TITLE
Recommendation to adopt resolution approving an amended repayment schedule for certain agreements between the City of Long Beach and the former Redevelopment Agency of the City of Long Beach.
DISCUSSION
Cities with redevelopment agencies commonly loaned funds to those agencies to carry out the purposes of their adopted redevelopment plans, especially during the early years of a redevelopment project when the amount of tax increment generated annually was not sufficient to initiate redevelopment activities. Furthermore, redevelopment agencies needed to have established debt as a requirement to receive tax increment. Cities made loans to their redevelopment agencies to initiate redevelopment activities, expecting the loans to be repaid with interest.
AB1x26, the “Dissolution Act,” voided loan agreements between cities and redevelopment agencies. AB 1484, legislation adopted to clean up earlier provisions of the Dissolution Act, provided that City/Agency loans could be deemed enforceable obligations under certain circumstances:
· A successor agency had received a finding of completion.
· A successor agency had repaid the former redevelopment agency’s debt to the Low- and Moderate-Income Housing Set-Aside Fund.
· A successor agency’s oversight board made a finding that the City and Agency loan agreements were for legitimate redevelopment purposes.
On April 26, 2013, the Successor Agency to the Redevelopment Agency of the City of Long Beach (Successor Agency) received its Finding of Completion. On March 11, 2016, the California Department of Finance (DOF) found that four loans totaling $34,635,279 were enforceable obligations. In July 2016, the Successor Agency repaid the remaining debt of the former Redevelopment Agency of the City of Long Beach (Agency) to the Low- and Moderate-Income Housing Set-Aside Fund (Housing Fund).
The repayment of the Agency’s debt to the Housing Fund, and the repayment of loans from the City are subject to the annual formula...
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