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04-0615_SAN JUAN CAPISTRANO, CITY OF_Cooperataive & Repayment AgrCOOPERATION AND REPAYMENT AGREEMENT THIS AGREEMENT is entered into as of the 15`h day of June, 2004 by and between the CITY OF SAN JUAN CAPISTRANO, a municipal corporation (herein the "City") and the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, a public body (herein the "Agency'). WITNESSETH: WHEREAS, the City Council of the City, acting pursuant to the provisions of the Community Redevelopment Law (Health & Safety Code Section 33000, et seq.) has activated the Agency and has declared itself to constitute the Agency, by Ordinance No. 488 adopted on July 12, 1981 WHEREAS, pursuant to the Community Redevelopment Law, the Agency is performing a public function of the City and may have access to services and facilities of the City; and WHEREAS, Section 33600 et. seq. of the California Community Redevelopment Law authorizes the Agency to borrow money or accept financial or other assistance from the City; and WHEREAS, the City will appropriate money in the City's Fiscal Year budget in an amount deemed appropriate each year by the Administrative Services Director to the Agency for the purpose of carrying out redevelopment activities; and WHEREAS, funds so appropriated may be used to find time, expenses, overhead costs, consultants contract costs, use of City facilities and staff and other expenses incurred on behalf of redevelopment efforts; and SD WHEREAS, funds so appropriated may be used in connection with the preparation and implementation of redevelopment plans pursuant to the Community Redevelopment Law; which costs include, but shall not be limited to: the costs of surveys, planning, studies, and environmental assessments for the adoption of a redevelopment plan; the costs of acquisition of properties acquired, building and site preparation; public improvements; relocation assistance to displaced residential and nonresidential occupants as required by law; financial assistance provided to developers; and, other costs incurred by the Agency in increasing, improving and preserving the City's supply of low and moderate income housing availability at affordable housing costs both inside and outside redevelopment project areas, in accordance with Health and Safety Code Section 33334.2 et seq. WHEREAS, the City will loan the funds to the Agency in the anticipation that such costs will be repaid by the Agency out of tax increment funds generated within the redevelopment project area and possible amended redevelopment project areas. NOW, THEREFORE, Agency and City for and in consideration of the mutual promises and agreements herein contained do agree as follows: 1. PURPOSE The purpose of this Agreement is to provide for the repayment to the City by the Agency in an amount deemed appropriate by the Administrative Services Director. Loan proceeds are to be used in connection with the preparation and implementation of redevelopment plans, administrative costs and expenses, including consultant costs, incurred by the Agency, which are incurred on behalf of the redevelopment efforts in the Central Redevelopment Project Area. 2. TERM OF AGREEMENT This Agreement shall be in full force and effect for a period beginning as of the date first written and continuing until all loans hereunder are repaid and no further City loans are required. 3. REPAYMENT TERMS The Agency agrees to repay the City in full together with accrued interest calculated at a variable rate based upon the annual average rate of return earned on the City's investment portfolio as determined by the City's Treasurer, compounded annually. The City shall calculate interest annually for the Agency. The loan together with accrued interest shall be repaid from future tax increment funds generated within the redevelopment project area starting on July 1, 2023 or earlier, if future tax increment is deemed available by the Finance Officer of the Agency. It is understood that in the event no project area is established or amended or tax increment revenues fail to yield enough revenue to repay this obligation, the Agency is under no obligation to the City to make such repayment from any further funds or resources it may acquire. Record Keeping As accurately as possible the Agency will track charges against this loan by redevelopment project area. In the event one or more project areas are amended, the costs incurred for the benefit of that project area(s) will become a debt of that project area(s). In the event that the City authorizes by appropriate resolution any future loans(s), such loan(s) shall become a debt of the Agency and shall be reflected as Attachment 1 (et seq.), which shall be attached to the Agreement, made a part hereof and subject to the terms set forth herein. 4. REPAYMENT SUBORDINATION It is agreed by the parties hereto that the repayment to the City pursuant to this Agreement is hereby subordinated to any and all payments necessary to satisfy the Agency's obligations in connection with any existing or future bonded indebtedness or obligation which may be incurred by the Agency for the benefit of the redevelopment plans, or to the extent necessary for any bonded indebtedness for which Agency has pledged as a security or source of repayment tax increment generated within the project areas. 5. VALIDITY OF AGREEMENT Ll If any provisions of this Agreement, or the application hereof to any person, party, transaction, or circumstance, are held invalid, the remainder of this Agreement, or the application of such provision to the other persons, parties, transactions or circumstances, shall not be affected thereby. IN WITNESS THEREOF, the parties have executed this agreement as of the date first above written. CITY OF 9AN AUJAN CAPISTRANO Joe ATTEST: 1 v R. Monahan COMMUNITY DEVELOPMENT AGENCY Diane Bathgate Chairperson ATTEST: � V arq ret R. Monahan APPROVED AS TO FORM: - Qv=� John Phaw City Affiorney 0 32400 PASEO ADEL NTO SAN JUAN CAPISTRANO, CA 92675 (949) 493-1171 (949) 493-1053 FAx WtS1T.Sanjuaw aplstl"ano.or�q �iKetn � • [slneusHo 1961 1776 T •AL TO: Cindy Russell, Administrative Services Director FROM: Meg Monahan, City Clerk RE: Cooperation & Repayment Ac Capistrano and the San Juan Agency DATE: June 17, 2004 the MEMBERS OF THE CITY COUNCIL SAM ALLEVATO DIANE L. BATHGATE WYATT HART JOE SOTO DAVID M. SWERDLIN San Juan Attached is (1) copy of the agreement approved by the City Council and the CRA Board of Directors on June 15, 2004. San Juan Capistrano: Preserving the Past to Enhance the Future L AGENDA REPORT TO: Dave Adams, Executive Director (&4\ FROM: Cindy Russell, Finance Officer • CRA 6/15/2004 C1 SUBJECT: Consideration of Approval of the Cooperation and Repayment Agreement with the City of San Juan Capistrano. RECOMMENDATION: By Motion, 1. Adopt a Resolution Approving the Cooperation and Repayment Agreement between the Community Redevelopment Agency and the City; and, 2. Authorize the Chairman to execute the Cooperation and Repayment Agreement Document. SITUATION The Community Redevelopment Agency Budget uses General Fund loans to cash flow current operations. The majority of the Redevelopment Agency's expenditure budget consists of staff charges from the City and outside financial, legal and other technical services. Staff charges to the Administrative Fund are related to the oversight of the Agency and project administration. These administrative charges also include costs associated with day -today financial functions of the Agency such as receiving rents, paying vendors, and other general accounting activities. Administrative staff charges, outside financial, legal and other services are estimated during the budget process. If these costs are less than anticipated, the amount borrowed from the General Fund will be reduced accordingly. These loans are to be repaid from available future tax increment. Tax increment revenues are projected to be sufficient to fund Agency obligations as well as repay the City's General Fund. Staff recommends that the City Council adopt the Resolution approving the Cooperation and Repayment Agreement between the San Juan Capistrano Community Redevelopment Agency and the City of San Juan Capistrano and authorize the Chairman to execute the Cooperation and Repayment Agreement Document. 0 Agenda Report Page 2 FINANCIAL CONSIDERATIONS 0 June 15, 2004 Currently, other revenue sources derived from Redevelopment Agency activities are limited. Without these General Fund loans, there will be no other available funding source to pay for administrative and possible future preparation and implementation costs associated with the Redevelopment Agency's on-going activities. NOTIFICATION Not Applicable By Motion, 1. Adopt a Resolution approving the Cooperation and Repayment Agreement between the Community Redevelopment Agency and the City; and, 2. Authorize the Chairman to execute the Cooperation and Repayment Agreement Document. Respectfully submitted, Cindy Russell Finance Officer Attachment: 1. Resolution approving Cooperation and Repayment Agreement RESOLUTION NO CRA 04-06-15-01 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, APPROVING A COOPERATION AND REPAYMENT AGREEMENT BETWEEN THE SAN JUAN CAPISTRANO COMMUNITY REDVELOPMENT AGENCY AND THE CITY OF SAN JUAN CAPISTRANO WHEREAS, by Ordinance No. 488, adopted July 12, 1983, Ordinance No. 509 adopted May 15, 1984, Ordinance No. 547, adopted on July 16, 1985, and Ordinance Nos. 582-583 adopted on August 19, 1986, the City Council of the City of San Juan Capistrano Community Redevelopment Agency (the "City Council") approved and amended the Redevelopment Plan (the "Plan") for the San Juan Capistrano Redevelopment Project (the "Project Area") of the San Juan Capistrano Community Redevelopment Agency (the "Agency"); and, WHEREAS, Section 33600 et. seq. of the California Community Redevelopment Law authorizes the Agency to borrow money or accept financial or other assistance from the City; and WHEREAS, the Agency incurs administrative costs associated with the plan activities of the Agency, including but not limited to staff time, legal, financial and other professional services; and, WHEREAS, the Agency incurs costs in connection with the preparation and implementation of redevelopment plans pursuant to the Community Redevelopment Law; and, WHEREAS, the Agency has the inability to meet its entire obligation for the payment of these costs. WHEREAS, the City Council, through its annual budget process has acknowledged the need to make General Fund Loans to the Agency to cover administrative costs; and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the San Juan Capistrano Community Redevelopment Agency does hereby Agree that the above recitals are true and correct. 2. Agree that the execution and delivery of the Cooperation and Repayment Agreement to provide this Repayment Loan is in the best interest of the Agency and will promote public health, safety and welfare. Approve the Cooperation and Repayment Agreement, attached hereto as Exhibit "A". The Chairman and the Executive Director are hereby authorized 06-15-2004 -1- 11 0 to execute the Cooperation and Repayment Agreement on behalf of the Agency, together with such changes thereto as are approved by the Executive Director, execution thereof being conclusive evidence of the Agency's approval of such changes. PASSED, APPROVED, AND ADOPTED this 15"' day of June 2004. DIANE BATHGATE, CHAIRMAN ATTEST: �' v M#RGPIRET R. MONAHAN, SECRETARY STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. CITY OF SAN JUAN CAPISTRANO ) 1, MARGARET R. MONAHAN, appointed Agency Secretary of the Community Redevelopment Agency of the City of San Juan Capistrano, do hereby certify that the foregoing Resolution No. CRA 04-06-15-01 was duly adopted by the Board of Directors of the Community Redevelopment Agency at a regular meeting thereof, held the 15"' day of June 2004, by the following vote: AYES: DIRECTORS: Allevato, Soto, Hart, Swerdlin, and Chairman Bathgate NOES DIRECTORS: None ABSENT: DIRECTORS: . None , Agency Secretary 06-15-2004 -2- 0 0 COOPERATION AND REPAYMENT AGREEMENT THIS AGREEMENT is entered into as of the 15th day of June, 2004 by and between the CITY OF SAN JUAN CAPISTRANO, a municipal corporation (herein the "City") and the SAN JUAN CAPISTRANO COMMUNITY REDEVELOPMENT AGENCY, a public body (herein the "Agency"). WITNESSETH: WHEREAS, the City Council of the City, acting pursuant to the provisions of the Community Redevelopment Law (Health & Safety Code Section 33000, et seq.) has activated the Agency and has declared itself to constitute the Agency, by Ordinance No. 488 adopted on July 12, 1983. WHEREAS, pursuant to the Community Redevelopment Law, the Agency is performing a public function of the City and may have access to services and facilities of the City; and WHEREAS, Section 33600 et. seq. of the California Community Redevelopment Law authorizes the Agency to borrow money or accept financial or other assistance from the City; and WHEREAS, the City will appropriate money in the City's Fiscal Year budget in an amount deemed appropriate each year by the Administrative Services Director to the Agency for the purpose of carrying out redevelopment activities; and WHEREAS, funds so appropriated may be used to find time, expenses, overhead costs, consultants contract costs, use of City facilities and staff and other expenses incurred on behalf of redevelopment efforts; and EXHIBIT "A" WHEREAS, funds so appropriated may be used in connection with the preparation and implementation of redevelopment plans pursuant to the Community Redevelopment Law; which costs include, but shall not be limited to: the costs of surveys, planning, studies, and environmental assessments for the adoption of a redevelopment plan; the costs of acquisition of properties acquired, building and site preparation; public improvements; relocation assistance to displaced residential and nonresidential occupants as required by law; financial assistance provided to developers; and, other costs incurred by the Agency in increasing, improving and preserving the City's supply of low and moderate income housing availability at affordable housing costs both inside and outside redevelopment project areas, in accordance with Health and Safety Code Section 33334.2 et seq. WHEREAS, the City will loan the funds to the Agency in the anticipation that such costs will be repaid by the Agency out of tax increment funds generated within the redevelopment project area and possible amended redevelopment project areas. NOW, THEREFORE, Agency and City for and in consideration of the mutual promises and agreements herein contained do agree as follows: 1. PURPOSE The purpose of this Agreement is to provide for the repayment to the City by the Agency in an amount deemed appropriate by the Administrative Services Director. Loan proceeds are to be used in connection with the preparation and implementation of redevelopment plans, administrative costs and expenses, including consultant costs, incurred by the Agency, which are incurred on behalf of the redevelopment efforts in the Central Redevelopment Project Area. 2. TERM OF AGREEMENT This Agreement shall be in full force and effect for a period beginning as of the date first written and continuing until all loans hereunder are repaid and no further City loans are required. 3. REPAYMENT TERMS The Agency agrees to repay the City in full together with accrued interest calculated at a variable rate based upon the annual average rate of return earned on the City's investment portfolio as determined by the City's Treasurer, compounded annually. The City shall calculate interest annually for the Agency. The loan together with accrued interest shall be repaid from future tax increment funds generated within the redevelopment project area starting on July 1, 2023 or earlier, if future tax increment is deemed available by the Finance Officer of the Agency. It is understood that in the event no project area is established or amended or tax increment revenues fail to yield enough revenue to repay this obligation, the Agency is under no obligation to the City to make such repayment from any further funds or resources it may acquire. Record Keeping As accurately as possible the Agency will track charges against this loan by redevelopment project area. In the event one or more project areas are amended, the costs incurred for the benefit of that project area(s) will become a debt of that project area(s). In the event that the City authorizes by appropriate resolution any future loans(s), such loan(s) shall become a debt of the Agency and shall be reflected as Attachment 1 (et seq.), which shall be attached to the Agreement, made a part hereof and subject to the terms set forth herein. 4. REPAYMENT SUBORDINATION It is agreed by the parties hereto that the repayment to the City pursuant to this Agreement is hereby subordinated to any and all payments necessary to satisfy the Agency's obligations in connection with any existing or future bonded indebtedness or obligation which may be incurred by the Agency for the benefit of the redevelopment plans, or to the extent necessary for any bonded indebtedness for which Agency has pledged as a security or source of repayment tax increment generated within the project areas. i 9 5. VALIDITY OF AGREEMENT If any provisions of this Agreement, or the application hereof to any person, party, transaction, or circumstance, are held invalid, the remainder of this Agreement, or the application of such provision to the other persons, parties, transactions or circumstances, shall not be affected thereby. IN WITNESS THEREOF, the parties have executed this agreement as of the date first above written. CITY OF SAN JUAN CAPISTRANO Joe Soto Mayor ATTEST: Margaret R. Monahan City Clerk COMMUNITY DEVELOPMENT AGENCY Diane Bathgate Chairperson ATTEST: Margaret R. Monahan Secretary APPROVED AS TO FORM: John Shaw City Attorney