pena and Members of the Oversight Board FROM: Mark Weiss, Interim Executive Director pf the Successor Agency to La Quinta Redevelopment Agency 1 DATE: April 4, 2012 SUBJECT: Response to Public Comment The following public comment was made at the March 7, 2012 Oversight Board Meeting: Kay Wolff, 77-927 Calle Ensenada, La Quinta asked a number of questions, listed below. Responses are in italics. 1. How is the public to be educated on the responsibilities of the Board, the disposition of money and property tax that were under the Redevelopment Agency? Chairperson Pena stated that Oversight Board meetings are open to the public and will be advertised. The March 7, 2012 agenda included an item entitled, 'Purpose of Oversight Board" which explains the duties of the Oversight Board. Attached to the staff report was Health and Safety Code Sections 34179-34181 which defines the composition, roles, and duties of Oversight Board members. Agendas and staff reports will be posted to the City of La Quinta website, and agendas are posted per Brown Act regulations. The above -listed items will be on this and future Oversight Board meeting agendas. The public is always welcome to call, email, or visit Successor Agency (i.e., City) staff as well. 2. When will Conflict of Interest Statements be filed and open to the public? Chairperson Pena stated that Statements of Economic Interest (FPPC Form 700) must be completed by April 2, 2012 and will be available to the public that day. 3. How can a member of the Successor Agency oversee himself on the Board? Vice Chairperson Osborne stated that the State Legislature dictates the composition of the Board. Health and Safety Code Section 34179(10)(i) allows for elected officials to serve on oversight boards. This section states, "Notwithstanding Section 1099 of the Government Code, or any other law, any individual may simultaneously be appointed to up to five oversight boards and may hold an office in a city, county, city and county, special district, school district, or community college district. " In addition, the Oversight Board is adopting a Conflict of Interest Code, which is on today's agenda. 4. How can former council members now oversee the actions relating to his or her prior Redevelopment Agency decisions? Health and Safety Code Section 34179(a) defines the composition of oversight boards, and does not exclude former elected officials from serving on the board. 2 Reports &Informational Item No.: R1 r*r °F 46Qulnrw MEMORANDUM TO: Chairman Pena and Members of the Oversight Board FROM: John M. Falconer, Finance Director DATE: April 4, 2012 RE: Update on the Debts and Obligations of the Former La Quinta Redevelopment Agency At the March 7, 2012 Oversight Board meeting, Board Member Nelson requested an update on the debt and obligations of the former La Quinta Redevelopment Agency (Attachment 1). Attachment: 1. Debts and Obligations of the Former La Quinta Redevelopment Agency ATTACHMENT 1 W O. O O OD O O OoO O ,aft 0 o�yy N ..^00.N .pp y QX88 Or c 0(0p0 yypOpppm O P O{by p Q� N 0�Y000 p aOp athD y�}�ry. �C fNN In= N ^�—g Nv ppp7!! N t0 M Mfn r•- Nv m o N C