Latest Developments With Respect To Redevelopment

Successor AgenciesAs of July 2013

Department of FinanceLocal Government Unit

Overview• Finance Goals and Objectives• Local Taxing Entities • Completed Tasks

– Housing Asset Transfers– Recognized Obligation Payment Schedules– Due Diligence Reviews

• Upcoming Tasks and Focus– Final and Conclusive Requests– Finding of Completion– Long-Range Property Management Plan

• Other Endeavors• Questions and Answers

2

Finance Goals and Objectives

• Protect Core Public Services • Protect Bond Holders• Expeditiously Wind Down former RDA Affairs• Solve Problems (Get to Yes when Possible)• Develop Positive Working Relationships• Minimize Litigation when Possible

3

Local Taxing Entities

• Dissolution Provides General Purpose Revenues to Affected Taxing Entities (Counties, Cities, and Special Districts)

• Current Estimates:– $1.4 Billion to Counties– $1.1 Billion to Cities– $500 Million to Special Districts

• Increases Local Flexibility with Regards to Use of Money

4

Completed Tasks

• Housing Asset Transfers

• Recognized Obligation Payment Schedules

• Due Diligence Reviews

5

Housing Asset Transfers

• Housing Asset Transfer Forms were Due to Finance by August 1, 2012

• Finance Received 372 Requests to Transfer Housing Assets to a Housing Successor Entity

• Finance Issued 372 Letters Approving and/or Objecting to Transfers Have been Sent Out

• 120 Requests to Meet and Confer on Finance Decisions

• 110 Meet and Confer Sessions Held to Date with 9 Determinations Outstanding

6

Recognized Obligation Payment Schedule

• Detailed Listing of Upcoming Enforceable Obligations of the Successor Agency

• Submitted to Finance Every Six Months (90 Days Prior to Property Tax Distribution)

• Finance has 45 Days to Review and Successor Agencies can Meet and Confer if they Disagree with Finance’s Determination

• Successor Agencies Can Only Pay those Enforceable Obligations Listed and Approved on the Schedules from the Funding Source Identified on the Schedule

• Approval is only Good for the Upcoming Six Month Period

7

Recognized Obligation Payment Schedule

• Completed 4 Full Cycles (ROPS I, ROPS II, and ROPS III, and 13-14A)

• 381 ROPS Were Submitted and Completed for the Current ROPS Period (July – Dec 2013)– 170 Meet and Confer Sessions Requested and

Conducted – ROPS 13-14A (July – Dec 2013), 13-14B (Jan-June

2014), 14-15A (July – Dec 2014), etc…

8

Due Diligence Reviews

• Due Diligence Reviews Identify Unencumbered Balances that Should be held by Successor Agencies

• Two Separate Reviews were Required:– Low and Moderate Income Housing Fund (LMIHF)– All Other Funds and Accounts

9

LMIHF Due Diligence Review

• Due to Finance by October 15th• 380 Reviews Have been Submitted to Finance • 6 More Reviews are Anticipated• 190 Meet and Confer Requests Received• All Meet and Confer Requests have either

Been Conducted or are Scheduled

10

Other Funds Due Diligence Review

• Due to Finance by January 15th• 363 Reviews Have been Submitted to Finance• 23 More Reviews are Anticipated• 221 Meet and Confer Requests Have been

Received• All Meet and Confer Requests have either

Been Conducted or are Scheduled with 15 Determinations Outstanding

11

Upcoming Tasks and Focus

• Final and Conclusive Requests

• Finding of Completion Issuances

• Long-Range Property Management Plans

12

Final and Conclusive

• A Successor Agency can request to have an Enforceable Obligation be determined to be final and conclusive

• If Finance approves the request, the Enforceable Obligation would no longer be subject to DOF rejection during ROPS reviews

• This process removes the uncertainty involved with the six-month approval of ROPS items

• 20 Requests Have Been Received and 7 Have Been Approved with 13 Requests Awaiting Decisions

13

Finding of Completion• Finance will Issue a Finding of Completion within 5 Days of

Verification that the Successor Agency has Paid the Amounts Required by the July True Up, LMIHF Due Diligence Review, and Other Funds Due Diligence Review

• Benefits of Receiving a Finding of Completion Include:– Successor Agency Can Dispose of Property pursuant to an

Approved Long-Range Property Management Plan– Loans between the former RDA and the Sponsoring Entity

can become enforceable– Stranded Bond proceeds from bonds issued before Jan 1,

2011 can be used for the purposes in which they were sold• 223 Finding of Completions Have Been Issued

14

Long-Range Property Management Plan

• AB 1484 Suspended Property Disposition Until Finding of Completion Received (exceptions include Housing Assets, Pursuant to an EO, and Governmental Purpose)

• Successor Agencies shall prepare a Property Plan that Addresses the Disposition and Use of the Real Properties of the former RDA

• The Property Plan shall be submitted within Six Months Following the Issuance of a Finding of Completion

• Property Plans have to be Approved by Finance

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Long-Range Property Management Plan

• The Law Specifies Requirements of the Plan• The Four Types of Disposition Include:– Retention for Governmental Purpose– Retention by City for Future Development– Sale of the Property– Use of the Property to Fulfill an Enforceable

Obligation• To Date 41 Oversight Board Approved Property Plans

Have Been Submitted to Finance and Finance has Approved 2 Plans

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Other Endeavors

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• ROPS Automation Efforts

• Dedicated County Teams

• Bond Debt Refinancing Tools

Additional Information

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DOF public website (www.dof.ca.gov/redevelopment)

FAQs Templates DOF Letters

Contact Information

(916) 445-1546Redevelopment_Administration@dof.ca.gov

Questions