HomeMy WebLinkAboutCC RES 03-094RESOLUTION NO. 03-94
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT
APPROVING PAYMENT BY THE PALM DESERT REDEVELOPMENT AGENCY OF
THE COST OF THE CONVERSION OF EXISTING OVERHEAD ELECTRIC
FACILITIES TO UNDERGROUND LOCATIONS ALONG MAGNESIA FALLS DRIVE
AND PORTOLA AVENUE
THE CITY COUNCIL OF THE CITY OF PALM DESERT HEREBY FINDS,
DETERMINES, RESOLVES AND ORDERS AS FOLLOWS:
Section 1. Pursuant to provisions of the Community Redevelopment Law
(California Health and Safety Code Section 33000, et seq.), and in particular Section
33445 thereof, the Palm Desert Redevelopment Agency (the "Agency") proposes to
reimburse the City for the amount the City contributes toward the cost of converting
existing overhead electric facilities to underground locations in public rights -of -way on
Magnesia Falls Drive and Portola Avenue. The conversion includes the removal of
poles, overhead wires and overhead structures and the underground installation of
wires and structures for supplying electric, or similar associated service (the
"Conversion"). The location of work is within the South right-of-way boundary of
Magnesia Falls Drive between Monterey Avenue and Rutledge Way, and the West
right-of-way boundary of Portola Avenue from Rutledge Way to 500 lineal feet North of
Magnesia Falls Drive.
The above -described sections of Magnesia Falls Drive and Portola
Avenue are located in Project Area No. 1 of the Agency (the "Project Area"). The City
Council has previously determined that the Project Area is an area in which the
combination of conditions of blight is so prevalent and so substantial that it causes a
reduction of, or lack of, proper utilization of the area to such an extent that it constitutes
a serious physical, social and economic burden on the community which cannot
reasonably be expected to be reversed or alleviated by private enterprise or
governmental action, or both, without redevelopment. Among other things, the Project
Area contains vacant and underutilized properties, properties which suffer from
depreciated or stagnant property values, and deteriorated, aged and obsolete buildings.
In addition, the Project Area is characterized by the existence of inadequate public
improvements, public facilities, and utilities which cannot be remedied by private or
governmental action without redevelopment.
The Conversion will serve a basic purpose of redevelopment;
redevelopment includes the provision of structures as may be appropriate or necessary
in the interest of the general welfare. In addition, a fundamental purpose of
redevelopment is to expand employment opportunities and to provide an environment
for the social, economic and psychological growth and well being of all citizens.
Resolution No. 03-94
Magnesia Falls Drive and Portola Avenue are major routes in the City.
The proposed Conversion will mitigate safety hazards associated with overhead
facilities, increase the effectiveness of utility service and improve the aesthetics of the
subject area, all for the benefit of the health, safety and welfare of the residents and
taxpayers of the Project Area, thereby assisting in eliminating factors which prevent or
substantially hinder the economically viable use or capacity of buildings or lots,
encouraging private -sector investment in the Project Area and facilitating the
redevelopment of the Project Area.
Section 2. Pursuant to budget considerations of the City, the cost of the
Conversion has been allocated to the Agency. While the City intends to advance the
cost of the Conversion, any moneys paid initially by the City for the Conversion will
constitute loans of such moneys by the City to the Agency. The budget constraints of
the City prevent the City from financing the Conversion by any means. Except for the
moneys to be loaned from the City to the Agency for the Conversion (which the City will,
upon repayment, use for other budgeted purposes of the City), no moneys of the City
were, are, or are reasonably expected to be available on a long-term basis under the
budget of the City to pay for the cost of the Conversion. Traditional methods of
financing such as the issuance of general obligation bonds are unavailable as a
practical matter because of the extraordinary majority voter approval requirements of
two-thirds of the electorate. Assessment financing or special tax financing could
overburden benefiting properties with assessments or special taxes and, in addition,
special taxes require a two-thirds vote and assessments are subject to a majority
protest.
Section 3. The City Council hereby finds and determines that based upon
the foregoing and other information presented to the City Council: (i) the Conversion
will benefit the Project Area and the immediate neighborhood in which the project is
located; (ii) the payment of funds for the Conversion will assist in the elimination of one
or more blighting conditions inside the Project Area; (iii) the payment of funds for the
Conversion is consistent with the Agency's implementation plan adopted pursuant to
Health and Safety Code Section 33490; and (iv) no other reasonable means of
financing the Conversion is available to the City.
Section 4. Section 1.150-2 of the Treasury Regulations governs the
allocation of expenditures of a reimbursement bond. A reimbursement bond is that
portion of an issue of bonds (or other obligations) allocated to reimburse an original
expenditure (i.e., an expenditure for a governmental purpose that is originally paid from
a source other than a reimbursement bond) that was paid before the date of issue of the
bonds. Section 1.150-2 provides rules to determine when an allocation of proceeds of
bonds to reimburse an original expenditure will be treated as an expenditure of those
proceeds.
Section 5. In order for such an allocation of proceeds to be treated as an
expenditure of those proceeds, the issuer (or in certain cases, a conduit borrower) of
the bonds must, in accordance with Section 1.150-2, adopt an official intent for the
original expenditure. The official intent is a declaration of intention by the issuer (or the
conduit borrower) to reimburse the original expenditure with proceeds of bonds.
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Resolution No. 03-94
Section 6. As set forth in Section 2 hereof, the City Council intends to
advance the costs of the Conversion and the Agency intends to reimburse the City for
such advance. As set forth in its Resolution No. 472 , the Agency intends to
reimburse the City's expenditures from the proceeds of bonds to be issued by the
Agency or a related public entity. The City Council expects that all such City
expenditures will be reimbursed with proceeds of the bonds.
Section 7. As set forth in the Agency's Resolution No. 472 , the
maximum principal amount of obligations expected to be issued for the purposes of
reimbursing the City for the costs of the Conversion is $375,000.00.
Section 8. This official intent is not declared as a matter of course and is
not declared in an amount substantially in excess of the amounts expected to be
necessary to reimburse the City's advance for the costs of the Conversion.
Section 9. The City Council hereby approves payment by the Agency for
all or a part of the cost of Conversion from any revenues of the Agency lawfully
available therefor, including the proceeds of bonds of the Agency secured by and
payable from any revenues of the Agency lawfully available therefor, including taxes
allocated to the Agency from the Project Area. Any moneys paid initially by the City for
the Conversion will constitute loans of such moneys by the City to the Agency, and the
Agency will repay such loans to the City from the proceeds of the Agency bonds (or
bonds or other obligations issued by a related public entity), from time to time, upon
demand by the City.
PASSED, APPROVED and ADOPTED this loth day
of July , 2003.
AYES: CRITES, KELLY, SPIEGEL
NOES: BENSON
ABSENTS: FERGUSON
ABSTAINS: NONE
4it16.12A,
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JE M. BENSON, MAYOR
Attest:
LLE D. KLASSEN, CITY CLERK
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