HomeMy WebLinkAboutRes OB-040 (2)OVERSIGHT BOARD TO THE SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
REQUEST:
SUBMITTED BY:
DATE:
CONTENTS:
Recommendation
Veronica Tapia, Accountant II
April 8, 2013
Resolution No. OB- 040
March 2013 Review Report
STAFF REPORT
RECEIVE AND FILE CALIFORNIA STATE CONTROLLER'S
OFFICE FINAL REPORT RELATIVE TO PALM DESERT
REDEVELOPMENT AGENCY ASSET TRANSFER REVIEW
PURSUANT TO HEALTH AND SAFETY CODE SECTION 34167.5
(G-o , S
BY OVERS HT BOARD
ON
VERIFIED BY
Original on file with City Clerk's Office
That the Oversight Board approve Resolution No. OB-040receiving and filing
the California State Controller's Office (SCO) Final Report relative to the
Palm Desert Redevelopment Agency Asset Transfer Review.
Discussion
Pursuant to Health and Safety Code Section 34167.5, the State Controller's Office
(SCO) reviewed all asset transfers made by the Palm Desert Redevelopment Agency to
the City of Palm Desert or any other public agency after January 1, 2011 to determine if
each asset transfer was allowable and whether it should instead be turned over to the
Successor Agency to the Palm Desert Redevelopment Agency. The assets reviewed
included (but were not limited to) real and personal property, cash funds, accounts
receivable, deeds of trust and mortgages, contract rights, and right to payment of any
kind.
The SCO began its asset transfer review in Palm Desert on February 5, 2013. The
SCO performed the following procedures during its review:
• Interviewed Successor agency personnel to gain an understanding of the
Successor Agency operations and procedures;
• Reviewed meeting minutes, resolutions, and ordinances of the Palm Desert
Redevelopment Agency, the Successor Agency, and the City of Palm Desert
Housing Authority;
• Reviewed accounting records relating to the recording of assets;
• Verified accuracy of the Asset Transfer Assessment Form;
• Reviewed applicable financial reports to verify assets (capital, cash, property,
etc)
Staff Report
Receive and file SCO Asset Transfer Review
April 8, 2013
On February 21, 2013 SCO staff met with Successor Agency staff in an exit conference
to discuss the review results. SCO staff indicated that although their results would have
to be approved by SCO management in Sacramento, they had no findings.
On March 14, 2013, SCO issued its final report indicating that all assets had been
appropriately transferred and that no unallowable transfers were identified.
Sub rty ted by:
Verona Tapia, Accou ant II
Paul Gibson, Director of Finance
Ap
royal:
hn Wohlmuth, Executive Director
(Janet Moore, Director of Housing
G:\rda\Veronica Tapia\Word Files\Staff Reports\Oversight Board\Staff Reports \OB SR for RECEIVING SCO Final Report Asset Transfer Review 4-8-13 docx2
RESOLUTION NO. OB - 040
A RESOLUTION OF THE OVERSIGHT BOARD OF THE SUCCESSOR
AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY
ACKNOWLEDGING THE RECEIPT OF THE CALIFORNIA STATE
CONTROLLER'S OFFICE FINAL REPORT RELATIVE TO THE ASSET
TRANSFER REVIEW
RECITALS:
A. Pursuant to Health and Safety Code Section 34179(3), all actions taken by
the oversight board for the Successor Agency to the Palm Desert Redevelopment Agency
(the "Oversight Board") shall be adopted by resolution.
B. There has been presented to this Oversight Board the California State
Controller's Office Final Report relative to the Asset Transfer Review pursuant to Health and
Safety Code Section 34167.5.
NOW, THEREFORE, THE OVERSIGHT BOARD FOR THE SUCCESSOR
AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY, HEREBY FINDS,
DETERMINES, RESOLVES, AND ORDERS AS FOLLOWS:
Section 1. The above recitals are true and correct and are a substantive part of
this Resolution.
Section 2. The Oversight Board hereby receives and files the Final Report as
provided by the State Controller's Office relative to the Asset Transfer Review pursuant to
Health and Safety Code Section 34167.5.
Section 3. The officers of the Oversight Board and staff of the Successor Agency
are hereby authorized and directed, jointly and severally, to do any and all things which they
may deem necessary or advisable to effectuate this Resolution.
PASSED, APPROVED AND ADOPTED this 8th day of April, 2013.
AYES:
NOES:
ABSENT:
ABSTAIN:
ROBERT A. SPIEGEL, CHAIR
ATTEST:
RACHELLE D. KLASSEN, SECRETARY
OVERSIGHT BOARD FOR THE SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
G:\rda\Veronica Tapia\Word Files\Staff Reports\Oversight Board\Staff Reports\OB Reso - rec and file SCO Final Report on Asset Transfers 4-8-13.docx
PALM DESERT
REDEVELOPMENT AGENCY
ASSET TRANSFER REVIEW
Review Report
January 1, 2011, through January 31, 2012
JOHN CHIANG
California State Controller
March 2013
JOHN CHIANG
California tate Controller
March 14, 2013
John Wohlmuth, City Manager
Palm Desert Redevelopment/Successor Agency
73-510 Fred Waring Drive
Palm Desert, CA 92260
Dear Mr. Wohlmuth:
Pursuant to Health and Safety (H&S) Code section 34167.5, the State Controller's Office (SCO)
reviewed all asset transfers made by the Palm Desert Redevelopment Agency to the City of Palm
Desert or any other public agency after January 1, 2011. This statutory provision states, "The
Legislature hereby finds that a transfer of assets by a redevelopment agency during the period
covered in this section is deemed not to be in furtherance of the Community Redevelopment Law
and is thereby unauthorized." Therefore, our review included an assessment of whether each
asset transfer was allowable and whether it should be turned over to the Palm Desert Successor
Agency.
Our review applied to all assets including, but not limited to, real and personal property, cash
funds, accounts receivable, deeds of trust and mortgages, contract rights, and rights to payment
of any kind. We also reviewed and determined whether any unallowable transfers of assets to the
City of Palm Desert or any other public agencies have been reversed.
Our review found that the Palm Desert Redevelopment Agency appropriately transferred
$384,499,103 in assets to the Palm Desert Successor Agency. These assets consisted of
$99,288,486 in housing assets and $285,210,617 in non -housing assets. No unallowable transfers
of assets were identified.
If you have any questions, please contact Steven Mar, Bureau Chief, Local Government Audits
Bureau, at (916) 324-7226.
Sincerely,
Original signed by
JEFFREY V. BROWNFIELD, CPA
Chief, Division of Audits
JVB/vb
John Wohlmuth, City Manager -2- March 14, 2013
cc: Robert A. Spiegel, Chair of Oversight Board
City of Palm Desert Redevelopment/Successor Agency
Paul Gibson, Director of Finance
City of Palm Desert Redevelopment/Successor Agency
Paul A. Angulo, Auditor -Controller
County of Riverside
Steven Szalay, Local Government Consultant
Department of Finance
Richard J. Chivaro, Chief Legal Counsel
State Controller's Office
Steven Mar, Bureau Chief
Division of Audits, State Controller's Office
Betty Moya, Audit Manager
Division of Audits, State Controller's Office
Nesha Neycheva, Auditor -in -Charge
Division of Audits, State Controller's Office
Mathew Rios, Audit Staff
Division of Audits, State Controller's Office
Palm Desert Redevelopment Agency Asset Transfer Review
Contents
Review Report
Summary 1
Background 1
Objectives, Scope, and Methodology 2
Conclusion 2
Views of Responsible Officials 2
Restricted Use 2
Palm Desert Redevelopment Agency Asset Transfer Review
Asset Transfer Review Report
Summary
Background
The State Controller's Office (SCO) reviewed the asset transfers made
by the Palm Desert Redevelopment Agency after January 1, 2011. Our
review included, but was not limited to, real and personal property, cash
funds, accounts receivable, deeds of trust and mortgages, contract rights,
and rights to payments of any kind from any source.
Our review found that the Palm Desert Redevelopment Agency
appropriately transferred $384,499,103 in assets to the Palm Desert
Successor Agency. No unallowable transfers of assets were identified.
In January of 2011, the Governor of the State of California proposed
statewide elimination of redevelopment agencies (RDAs) beginning with
the fiscal year (FY) 2011-12 State budget. The Governor's proposal was
incorporated into Assembly Bill 26 (ABX1 26, Chapter 5, Statutes of
2011, First Extraordinary Session), which was passed by the Legislature,
and signed into law by the Governor on June 28, 2011.
ABX1 26 prohibited RDAs from engaging in new business, established
mechanisms and timelines for dissolution of the RDAs, and created RDA
Successor Agencies to oversee dissolution of the RDAs and
redistribution of RDA assets.
A California Supreme Court decision on December 28, 2011 (California
Redevelopment Association et al. v. Matosantos), upheld ABX1 26 and
the Legislature's constitutional authority to dissolve the RDAs.
ABX1 26 was codified in the Health and Safety Code (H&S Code)
beginning with section 34161.
In accordance with the requirements of H&S Code section 34167.5, the
State Controller is required to review the activities of RDAs, "to
determine whether an asset transfer has occurred after January 1, 2011,
between the city or county, or city and county that created a
redevelopment agency, or any other public agency, and the
redevelopment agency," and the date on which the RDA ceases to
operate, or January 31, 2012, whichever is earlier.
The SCO has identified transfers of assets that occurred after
January 1, 2011, between the Palm Desert Redevelopment Agency, the
City of Palm Desert, and/or other public agencies. By law, the SCO is
required to order that such assets, except those that already had been
committed to a third party prior to June 28, 2011, the effective date of
ABX1 26, be turned over to the Successor Agency. In addition, the SCO
may file a legal order to ensure compliance with this order.
-1-
Palm Desert Redevelopment Agency Asset Transfer Review
Objectives, Scope,
and Methodology
Conclusion
Views of
Responsible
Officials
Restricted Use
Our review objective was to determine whether asset transfers that
occurred after January 1, 2011, and the date upon which the RDA ceased
to operate, or January 31, 2012, whichever was earlier, between the city
or county, or city and county that created an RDA, or any other public
agency, and the RDA, were appropriate.
We performed the following procedures:
• Interviewed Successor Agency personnel to gain an understanding of
the Successor Agency operations and procedures.
• Reviewed meeting minutes, resolutions, and ordinances of the Palm
Desert Redevelopment Agency, the Successor Agency, and the City
of Palm Desert Housing Authority.
• Reviewed accounting records relating to the recording of assets.
• Verified the accuracy of the Asset Transfer Assessment Form. This
form was sent to all former RDAs to provide a list of all assets
transferred between January 1, 2011, and January 31, 2012.
• Reviewed applicable financial reports to verify assets (capital, cash,
property, etc.).
Our review found that the Palm Desert Redevelopment Agency
appropriately transferred $384,499,103 in assets to the Palm Desert
Successor Agency. These assets consisted of $99,288,486 in housing
assets and $285,210,617 in non -housing assets. No unallowable transfers
of assets were identified.
At an exit conference on February 21, 2013, we discussed the review
results with John Wohlmuth, City Manager; Janet M. Moore, Director of
Housing; Veronica A. Tapia, Accountant; and Luis Espinoza, Assistant
Director of Finance, who agreed with the review results. They further
agreed that a draft review report was not necessary and that we could
issue the review report as final.
This report is solely for the information and use of the Palm Desert
Redevelopment Agency, the Successor Agency, the Successor Agency
Oversight Board, the Palm Desert Housing Authority, the City of
Palm Desert, and the SCO; it is not intended to be and should not be used
by anyone other than these specified parties. This restriction is not
intended to limit distribution of this report, which is a matter of public
record when issued final.
Original signed by
JEFFREY V. BROWNFIELD, CPA
Chief, Division of Audits
March 14, 2013
-2-
State Controller's Office
Division of Audits
Post Office Box 942850
Sacramento, CA 94250-5874
http://www.sco.ca.gov
S 13-RDA-951