OBRES 2013-002RESOLUTION NO. OB 2013 -002
A RESOLUTION OF THE OVERSIGHT BOARD OF THE
SUCCESSOR AGENGY TO LA QUINTA REDEVELOPMENT
AGENCY 1) ADOPTING A RECOGNIZED OBLIGATION
PAYMENT SCHEDULE FOR THE PERIOD OF JULY 2013
THROUGH DECEMBER 2013; 2) APPROVING THE
CONTINUED IMPLEMENTATION OF THE WASHINGTON
STREET APARTMENTS REHABILITATION PROJECT, 3)
APPROVING THE EXPENDITURE OF $3,006,360 IN
2004 TAX - EXEMPT HOUSING BOND PROCEEDS AND
$15,523,220 OVER THE COURSE OF
IMPLEMENTATION, AND $1,718,831 IN 2004 TAX -
EXEMPT HOUSING BOND PROCEEDS DURING THE JULY
- DECEMBER 2013 ROPS PERIOD, 4) CONFIRMING
THAT THE HOUSING BOND PROCEEDS ARE HOUSING
ASSETS THAT ARE TO BE TRANSFERRED TO THE LA
QUINTA HOUSING AUTHORITY PURSUANT TO HEALTH
& SAFETY CODE SECTION 34176(b) IN ACCORDANCE
WITH THE ROPS SCHEDULE
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;
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, et sec.) ( "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 and 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 the period of July 2013 through December 2013; and
Resolution No. OB 2013 -002
Adoption of Recognized Obligation Payment Schedule
Adopted: February 20, 2013
Page 2 of 4
WHEREAS, in fulfilling its purpose of increasing, improving, and preserving the
supply of low- and moderate - income housing in the City, in 2008 the La Quinta
Redevelopment Agency ( "LQRDA ") expended tax - exempt bond proceeds to acquire a 72-
unit very low- income senior and disabled adult affordable housing complex located on the
east side of Washington street, at Hidden River Road and commonly known as the
Washington Street Apartments ( "WSA "); and
WHEREAS, the LQRDA acquired the WSA with the intent of expending bond
proceeds from a 2004 tax - exempt housing bond issuance to substantially rehabilitate the
development, including the construction of additional units to avoid the long -term
displacement of any of the tenants at the development, for purposes of preserving the
units and affordability of the WSA; and
WHEREAS, the WSA was developed in the 1970s, with assistance from the U.S.
Department of Agriculture, Rural Development Division ( "RD "), and is subject to an
outstanding RD loan ( "RD Loan "); and
WHEREAS, after an extensive application process, during which the LQRDA
represented and committed to RD that it would complete the planned rehabilitation; RD
permitted the LQRDA to assume the RD Loan; and
WHEREAS, in June 2011, to ensure that the rehabilitation of the WSA would
continue without delay in the event of the dissolution of the LQRDA, the LQRDA added the
Authority to the title of the WSA; and
WHEREAS, on January 2, 2012, the City Council adopted City Council Resolution
No. 2012 -002, affirmatively electing to be the "successor agency" to the LQRDA; and
WHEREAS, on January 17, 2012, the Authority adopted Housing Authority
Resolution No. 2012 -02, electing to be the "housing successor" to the LQRDA; and
WHEREAS, on April 18, 2012, the Oversight Board of the Successor Agency to La
Quinta Redevelopment Agency adopted Oversight Board Resolution No. 2012 -008
affirming that certain housing properties, including the WSA, are "housing assets" of the
LQRDA, as that term is used in Health and Safety Code Sections 34176(a) and 34177(g)
and approving the transfer of the "housing assets" to the Authority; and
WHEREAS, Health and Safety Code Section 34177, which contains a
comprehensive list of successor agency obligations, provides in subdivision (i), "bond
proceeds shall be used for the purposes for which bonds were sold unless the purposes
can no longer be achieved "; and
WHEREAS, the bond documents for the 2004 tax - exempt housing bonds and 2011
taxable housing bonds expressly state that the bonds were issued to finance low- and
moderate - income housing projects benefiting the former LQRDA's project areas; and
Resolution No. OB 2013 -002
Adoption of Recognized Obligation Payment Schedule
Adopted: February 20, 2013
Page 3 of 4
WHEREAS, the purpose for which the bonds were sold may still be achieved,
through the rehabilitation and improvement of the WSA.
WHEREAS, all other legal prerequisites to the adoption of this Resolution have
occurred.
NOW THEREFORE, BE IT RESOLVED, by the Oversight Board of the Successor
Agency to La Quinta Redevelopment Agency, 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 Schedule attached
hereto as Exhibit A as the Recognized Obligation Payment Schedule for the period of July
2013 through December 2013. Pursuant to Health & Safety 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 authorizes and directs the
Executive Director to take any action and execute any documents necessary to implement
this Resolution, and further authorizes the Executive Director to forward the Recognized
Obligation Payment Schedule to the Department of Finance, State Controller, County
Administrative Officer, and County Auditor - Controller.
SECTION 4. The purposes for which the 2004 tax - exempt housing bonds and 2011
taxable housing bonds were issued — to finance low- and moderate - income housing in the
City — can still be achieved. The bond documents, including the indenture, the official
statement, the bond purchase agreement, and other related documents for the 2004 and
2011 housing bond issuances require that the net bond proceeds be used for affordable
housing.
SECTION 5. The Oversight Board hereby approves the continued implementation of the
WSA rehabilitation project, and consents to the Authority's authorization and direction to
its Executive Director to administer and implement the WSA rehabilitation project,
including, without limitation, entering into the agreements necessary to affect the same.
SECTION 6. The Oversight Board hereby approves the expenditure of $3,006,360 in
2004 tax - exempt housing bond proceeds and $15,523,220 in 2011 taxable housing bond
proceeds (collectively, the "WSA Bond Proceeds ") to fund the WSA rehabilitation project
over the course of the implementation; and $1,718,831 in 2004 tax - exempt bond
proceeds during the July — December 2013 ROPS period.
SECTION 7. The Oversight Board hereby reconfirms that the 2004 tax - exempt housing
bond proceeds and the 2011 taxable housing bond proceeds are "housing assets" and that
Resolution No. OB 2013 -002
Adoption of Recognized Obligation Payment Schedule
Adopted: February 20, 2013
Page 4 of 4
the WSA Bond Proceeds are to be transferred to the Authority pursuant to Health & Safety
Code Section 34176(b)(1) for implementation of the WSA rehabilitation project, in
accordance with the ROPS schedule. The Oversight Board further confirms that the 2004
and 2011 housing bond proceeds are funds that are encumbered by an enforceable
obligation to build or acquire low- and moderate - income housing as defined in the
Community Redevelopment Law, and therefore the funds meet the definition of the term
"Housing asset" set forth in the Department of Finance's Questions and Answers section
of its website, and further meeting the definition of "Housing asset" proposed by DOF to
be codified as Health & Safety Code Section 34176(d)(2) in the Redevelopment Agencies
Dissolution Clean -up and Liquid Asset Provisions, May Revision.
SECTION 8 . 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 9 . The Oversight Board Secretary shall certify to the adoption of this
Resolution.
PASSED, APPROVED, AND ADOPTED at the meeting of the Oversight Board of the
Successor Agency to La Quinta Redevelopment Agency held this 20th of August, 2012,
by the following vote, to wit:
AYES: Board Members Marshall, Maysels, Nelson, Osborne and Chairperson Pelia
NOES: None
ABSENT: Board Members Ellis and McDaniel
ABSTAIN: None
JOh (�ffNA{ Chairperson
Oversight Board of the Successor Agency
to La Quinta Redevelopment Agency
0
Vianka OrranNa %/'
Oversight Board Secretary