TITLE
Recommendation to authorize City Manager to execute an Amended and Restated Agreement for Services between the City of Long Beach and the Redevelopment Agency to encumber approximately $886,000,000 in current and future redevelopment tax increment proceeds through Fiscal Year 21 to support revitalization of neighborhoods throughout seven redevelopment project areas; and
Adopt resolution making certain findings regarding the construction of certain public improvements in all Redevelopment Project Areas with the exception of West Beach. (Citywide)
DISCUSSION
Approval is recommended to amend the Agreement for Services (Agreement) with the Long Beach Redevelopment Agency (Agency) to provide short-term loans for services, programs and projects in seven redevelopment project areas for ten years.
California Community Redevelopment Law specifies that a redevelopment agency may not spend tax increment directly on staff salaries, consultants or other services; as a general rule, its use is limited to the payment of principal and interest on bonds, loans, and other forms of indebtedness. Agencies then borrow from cities the funds required for operating expenses on an annual basis, which provide for staff and project expenses. Tax increment is used to repay the City loan, debt service on bonds, and other long-term obligations.
The Agency and the City have an existing Agreement for Services, established in 1987 and last amended in 2003, which establishes such a mechanism. The Agreement allows the Agency to borrow from the City funds needed for annual expenses, and to repay the City with tax increment before the end of each fiscal year. The City also agrees to fund the Agency's activities based on an annual request; in the past, the funding request would come to the City Council as part of the annual budget process.
Due to the nature of the development process, the Agency currently has numerous projects in various stages of development, from pre-conception to actual construction. These projects range from significant public infrastructure projects such as Fire Station No. 12 in North Long Beach (currently under construction), the Pine Avenue Streetscape Project in Downtown (currently in conceptual design) and the proposed East Police Station (pre-development) to participation in public-private development projects such as the redevelopment of the North Village Center (pre-development) and the new Los Angeles County Superior Courthouse (conceptual development).
The Agency also maintains a list of future potential projects to which the Agency would consider dedicating resources in future years. Many of the identified projects will accelerate the economic recovery of the City; construct, rehabilitate or replace publiclyowned capital improvements and public improvements; provide housing; and ensure the creation of locally-based, quality jobs.
In addition to these improvement projects, the Agency funds numerous activities and programs in the various redevelopment project areas such as fa9ade improvement loans, fencing and screening projects, and neighborhood revitalization initiatives. The Agency has also been very active in removing the sources of significant crime and blighting influences in the project areas, including the use of eminent domain for the removal of liquor stores, day-use motels, adult bookstores and other nuisance uses that have a detrimental impact on the quality of life in neighborhoods.
Given the current budget environment in the State, the Agency's ability to carry out these activities may be limited. Therefore, staff recommends the following changes to the Agreement in order to maintain its revitalization efforts:
1. Services. The current Agreement establishes that the City shall provide services in order that the Agency may accomplish the purposes of the redevelopment plans for each project area. The amended Agreement would specify that the City shall provide services in order that the Agency may complete the work plan outlined in Exhibit A. This work plan will be completed at the staffing levels outlined below, with a three percent increase annually.
Staffing and Services Required for Work Plan Completion |
City Service |
FTE |
Est. Cost |
Project Area Operations |
30.50 |
3,457,964 |
Project Planning Services |
3.00 |
321,076 |
Code Enforcement/Graffiti Abatement |
8.41 |
742,654 |
Grant Support |
2.98 |
326,705 |
Asset Management |
1.37 |
148,993 |
Administrative Support |
7.32 |
806,108 |
City Services and Overhead |
N/A |
2,072,094 |
Total |
54.33 |
7,875,594 |
|
|
|
2. Delivery of Programs and Projects. Amend the current Agreement for the delivery of programs and projects in the City's redevelopment projects through FY 21. The programs and projects are identified in Exhibit A.
3. Termination of Agreement. The current Agreement provides for termination on written notice by either party or the expiration of the redevelopment plans, whichever occurs first.
The amended Agreement would specify that the Agreement terminate on September 30, 2021.
California Redevelopment Law provides that a redevelopment agency may, with the consent of the City Council, pay for public improvements that are publicly owned either within or outside of a Redevelopment Project Area, if the City Council determines that:
· The construction of such public improvements is of benefit to the redevelopment project area or immediate neighborhood in which the public improvement is located.
· No other reasonable means of financing the public improvements are available to the community.
· The payment of Redevelopment Agency funds for the construction of the public improvements will assist in the elimination of one or more blighting conditions within the project area.
Typical improvements include library, park, police, fire and other public safety improvements and facilities; additional open space and open space improvements; public art; neighborhood, street and alley improvements; streetscape enhancements; and public parking. Since the Agency's work plan may include the construction of public improvements, these findings must be made for the Downtown, West Long Beach Industrial, Central, North, Los Altos, and Poly High redevelopment project areas. Given that the West Beach Project Area is set to expire in January 2012, it is not included in this request. The Agency is expected to make the necessary findings and review the amendment request at its meeting on January 20,2011.
This letter was reviewed by Chief Assistant City Attorney Heather Mahood on January 16, 2011 and by Budget and Performance Management Bureau Manager Lou Palmer on January 16, 2011.
TIMING CONSIDERATIONS
City Council action is requested on January 18, 2011, to expedite execution of the amended Agreement expeditiously and to ensure the continued revitalization of neighborhoods.
FISCAL IMPACT
Entering into this Agreement will ensure that the Agency is able to continue to provide support to the General Fund and complete public projects of benefit to the City through Fiscal Year 21 .
SUGGESTED ACTION
Approve recommendation.
BODY
A RESOLUTION OF THE CITY COUNCil OF THE CITY OF lONG BEACH MAKING CERTAIN FINDINGS REGARDING THE CONSTRUCTION OF CERTAIN PUBLIC IMPROVEMENTS WITH NORTH, CENTRAL, DOWNTOWN, WEST lONG BEACH INDUSTRIAL, POLY HIGH AND LOS ALTOS REDEVELOPMENT PROJECT FUNDS
Respectfully Submitted,
AMY J. BODEK
DIRECTOR OF DEVELOPMENT SERVICES
APPROVED:
PATRICK H. WEST
CITY MANAGER