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OBRES 2013-005RESOLUTION NO. OB 2013 -005 A RESOLUTION OF THE OVERSIGHT BOARD OF THE CITY AS SUCCESSOR AGENCY TO THE LA QUINTA REDEVELOPMENT AGENCY RATIFYING AND APPROVING THE PAYMENT BY THE FORMER LA QUINTA REDEVELOPMENT AGENCY FOR CERTAIN HIGHWAY 111 MEDIAN ISLAND IMPROVEMENTS WHEREAS, the Oversight Board of the City as Successor Agency to the La Quinta Redevelopment Agency ( "Oversight Board" or "Successor Agency," as applicable) has been established to direct the Successor Agency to take certain actions to wind down the affairs of the former La Quinta Redevelopment Agency ( "Agency ") in accordance with the California Health and Safety Code; and WHEREAS, the City Council of the City of La Quinta ( "City Council" or "City," as applicable) approved and adopted (i) the Redevelopment Plan for La Quinta Project Area No. 1 ( "Project Area No. 1 " or "Project Area No. 1 Redevelopment Plan," as applicable) on November 29, 1983, by Ordinance No. 43, as amended on December 20, 1994, by Ordinance No. 258, on August 19, 2003, by Ordinance No. 388, and on March 16, 2004, by Ordinance No. 402; and (ii) the Redevelopment Plan for La Quinta Redevelopment Project Area No. 2 ( "Project Area No. 2" or "Project Area No. 2 Redevelopment Plan," as applicable) on May 16, 1989, by Ordinance No. 139, as amended on December 20, 1994, by Ordinance No. 259, on February 3, 2004, by Ordinance No. 399, on March 16, 2004, by Ordinance No. 403, and on March 16, 2004, by Ordinance No. 404; and WHEREAS, the Agency was engaged in activities to execute and implement the Project Area No.1 Redevelopment Plan and the Project Area No.2 Redevelopment Plan pursuant to the provisions of the California Community Redevelopment Law (Health and Safety Code § 33000, et seq.) ( "CRL "); and WHEREAS, pursuant to the authority granted in Health and Safety Code section 33220, the City of La Quinta ( "City ") and the Agency worked cooperatively to implement redevelopment projects and to provide funding necessary to effectuate the completion of redevelopment projects; and WHEREAS, pursuant to this cooperative effort, and in accordance with the authority granted in Health and Safety Code Section 33445, on or around June 14, 2011, the Agency entered into a Financing Agreement with the City (the "Financing Agreement) pursuant to which the Agency loaned the City One Million Two Hundred Seventy -Six Thousand Five Hundred Sixteen Dollars ($1,276,516) (the "Agency Loan ") to be used by the City to pay for the cost of installing certain Resolution No. OB 2013 -005 Ratification of Agency Sale to City of Development Properties Adopted: March 13, 2013 Page 2 landscaping, irrigation, and lighting improvements within the median island on Highway 111, from Adams Street to Jefferson Street (the "Improvements "); and WHEREAS, on June 28, 2011, the City entered into a contract with Marina Landscape, Inc. to construct the improvements (Project 2009 -03) in reliance on the loan agreement, and Project 2009 -03 has been completed and Marina Landscape has been fully paid; and WHEREAS, as part of the 2011 -12 State budget bill, the California Legislature enacted and the Governor of California signed, ABx1 26 requiring that each redevelopment agency be dissolved; and WHEREAS, an action challenging the constitutionality of ABx1 26 and companion bill 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 struck down as unconstitutional ABx1 27; and WHEREAS, AB 26 states, in part, that "[t]he Legislature hereby finds that a transfer of assets by a redevelopment agency [after January 1, 20111 is deemed not to be in the furtherance of the [CRL] and is thereby unauthorized," that "[c]ommencing [February 1, 20121, ... arrangements between the city ... that created the redevelopment agency and the redevelopment agency are invalid...;" and that "[a]II assets ... of the former redevelopment agency are transferred on [February 1, 20121, to the control of the successor agency;" and WHEREAS, on or about April 20, 2012, the California State Controller issued correspondence stating, in part, that "[i]f your city ... received any assets from a redevelopment agency after January 1, 2011, your city ... hereby is ordered to ... reverse the transfer and return the applicable assets to the successor agency of the relevant redevelopment agency;" and WHEREAS, Assembly Bill 1484 ( "AB 1484 ") was signed by the Governor of California on June 27, 2012, making changes to AB 26 and certain additional changes to the CRL; and WHEREAS, during the Successor Agency's exit interview with the auditors from the State Controller's Office, the auditors recommended that the Oversight Board (i) ratify and approve the Agency's provision of the Agency Loan to the City Resolution No. OB 2013 -005 Ratification of Agency Sale to City of Development Properties Adopted: March 13, 2013 Page 3 pursuant to the Financing Agreement, (ii) confirm that the funds comprising the Agency Loan were contractually committed to a third party for the expenditure of such funds, and (iii) confirm that the funds comprising the Agency Loan are not subject to an order by the Controller to be returned to the Successor Agency; and WHEREAS, notice of the action proposed to be taken by the Oversight Board pursuant to this Resolution was duly published in accordance with the requirements of Health and Safety Code Section 34181(f); and WHEREAS, all other legal prerequisites to the adoption of this Resolution have occurred. NOW, THEREFORE, BE IT RESOLVED that the Oversight Board of City as Successor Agency to the 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 Ra tification and Approval of Agency Sa to City. The Oversight Board hereby ratifies and approves the Agency's loan of $1,276,516 to the Developer Impact Fund and the payment of funds by the former Redevelopment Agency funds for .(Project 2009 -03). The Oversight Board further finds that the payment to the contractor were in reliance on the loan agreement. The Oversight Board confirms that the funds comprising the Agency Loan were contractually committed to a third party for the expenditure of such funds, and further confirm that the funds comprising the Agency Loan are not subject to an order by the Controller to be returned to the Successor Agency. Section 3 . 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 4 . Certification The Oversight Board Secretary shall certify to the adoption of this Resolution. Resolution No. OB 2013 -005 Ratification of Agency Sale to City of Development Properties Adopted: March 13, 2013 Page 4 PASSED, APPROVED, AND ADOPTED at the meeting of the Oversight Board of the City as Successor Agency to the La Quinta Redevelopment Agency held this 13t day of March, 2013, by the following vote, to wit: AYES: Board Members Ellis, Marshall, Maysels, McDaniel, Osborne and Chairman Pena NOES: None ABSENT: Board Member Nelson ABSTAIN: None JOHN PEI#, Chh irperson Oversight Card of the Successor Agency to La Quinta Redevelopment Agency Oversight Board Secretary