2017-03-21 Successor Agency Agenda Packet (Special)California Public Records Act ("PRA"): In compliance with the PRA, the documents pertaining to agenda
items, including attachments, which are presented to the Successor Agency in open session, are available for
public inspection. They may be inspected during regular business hours in the City Clerk's Office at Vernon
City Hall, 4305 Santa Fe Avenue, Vernon, California 90058, no appointment necessary, and on the City’s website at www.cityofvernon.org.
Americans with Disabilities Act (“ADA”): In compliance with the ADA, if you need special assistance to
participate in the meeting, please contact the City Clerk’s office at (323) 583-8811. Notification of at least 48
hours prior to the meeting or time when services are needed will assist the City staff in assuring that reasonable arrangements can be made to provide accessibility to the meeting or service.
Agenda
City of Vernon
Special Meeting of the Successor Agency
to the Redevelopment Agency
Tuesday, March 21, 2017, 9:00 a.m.,
or as soon thereafter as the City Council adjourns its meeting
Council Chamber
4305 Santa Fe Avenue
Vernon, CA 90058
William J. Davis, Chairperson Yvette Woodruff-Perez, Vice Chairperson
Luz Martinez, Member
Melissa Ybarra, Member Leticia Lopez, Member
CALL TO ORDER
CHANGES TO THE AGENDA
PUBLIC COMMENT - At this time the public is encouraged to address the Successor Agency to the
Redevelopment Agency on any matter that is within the subject matter jurisdiction of the Successor Agency. The public will also be given a chance to comment on matters which are on the posted agenda during
deliberation on those specific matters.
NEW BUSINESS
1. A Resolution of the City Council of the City of Vernon acting as the Successor Agency of the
Redevelopment Agency of the City of Vernon, approving an agreement regarding expenditure of excess bond proceeds between the Successor Agency and the City of Vernon [2005 Tax Allocation Bonds]
/ / /
Successor Agency to the Redevelopment Agency Agenda
Special Meeting March 21, 2017
Page 2 of 2
Recommendation:
A. Find that adoption of the proposed resolution for approval of the Agreement Regarding Expenditure of Excess Bond Proceeds [2005 Tax Allocation Bonds] is exempt under the California Environmental Quality Act (“CEQA”) because it is a government fiscal activity that
will not result in any change to the environment and, therefore, is not a “project” as defined by
CEQA Guidelines Section 15378. Even assuming the activity were a “project”, it would be
exempt from CEQA review in accordance with CEQA Guidelines Section 15061(b)(3), the general rule that CEQA only applies to projects that may have an effect on the environment; and
B. Adopt a resolution to approve an Agreement Regarding Expenditure of Excess Bond Proceeds
[2005 Tax Allocation Bonds], in substantially the same form as presented herewith.
ORAL REPORTS
2. Brief reports on activities, other brief announcements, and directives to staff.
ADJOURNMENT
I hereby certify under penalty of perjury under the laws of the State of California, that the foregoing agenda was
posted on the bulletin board at the main entrance of the City of Vernon City Hall, located at 4305 Santa Fe
Avenue, Vernon, California, and on the City’s website, not less than 24 hours prior to the meeting set forth on this agenda. Dated this 16th day of March 2017.
__________________________________
Maria E. Ayala
City Clerk
REGEIVED
i,lAR I 6 2017
OIIY CLERl('S OFFICE
RECEIVED
i{AR I 6 2017
CITY ADII I i': ISTRATI 0'rlSTAFF REPORT CV
SUCCESSOR AGENCY FOR THE
FOR]VIER VERNON REDEVELOPMENT AGENCY
DATE:
TO:
FROM:
RE:
March 21,2017
Honorable Chairperson and Members of the Successor Agency for the
Former Vernon Redevelopment Agency t
Wiltiam Fox, Successor Agency Staff Me ^A", it
Originator: Outside Counsel, Iris Yang of Best Best & Krieger
Agreement Regarding Expenditure of Excess Bond Proceed
[2005 Tax Allocation Bondsl
Recommendation
A. Find that adoption of the proposed resolution for approval of the Agreernent Regarding
Expenditure of Excess Bond Proceeds [2005 Tax Allocation Bonds] is exempt under the
Califomia Environmental Quality Act CCEQA") because it is a govemment fiscal
activity that will not result in any change to the environment and, therefore, is not a
'proJect" as defined by CEQA Guidelines Section 15378. Even assuming the activity
were a 'project", it would be exernpt from CEQA review in accordance with CEQA
Guidelines Section 15061(bX3), the general rule that CEQA only applies to projects that
may have an effect on the environment; and
B. Adopt a resolution to approve an Agreement Regarding Expenditure of Excess Bond
Proceeds [2005 Tax Allocation Bonds], in substantially the same form as presented
herewith.
Backqround
Health and Safety Code Section 34191.4(c) provides that after the Successor Agency to the
Redevelopment Agency has received a Finding of Completion from the state Departrnent of
Finance (*DOF-), the Successor Agency is authorized to use the bond proceeds from bonds
issued on or before Decernber 3 l, 2010, in a manner consistent with the original bond covenants.
Further, the Successor Agency may designate the use of and commit indebtedness obligation
proceeds that were derived from indebtedness issued for redevelopment purposes after January l,
201 I, and that rernain available after the satisfaction of enforceable obligations that have been
81176.00003\29636176.2
Page I of2
approved on a Recognized Obligation Payment Schedule C'ROPS) and that are consistent with
the indebtedness obligation covenants (hereafter "Excess Bond Proceeds").
The Successor Agency received its Finding of Completion from DOF on April 17 , 2013.
The Successor Agency and City previously approved an Agreement Regarding Expenditure of
Excess Bond Proceeds [2005 Tax Allocation Bonds] ("Agreement") to transfer all the excess
bond proceeds from the Excess Bond Proceeds from the Redevelopment Agency's Industrial
Redevelopment Project Tax Allocation Bonds, Series 2005, dated October 4, 2005 (the "2005
Bonds") held by the Successor Agency to the City to be expended in a manner consistent with
the applicable bond covenants. The Agreanent was approved by the Oversight Board by
Resolution No. 42 on January 17, 2017, and submitted to the State Department of Finance
('DOF') for review as required by Health and Safety Code Section 34179(h).
By letter dated March I0,2017, DOF notified the Successor Agency that it did not approve
Oversight Board Resolution No. 42 because the amount of excess bond proceeds specified to be
transferred to the City included bond reserves and tax revenue. DOF retumed Resolution No.42
to the Oversight Board for reconsideration.
The City and Successor Agency have revised the Agreement to revise the amount of2005 bond
proceeds eligible for transfer to the City pursuant to Health and Safety Code Section 34191.4(c).
The revised Agreement must be approved by the Oversight Board, and is subject to review by
DOF. DOF has approved similar agreernents transferring bond proceeds from a Successor
Agency to the City. If the revised Agreement is approved by the Oversight Board, the Successor
Agency may list the revised Agreement as an enforceable obligation on the Recogrrized
Obligation Payment Schedule ("ROPS").
The proposed Agreernent Regarding Expenditure of Excess Bond Proceeds between the City and
Successor Agency (which has been approved as to form by outside counsel) would permit all
Excess Bond Proceeds from the 2005 Bonds to be transferred from the Successor Agency to the
City, which in tum must use the proceeds in accordance with the bond covenants. As ofJune 30,
2016, the Successor Agency had $22,892,349.60 in Excess Bond Proceeds available from the
2005 Bonds. The exact amount of Excess Bond Proceeds shall be determined by the Successor
Agancy, and as agreed to by the DOF.
Fiscal Impact
Approval of the revised Agreement would allow the transfer of the rernaining proceeds from the
2005 Tax Allocation Bond issuance to the City for the City to administer. These agreernents
have been approved by the Department ofFinance for other successor agencies and their cities.
Attachment(s)
l. Resolution Approving the Agreement Regarding Expenditure ofExcess Bond Proceeds
[2005 Tax Allocation Bonds]
811? 6 - 00003\296361? 6.2
Page 2 of 2
RESOLUTION NO. SA-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON ACTING AS THE SUCCESSOR AGENCY OF THE
REDEVELOPMEI'TT AGENCY OF THE CITY OF VERNON,
APPROVING AN AGREEMENT REGARDING EXPENDITURE OF
EXCESS BOND PROCEEDS BETWEEN THE SUCCESSOR AGENCY
AND THE CITY OE VERNON [2005 TAX ALLOCATION BONDS]
WHEREAS, pursuant to Assemlcly BiIt X1 25, enactsed on June 28,
2011, Assembly Bill 1484, enacted on ,fune 27, 2012, and other
subsequent legislat.ion (collectively, the "Dissolution Law,,), the
RedevelopmenE Agency of the City of Vernon ( "Redevelopment Agency,, ) was
dissolved on February L, 2O!2; and
WHEREAS, pursuant to HealEh and Safety Code Section 34L73,
the City of Vernon elected tso serve as the Successor Agency E.o the
Redevelopment Agency and pursuanE to Health aIrd Safety Code Section
34173 (g) , the Successor Agency is a separat.e public entity from the
city,' and
WHEREAS, pursuant to Healt,h and Safety Code Section
3419]- .4 (c) , after a successor agency has received a finding of
completion from t,he state Department of Finance ( "DOF" ) , a successor
agency, with the approval of its oversight board, may list enforceable
obligations to expend excess bond proceeds on its Recogmized obligat.ion
Payment Schedul-e ("ROPS"), so long as such expendit.ures are consistent
with the bond covenanEs; and
WHEREAS. t.he Successor Agency received a Finding of
Complelion from DOF on April 17, 2013; and
WHEREAS, t.he Successor Agency has excess bond proceeds from
the RedevelopmenE Agency's Indust.rial Redevelopment Project Tax
Allocation Bonds, Series 2005 ("2005 Bonds"),- and
WHEREAS, the Successor Agency, by Resol-ut.ion No. SA-23, and
City previously approved an Agreement Regarding Expenditure of Excess
Bond Proceeds [2005 Tax Allocation Bonds] ('.Agreement,, ) to have all the
excess bond proceeds from tshe 2005 Bonds held by the Successor Agency
transferred Co the City to be expended in a ma-nner consisEent. hrith the
applicable bond covenants, which Agreement was approved by the
Oversight Board by Resolution No. 42 on afanuary L7, 2077; and
WHEREAS, by letter dated March tO, 20J,7, the California
DeparEment of Finance ("DOF" ) notified the Successor Agency t.hat iE was
not approving Oversight Board ResoluEion No. 42 because the amount of
excess bond proceeds specified tso be transferred Eo the Cit,y included
2005 bond reserves and tax revenue, and DOF returned Resolulion No. 42
to the Oversight Board for reconsiderat ion; and
WHEREAS, the City and Successor Agency hawe revised the
Agreement to revise the amounc of 2005 bond proceeds eligible for
t.ransfer tso the City pursuant t.o Health and Safety Code SecEion
34191.4 (c) ; and
WHEREAS, the Successor Agency had, as of .fune 30, 20L6,
approximately $22,892,349.50 in bond proceeds, with the exact amount. to
be transferred E.o Ehe City to be approved by the DOF.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COI'NCIL OF THE
CITY OF VERNON ACTING AS THE SUCCESSOR AGENCY TO THE REDEVELOPMENT
AGENCY OF THE CITY OF VERNON AS FOLLOWS:
SECTION 1:The City Council of the City of Vernon AcE.ing as
the Successor Agency of t.he Redevelopment Agency of tshe City of Vernon
hereby finds and determines that t.he above recitals are true and
correct..
2
SECTION 2: The City Council of the Citsy of Vernon Acting as
Ehe Successor Agency of the Redevelopments Agency of Che City of Vernon
hereby finds that this action is exempt under the California
Environmental ouality Act ("CEoA") because it. is a government. fiscal
acEivity Ehat will not. resul! in any change to Ehe environment and,
tsherefore, is noE a "project" as defined by CEOA Guidelines Section
15378. Even assuming the activity were a "project", it would be exempt
from CEQA review in accordance wiEh CEOA Guidelines Section
15051(b) (3), the general rule t,hat CEOA only applies t.o projects t.hat
may have an effect on the environment.
SECTION 3: The Cit.y Council of the City of Vernon Acting as
the Successor Agency of the Redevelopment Agency of the City of Vernon
hereby approves the revised Agreement Regarding ExpendiEure of Excess
Bond Proceeds [2005 Tax Allocation Bonds] ("Agreement"), in
substantially the same form as lhe copy which is atcached heret.o as
Exhibit A.
SECTION 4:SubjecE Eo Ehe conditions seE fortsh in Section
5, befow, t.he Chair of Ehe Successor Agency is hereby authorized and
directed to execut.e the Agreement Regarding Expenditure of Excess Bond
Proceeds [2005 Tax Allocation Bonds] , on behalf of Ehe Successor
Agency, in subst.antially the form atE.ached hereto as Exhibit A, subject
Eo any minor, t.echnical and clarifying changes as may be approved by
Ehe Successor Agency Counsel. The City Administsrator, as tshe Execut.ive
Direct.or of the Successor Agency, or his designee, is hereby authorized
and directed to tsake such actions as are necessary and appropriaE.e to
implement. said Agreement on behalf of the Successor Agency.
3
SECTION 5: The approvals and authorizations set forth j-n
Sections 3 and 4 of tshis Resolution are condiEioned upon all of lhe
following:
a. Approval of the Agreement negarding Expenditsure of
Excess Bond Proceeds by the City Counci1,. and
b. Approval of the Agreement Regarding Expenditure of
Excess Bond Proceeds by the Oversight. Board, and submiEEal of such
action Eo DOF for review in accordance with Health and Safety Code
Section 34179 (h) ; and
c. Approval by DOF of the OversighE Board's acEion tso
approve the AgreemenE Regarding Expendit.ure of Excess Bond Proceeds,
if DOF does not request a review within five business days, tshe
OversighE. Board's action becomes effective in accordance r/rith said
Section 34179 (hl .
4
SECTION 6: The City C1erk, or Deputy City Clerk, of tshe City
of Vernon, as Secretary to tshe Successor Agency, shalI cert.ify to t.he
paEsage, approval and adoption of this resolution, and the Secretary of
t.he Successor Agency shall cause E,his resolution and the Secret,ary, a
cert.ification to be entered in the File of ReEolutione of Ehe Board of
the Successor Agency.
APPROVED AND ADOPTED this 2l-st day of March, 2017.
Name :
Title: Chairman / Vice Chairman
ATTEST :
Maria E. Ayala, Secret.ary
BeBt Best & Krieger IJL,P,
Special Counsel E,o the Successor Agency
APPROVED AS TO FORM:
Iris Yang, Esq
5
STATE OF CAIIFORNIA ))ss
COUNTY OF LOS ANGELES )
f, Maria E. Ayala, acting on behalf of Ehe Successor Agency as itss
Secretary, do hereby certify thaE tshe foregoing Resolution, being
Resol-ution No. SA- , was duly passed, approved and adoptsed by the City
Council of tshe City of Vernon Acting as the Successor Agency of the
Redevelopment Agency of the CiUy of Vernon at a special meeting of the
Successor Agency duly held on Tuesday, March 21, 2017, ar]d thereafter
was duly signed by the Chairman or Vice Chairman of the Successor
Agency.
Executed this day of March, 2017, aE Vernon, California.
Maria E. Ayala, SecreEary
(SEAL)
5
EXHIBIT A
Exhibit A
AGREEMENT REGARDING
EXPENDITURE OF EXCESS BOND PROCEEDS
[2005 Tax Allocation Bonds]
-1-
AGREEMENT REGARDING
EXPENDITURE OF EXCESS BOI\ID PROCEEDS
[2005 Tax Allocation Bondsl
This Agreernent Regarding Expenditure of Excess Bond Proceeds ("Agreement") is
entered into this 21't day of March, 2017, by and between the Successor Agency to the
Redevelopmant Agency of the City of Vernon ("Successor Agency'') and the City of Vernon, a
charter city C'City). The Successor Agency and the City are hereinafter collectively referred to
as the "Parties."
RECITALS
A. Pursuant to the Community Redevelopment taw (Health & Saf. Code $33000 et
a/.) ("CRL"), the former Redevelopment Agency of the City of Vemon ("Redevelopment
Agency'') was responsible for implementing the Redevelopment Plan for the Industrial Project
Area (the "Redevelopment Project Area"), originally adopted by the City Council of the City of
Vernon ("City Council").
B. Pursuant to an Indenhre ofTrust Agreernent, dated October 1,2005, executed by
and between the Redevelopment Agency and the Bank of New York Trust Company, N.A., as
Trustee, (the "Trust Agreements"), the Redevelopment Agency issued Tax Allocation Bonds as
more fully described below (collectively, the "2005 Bonds").
C. Following dissolution of the Redevelopment Agency on February l, 2012,
pursuant to Assembly Bill lX 26, the City elected to serve as the Successor Agency to the
Redevelopment Agency. Pursuant to Health and Safety Code Section 3a173(g\, the Successor
Agency is a separate public entity from the City.
D. Health and Safety Code Section 34191.4(c) provides that once the Successor
Agency has been issued a Finding of Completion by the Califomia Department of Finance
C'DOF), the Successor Agency is authorized to use bond proceeds from bonds issued on or
before Decernber 3 I , 2010, in a manner consistent with the original bond covenants. Further, the
Successor Agency may desigrate the use of and commit indebtedness obligation proceeds that
were derived from indebtedness issued for redevelopment purposes after January l, 2011, and
that rernain available after the satisfaction of enforceable obligations that have been approved on
a Recogrized Obligation Payment Schedule C'ROPS) and that are consistent with the
indebtedness obligation covenants (hereafter "Excess Bond Proceeds").
E. The DOF issued a Finding of Completion to the Successor Agency on April 17,
2013.
F. Health and Safety Code Section 34191.4(c) further provides that the expenditure
ofExcess Bond Proceeds must be listed separately on the applicable ROPS.
Agt to Expend Excess Bond Proceeds [2005 Bonds]
8 r r76.00003u94t4 r02.2
-l-
G. The Parties desire to enter into this Agreernent to use the Excess Bond Proceeds
for the purposes identified in and consistent with the covenants contained in the Trust Agreanent
and related documents (the "Bond Covenants") and the requirernents of the CRL, and to provide
for the Successor Agency to transfer the Excess Bond Proceeds to the City to be used for such
purposes.
H. The execution of this Agreernent was approved in a public meeting of the City
Council and the Successor Agency on March 21,2017.
I. This Agreement was approved by the Oversight Board for the Successor Agency
in a public meeting on 20t7.
J. The Oversight Board's action to approve this Agreement was submitted to DOF
pursuant to Health and Safety Code Section 34179(h), and DOF approved this Agreement on
20t7.
NOW, THEREFORE, in consideration of the mutual covenants, conditions and
promises herein contained, the Parties hereby agree as follows:
l.
reference.
Recitals. The Recitals above are true and correct and are incorporated herein by
2. Term. The term of this Agreement shall commence on the Effective Date, and
shall continue in effect until the date that all Excess Bond Proceeds are expended in accordance
with the requirernents of this Agreernort.
3. 2005 Bonds. The following bonds were issued by the Redevelopment Agency:
Redevelopment Agency of the City of Vemon Industrial Redevelopment Project Tax Allocation
Bonds, Series 2005, in the amount of $49,420,000, dated October 4,2005, to be used to finance
various public improvernents within or benefiting the Redevelopment Project Area. As ofJune
lO, 2016, the Successor Agency had approximately 922,892,349.60 in Excess Bond Proceeds
available from the 2005 Bonds. The exact amount of Excess Bond Proceeds shall be determined
by the Successor Agency, and as agreed to by the DOF.
4. Use ofExcess Bond Proceeds. The City agrees that it shall use the Excess Bond
Proceeds available from the 2005 Bonds identified above solely for the purposes identified in
Recital G., above, or for other projects consistent with the 2005 Bond Covenants and the
provisions of the CRL, as may be amended from time to time, that apply to the expenditure of
such Excess Bond Proceeds.
5. Transmittal of Excess Bond Proceeds. Subject to the last sentence of Section 3,
above, upon the Effective Date, the Successor Agency shall transfer the Excess Bond Proceeds
(including any interest accrued thereon as of the Effective Date) to the City, and the City shall
deposit such funds into a separate 2005 Excess Bond Proceeds Account for the City's use in
accordance with the terms, conditions and purposes set forth in this Agreanent.
Agt to Expend Excess Bond Proceeds [2005 Bonds]
E I t76.00003\294E4102 2
6. Project Aoorovals: Environmental Review. This Agreement is not intended to
limit in any manner the discretion of the City in connection with the issuance of approvals and
entitlements for the projects described in this Agreernent, nor to avoid legally required processes
attendant to project approval, including, without limitation, the undertaking and completion of
any required environmental review pursuant to the Califomia Environmental Quality Act and the
National Environmental Protection Act, as applicable, and the review and approval of plans and
specifications.
7. Severabiliw. If any term, provision, covenant, or condition set forth in this
Agreement is held by the final judgnent of a court of competent jurisdiction to be invalid, void
or unenforceable, the remaining provisions, covenants, and conditions shall continue in full force
and effect to tlre extent that the basic intent of the Parties as expressed herein can be
accomplished. In addition, the Parties shall cooperate in good faith in an effort to amend or
modifu this Agreement in a manner such that the purpose of any invalidated or voided provision,
covenant or condition can be accomplished to the maximum extent legally permissible.
8. No Third-Partv Beneficiaries: Assimments. Nothing in this Agreement is
intended to create any third-party beneficiaries to this Agreement, and no person or entity other
than the Successor Agency and the City, and the permitted successors and assigns of either of
thern, shall be authorized to enforce the provisions of this Agreement.
9. Further Assurances. Each Party agrees to execute, acknowledge and deliver all
additional documents and instruments, and to take such other actions as may be reasonably
necessary to carry out the intent of the transactions contemplated by this Agreernott.
10. Governins Law. This Agreernent shall be governed by and constnred in
accordance with the laws of the State of Califomia.
I l. Counterparts. This Agreernent may be executed in counterparts, each of which
shall be deemed an original and all of which shall constitute but one and the same instrument.
12. Amendment. This Agreernent may be modified or amended, in whole or in part,
only by an instrument in writing, executed by the Panies.
13. Effective Date. This Agreement shall be effective when signed by both parties,
and approved by the Oversight Board and DOF.
Agt to Expend Excess Bond Proceeds [2005 Bonds]
8r r76 00003u94E4 r02.2
-J-
IN WITI\IESS WHEREOF, the Parties have executed this Agreement as of the date first
written above.
CITY OF VER,\ON SUCCESSOR AGENCY TO THE
REDEVELOPMENT AGENCY OF THE
CITY OF VERNON
By:
Carlos Fandino, City Administrator Chairperson
Attesr:
Maria E. Ayala, City Clerk
Approved as to Form:
Hema Patel, City Attomey
Agt to Expend Excess Bond Proceeds [2005 Bonds]
u 176 00003\294t4102 2
Secretary
Approved as to Form:
Legal Counsel
4