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SUCCESSOR AGENCYAGREEMENT FOR REIMBURSEMENT OF COSTS AND CITY/SUCCESSOR AGENCY OPERATIONS LOAN This AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITY/ SUCCfISOR AGENCY OPERATIONS LOAN ("Agreement") is made and entered into as of I�qy o4 , 2012 by and among the CITY OF SAN JUAN CAPISTRANO, a California umcipal corporation ("City"), and the CITY OF SAN JUAN CAPISTRANO ACTING AS SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY ("Successor Agency") RECITALS A. The San Juan Capistrano Community Redevelopment Agency ("Agency") was established as a community redevelopment agency that was previously organized and existing under the California Community Redevelopment Law, Health and Safety Code Sections 33000, at seq. ("CRL"), and previously authorized to transact business and exercise the powers of a redevelopment agency pursuant to action of the City Council ("City Council") of the City. B. Assembly Bill (AB)X1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health & Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies ("Dissolution Act"). C. On December 29, 2011, California Redevelopment Association v. Matosantos, Case No. 5194861, the California Supreme Court upheld the Dissolution Act and thereby all redevelopment agencies in California are subject to the Dissolution Act and were dissolved effective February 1, 2012. D. On January 11, 2012, the City Council adopted Resolution No. 12-01-10- 01 at an open public meeting choosing to become and serve as the "Successor Agency" to the dissolved Agency under the Dissolution Act. E. As of and on and after February 1, 2012, the City serves as the "Successor Agency" and is performing its functions as the successor agency under the Dissolution Act to administer the enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by the seven - member Oversight Board. F. On January 17, 2012, the City Council adopted Resolution No. 12 -01 -17 - pursuant to California Health and Safety Code Section 34176 of the Dissolution Act, declining to assume the housing assets and functions of the Agency and selected the San Juan Capistrano Housing Authority to so assume such housing assets and functions, and on such date also pursuant to Section 34176 the Authority accepted and assumed the housing assets and functions of the Agency and as of February 1, 2012, became and serves as the "Successor Housing Agency" of the former Agency pursuant to the Dissolution Act. At this time, any assets assigned and transferred by operation of law and to be assigned and transferred by authorization of and direction from the oversight board when formed and operating pursuant to the Dissolution Act to the Successor Housing Agency are not adequate to fund administrative support costs and expenses unless any future Low and Moderate Income Housing fund balances are authorized to be transferred under State Law to the Successor Housing Agency. If this occurs, a future modification to this Agreement may be necessary. G. City, acting as Successor Agency, is engaged in activities necessary and appropriate to winding down the activities of the Agency's Community Development Central Project Area ("Central Project Area") that was originally adopted and amended by ordinances of the City Council. H. Employees of the City will perform day-to-day administration and operation of the Successor Agency's duties and functions. Since the San Juan Capistrano Community Redevelopment Agency was originally formed and upon Successor Agency's effectiveness as of February 1, 2012, City has provided and shall continue to provide services to the Successor Agency, including but not limited to providing administrative, accounting, auditing, planning, engineering, legal, risk management, financial, clerical, record-keeping, and other services necessary for the Successor Agency to carry out its responsibilities. I. City and Successor Agency desire to affirm and document an on-going cooperative arrangement regarding administrative and operational services and payment for services by entering into a new contract whereby City agrees to provide administrative and operational services and Successor Agency agrees to pay City for the cost of all such services to be provided by City for Successor Agency. NOW, THEREFORE, for and in consideration of the mutual promises, covenants and conditions herein contained, the parties hereto agree as follows: 1. Reimbursement of Administrative Expenses and Enforceable Obligation Expenses. The Successor Agency shall be liable to the City for the payment of its Administrative Expenses as set forth in this Agreement and as adopted by the Successor Agency as part of an Administrative Budget pursuant to Health & Safety Code Section 341770) and approved by the Oversight Board, as such annual Administrative Budget may be amended, revised or reconciled from time to time. In addition, the Successor Agency shall be liable to the City for any program or operational expenses associated with Enforceable Obligations, as that term is defined in the Dissolution Act as set forth in each Recognized Obligation Payment Schedule ("ROPS"), including salary and benefits of employees. 2 2. Cost of Administrative Expenses and Administrative Cost Allowance from February 1, 2012 through June 30, 2012. 2.1 Successor Agency and City estimate that the cost of Administrative Expenses to be provided by City to the Successor Agency for the period of February 1, 2012 through June 30, 2012, is Two Hundred Twelve Eight Hundred Forty Seven Dollars ($212,847), which is itemized in the Successor Agency's Administrative Budget approved by action of the Oversight Board. Pursuant to the provisions of Section 4 herein, Successor Agency agrees to pay the sum of $212,847 to City to pay for the estimated Administrative Expenses of the Successor Agency for the period February 1, 2012, through June 30, 2012, and for subsequent fiscal years, subject to Oversight Board approval and Successor Agency preparation and approval of an Administrative Budget estimate for such services and costs pursuant to the Dissolution Act. 2.2. Information and supporting data regarding the staffing and allocation of costs have been prepared by Successor Agency and City staff and are made a part hereof by this reference. Within thirty (30) days of the expiration of the each calendar quarter during the term of this Agreement, the parties shall determine the actual costs incurred by Successor Agency for services provided to the City and the Successor Agency shall reimburse the City for these costs within thirty (30) days of this determination. For the period of February 1, 2012, through March 31, 2012, these amounts shall be reimbursed within thirty (30) days of the approval of this agreement. Within thirty (30) days of the expiration of Fiscal Year 2011-12 and each fiscal year thereafter during the term of this Agreement, the parties shall determine the actual costs incurred by Successor Agency for services provided to the City. If the actual amount incurred by Successor Agency is less than the estimated amount, City shall reimburse Successor Agency in the amount overpaid within 30 days of such notice, and if the actual amount incurred by Successor Agency is greater than the estimated amount, any additional amount above the estimated amount shall be due and payable by Successor Agency from the Redevelopment Obligation Retirement Fund and the additional amount shall be advanced to Successor Agency by City. 3. Services to be Provided. City agrees to continue to aid and cooperate and shall aid and cooperate in the planning, undertaking, construction and operation of remaining enforceable obligations of the Successor Agency previously incurred by the Agency as it relates to Enforceable Obligations of the Agency within the City provided the cost of such services .are paid by Successor Agency. At the request of Successor Agency through the City Manager and duly authorized designees, the City and its officers and employees shall perform services for Successor Agency in carrying out its work related to meeting the Agency's Enforceable Obligations and for winding down the activities of the Agency and shall have access to any and all personnel and the facilities of the departments and offices of the City. Those City officers and employees who are also appointed to positions or offices with or related to the Successor Agency shall perform services for the each agency in a dual capacity. The City Manager, and other appropriate City officials on behalf of the City and the Successor Agency, and duly authorized designees, shall determine and establish the procedures to be followed in requesting and rendering such services. The costs of administrative services shall be 3 considered Administrative Expenses in the Annual Administrative Budget. The costs of other Enforceable Obligation where supported by City services are identified as specific line items on the EOPS or ROPS and not part of the estimated Administrative Expenses identified in Section 1. 4. Meeting Facilities. City agrees to make available to Successor Agency such office space and meeting space as is necessary for conducting meetings and the business of such agency, including use of the City Council Chambers and appropriate conference room(s) for open public meetings, closed session meetings, and study session meetings of the Successor Agency and Oversight Board, and meetings of Successor Agency staff, counsel, consultants, and other representatives. Each agency shall use such space in accordance with the rules and regulations of the City as applicable to other buildings and offices of the City. 5. Succeeding Years during Term of Agreement. The procedure set forth above in Sections 2, 3 and 4 shall be undertaken by Successor Agency, the Oversight Board, and City for each successive six-month period and for each fiscal year during the term of this Agreement based on each approved Administrative Budget and ROPS prepared pursuant to the Dissolution Act. 6. City Cost Allocation Plan; Estimated Cost of Services and Facilities. Expenses shall be calculated in the manner set forth in City's cost allocation plan, or other applicable reasonable cost allocation and accounting plan approved by the parties that conforms with generally accepted accounting principles and that is generally applicable to all users of services and facilities of the City. The specific costs to be allocated herein shall be based upon the cost of the following categories of services. 6.1 Wages and Benefits Successor Agency. Wage and Benefit expenses incurred in connection with City employees described to perform administrative services work for Successor Agency. The costs attributable to employees who devote less than 100% of their time to the Successor Agency shall be allocated in accordance with the City's cost allocation plan. 6.2 General Overhead. A general indirect administrative operating expenses and overhead support charge which shall be determined in accordance with the City's cost allocation plan and Successor Agency Annual Administrative Budget. 6.3 Specific Services. All expenses that City may actually incur in providing specific administrative services on behalf of Successor Agency including, but not limited to, audit services, lease of space to accommodate Successor Agency's activities, City Treasurer services, property insurance for Successor Agency's properties, contracts for real estate data and information, department supplies, mail and postage services, equipment maintenance and IT support. 7. Annual Expenses Deemed City Advance. For each year in which Successor Agency does not have adequate funds to pay and reimburse for Administrative Expenses and/or Enforceable Obligation Expenses, each such amount 4 U shall be deemed an advance by City to Successor Agency and such amount shall be deemed to have been loaned by City to Successor Agency ("City/Successor Agency Operations Loan"). 8. Repayment of Operations Loan. Successor Agency agrees to repay the City/Successor Agency Operations Loan (and all future advances thereto) from (former) tax increment funds allocated to Successor Agency that are to be paid from property tax revenues deposited in the Redevelopment Property Tax Trust Fund pursuant to California Health and Safety Code Section 34177(k) and other applicable laws. Successor Agency shall repay to City the principal amount of the City/Successor Agency Operations Loan on or before the last date that Successor Agency may receive tax increment funds pursuant to the time and financial limitations required to meet all enforceable obligations of the Successor Agency and subject to the Dissolution Act and other applicable laws. 9. Provisions Severable. If any provision of this Agreement or application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the invalid provision or application, and to this end the provisions of this Agreement are severable. The City Council and Successor Agency each hereby declares that it would have approved this Agreement irrespective of the invalidity of any particular portion hereof. 10. Effective Date of Agreement. This Agreement shall become effective as of the date in the first paragraph hereof and shall continue thereafter until modified or terminated by the parties hereto. 11. Subordination Indebtedness. The indebtedness of the City/Successor Agency Operations Loan under this Agreement shall be junior and subordinate to other allocated moneys made from the Redevelopment Property Tax Trust Fund including those pursuant to California Health and Safety Code Section 34183(a)(1) and (2). 5 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their officers thereunto duly authorized on the date first above written. CITY OF SAN JUAN CAPISTRANO, a California Municipal Corporation APPROVED AS TO FORM Larry K�r, !�nf�eJr, Mayor Dated: f`1fi q "Z 201 [Signatures continue on next page] [Signatures continued from previous page] CITY OF SAN JUAN CAPISTRANO ACTING AND SERVING AS THE SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY Larry Krar�fer, Mayor Dated: "x-D— city geNon behalf of the Successor Agency Dated: APPROVED AST RM–_ Tom Clark, Stradlin , Y cca, Carlson, and Rauth Special Counsel to Succ ssor Agency Dated: Zo12 U OVERSIGHT BOARD RESOLUTION NO. 12-05-02-01 A RESOLUTION OF THE OVERSIGHT BOARD TO THE SUCCESSOR AGENCY OF THE SAN JUAN CAPISTRANO REDEVELOPMENT AGENCY, APPROVING THE SUCCESSOR AGENCY ADMINISTRATIVE BUDGET FROM FEBRUARY 1, 2012 TO JUNE 30, 2012, PURSUANT TO HEALTH AND SAFETY CODE SECTION 341770) AND AUTHORIZING THE SUCCESSOR AGENCY TO ENTER INTO AN AGREEMENT WITH THE CITY OF SAN JUAN CAPISTRANO FOR ADMINISTRATIVE SUPPORT PURSUANT TO HEALTH AND SAFETY CODE SECTION 34171. WHEREAS, the San Juan Capistrano Community Redevelopment Agency ("Agency`) was established as a community redevelopment agency duly organized and existing under the California Community Redevelopment Law, Health and Safety Code Section 33000, et seq. ("CRL"), and has been authorized to transact business and exercise the power of a redevelopment agency pursuant to action of the City Council ("City Council') of the City of San Juan Capistrano ("City"); and WHEREAS, Assembly Bili X1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health and Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies (the "Dissolution Act); and WHEREAS, the Agency is now a dissolved redevelopment agency pursuant to the Dissolution Act and WHEREAS, by Resolution No. 12-01-10-01 approved by the City Council at an open meeting on January 10, 2012, the City chose to become and serve as the successor agency to the dissolved Agency under the Dissolution Act; and WHEREAS, as of and on and after February 1, 2012, the City serves and acts as the "Successor Agency" and will perform its functions as the successor agency under the Dissolution Act to administer all enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by a seven -member oversight board ("Oversight Board") and; WHEREAS, pursuant to Health and Safety Code Section 34179 the Successor Agency's Oversight Board has been formed and the initial meeting has occurred on April 9, 2012; and WHEREAS, Section 34179 provides that the Oversight Board has fiduciary responsibilities to holders of enforceable obligations and the taxing entities that benefit from distributions of property tax and other revenues pursuant to Section 34188 of Part 1.85 of the Dissolution Act; and 5/2/2012 WHEREAS, Health and Safety Code Section 341770) requires the Successor Agency to prepare a proposed Administrative Budget covering the period from February 1, 2012 through June 30, 2012, and submit it to the Oversight Board for approval; and WHEREAS, pursuant to Section 341770), the Successor Agency's "Administrative Budget° is to include all of the following: (a) estimated amounts of the Successor Agency's administrative costs for the upcoming six month fiscal period; (b) the proposed sources of payment for the costs Identified in (a); and (c) proposals for arrangements for administrative and operations services provided by the City as Successor Agency; and WHEREAS, the Successor Agency's proposed Administrative Budget has been submitted to the Oversight Board for its review and approval; and WHEREAS, the Administrative Budget, as approved by the Oversight Board, will be provided to the County of Orange Auditor -Controller pursuant to Health and Safety Code Section 34177(k) so that the Successor Agency's estimated administrative costs in the approved Administrative Budget will be paid from property tax revenues deposited Into the Redevelopment Property Tax Trust Fund for the upcoming six-month period; and WHEREAS, pursuant to Section 34180(h) the Successor Agency may request authorization from the Oversight Board for the Successor Agency and the City of San Juan Capistrano to enter Into an agreement to ensure provision of the necessary services from the City to support Successor Agency responsibilities In winding down the activities of the former Agency, including the estimated costs set forth in the Administrative Budget; and WHEREAS, the Successor Agency desires to enter into that certain "Agreement for Reimbursement of Costs and City/Suooessor Agency Operations Loan" ("Costs Reimbursement Agreement% which agreement will authorize the reimbursement of costs incurred by the City to support Successor Agency operations and obligations; and WHEREAS, the Oversight Board desires to approve the Successor Agency's proposed Administrative Budget and to authorize the Successor Agency to enter into the "Costs Reimbursement Agreement"; and WHEREAS, pursuant to the Dissolution Act, the actions of the Oversight Board, including those approved by this Resolution, do not become effective for three (3) business days pending any request for review by the State Department of Finance (DOF), and If the DOF requests review hereof, DOF will have 10 days from the date of Its request to approve this Oversight Board action or return it to the Oversight Board for reconsideration and the action, if subject to review by DOF, will not be effective until approved by DOF. NOW THEREFORE, BE IT RESOLVED, that the Oversight Board to the Successor Agency of the San Juan Capistrano Community Redevelopment Agency, does hereby resolve as follows: 2 Section 1. The foregoing Recitals are incorporated into this Resolution by this reference, and constitute a material part of this Resolution. Section 2. Pursuant to CRL Section 341770), the Oversight Board approves the Successor Agency's proposed Administrative Budget, attached hereto as Exhibit A and incorporated by this reference. Section 3. Pursuant to the Dissolution Act, the Oversight Board authorizes the Successor Agency to enter into the Cost Reimbursement Agreement substantially in the form of the Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan, attached hereto as Exhibit B and incorporated by this reference. Section 4. The Oversight Board authorizes the Successor Agency to transmit the Administrative Budget and Cost Reimbursement Agreement, when approved and entered into between the Successor Agency and the City, to the County of Orange Auditor -Controller, the California State Department of Finance, and the State Controller's Office. Section 5. The City Manager or her authorized designees are directed to post the Administrative Budget and Cost Reimbursement Agreement (when entered into) on the City/Successor Agency website. Section 6. The Oversight Board Secretary shall certify to the adoption of this Resolution. PASSED, APPROVED and ADOPTED this 2"d day of May 2012. Laura Freese, Chair 3 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. CITY OF SAN JUAN CAPISTRANO ) I, MARIA MORRIS, appointed Oversight Board Secretary of the Oversight Board to the Successor Agency of the San Juan Capistrano Community Redevelopment Agency, do hereby certify that the foregoing Oversight Resolution 12-05-02-01 was duly adopted by the Board Members of the Oversight Board to the Successor Agency of the San Juan Capistrano Community Redevelopment Agency at a special meeting thereof, held the 2nd day of May, 2012, by the following vote: AYES:ARD MEMBERS: Doll, Hampton, McCord, Tatarian, Thomas, Kerr and Chair Freese NOES 4ARD ARD MEMBERS: None ABSENT: MEMBERS: None 4 Expenditure Category Description Amount Salaries and benefits Successor Agency share of City employee's salaries and benefits $106,154 Facility charges Successor Agency share of City's overhead costs for office space 19,476 Vehicle fleet charges Successor Agency share of Citys overhead costs for vehicles 6,457 Insurance charges Successor Agency share of Ci s overhead costs for insurance 26,284 IT/communication charges Successor Agency share of Citys overhead costs for computers and phones 19,956 Malenals and supplies Successor Agency share of various supplies 292 Utilities Successor Agency share of electricity, as and water costs 1,592 Training Participation by the CFO and Accounting Manager at the Successor Agency training in March 2012 sponsored by the California Redevelopment Association (includes mileage reimbursement) 662 Sub -total - Administrative Allowance (1)(2) $180,873 Lena] services 3 Contract for legal services 31,975 Total Administrative Expenses $212,848 (1) For Fiscal Year 2011-12, the City, as the Successor Agency, is entitled to receive up to 5% of the portion of its former tax increment payable, but not less than $250,000, to meet the administrative expenses of serving as the Successor Agency. (2) Administrative costs for salaries and benefits and overhead costs are identified on Page 5, Lines 6 and 7 of the Successor Agency's Recognized Obligation Payment Schedule (ROPS). (3) Legal services are identified on Page 5, Lines 14 and 15 of the Successor Agency's ROPS as separate enforceable obligations. EXHIBIT A AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITY/SUCCESSOR AGENCY OPERATIONS LOAN This AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITY/ SUCC SSOR AGENCY OPERATIONS LOAN ("Agreement") is made and entered into as of , 2012 by and among the CITY OF SAN JUAN CAPISTRANO, a California nlcipal corporation rCity"), and the CITY OF SAN JUAN CAPISTRANO ACTING -AS SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY ("Successor Agency") RECITALS A. The San Juan Capistrano Community Redevelopment Agency rAgency") was established as a community redevelopment agency that was previously organized and existing under the California Community Redevelopment Law, Health and Safety Code Sections 33000, et seq. ("CRU), and previously authorized to transact business and exercise the powers of a redevelopment agency pursuant to action of the City Council ("City Council") of the City. B. Assembly Bill (AB)X1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health S Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies ("Dissolution Act°). C. On December 29, 2011, California Redevelopment Association v. Matosentos, Case No. S194861, the California Supreme Court upheld the Dissolution Act and thereby all redevelopment agencies In California are subject to the Dissolution Act and were dissolved effective February 1, 2012. D. On January 11, 2012, the City Council adopted Resolution No. 12-01-10- 01 at an open public meeting choosing to become and serve as the "Successor Agency" to the dissolved Agency under the Dissolution Act. E. As of and on and after February 1, 2012, the City serves as the "Successor Agency" and is performing Its functions as the successor agency under the Dissolution Act to administer the enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by the seven - member Oversight Board. F. On January 17, 2012, the City Council adopted Resolution No. 12 -01 -17 - pursuant to California Health and Safety Code Section 34176 of the Dissolution Act, declining to assume the housing assets and functions of the Agency and selected the San Juan Capistrano Housing Authority to so assume such housing assets and functions, and on such date also pursuant to Section 34176 the Authority accepted and assumed the housing assets and functions of the Agency and as of February 1, 2012, became and serves as the "Successor Housing Agency" of the former Agency pursuant to the Dissolution Act. At this time, any assets assigned and transferred by operation of Exhibit B U law and to be assigned and transferred by authorization of and direction from the oversight board when formed and operating pursuant to the Dissolution Act to the Successor Housing Agency are not adequate to fund administrative support costs and expenses unless any future Low and Moderate Income Housing fund balances are authorized to be transferred under State Law to the Successor Housing Agency. If this occurs, a future modification to this Agreement may be necessary. G. City, acting as Successor Agency, is engaged In activities necessary and appropriate to winding down the activities of the Agency's Community Development Central Project Area ("Central Project Area") that was originally adopted and amended by ordinances of the City Council. H. Employees of the City will perform day 4o -day administration and operation of the Successor Agency's duties and functions. Since the San Juan Capistrano Community Redevelopment Agency was originally formed and upon Successor Agency's effectiveness as of February 1, 2012, City has provided and shall continue to provide services to the Successor Agency, including but not limited to providing administrative, accounting, auditing, planning, engineering, legal, risk management, financial, clerical, record-keeping, and other services necessary for the Successor Agenoy to carry out its responsibilities. 1. City and Successor Agency desire to affirm and document an on-going cooperative arrangement regarding administrative and operational services and payment for services by entering Into a new contract whereby City agrees to provide admInistrativer and operational services and Successor Agency agrees to pay City for the cost of all such services to be provided by City for Successor Agency. NOW, THEREFORE, for and In consideration of the mutual promises, covenants and conditions herein contained, the parties hereto agree as follows: 1. Reimbursement of Administrative Expenses and Enforceable ObilnaHon Expenses. The Successor Agency shall be liable to the City for the payment of Its Administrative Expenses as set forth In this Agreement and as adopted by the Successor Agency as part of an Administrative Budget pursuant to Health & Safety Code Section 341770) and approved by the Oversight Board, as such annual Administrative Budget may be amended, revised or reconciled from time to time. In addition, the Successor Agency shall be liable to the City for any program or operational expenses associated with Enforceable Obligations, as that term is defined In the Dlssolutlon Act as set forth In each Recognized Obligation Payment Schedule CROPS"), Including salary and benefits of employees.* 2 U F; 2.1 Successor Agency and City estimate Bret the cost of Administrative Expenses to be provided by City to the Successor Agency for the period of February 1, 2012 through June 30, 2012, is Two Hundred Twelve Eight Hundred Forty Seven Dollars ($212,847), which Is Itemized In the Successor Agency's Administnative Budget approved by action of the Oversight Board. Pursuant to the provisions of Section 4 herein, Successor Agency agrees to pay the sum of $212,847 to City to pay for the estimated Administrative Expenses of the Successor Agency for the period February 1, 2012, through June 30, 2012, and for subsequent fiscal years, subject to Oversight Board approval and Successor Agency preparation and approval of an Administrative Budget estimate for such services and costs pursuant to the Dissolution Act. 2.2. Information and supporting data regarding the staflb►g and allocation of costs have been prepared by Successor Agency and City staff and are made a part hereof by this reference. Within thirty (30) days of the expiration of the each calendar quarter during the terrn of this Agreement, the parties shall detemnmine the actual costs Incurred by Successor Agency for services provided to the City and the Successor Agency shall reimburse the City for these costs within thirty (30) days of this determination. For the period of February 1, 2012, through March 319 2012, these amounts shall be reimbursed within thirty (30) days of the approval of this agreement. Within thirty (30) days of the expiration of Flscal Year 2011-12 and each fiscal year thereafter during the term of this Agreement, the parties shalt determine the actual costs Incurred by Successor Agency for services provided to the City. If the actual amount Incurred by Successor Agency is less than the estimated amount, City shall reimburse Successor Agency In the amount overpaid within 30 days of such notice, and If the actual amount Incurred by Successor Agency is greater then the estimated amount, any additional amount above the estimated amount shall be due and payable by Successor Agency from the Redevelopment Obligation Retirement Fund and the additional amount shall be advanced td Successor Agency by City. 3. Barvtcea to be Provided. City agrees to continue to aid and 000perate and shall old and cooperate In the planning, undertaking, construction and operation of remaining enf weabte obligailons of the Successor Agency previously incurred by the Agency as it relates to Enforceable Obligations of the Agency within the City provided the cost of such services are paid by Successor Agency. At the request of Successor Agency through the City Manager and duly authorized designees, the City and Its oi3cers and employees shall perform services for Successor Agency in carrying out its work related to meeting the Agency's Enfoiceable Obilgatlons and for winding down the activities of the Agency and shall have access to any and all personnel and the facilities of the departments and offices of the City. Those City oflfcers and employees who are also appointed to positions or oMces with or related to the Successor Agency shall perform services for the each agency in a dual capacity. The Clay Manager, and other appropriate City officlats on behalf of the City and the Successot Agency, and duly authorized designees, shall determine.and establish the procedures to be followed In requesting and rendering such services. The costs of administrative services shall be considered Administrative Expenses In the Annual Administrative Budget The costs of other Enforceable Obligation where supported by City services are IdentMed as spedfic One items on the EOPS or ROPS and not part of the estimated Administrative Expenses Identified in Section 1. 4. Meeting Facilities. City agrees to make available to Successor Agency such office space and meeting space as Is necessary for conducting meetings and the business of such agency, Including use of the City Council Chambers and appropriate conference room(s) for open public meetings, closed session meetings, and study session meetings of the Successor Agency and Oversight Board, and meetings of Successor Agency staff, counsel, consultants, and other representatives. Each agency shall use such space In accordance with the rules and regulations of the City as applicable to other buildings and offices of the City. S. Succeeding Years during Term of Agfeemen. The procedure set forth above in Sections 2, 3 and 4 shall be undertaken by Successor Agency, the Oversight Board, and City for each successive six-month period and for each fiscal year during the tern of this Agreement based on each approved Administrative Budget and ROPS prepared pursuant to the Dissolution Act 6. Ck C_ost Allocation Plan: ,Eatim ted Cost of Services and Facilities. Expenses shall be calculated In the manner set forth in City's cost allocation plan, or other -applicable reasonable cost allocation and accounting pian approved by the parties that conforms with generally accepted accounting principles and that is generally applicable to all users of services and facilities of the City. The specific costs to be allocated herein shall be based upon the cost of the following categories•of services. 6.1 Wages and Oggga Successor Agency. Wage and Benefit expenses Incurred In connection with City employees described to perform administrative services work for Successor Agency. The costs attributable to employees who devote less than 100% of their time to the Successor Agency shall be allocated in accordance with the City's cost allocation plan. 0.2 gongMI ,Overhead. A general Indirect administrative operating expenses and overhead support charge which shall be determined in accordance with the City's cost allocation plan and Successor Agency Annual Administrative Budget 8A Specific Bond= All expenses that City may actually incur In providing specific administrative services on behalf of Successor Agency Induding, but not limited to, audit services, lease of space to accommodate Suoceasor Agencies activities, City Treasurer services, property insurance for Su or Agency's properties, contracts for real estate data and information, department supplies, mall and postage services, equipment maintenance and IT support. 7. Annual Expenses DeenM1Zd...ra& Advance. For each year in which Successor Agency does not have adequate funds to pay and reimburse for Administrative Expenses and/or Enforceable Obligation Expenses, each such amount 4 shall be deemed an advance by City to Successor Agency and such amount shall be deemed to have been loaned by City to Successor Agency CCity/Successor Agency Operations Loan'). 8. Rogavment of Operations -Lown. Successor Agency agrees to repay the Clty/Suaessor Agency Operations Loan (and all future advances thereto) from (former) tax Increment funds allocated to Successor Agency that are to be paid from property tax revenues deposited in the Redevelopment Property Tax Trust Fund pursuant to California Health and Safety Code Section 34177(k) and other applicable laws. Suocebsor Agency shall repay to City the principal amount of the City/Successor Agency Opendlons Loan on or before the last date that Successor Agency may receive tax Increment funds pursuant to the fime and financial limitations required to meet all enforceable obligations of the Successor Agency and subject to the Dissolution Act and other applicable laws. 9. Provisions Severable. If any provision of this Agreement or application thereof to any person or circumstance is held invalid, such Invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the Invalid provision or appllcation, and to this end the provisions of this Agreement are severable. The City Council and Successor Agency each hereby declares that it would have approved this Agreement irrespective of the Invalidity of any particular portion hereof. 10. 99ha e D U of Aareement This Agreement shall become effective as of the date in the first paragraph hereof and shall continue thereafter until mcdMed or terminated by the parties hereto. 11. gub-ordination Indebtedness. The indebtedness of the City/Successor Agency Operations Loan under this Agreement shall be junior and subordinate to other allocated moneys made from the Redevelopment Property Tax -Trust Fund including those pursuant to Callfomia Health and Safety Code Section 34183(e)(1) and (2). P U IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their officers thereunto duly authorized on the date first above written. CITY OF SAN JUAN CAPISTRANO, a California Municipal Corporation Larry Krani Qr, ayor M Dated: a/ APPROVED AS TO FORM [Signatures continue on next page] 6 U U [Signatures continued from previous page] CITY OF SAN JUAN CAPISTRANO ACTING AND SERVING AS THE SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY Larry Krargdr, Mayor Dated: _!`tati 2 L 0 1 a. 0, Maki"orris; City CI on behalf of the Successor Agency Dated: (� APPROVED AS TO FORM Tom Claris, Stradlin c a, Carlson, and Rauth Special 'Co;74ta nsel to sor Agency Dated:Z.a2 7 RESOLUTION NO. SACRA 12-05-01-01 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO, ACTING SOLELY IN ITS CAPACITY AS SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO REDEVELOPMENT AGENCY, APPROVING THE SUCCESSOR AGENCY ADMINISTRATIVE BUDGET FROM FEBRUARY 1, 2012, TO JUNE 30, 2012 PURSUANT TO HEALTH AND SAFETY CODE SECTION 341770) AND REQUEST TO OVERSIGHT BOARD AUTHORIZING THE SUCCESSOR AGENCY TO ENTER INTO AN AGREEMENT WITH THE CITY OF SAN JUAN CAPISTRANO FOR ADMINISTRATIVE SUPPORT PURSUANT TO HEALTH AND SAFETY CODE SECTION 34171 WHEREAS, the San Juan Capistrano Community Redevelopment Agency ("Agency") was established as a community redevelopment agency duly organized and existing under the California Community Redevelopment Law, Health and Safety Code Section 33000, et seq. ("CRL"), and has been authorized to transact business and exercise the power of a redevelopment agency pursuant to action of the City Council ("City Council") of the City of San Juan Capistrano ("City"); and WHEREAS, Assembly Bill x1 28 added Parts 1.8 and 1.85 to Division 24 of the California Health and Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies (the "Dissolution Act's; and WHEREAS, the Agency is now a dissolved redevelopment agency pursuant to the Dissolution Act; and WHEREAS, by Resolution No. 12-01-10-01 approved by the City Council at an open meeting on January 10, 2012, the City chose to become and serve as the successor agency to the dissolved Agency under the Dissolution Act; and WHEREAS, as of and on and after February 1, 2012, the City serves and acts as the "Successor Agency" and will perform its functions as the successor agency under the Dissolution Act to administer all enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by a seven -member oversight board ("Oversight Board's and; WHEREAS, Health and Safety Code Section 341770) requires the Successor Agency to prepare a proposed Administrative Budget covering the period from February 1, 2012, through June 30, 2012; and WHEREAS, pursuant to Section 341770), the Successor Agency's "Administrative Budget" Is to include all of the following: (a) estimated amounts of the Successor Agency's administrative costs for the upcoming six month fiscal period; (b) the proposed sources of payment for the costs identified in (a); and (c) proposals for arrangements for administrative and operations services provided by the City as Successor Agency; and U WHEREAS, the Administrative Budget must be approved by the Oversight Board pursuant to Health and Safety Code Section 341770); and WHEREAS, upon the Oversight Board's approval of the Administrative Budget, the Administrative Budget will be provided to the County of Orange Auditor -Controller pursuant to Health and Safety Code Section 34177(k) so that the Successor Agency's estimated administrative costs in the approved Administrative Budget will be paid from property tax revenues deposited into the Redevelopment Property Tax Trust Fund for the upcoming six-month period; and WHEREAS, pursuant to Section 34180(h) the Successor Agency may request authorization from the Oversight Board for the Successor Agency and the City of San Juan Capistrano to enter into an agreement to ensure provision of the necessary services from the City to support Successor Agency responsibilities in winding down the activities of the former Agency, including the estimated costs set forth in the Administrative Budget; and WHEREAS, the Successor Agency desires to enter into that certain "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" ("Costs Reimbursement Agreement', which agreement will authorize the reimbursement of costs incurred by the City to support Successor Agency operations and obligations; and WHEREAS, the City Council, on behalf of the City acting solely in its capacity as Successor Agency to the Agency, has duly considered this Resolution and has determined that the adoption of this Resolution is in the best interests of the City, in its capacity as Successor Agency to the Agency, and the health, safety, and welfare of the residents of the City, and in accord with the public purposes and provisions of applicable state and local laws and requirements. NOW THEREFORE, BE IT RESOLVED, that the City Council of the City of San Juan Capistrano, acting solely as the Successor Agency to the Community Redevelopment Agency, does hereby resolve as follows: Section 1. The foregoing Recitals are incorporated into this Resolution by this reference, and constitute a material part of this Resolution. Section 2. Pursuant to CRL Section 34177Q), the City Council, acting solely as a Successor Agency to the Agency, hereby approves the Administrative Budget, attached hereto as Exhibit A and incorporated by this reference. Section 3. Pursuant to the Dissolution Act, the City Council, acting solely as a Successor Agency to the Agency, hereby authorizes the Successor Agency to enter into the Cost Reimbursement Agreement substantially in the form of the Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan, attached hereto as Exhibit B and incorporated by this reference. 2 Section 4. The City Manager or her authorized designees are further authorized and directed to submit the Successor Agency Administrative Budget and Cost Reimbursement Agreement to the Oversight Board on behalf of the City. Section 5. Upon approval by the Oversight Board, the City Council, acting solely as a Successor Agency to the Agency, authorizes the Successor Agency to transmit the Administrative Budget and Costs Reimbursement Agreement, when approved and entered into between the Successor Agency and the City, to the County of Orange Auditor -Controller, the California State Department of Finance, and the State Controller's Office. Section 6. Upon approval by the Oversight Board, the City Council, acting solely as a Successor Agency to the Agency, the City Manager or her authorized designees are directed to post the Administrative Budget and Costs Reimbursement Agreement (when entered into) on the City/Successor Agency website. Section 7. The City Clerk shall certify to the adoption of this Resolution. PASSED, APPROVED and ADOPTED this 1 st day of May 2012. CITY OF SAN JUAN CAPISTRANO, ACTING SOLELY IN ITS CAPACITY AS A 3 STATE OF CALIFORNIA COUNTY OF ORANGE ss. CITY OF SAN JUAN CAPISTRANO ) I, MARIA MORRIS, appointed City Clerk of the City of San Juan Capistrano, do hereby certify that the foregoing Resolution No. SACRA 12-04-01-01 was duly adopted by the City Council of the City of San Juan Capistrano at a Regular meeting thereof, held the 1 t day of May 2012, by the following vote: COUNCIL MEMBERS: COUNCIL MEMBER: COUNCIL MEMBER: :se, Reeve, e e 4 Taylor, Allevato and Mayor Kramer Expenditure Category Description Amount Salaries and benefits Successor Anency share of City employee's salaries and benefits $106 154 Facility charges Successor Agency share of City's overhead costs for offices ace 19,476 Vehicle fleet charges Successor Agency share of Citys overhead costs for vehicles 6,457 Insurance charges Successor Agency share of City's overhead costs for insurance 26,284 IT/communication charges Successor Agency share of City's overhead costs for computers and phones 19,956 Materials and supplies Successor Agency share of various supplies 292 Utilities Successor Agency share of electricity, gas, and comer costs 1.592 Training Participation by the CFO and Accounting Manager at the Successor Agency training in March 2012 sponsored by the California Redevelopment Association (includes mileage reimbursement) 662 Sub -total -Administrative Allowance (1)(2) $180,873 Least services 3 Contract for legal services 31 975 Total Administrative Expenses $212,648 (1) For Fiscal Year 2011-12, the City, as the Successor Agency, is entitled to receive up to 5% of the portion of its former tax increment payable, but not less than $250,000, to meet the administrative expenses of serving as the Successor Agency. (2) Administrative costs for salaries and benefits and overhead costs are identified on Page 5, Lines 6 and 7 of the Successor Agency's Recognized Obligation Payment Schedule (ROPS). (3) Legal services are identified on Page 5, Lines 14 and 15 of the Successor Agency's ROPS as separate enforceable obligations. EXHIBIT A AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITYISUCCESSOR AGENCY OPERATIONS LOAN This AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITY/ SUCC SSOR AGENCY OPERATIONS LOAN ("Agreement') is made and entered into as of , 2012 by and among the CITY OF SAN JUAN CAPISTRANO, a California nicipal corporation ("City"), and the CITY OF SAN JUAN CAPISTRANO ACTING -AS SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY ("Successor Agency") RECITALS A. The San Juan Capistrano Community Redevelopment Agency ("Agency") was established as a community redevelopment agency that was previously organized and existing under the California Community Redevelopment Law, Health and Safety Code Sections 33000, et seq. ("CRL'), and previously authorized to transact business and exercise the powers of a redevelopment agency pursuant to action of the City Council ("City Council") of the City. B. Assembly Bill (AB)X1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health & Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies ("Dissolution Acn. C. On December 29, 2011, Cellfomis Redevelopment Association v. Matosantos, Case No. S194861, the California Supreme Court upheld the DIssolution Act and thereby all redevelopment agencies In Caiifomia are subject to the Dissolution Act and were dissolved effective February 1, 2012. D. On January 11, 2012, the City Council adopted Resolution No. 12-01-10- 01 at an open public meeting choosing to become and serve as the "Successor Agency" to the dissolved Agency under the Dissolution Act. E. As of and on and after February 1, 2012, the City serves as the "Successor Agency" and Is performing its functions as the successor agency under the Dissolution Act to administer the enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by the seven - member Oversight Board. F. On January 17, 2012, the City Council adopted Resolution No. 12 -01 -17 - pursuant to California Health and Safety Code Section 34176 of the Dissolution Act, declining to assume the housing assets and functions of the Agency and selected the San Juan Capistrano Housing Authority to so assume such housing assets and functions, and on such date also pursuant to Section 34176 the Authority accepted and assumed the housing assets and functions of the Agency and as of February 1, 2012, became and serves as the "Successor Housing Agency" of the former Agency pursuant to the Dissolution Act. At this time, any assets assigned and transferred by operation of Exhibit B law and to be assigned and transferred by authorization of and direction from the ovenright board when formed and operating pursuant to the Dissolution Act to the Successor Housing Agency are not adequate to fund administrative support costs and expenses unless any future Low and Moderate Income Housing fund balanus are authorized to be transferred under State Law to the Successor Housing Agency. If this occurs, a future modification to this Agreement may be necessary. G. Clty, acting as Successor Agency, is engaged In activities necessary and appropriate to winding down the activities of the Agency's Community Development Central Project Area rCentral Project Area`) that was originally adopted and amended by ordinances of the City Council. H. Employees of the -City will perform dar4oday administration and operation of the Successor Agency's duties and functions. Since the San Juan Capistrano Community Redevelopment Agency was originally formed and upon Successor Agency's effectiveness as of February 1, 2012, City has provided and shall continue to provide services to* the Successor Agency, Including but not limited to providing administrative, acooudUng, auditing, planning, engineering, legal, risk management, financial, clerical, record-keeping, and other services necessary for the Successor Agency to cavy out Its responsibilities. t. City and Successor Agency desire to affirm and document an on-going cooperative arrangement regarding administrative and operational services and payment for services by entering Into a new contract whereby City agrees to provide administrativer and operational services and Successor Agency agrees to pay City for the oast of all such services to be provided by City for Successor Agency. NOW, THEREFORE, for and In consideration of the mutual promises, covenants and conditions herein contained, the parties hereto agree as follows: 1. Retfnbursemant of . Admtnlsftdve Expenses and Enforceable Qhftoatson Exuanses. The Successor Agency shall be Roble to the City for the payment of Be Administrative Expenses as set forth in this Agreement and as adopted by the Successor Agency as part of an Administrative Budget pursuant to Health & Safety Code Section 341770) and approved by the Oversight Board, as such annual Administrative Budget may be amended, revised or reconciled from time to time. In addition, the Successor Agency shall be liable to the City for any program or operational expanses assooleted with Enforceable Obligations, as that term Is defined In the Dissolution Act as set forth in each Recognized Obligation Payment Schedule CROPS°), Including salary and benefits of employees. 2 L 2.1 Successor Agency and City estimate that the cost of Administrative Expenses to be provided by City to the Successor Agency for the period of February 1, 2012 through June 300 2012, Is Two Hundred Twelve Eight Hundred Fogy Seven Dollars ($212,847), which Is itembod In the Successor Agency's Administrative Budget approved by action of the Oversight Board. Pursuant to the provisions of Section 4 herein, Successor Agency agrees to pay the sum of $212,847 to City to pay for the estimated Administratin Expenses of the Successor Agency for the period February 1, 2012, through June 30, 2012, and for subsequent fiscal years, subject to Oversight Board approval and Successor Agency preparation and approval of an Administrative Budget estimate for such services and costa pursuant to the Dissolution Act. 2.2. Information and siVpordng data regarding the stafftrrg and allocation of costs has been prepared by Successor Agency and City staff and are made a part hereof by this reference. Within thirty (30) days of the expiration of the each calendar quarter during the teen of this Agreement, the parties shall determine the actual costs Incurred by Successor Agency fior services provided to the City and the Successor Agency shall reimburse the City for these costs within thirty (30) days of this detwminallon. For the period of February 1, 2012, through Manch 310 2012, these amounts shall be reimbursed within thirty (30) days of the approval of this agreement. 1A1+'thln thirty (30) days of the expiration of Fiscal Year 201142 and each fiscal year thereafter during the term of this Agreement, the parties shall determine the actual costs Incurred by Successor Agency for services provided to the City. If the actual amount Incurred by Successor Agency Is less than the estimated amount, City snap reimburse Successor Agency in the amount overpaid within 30 days of such notice, and if the actual amount incurred by Successor Agency Is greater than the estimated amount, any additional amount above the estimated amount shall be due and payable by Successor Agency from the Redevelopment Obligation Retirement Fund and the additional amount shall be advanced t0 Successor Agency by City. - 3. Servlaea to be Provided. City agrees to continue to aid and cooperate and shall aid and cooperate In the planning, undertaking, construction and operation of remaining enforoeable obligations of the Successor Agency previously Incurred by the Agency as it relates to Enfbmeable Obligations of the Agency within the City provided the cost of such services are paid by Successor Agency. At the request of Successor Agency through the City Manager and duly authorized designees, the City and its officers and employees shall perform services for Successor Agency in carrying out Its work related to meeting the Agency's Enfor�oeable Obligations and for winding down the activities of the Agency and shall have ato any and all personnel and the faclNes of the departments and offices of the City. Those City officers and employees who are also appointed to positions or offices with or related to the Successor Agency shag perforin services for the each agency in a dust capacity. The City Manager, and other appropriate City ottlolals on behalf of the City and the Successor Agency, and duly authorized designees, shall determine.and establish the procedures to be followed In requesting and rendering such services. The costs of adminlstradve services shall be U considered Administrative Expenses In the Annual Administrative Budget The costs of other Enforceable Obligation where supported by City services are Identified as specific line items on the EOPS or ROPS and not part of the estimated Administrative Expenses Identified in Section 1. 4. Meeting Facilities. City agrees to make available to Successor Agency such office space and meeting space as Is necessary for conducting meetings and the business of such agency, including use of the City Council Chambers and appropriate conference room(s) for open public meetings, closed session meetings, and study session meetings of the Successor Agency .and Oversight Board, and meetings of Successor Agency staff, counsel, consultants, and other representatives. Each agency shall use such space In accordance with the rules and regulations of the City as applicable to other buildings and of es, of the City. 8. Sucaeedina Years during Tann of Agreement. The procedure set forth above In Sections 2.3 and 4 shall be undertaken by Successor Agency, the Oversight Board, and City for each successive six-month period and for each fiscal year during the tern of this Agreement based on each approved Administrative Budget and ROPS prepared pursuant to the Dissolution Act 8. Ch Cost Allocation Plan: Estimated Cost of Services and Facilltiea. Expenses shall be calculated In the manner set forth in City's cost allocation pian, or other -applicable reasonable cost allocation and accounting plan approved by the parties that conforms with generally accepted accounting principles and -that is generally applicable to all users of services and foollities of the City. The specific costs to be allocated herein shall be based upon the oust of the following categorles•of services. 8.1 Wages and_RoMM Successor Agenay. Wage and Benefit expenses Incurred in connection with, City employees described to perform administrative services work for Successor Agency. The costs attributable to employees who devote less than 100% of their time to the Successor Agency shall be allocated in accordance with the City's cost allocation plan. 8.2 Gang9j garhead. A general Indirect administrative operating expenses and overhead support charge which shall be determined In accordance with the City's cost allocation plan and Successor Agency Annual Administrative Budget GA Sc=Mo ; rvicas. All expenses that City may actually Incur In providing specific administrative services on behalf of Successor Agency Including, but not limited to, audit services, lease of space to accommodate Successor Agency a actWllles, City Treasurer services, property insurance for Successor Agency's properties, contracts for real estate data and information. department supplies, mail and postage services, equipment maintenance and IT support. 7. Annual Expenses Deemed City Advance. For each year in which Successor Agency does not have adequate funds to pay and reimburse for Administrative Expenses andlor Enforceable Obligation Expenses, each such amount 4 shall be deemed an advance by City to Successor Agency and such amount shall be deemed to have been loaned by City to Successor Agency ('City/Successor Agency Operations l oanj. 8. Ret MI Operations Loan. Successor Agency agrees to repay the City/Successor Agency Operations Loan (and all future advances thereto) from (former) tax Increment funds allocated to Successor Agency that are to be paid from property tax revenues deposited In the Redevelopment Property Tax Trust Fund pursuant to California Health and Safety Code Section 34177(k) and other applicable laws. Suocebsor Agency shall repay to City the principal amount of the City/Successor Agency Operations Loan on or before the last date that Successor Agency may receive tax Increment funds pursuant to the time and financial limitations required to meet all enforceable obligations of the Successor Agency and subject to the Dissolution Act and other applicable taws. 9. Provisions Severable. If any provision of this Agreement or application thereof to any person or circumstance is held invalid. such invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the Invalid provision or application, and to this end the provisions of this Agreement are severable. The City Council and Successor Agency each hereby declares that It would have approved this Agreement Irrespective of the Invalidity of any particular portion hereof. 10. K#lgM Date of Agreement. This Agreement shall become effective as of the date In the first paragraph hereof and shall continue thereafter until modified or terminated by the parties hereto. 11. -Subordination Indebtedness. The Indebtedness of the City/Successor Agency Operations Loan under this Agreement shall be junior and subordinate to other allocated moneys made from the Redevelopment Property Tax-Trust Fund including those pursuant to Cailfbmia Health and Safety Code Section 34183(x)(1) and (2). IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their officers thereunto duly authorized on the date first above written. CITY OF SAN JUAN CAPISTRANO, a California Municipal Corporation LarryK.rani n Qr, ayor M Dated: D/ APPROVED AS TO FORM [Signatures continue on next page] U [Signatures continued from previous page] CITY OF SAN JUAN CAPISTRANO ACTING AND SERVING AS THE SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY Larry Krargdr, Mayor Dated: Mg , L0 I a. KIL Mari orris, Cit1:Z00-a' Cl behaff of the Successor Agency Dated:P APPROVED AS TO FORM Tom Clark, Stradlin c ca, Carlson, and Rauth Special ' Consel to sor Agency Dated:ZD 2 7 512/2012 AGENDA REPORT D1 TO: Oversight Board Members FROM: Cindy Russell, Chief Financial Officer/City Treasurer SUBJECT: Consideration of a Resolution Approving the Administrative Budget for the Successor Agency to the San Juan Capistrano Community Redevelopment Agency; and Authorization of an "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" Between the City and the Successor Agency. RECOMMENDATION: By motion, adopt a Resolution: 1) Approving the Successor Agency Administrative Budget for the period from February 1, 2012 through June 30, 2012; and, 2) Authorizing the Successor Agency to enter into an "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" ("Costs Reimbursement Agreement") with the City of San Juan Capistrano pursuant to Code Sections 34171(d)(1)(F) and 34178(a) of the Dissolution Act for reimbursement of costs incurred by the City to support Successor Agency operations and responsibilities consistent with the Administrative Budget proposed to be approved by the Successor Agency; and, 3) Authorizing the Successor Agency to transmit the Administrative Budget and Cost Reimbursement Agreement, when approved and entered into, to the County of Orange Auditor -Controller, State Department of Finance (DOF) and State Controller's Office; and, 4) Authorizing the Successor Agency to post the Administrative Budget and Cost Reimbursement Agreement on its website. (Note that the above actions of the Oversight Board shall not become effective for three business days, pending any request for review by the DOR If DOF requests review of the above Board actions, it will have 10 days from the date of its request to approve the Oversight Board action or return it to the Oversight Board for reconsideration and the action, if subject to review by DOF, will not be effective until approved by DOF.) SITUATION: The California State Legislature enacted Assembly Bill X1 26 (the "Dissolution Act") to dissolve redevelopment agencies formed under the Community Redevelopment Law. The California Supreme Court in its decision in Califomia Redevelopment Association v. Agenda Report Page 2 May 2, 2012 Matosantos, issued December 29, 2011, (the "Supreme Court Decision"), declared the Dissolution Act to be constitutional. Under the Dissolution Act, all California redevelopment agencies were dissolved effective February 1, 2012, and various actions are now required by successor agencies to unwind the affairs of all former redevelopment agencies. Health and Safety Code Section 341770), as modified by the Supreme Court Decision, requires the Successor Agency to prepare a proposed Administrative Budget covering the period from February 1, 2012 through June 30, 2012, and submit it to the Oversight Board for approval. Pursuant to Section 341770), the Administrative Budget is to include all of the following: (a) estimated amounts of the Successor Agency's administrative costs for the upcoming six-month period (first period is February 1, 2012 to June 30, 2012, based on reformed dates); b) the proposed sources of payment for the costs identified in (a); and (c) proposals for arrangements for administrative and operations services provided by the City to the Successor Agency. For Fiscal Year 2011-2012, the City, as Successor Agency, is entitled to receive up to 5% of the portion of its former tax increment payable to meet the enforceable obligations of the former redevelopment agency as shown on the Recognized Obligation Payment Schedule and up to 3% of that amount each year after that, but not less than $250,000 each year, to meet the administrative expenses of serving as the Successor Agency. The proposed Successor Agency Administrative Budget is prepared as Exhibit A to the Resolution (Attachment 1). Under Health and Safety Code Section 34177(k), the Successor Agency will provide the County of Orange Auditor - Controller the administrative cost estimates from the approved Administrative Budget that are to be paid from property tax revenues deposited into the Redevelopment Property Tax Trust Fund for the period February 1, 2012 to June 30, 2012. Also subject to Oversight Board approval, pursuant to Health and Safety Code Section 34180(h), is any request by the Successor Agency to enter into an agreement with the City of San Juan Capistrano. To ensure provision of the necessary services from the City to support Successor Agency responsibilities in winding down the activities of the former San Juan Capistrano Community Redevelopment Agency ("Agency") and under the proposed Administrative Budget, it is necessary that the City and the Successor Agency enter into an agreement for reimbursement of costs incurred by the City to support Successor Agency operations and obligations. The Successor Agency requests that the Oversight Board authorize the Successor Agency to enter into the "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" ("Cost Reimbursement Agreement") with the City of San Juan Capistrano pursuant to Sections 34171(d)(1)(F) and 34178(a) of the Dissolution Act. This item is scheduled for consideration by the Successor Agency at its regular meeting of May 1, 2012. Any additional information based on their action will be provided at the Oversight Board meeting. Agenda Report Page 3 May 2, 2012 FINANCIAL CONSIDERATIONS: Administrative costs associated with the Successor Agency wind down of Agency affairs are estimated to be $180,873, excluding legal costs for the period from February 1, 2012, through June 30, 2012. Legal costs, totaling $31,975 are segregated from the administrative costs and listed as a separate enforceable obligation on the City Recognized Obligations Payment Schedule (ROPS). Although legal costs are listed separately on the ROPS, they have been included on the Administrative Budget schedule (Exhibit A to the Resolution) pending their approval as a separate obligation by the California State Department of Finance (DOF). Total estimated administrative and legal costs are $212,848. The administrative allowance is limited to 5% of the tax increment for Fiscal Year 2011/12. This amount is calculated to be $386,807. For the five month period from February 1, 2012 through June 30, 2012, the administrative allowance is calculated to be $161,170 (5/12 X $386,807). Additionally, the City's redevelopment agency administrative fund (Fund 04) has a fund balance of approximately $66,000 that is available to cover any costs in excess of the administrative allowance and/or any legal costs not approved as an enforceable obligation separate from the administrative allowance through June 30, 2012. The amounts on deposit in this fund were received in prior years from redevelopment agency tax increment. For future fiscal years, the City's administrative allowance is limited to 3% of tax increment or a minimum of $250,000. Based on tax increment projections, the administrative allowance would be capped at $250,000. NOTIFICATIONS: None RECOMMENDATION: By motion, adopt a Resolution: 1) Approving the Successor Agency Administrative Budget for the period from February 1, 2012 through June 30, 2012; and, 2) Authorizing the Successor Agency to enter into an "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" ("Costs Reimbursement Agreement") with the City of San Juan Capistrano pursuant to Code Sections 34171(d)(1)(F) and 34178(a) of the Dissolution Act for reimbursement of costs incurred by the City to support Successor Agency operations and responsibilities consistent with the Administrative Budget proposed to be approved by the Successor Agency; and, 3) Authorizing the Successor Agency to transmit the Administrative Budget and Cost Reimbursement Agreement, when approved and entered into, to the County Agenda Report a �- Page 4 May 2, 2012 of Orange Auditor -Controller, State Department of Finance (DOF) and State Controller's Office; and, 4) Authorizing the Successor Agency to post the Administrative Budget and Cost Reimbursement Agreement on its website. (Note that the above actions of the Oversight Board shall not become effective for three business days, pending any request for review by the DOF. If DOF requests review of the above Board actions, it will have 10 days from the date of its request to approve the Oversight Board action or return it to the Oversight Board for reconsideration and the action, if subject to review by DOF, will not be effective until approved by DOF.) Respectfully submitted, Cindy Russell Chief Financial Officer/City Treasurer Prepared by, Michelle Bannig�* Accounting Manager Attachment: 1. Resolution approving the Successor Agency Administrative Budget from February 1, 2012 to June 30, 2012, (Exhibit A — Administrative Budget; and Exhibit B - Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan) OVERSIGHT BOARD RESOLUTION NO. 12 -05 -02 -XX A RESOLUTION OF THE OVERSIGHT BOARD TO THE SUCCESSOR AGENCY OF THE SAN JUAN CAPISTRANO REDEVELOPMENT AGENCY, APPROVING THE SUCCESSOR AGENCY ADMINISTRATIVE BUDGET FROM FEBRUARY 1, 2012 TO JUNE 30, 2012, PURSUANT TO HEALTH AND SAFETY CODE SECTION 341770) AND AUTHORIZING THE SUCCESSOR AGENCY TO ENTER INTO AN AGREEMENT WITH THE CITY OF SAN JUAN CAPISTRANO FOR ADMINISTRATIVE SUPPORT PURSUANT TO HEALTH AND SAFETY CODE SECTION 34171. WHEREAS, the San Juan Capistrano Community Redevelopment Agency ("Agency") was established as a community redevelopment agency duly organized and existing under the California Community Redevelopment Law, Health and Safety Code Section 33000, et seq. ("CRL"), and has been authorized to transact business and exercise the power of a redevelopment agency pursuant to action of the City Council ("City Council") of the City of San Juan Capistrano ("City"); and WHEREAS, Assembly Bill X1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health and Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies (the "Dissolution Act"); and WHEREAS, the Agency is now a dissolved redevelopment agency pursuant to the Dissolution Act; and WHEREAS, by Resolution No. 12-01-10-01 approved by the City Council at an open meeting on January 10, 2012, the City chose to become and serve as the successor agency to the dissolved Agency under the Dissolution Act; and WHEREAS, as of and on and after February 1, 2012, the City serves and acts as the "Successor Agency" and will perform its functions as the successor agency under the Dissolution Act to administer all enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by a seven -member oversight board ("Oversight Board") and; WHEREAS, pursuant to Health and Safety Code Section 34179 the Successor Agency's Oversight Board has been formed and the initial meeting has occurred on April 9, 2012; and WHEREAS, Section 34179 provides that the Oversight Board has fiduciary responsibilities to holders of enforceable obligations and the taxing entities that benefit from distributions of property tax and other revenues pursuant to Section 34188 of Part 1.85 of the Dissolution Act; and ATTACHMENT 1 WHEREAS, Health and Safety Code Section 341770) requires the Successor Agency to prepare a proposed Administrative Budget covering the period from February 1, 2012 through June 30, 2012, and submit it to the Oversight Board for approval; and WHEREAS, pursuant to Section 341770), the Successor Agency's "Administrative Budget" is to include all of the following: (a) estimated amounts of the Successor Agency's administrative costs for the upcoming six month fiscal period; (b) the proposed sources of payment for the costs identified in (a); and (c) proposals for arrangements for administrative and operations services provided by the City as Successor Agency; and WHEREAS, the Successor Agency's proposed Administrative Budget has been submitted to the Oversight Board for its review and approval; and WHEREAS, the Administrative Budget, as approved by the Oversight Board, will be provided to the County of Orange Auditor -Controller pursuant to Health and Safety Code Section 34177(k) so that the Successor Agency's estimated administrative costs in the approved Administrative Budget will be paid from property tax revenues deposited into the Redevelopment Property Tax Trust Fund for the upcoming six-month period; and WHEREAS, pursuant to Section 34180(h) the Successor Agency may request authorization from the Oversight Board for the Successor Agency and the City of San Juan Capistrano to enter into an agreement to ensure provision of the necessary services from the City to support Successor Agency responsibilities in winding down the activities of the former Agency, including the estimated costs set forth in the Administrative Budget; and WHEREAS, the Successor Agency desires to enter into that certain "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" ("Costs Reimbursement Agreement"), which agreement will authorize the reimbursement of costs incurred by the City to support Successor Agency operations and obligations; and WHEREAS, the Oversight Board desires to approve the Successor Agency's proposed Administrative Budget and to authorize the Successor Agency to enter into the "Costs Reimbursement Agreement"; and WHEREAS, pursuant to the Dissolution Act, the actions of the Oversight Board, including those approved by this Resolution, do not become effective for three (3) business days pending any request for review by the -State Department of Finance (DOF), and if the DOF requests review hereof, DOF will have 10 days from the date of its request to approve this Oversight Board action or return it to the Oversight Board for reconsideration and the action, if subject to review by DOF, will not be effective until approved by DOF. NOW THEREFORE, BE IT RESOLVED, that the Oversight Board to the Successor Agency of the San Juan Capistrano Community Redevelopment Agency, does hereby resolve as follows: 2 U `✓ Section 1. The foregoing Recitals are incorporated into this Resolution by this reference, and constitute a material part of this Resolution. Section 2. Pursuant to CRL Section 341776), the Oversight Board approves the Successor Agency's proposed Administrative Budget, attached hereto as Exhibit A and incorporated by this reference. Section 3. Pursuant to the Dissolution Act, the Oversight Board authorizes the Successor Agency to enter into the Cost Reimbursement Agreement substantially in the form of the Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan, attached hereto as Exhibit B and incorporated by this reference. Section 4. The Oversight Board authorizes the Successor Agency to transmit the Administrative Budget and Cost Reimbursement Agreement, when approved and entered into between the Successor Agency and the City, to the County of Orange Auditor -Controller, the California State Department of Finance, and the State Controller's Office. Section 6. The City Manager or her authorized designees are directed to post the Administrative Budget and Cost Reimbursement Agreement (when entered into) on the City/Successor Agency website. Section 6. The Oversight Board Secretary shall certify to the adoption of this Resolution. PASSED, APPROVED and ADOPTED this 2nd day of May 2012. ATTEST: Maria Moms, Oversight Board Secretary Laura Freese, Chair 3 SUCCESSOR AGENCY ADMINISTRATIVE BUDGET February 1 2012 tO June 30 2012 Expenditure Category Description Amount Salaries and benefits Successor Agency share of City employee's salaries and benefits $106154 Facility charges Successor Agency share of City's overhead costs for offices ace 19,476 Vehicle fleet charges Successor Agency share of City's overhead costs for vehicles 6,457 Insurance cha es Successor Agencv share of Ci s overhead costs for insurance 26,284 IT/communication cha es Successor Agency share of City's overhead costs for computers and phones 19,956 Materials and supplies Successor Agency share of various supplies 292 Utilities Successor Agency share of electricity, as and water costs 1,692 Training Participation by the CFO and Accounting Manager at the Successor Agency training in March 2012 sponsored by the California Redevelopment Association (includes mileage reimbursement) 662 Sub -total - Administrative Allowance (1)(2) $180,873 Legal services 3 Contract for le al services 31.976 Total Administrative Expenses $212,848 (1) For Fiscal Year 2011-12, the City, as the Successor Agency, is entitled to receive up to 5% of the portion of its former tax increment payable, but not less than $250,000, to meet the administrative expenses of serving as the Successor Agency. (2) Administrative costs for salaries and benefits and overhead costs are identified on Page 5, Lines 6 and 7 of the Successor Agency's Recognized Obligation Payment Schedule (ROPS). (3) Legal services are identified on Page 5, Lines 14 and 15 of the Successor Agency's ROPS as separate enforceable obligations. EXHIBIT A AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITYISUCCESSOR AGENCY OPERATIONS LOAN This AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITY/ SUCCESSOR AGENCY OPERATIONS LOAN ("Agreement") is made and entered into as of , 2012, by and among the CITY OF SAN JUAN CAPISTRANO, a California municipal corporation ("City"), and the CITY OF SAN JUAN CAPISTRANO ACTING AS SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY ("Successor Agency") RECITALS A. The San Juan Capistrano Community Redevelopment Agency ("Agency") was established as a community redevelopment agency that was previously organized and existing under the California Community Redevelopment Law, Health and Safety Code Sections 33000, et seq. ("CRL"), and previously authorized to transact business and exercise the powers of a redevelopment agency pursuant to action of the City Council ("City Council") of the City. B. Assembly Bill (AB)X1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health & Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies ("Dissolution Act"). C. On December 29, 2011, Califomia Redevelopment Association v. Matosantos, Case No. S194861, the California Supreme Court upheld the Dissolution Act and thereby all redevelopment agencies in California are subject to the Dissolution Act and were dissolved effective February 1, 2012. D. On January 11, 2012, the City Council adopted Resolution No. 12-01-10- 01 at an open public meeting choosing to become and serve as the "Successor Agency" to the dissolved Agency under the Dissolution Act. E. As of and on and after February 1, 2012, the City serves as the "Successor Agency" and is performing its functions as the successor agency. under the Dissolution Act to administer the enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by the seven - member Oversight Board. F. On January 17, 2012, the City Council adopted Resolution No. 12 -01 -17 - pursuant to California Health and Safety Code Section 34176 of the Dissolution Act, declining to assume the housing assets and functions of the Agency and selected the San Juan Capistrano Housing Authority to so assume such housing assets and functions, and on such date also pursuant to Section 34176, the Authority accepted and assumed the housing assets and functions of the Agency and as of February 1, 2012, became and serves as the "Successor Housing Agency" of the former Agency pursuant to the Dissolution Act. At this time, any assets assigned and transferred by operation of EXHIBIT "B" U law and to be assigned and transferred by authorization of and direction from the Oversight Board when formed and operating pursuant to the Dissolution Act to the Successor Housing Agency are not adequate to fund administrative support costs and expenses unless any future Low and Moderate Income Housing fund balances are authorized to be transferred under State Law to the Successor Housing Agency. If this occurs, a future modification to this Agreement may be necessary. G. City, acting as Successor Agency, is engaged in activities necessary and appropriate to winding down the activities of the Agency's Community Development Central Project Area ("Central Project Area") that was originally adopted and amended by ordinances of the City Council. H. Employees of the City will perform day-to-day administration and operation of the Successor Agency's duties and functions. Since the San Juan Capistrano Community Redevelopment Agency was originally formed and upon Successor Agency's effectiveness as of February 1, 2012, City has provided and shall continue to provide services to the Successor Agency, including but not limited to providing administrative, accounting, auditing, planning, engineering, legal, risk management, financial, clerical, record-keeping, and other services necessary for the Successor Agency to cant' out its responsibilities. I. City and Successor Agency desire to affirm and document an on-going cooperative arrangement regarding administrative and operational services and payment for services by entering into a new contract whereby City agrees to provide administrative and operational services and Successor Agency agrees to pay City for the cost of all such services to be provided by City for Successor Agency. NOW, THEREFORE, for and in consideration of the mutual promises, covenants and conditions herein contained, the parties hereto agree as follows: 1. Reimbursement of Administrative Expenses and Enforceable Obligation Expenses. The Successor Agency shall be liable to the City for the payment of its Administrative Expenses as set forth in this Agreement and as adopted by the Successor Agency as part of an Administrative Budget pursuant to Health & Safety Code Section 341770) and approved by the Oversight Board, as such annual Administrative Budget may be amended, revised or reconciled from time to time. In addition, the Successor Agency shall be liable to the City for any program or operational expenses associated with Enforceable Obligations, as that term is defined in the Dissolution Act as set forth in each Recognized Obligation Payment Schedule ("ROPS"), including salary and benefits of employees. K 2. Cost of Administrative Expenses and Administrative Cost Allowance from February 1. 2012 through June 30, 2012. 2.1 Successor Agency and City estimate that the cost of Administrative Expenses to be provided by the City to the Successor Agency for the period of February 1, 2012 through June 30, 2012, is Two Hundred Twelve Eight Hundred Forty Eight Dollars ($212,848), which is itemized in the Successor Agency's Administrative Budget approved by action of the Oversight Board. Pursuant to the provisions of Section 4 herein, Successor Agency agrees to pay the sum of $212,848 to City to pay for the estimated Administrative Expenses of the Successor Agency for the period February 1, 2012 through June 30, 2012, and for subsequent fiscal years, subject to Oversight Board approval and Successor Agency preparation and approval of an Administrative Budget estimate for such services and costs pursuant to the Dissolution Act. 2.2. Information and supporting data regarding the staffing and allocation of costs have been prepared by Successor Agency and City staff and are made a part hereof by this reference. Within thirty (30) days of the expiration of each calendar quarter during the term of this Agreement, the parties shall determine the actual costs incurred by Successor Agency for services provided to the City and the Successor Agency shall reimburse the City for these costs within thirty (30) days of this determination. For the period of February 1, 2012 through March 31, 2012, these amounts shall be reimbursed within thirty (30) days of the approval of this agreement. Within thirty (30) days of the expiration of Fiscal Year 2011-12 and each fiscal year thereafter during the term of this Agreement, the parties shall determine the actual costs incurred by Successor Agency for services provided to the City. If the actual amount incurred by Successor Agency is less than the estimated amount, City shall reimburse Successor Agency in the amount overpaid within 30 days of such notice, and if the actual amount incurred by Successor Agency is greater than the estimated amount, any additional amount above the estimated amount shall be due and payable by Successor Agency from the Redevelopment Obligation Retirement Fund and the additional amount shall be advanced to Successor Agency by City. 3. Services to be Provided. City agrees to continue to aid and cooperate and shall aid and cooperate in the planning, undertaking, construction and operation of remaining enforceable obligations of the Successor Agency previously incurred by the Agency as it relates to Enforceable Obligations of the Agency within the City, provided that the costs of such services are paid by Successor Agency. At the request of Successor Agency through the City Manager and duly authorized designees, the City and its officers and employees shall perform services for Successor Agency in carrying out its work related to meeting the Agency's Enforceable Obligations and for winding down the activities of the Agency and shall have access to any and all personnel and the facilities of the departments and offices of the City. Those City officers and employees who are also appointed to positions or offices with or related to the Successor Agency shall perform services for each agency in a dual capacity. The City Manager, and other appropriate City officials on behalf of the City and the Successor Agency, and duly authorized designees, shall determine and establish the procedures to be followed in requesting and rendering such services. The costs of administrative M services shall be considered Administrative Expenses in the Annual Administrative Budget. The costs of other Enforceable Obligations where supported by City services are identified as speck line items on the EOPS or ROPS and not part of the estimated Administrative Expenses identified in Section 1. 4. Meetina Facilities. City agrees to make available to Successor Agency such office space and meeting space as is necessary for conducting meetings and the business of such agency, including use of the City Council Chambers and appropriate conference room(s) for open public meetings, closed session meetings, and study session meetings of the Successor Agency and Oversight Board, and meetings of Successor Agency staff, counsel, consultants, and other representatives. Each agency shall use such space in accordance with the rules and regulations of the City as applicable to other buildings and offices of the City. 5. Succeeding Years during Term of Agreement. The procedure set forth above in Sections 2, 3 and 4 shall be undertaken by Successor Agency, the Oversight Board, and City for each successive six-month period and for each fiscal year during the term of this Agreement based on each approved Administrative Budget and ROPS prepared pursuant to the Dissolution Act. 6. City Cost Allocation Plan; Estimated Cost of Services and Facilities. Expenses shall be calculated in the manner set forth in City's cost allocation plan, or other applicable reasonable cost allocation and accounting plan approved by the parties that conforms with generally accepted accounting principles and that is generally applicable to all users of services and facilities of the City. The specific costs to be allocated herein shall be based upon the cost of the following categories of services. 6.1 Wages and Benefits for the Successor Agency. Wage and Benefit expenses incurred in connection with City employees described to perform administrative services work for Successor Agency. The costs attributable to employees who devote less than 100% of their time to the Successor Agency shall be allocated in accordance with the City's cost allocation plan. 6.2 General Overhead. A general indirect administrative operating expense and overhead support charge which shall be determined in accordance with the City's cost allocation plan and Successor Agency Annual Administrative Budget. 6.3 Specific Services. All expenses that City may actually incur in providing specific administrative services on behalf of Successor Agency including, but not limited to, audit services, lease of space to accommodate Successor Agency's activities, City Treasurer services, property insurance for Successor Agency's properties, contracts for real estate data and information, department supplies, mail and postage services, equipment maintenance and IT support. 7. Annual Expenses Deemed City Advance. For each year in which Successor Agency does not have adequate funds to pay and reimburse for Administrative Expenses and/or Enforceable Obligation Expenses, each such amount 4 shall be deemed an advance by City to deemed to have been loaned by City to Operations Loan"). Successor Agency and such amount shall be Successor Agency ("City/Successor Agency 8. Repayment of Operations Loan. Successor Agency agrees to repay the City/Successor Agency Operations Loan (and all future advances thereto) from (former) tax increment funds allocated to Successor Agency that are to be paid from property tax revenues deposited in the Redevelopment Property Tax Trust Fund pursuant to California Health and Safety Code Section 34177(k) and other applicable laws. Successor Agency shall repay to City the principal amount of the City/Successor Agency Operations Loan on or before the last date that Successor Agency may receive tax increment funds pursuant to the time and financial limitations required to meet all enforceable obligations of the Successor Agency and subject to the Dissolution Act and other applicable laws. 9. Provisions Severable. If any provision of this Agreement or application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the invalid provision or application, and to this end the provisions of this Agreement are severable. The City Council and Successor Agency each hereby declares that it would have approved this Agreement irrespective of the invalidity of any particular portion hereof. 10. Effective Dane of Aureement. This Agreement shall become effective as of the date in the first paragraph hereof and shall continue thereafter until modified or terminated by the parties hereto. 11. Subordination Indebtedness. The indebtedness of the City/Successor Agency Operations Loan under this Agreement shall be junior and subordinate to other allocated moneys made from the Redevelopment Property Tax Trust Fund including those pursuant to California Health and Safety Code Section 34183(a)(1) and (2). 5 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their officers thereunto duly authorized on the date first above written. ATTEST: Maria L. Moms, City Clerk, Dated: APPROVED AS TO FORM Omar Sandoval, City Attorney Dated: CITY OF SAN JUAN CAPISTRANO, a California Municipal Corporation By: Larry Kramer, Mayor Dated: [Signatures continue on next page] U U [Signatures continued from previous page] CITY OF SAN JUAN CAPISTRANO ACTING AND SERVING AS THE SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY LIM ATTEST: Larry Kramer, Mayor Dated: Maria L. Moms, City Clerk on behalf of the Successor Agency Dated: APPROVED AS TO FORM Tom Clark, Stradling, Yocca, Carlson, and Rauth Special Counsel to Successor Agency Dated: 7 U Christy Jakl From: Christy Jakl Sent: Wednesday, May 02, 2012 4:13 PM To: Cindy Russell; Michelle Bannigan Cc: Maria Morris; Christine Casper Subject: Oversight Board Executed Documents This message contains attachments delivered via ShareFile. • 12-0502 Agr for Reimbursement of Cost (City -Successor Agency).pdf • SJCOB 12-05-02-01.pdf • SJCOB 12-05-02-02.pdf Download the attachments by clicking here. Good Afternoon, Please use the link above to access the executed documents approved at the May 2, 2012 Oversight Board meeting. Thank you! Chi-ist%? JIakl Deputy City Clerk City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 (949) 443-6310 1 (949) 493-1053 fax Christy Jakl From: Christy Jakl Sent: Thursday, May 03, 201210:08 AM To: Cindy Russell; Michelle Bannigan Cc: Christine Casper Subject. SACRA Resolutions Attachments: SACRA 12-05-01-Ol.pdf; SACRA 12-05-01-02.pdf Good Morning, Attached are the executed SACRA resolutions approved at the 5/1 City Council meeting. Thanks! C;ht-ist� RN Deputy City Clerk City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 (949) 443-6310 1 (949) 493-1053 fax AGENDA REPORT TO: Karen P. Brust, City FROM: Cindy Russell, Chief Financial officer/City Treasurer SACRA 611/2012 H3 SUBJECT: Consideration of Resolution Approving the Successor Agency Administrative Budget from February 1, 2012 to June 30, 2012, and Requesting the Oversight Board to Authorize the Successor Agency to Enter Into an Agreement with the City of San Juan Capistrano for Administrative Support. RECOMMENDATION: By motion, adopt a Resolution: 1. Approving the Successor Agency's proposed Administrative Budget for the period from February 1, 2012, through June 30, 2012; and, 2. Authorizing the Successor Agency to enter into an "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" rCosts Reimbursement Agreemenn with the City of San Juan Capistrano pursuant to Code Sections 34171(d)(1)(F) and 34178(a) of the Dissolution Act for reimbursement of costs incurred by the City to support Successor Agency operations and responsibilities consistent with the Administrative Budget proposed to be approved by the Successor Agency; and, 3. Authorizing the Successor Agency, upon Oversight Board approval, to transmit the Administrative Budget and Cost Reimbursement Agreement, when approved and entered into, to the County of Orange Auditor -Controller, State Department of Finance (DOF) and State Controller's Office; and, 4. Authorizing the Successor Agency to post the Administrative Budget and Cost Reimbursement Agreement on its website. SITUATION: The California State Legislature enacted Assembly Bill x1 26 (the "Dissolution Act") to dissolve redevelopment agencies formed under the Community Redevelopment Law. The California Supreme Court in its decision in California Redevelopment Association v. Matosantos, issued December 29, 2011, (the "Supreme Court Decision"), declared the Dissolution Act to be constitutional. Under the Dissolution Act, all California redevelopment agencies were dissolved effective February 1, 2012, and various actions are now required by successor agencies to unwind the affairs of all former redevelopment agencies. LWA Agenda Report Page 2 May 1, 2012 Health and Safety Code Section 341770), as modified by the Supreme Court Decision, requires the Successor Agency to prepare a proposed Administrative Budget covering the period from February 1, 2012, through June 30, 2012, and submit it to the Oversight Board for approval. Pursuant to Section 341770), the Administrative Budget is to include all of the following: (a) estimated amounts of the Successor Agency's administrative costs for the upcoming six-month period (first period is February 1, 2012, to June 30, 2012 based on reformed dates); b) the proposed sources of payment for the costs identified in (a); and (c) proposals for arrangements for administrative and operations services provided by the City to the Successor Agency. For Fiscal Year 2011-2012, the City, as Successor Agency, is entitled to receive up to 5% of the portion of its former tax increment payable to meet the enforceable obligations of the former redevelopment agency as shown on the Recognized Obligation Payment Schedule and up to 3% of that amount each year after that, but not less than $250,000 each year, to meet the administrative expenses of serving as the Successor Agency. The proposed Successor Agency Administrative Budget is prepared as Exhibit A of Attachment 1. Under Health and Safety Code Section 34177(k), the Successor Agency will provide the County of Orange Auditor -Controller the administrative cost estimates from the approved Administrative Budget that are to be paid from property tax revenues deposited into the Redevelopment Property Tax Trust Fund for the period February 1, 2012, to June 30, 2012. In addition, in order to ensure provision of the necessary services from they City to support Successor Agency responsibilities in winding down the activities of the former San Juan Capistrano Community Redevelopment Agency ("Agency") and under the proposed Administrative Budget, it is necessary that the City and the Successor Agency enter into an agreement for reimbursement of costs incurred by the City to support Successor Agency operations and responsibilities. Staff is recommending the Successor Agency approve the "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" ("Cost Reimbursement Agreement") prepared as Exhibit B pursuant to Sections 34171(d)(1)(F) and 34178(a) of the Dissolution Act. Once the Successor Agency reviews and approves the Administrative Budget and Cost Reimbursement Agreement, they are required to be considered and approved by the Oversight Board. This item is scheduled for consideration by the Oversight Board at its special meeting of May 2, 2012. FINANCIAL CONSIDERATIONS: Administrative costs associated with the Successor Agency wind down of Agency affairs are estimated to be $180,873, excluding legal costs for the period from February 1, 2012, through June 30, 2012. Legal costs, totaling $31,975 are segregated from the administrative costs and listed as a separate enforceable obligation on the City Recognized Obligations Payment Schedule (ROPS). Although legal costs are listed separately on the ROPS, they have been included on the Administrative Budget schedule (Exhibit A to the Resolution) pending their approval as a separate obligation Agenda Report Page 3 May 1, 2012 by the California State Department of Finance (DOF). Total estimated administrative and legal costs are $212,848. The administrative allowance is limited to 5% of the tax increment for Fiscal Year 2011/12. This amount is calculated to be $386,807. For the five month period from February 1, 2012, through June 30, 2012, the administrative allowance is calculated to be $161,170 (5/12 X $386,807). Additionally, the City's redevelopment agency administrative fund (Fund 04) has a fund balance of approximately $66,000 that is available to cover any costs in excess, of the administrative allowance and/or any legal costs not approved as an enforceable obligation separate from the administrative allowance through June 30, 2012. The amounts on deposit in this fund were received in prior years from redevelopment agency tax increment. For future fiscal years, the City's administrative allowance is limited to 3% of tax• increment or a minimum of $250,000. Based on tax increment projections, the administrative allowance would be capped at $250,000. NOTIFICATIONS: None RECOMMENDATION: By motion, adopt a Resolution: 1. Approving the Successor Agency's proposed Administrative Budget for the period from February 1, 2012, through June 30, 2012; and, 2. Authorizing the Successor Agency to enter into an "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" ("Costs Reimbursement Agreement") with the City of San Juan Capistrano pursuant to Code Sections 34171(d)(1)(F) and 34178(a) of the Dissolution Act for reimbursement of costs incurred by the City to support Successor Agency operations and responsibilities consistent with the Administrative Budget proposed to be approved by the Successor Agency; and, 3. Authorizing the Successor Agency, upon Oversight Board approval, to transmit the Administrative Budget and Cost Reimbursement Agreement, when approved and entered into, to the County of Orange Auditor -Controller, State Department of Finance (DOF) and State Controller's Office; and, 4. Authorizing the Successor Agency to post the Administrative Budget and Cost Reimbursement Agreement on its website. Agenda Report Page 4 May 1, 2012 Respectfully submitted, Cindy Russel Chief Financial Officer/City Treasurer Prepared by, Michelle Bannigan 6a, Accounting Manager Attachment: 1. Resolution approving the Successor Agency Administrative Budget from February 1, 2012, to June 30, 2012, (Exhibit A — Administrative Budget; and Exhibit B - Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan) RESOLUTION NO. SACRA 12 -05 -01 -XX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO, ACTING SOLELY IN ITS CAPACITY AS SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO REDEVELOPMENT AGENCY, APPROVING THE SUCCESSOR AGENCY ADMINISTRATIVE BUDGET FROM FEBRUARY 1, 2012, TO JUNE 30, 2012 PURSUANT TO HEALTH AND SAFETY CODE SECTION 341770) AND REQUEST TO OVERSIGHT BOARD AUTHORIZING THE SUCCESSOR AGENCY TO ENTER INTO AN AGREEMENT WITH THE CITY OF SAN JUAN CAPISTRANO FOR ADMINISTRATIVE SUPPORT PURSUANT TO HEALTH AND SAFETY CODE SECTION 34171 WHEREAS, the San Juan Capistrano Community Redevelopment Agency ("Agency") was established as a community redevelopment agency duly organized and existing under the California Community Redevelopment Law, Health and Safety Code Section 33000, et seq. ("CRL"), and has been authorized to transact business and exercise the power of a redevelopment agency pursuant to action of the City Council ("City Council") of the City of San Juan Capistrano ("City"); and WHEREAS, Assembly Bill x1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health and Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies (the "Dissolution Act"); and WHEREAS, the Agency is now a dissolved redevelopment agency pursuant to the Dissolution Act; and WHEREAS, by Resolution No. 12-01-10-01 approved by the City Council at an open meeting on January 10, 2012, the City chose to become and serve as the successor agency to the dissolved Agency under the Dissolution Act; and WHEREAS, as of and on and after February 1, 2012, the City serves and acts as the "Successor Agency" and will perform its functions as the successor agency under the Dissolution Act to administer all enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by a seven -member oversight board ("Oversight Board") and; WHEREAS, Health and Safety Code Section 341770) requires the Successor Agency to prepare a proposed Administrative Budget covering the period from February 1, 2012, through June 30, 2012; and WHEREAS, pursuant to Section 341770), the Successor Agency's "Administrative Budget' is to include all of the following: (a) estimated amounts of the Successor Agency's administrative costs for the upcoming six month fiscal period; (b) the proposed sources of payment for the costs identified in (a); and (c) proposals for arrangements for administrative and operations services provided by the City as Successor Agency; and ATTACHMENT 1 WHEREAS, the Administrative Budget must be approved by the Oversight Board pursuant to Health and Safety Code Section 341770); and WHEREAS, upon the Oversight Board's approval of the Administrative Budget, the Administrative Budget will be provided to the County of Orange Auditor -Controller pursuant to Health and Safety Code Section 34177(k) so that the Successor Agency's estimated administrative costs in the approved Administrative Budget will be paid from property tax revenues deposited into the Redevelopment Property Tax Trust Fund for the upcoming six-month period; and WHEREAS, pursuant to Section 34180(h) the Successor Agency may request authorization from the Oversight Board for the Successor Agency and the City of San Juan Capistrano to enter into an agreement to ensure provision of the necessary services from the City to support Successor Agency responsibilities in winding down the activities of the former Agency, including the estimated costs set forth in the Administrative Budget; and WHEREAS, the Successor Agency desires to enter into that certain "Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan" ("Costs Reimbursement Agreement"), which agreement will authorize the reimbursement of costs incurred by the City to support Successor Agency operations and obligations; and WHEREAS, the City Council, on behalf of the City acting solely in its capacity as Successor Agency to the Agency, has duly considered this Resolution and has determined that the adoption of this Resolution is in the best interests of the City, in its capacity as Successor Agency to the Agency, and the health, safety, and welfare of the residents of the City, and in accord with the public purposes and provisions of applicable state and local laws and requirements. NOW THEREFORE, BE IT RESOLVED, that the City Council of the City of San Juan Capistrano, acting solely as the Successor Agency to the Community Redevelopment Agency, does hereby resolve as follows: Section 1. The foregoing Recitals are incorporated into this Resolution by this reference, and constitute a material part of this Resolution. Section 2. Pursuant to CRL Section 341770), the City Council, acting solely as a Successor Agency to the Agency, hereby approves the Administrative Budget, attached hereto as Exhibit A and incorporated by this reference. Section 3. Pursuant to the Dissolution Act, the City Council, acting solely as a Successor Agency to the Agency, hereby authorizes the Successor Agency to enter into the Cost Reimbursement Agreement substantially in the form of the Agreement for Reimbursement of Costs and City/Successor Agency Operations Loan, attached hereto as Exhibit B and incorporated by this reference. 2 Section 4. The City Manager or her authorized designees are further authorized and directed to submit the Successor Agency Administrative Budget and Cost Reimbursement Agreement to the Oversight Board on behalf of the City. Section 5. Upon approval by the Oversight Board, the City Council, acting solely as a Successor Agency to the Agency, authorizes the Successor Agency to transmit the Administrative Budget and Costs Reimbursement Agreement, when approved and entered into between the Successor Agency and the City, to the County of Orange Auditor -Controller, the California State Department of Finance, and the State Controller's Office. Section 6. Upon approval by the Oversight Board, the City Council, acting solely as a Successor Agency to the Agency, the City Manager or her authorized designees are directed to post the Administrative Budget and Costs Reimbursement Agreement (when entered into) on the City/Successor Agency website. Section 7. The City Clerk shall certify to the adoption of this Resolution. PASSED, APPROVED and ADOPTED this day of , 2012. ATTEST: Maria Moms, City Clerk CITY OF SAN JUAN CAPISTRANO, ACTING SOLELY IN ITS CAPACITY AS A SUCCESSOR AGENCY Larry Kramer, Mayor 3 SUCCESSOR AGENCY ADMINISTRATIVE BUDGET February 1 2012 tO June 30. 2012 Expenditure Category Description Amount Salaries and benefits Successor Agency share of City em to eels salaries and benefits $106,154 Facility charges Successor Agency share of City's overhead costs for offices ace .19476 Vehicle fleet charges Successor Agency share of City's overhead costs for vehicles 6,457 Insurance charges Successor Agency share of City's overhead costs for insurance 28 284 IT/communication charqes Successor Agency share of City's overhead costs for computers and phones 19,956 Materials and supplies Successor Agency share of various supplies 292 Utilities Successor Agency share of electricity, gas,and water costs 1,592 Training Participation by the CFO and Accounting Manager at the Successor Agency training in March 2012 sponsored by the California Redevelopment Association (includes mileage reimbursement) 662 Sub-total -Administrative Allowance (1)(2) $180,873 services 3 Contract for legal services 31,975 ital Total Admintstrative Expensee; $212,848 (1) For Fiscal Year 2011-12, the City, as the Successor Agency, is entitled to receive up to 5% of the portion of its former tax increment payable, but not less than $250,000, to meet the administrative expenses of serving as the Successor Agency. (2) - Administrative costs for salaries and benefits and overhead costs are identified on Page 5, Lines 6 and 7 of the Successor Agency's Recognized Obligation Payment Schedule (ROPS). (3) - Legal services are identified on Page 5, Lines 14 and 15 of the Successor Agency's ROPS as separate enforceable obligations. EXHIBIT A AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITY/SUCCESSOR AGENCY OPERATIONS LOAN This AGREEMENT FOR REIMBURSEMENT OF COSTS AND CITY/ SUCCESSOR AGENCY OPERATIONS LOAN ("Agreement") is made and entered into as of , 2012, by and among the CITY OF SAN JUAN CAPISTRANO, a California municipal corporation ("City"), and the CITY OF SAN JUAN CAPISTRANO ACTING AS SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY ("Successor Agency") RECITALS A. The San Juan Capistrano Community Redevelopment Agency ("Agency") was established as a community redevelopment agency that was previously organized and existing under the California Community Redevelopment Law, Health and Safety Code Sections 33000, et seq. ("CRL"), and previously authorized to transact business and exercise the powers of a redevelopment agency pursuant to action of the City Council ("City Council") of the City. B. Assembly Bill (AB)X1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health & Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies ("Dissolution Act"). C. On December 29, 2011, Califomia Redevelopment Association v. Matosantos, Case No. S194861, the California Supreme Court upheld the Dissolution Act and thereby all redevelopment agencies in California are subject to the Dissolution Act and were dissolved effective February 1, 2012. D. On January 11, 2012, the City Council adopted Resolution No. 12-01-10- 01 at an open public meeting choosing to become and serve as the "Successor Agency" to the dissolved Agency under the Dissolution Act. E. As of and on and after February 1, 2012, the City serves as the "Successor Agency" and is performing its functions as the successor agency under the Dissolution Act to administer the enforceable obligations of the Agency and otherwise unwind the Agency's affairs, all subject to the review and approval by the seven - member Oversight Board. F. On January 17, 2012, the City Council adopted Resolution No. 12 -01 -17 - pursuant to California Health and Safety Code Section 34176 of the Dissolution Act, declining to assume the housing assets and functions of the Agency and selected the San Juan Capistrano Housing Authority to so assume such housing assets and functions, and on such date also pursuant to Section 34176 the Authority accepted and assumed the housing assets and functions of the Agency and as of February 1, 2012, became and serves as the "Successor Housing Agency" of the former Agency pursuant to the Dissolution Act. At this time, any assets assigned and transferred by operation of EXHIBIT "B" U law and to be assigned and transferred by authorization of and direction from the oversight board when formed and operating pursuant to the Dissolution Act to the Successor Housing Agency are not adequate to fund administrative support costs and expenses unless any future Low and Moderate Income Housing fund balances are authorized to be transferred under State Law to the Successor Housing Agency. If this occurs, a future modification to this Agreement may be necessary. G. City, acting as Successor Agency, is engaged in activities necessary and appropriate to winding down the activities of the Agency's Community Development Central Project Area ("Central Project Area") that was originally adopted and amended by ordinances of the City Council. H. Employees of the City will perform day -today administration and operation of the Successor Agency's duties and functions. Since the San Juan Capistrano Community Redevelopment Agency was originally formed and upon Successor Agency's effectiveness as of February 1, 2012, City has provided and shall continue to provide services to the Successor Agency, including but not limited to providing administrative, accounting, auditing, planning, engineering, legal, risk management, financial, clerical, record-keeping, and other services necessary for the Successor Agency to cant' out its responsibilities. 1. City and Successor Agency desire to affirm and document an on-going cooperative arrangement regarding administrative and operational services and payment for services by entering into a new contract whereby City agrees to provide administrative and operational services and Successor Agency agrees to pay City for the cost of all such services to be provided by City for Successor Agency. NOW, THEREFORE, for and in consideration of the mutual promises, covenants and conditions herein contained, the parties hereto agree as follows: 1. Reimbursement of Administrative Expenses and Enforceable Oblination Expenses. The Successor Agency shall be liable to the City for the payment of its Administrative Expenses as set forth in this Agreement and as adopted by the Successor Agency as part of an Administrative Budget pursuant to Health & Safety Code Section 341770) and approved by the Oversight Board, as such annual Administrative Budget may be amended, revised or reconciled from time to time. In addition, the Successor Agency shall be liable to the City for any program or operational expenses associated with Enforceable Obligations, as that term is defined in the Dissolution Act as set forth in each Recognized Obligation Payment Schedule ("ROPS"), including salary and benefits of employees.. 2 2. Cost of Administrative Expenses and Administrative Cost Allowance from February 1, 2012, through June 30, 2012. 2.1 Successor Agency and City estimate that the cost of Administrative Expenses to be provided by City to the Successor Agency for the period of February 1, 2012, through June 30, 2012, is Two Hundred Twelve Eight Hundred Forty Seven Dollars ($212,847), which is itemized in the Successor Agency's Administrative Budget approved by action of the Oversight Board. Pursuant to the provisions of Section 4 herein, Successor Agency agrees to pay the sum of $212,848 to City to pay for the estimated Administrative Expenses of the Successor Agency for the period February 1, 2012, through June 30, 2012, and for subsequent fiscal years, subject to Oversight Board approval and Successor Agency preparation and approval of an Administrative Budget estimate for such services and costs pursuant to the Dissolution Act. 2.2. Information and supporting data regarding the staffing and allocation of costs have been prepared by Successor Agency and City staff and are made a part hereof by this reference. Within thirty (30) days of the expiration of each calendar quarter during the term of this Agreement, the parties shall determine the actual costs incurred by Successor Agency for services provided to the City and the Successor Agency shall reimburse the City for these costs within thirty (30) days of this determination. For the period of February 1, 2012, through March 31, 2012, these amounts shall be reimbursed within thirty (30) days of the approval of this agreement. Within thirty (30) days of the expiration of Fiscal Year 2011-12 and each fiscal year thereafter during the term of this Agreement, the parties shall determine the actual costs incurred by Successor Agency for services provided to the City. If the actual amount incurred by Successor Agency is less than the estimated amount, City shall reimburse Successor Agency in the amount overpaid within 30 days of such notice, and if the actual amount incurred by Successor Agency is greater than the estimated amount, any additional amount above the estimated amount shall be due and payable by Successor Agency from the Redevelopment Obligation Retirement Fund and the additional amount shall be advanced to Successor Agency by City. 3. Services to be Provided. City agrees to continue to aid and cooperate and shall aid and cooperate in the planning, undertaking, construction and operation of remaining enforceable obligations of the Successor Agency previously incurred by the Agency as it relates to Enforceable Obligations of the Agency within the City provided the cost of such services are paid by Successor Agency. At the request of Successor Agency through the City Manager and duly authorized designees, the City and its officers and employees shall perform services for Successor Agency in carrying out its work related to meeting the Agency's Enforceable Obligations and for winding down the activities of the Agency and shall have access to any and all personnel and the facilities of the departments and offices of the City. Those City officers and employees who are also appointed to positions or offices with or related to the Successor Agency shall perform services for the each agency in a dual capacity. The City Manager, and other appropriate City officials on behalf of the City and the Successor Agency, and duly authorized designees, shall determine and establish the procedures to be followed in requesting and rendering such services. The costs of administrative services shall be 3 considered Administrative Expenses in the Annual Administrative Budget. The costs of other Enforceable Obligations where supported by City services are identified as specific line items on the EOPS or ROPS and not part of the estimated Administrative Expenses identified in Section 1. 4. Meetine Facilities. City agrees to make available to Successor Agency such office space and meeting space as is necessary for conducting meetings and the business of such agency, including use of the City Council Chambers and appropriate conference room(s) for open public meetings, closed session meetings, and study session meetings of the Successor Agency and Oversight Board, and meetings of Successor Agency staff, counsel, consultants, and other representatives. Each agency shall use such space in accordance with the rules and regulations of the City as applicable to other buildings and offices of the City. S. Succeeding Years durina Term of Aureement. The procedure set forth above in Sections 2, 3 and 4 shall be undertaken by Successor Agency, the Oversight Board, and City for each successive six-month period and for each fiscal year during the term of this Agreement based on each approved Administrative Budget and ROPS prepared pursuant to the Dissolution Act. 6. City Cost Allocation Plan; Estimated Cost of Services and Facilities. Expenses shall be calculated in the manner set forth in City's cost allocation plan, or other applicable reasonable cost allocation and accounting plan approved by the parties that conforms with generally accepted accounting principles and that is generally applicable to all users of services and facilities of the City. The specific costs to be allocated herein shall be based upon the cost of the following categories of services. 6.1 Wanes and Benefits Successor Agency. Wage and Benefit expenses incurred in connection with City employees described to perform administrative services work for Successor Agency. The costs attributable to employees who devote less than 100% of their time to the Successor Agency shall be allocated in accordance with the City's cost allocation plan. 6.2 General Overhead. A general indirect administrative operating expenses and overhead support charge which shall be determined in accordance with the City's cost allocation plan and Successor Agency Annual Administrative Budget. 6.3 Specific Services. All expenses that City may actually incur in providing specific administrative services on behalf of Successor Agency including, but not limited to, audit services, lease of space to accommodate Successor Agency's activities, City Treasurer services, property insurance for Successor Agency's properties, contracts for real estate data and information, department supplies, mail and postage services, equipment maintenance and IT support. 7. Annual Expenses Deemed City Advance. For each year in which Successor Agency does not have adequate funds to pay and reimburse for Administrative Expenses and/or Enforceable Obligation Expenses, each such amount 4 shall be deemed an advance by City to Successor Agency and such amount shall be deemed to have been loaned by City to Successor Agency ("City/Successor Agency Operations Loan"). 8. Repayment of Operations Loan. Successor Agency agrees to repay the City/Successor Agency Operations Loan (and all future advances thereto) from (former) tax increment funds allocated to Successor Agency that are to be paid from property tax revenues deposited in the Redevelopment Property Tax Trust Fund pursuant to California Health and Safety Code Section 34177(k) and other applicable laws. Successor Agency shall repay to City the principal amount of the City/Successor Agency Operations Loan on or before the last date that Successor Agency may receive tax increment funds pursuant to the time and financial limitations required to meet all enforceable obligations of the Successor Agency and subject to the Dissolution Act and other applicable laws. 9. Provisions Severable. If any provision of this Agreement or application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the invalid provision or application, and to this end the provisions of this Agreement are severable. The City Council and Successor Agency each hereby declares that it would have approved this Agreement irrespective of the invalidity of any particular portion hereof. 10. Effective Date of Aereement. This Agreement shall become effective as of the date in the first paragraph hereof and shall continue thereafter until modified or terminated by the parties hereto. 11. Subordination Indebtedness. The indebtedness of the City/Successor Agency Operations Loan under this Agreement shall be junior and subordinate to other allocated moneys made from the Redevelopment Property Tax Trust Fund including those pursuant to California Health and Safety Code Section 34183(a)(1) and (2). 5 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their officers thereunto duly authorized on the date first above written. ATTEST: Maria L. Moms, City Clerk, Dated: APPROVED AS TO FORM Omar Sandoval, City Attorney Dated: CITY OF SAN JUAN CAPISTRANO, a California Municipal Corporation 22 Larry Kramer, Mayor Dated: [Signatures continue on next page] [Signatures continued from previous page] CITY OF SAN JUAN CAPISTRANO ACTING AND SERVING AS THE SUCCESSOR AGENCY TO THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY By: ATTEST: Larry Kramer, Mayor Dated: Maria L. Morris, City Clerk on behalf of the Successor Agency Dated: APPROVED AS TO FORM Tom Clark, Stradling, Yocca, Carlson, and Rauth Special Counsel to Successor Agency Dated: 7