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HomeMy WebLinkAboutRDA RES 436RESOLUTION NO. 436 A RESOLUTION OF THE PALM DESERT REDEVELOPMENT AGENCY APPROVING PAYMENT BY THE AGENCY FOR PART OF THE COST OF CONVERTING OVERHEAD UTILITY FACILITIES TO UNDERGROUND LOCATIONS THE PALM DESERT REDEVELOPMENT AGENCY HEREBY FINDS, DETERMINES, RESOLVES AND ORDERS AS FOLLOWS: Section 1. The Legislature of the State of California has found and declared that, in many areas of the State, landowners, cities, public agencies and public utilities desire to convert existing overhead electric and communication facilities to underground locations by means of special assessment proceedings, that a public purpose will be served by providing a procedure to accomplish this conversion, and that it is in the public interest to provide for the conversion by special assessment proceedings. Section 2. Homeowners in various locations in the City of Palm Desert have expressed a desire for the City Council of the City of Palm Desert (the "City Council") to undertake special assessment proceedings for the purpose of financing the conversion of overhead utility facilities to underground locations. Such conversions will include the removal of poles, overhead wires and overhead structures and the underground installation of wires and structures for supplying electric, communication, or similar associated service. Section 3. By its Resolution No.00-135, the City Council has adopted a policy for the initiation of proceedings pursuant to the Municipal Improvement Act of 1913 (Streets and Highways Code Section 10000, et s�.)to form assessment districts for the purpose of levying and collecting assessments against properties in the assessment districts to finance the conversion of overhead utility facilities to underground locations. Section 4. With respect to each such assessment district that is formed, the City Council, pursuant to its Resolution No.00-135, has declared its intention to contribute up to fifty percent of the cost of the conversion (excluding costs of users' connections to underground electric or communication facilities). Section 5. Pursuant to provisions of the Community Redevelopment Law (California Health and Safety Code Section 33000, et sec�.), and in particular Section 33445 thereof, the Palm Desert Redevelopment Agency (the "Agency") proposes to reimburse the City for the amounts the City contributes toward the cost of the conversions as set forth in Section 4 hereof. The proposed assessment districts, consisting of approximately 3,916 total parcels, are located in Project Area No. 1(proposed assessment district Nos. 3-18), of the Agency . The City Council has previously determined that the Project Areas P6902\0001\617765.2 Resolution No. 436 are areas in which the combination of conditions of blight is so prevalent and so substantial that it causes a reduction of, or lack of, proper utilizatian of the areas 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 Areas contain vacant and underutilized properties, properties which suffer from depreciated or stagnant property values, and deteriorated, aged and obsolete buildings. In addition, the Project Areas are characterized by the existence of public improvements, public facilities, and utilities which cannot be remedied by private or governmental action without redevelopment. The conversion of overhead electric and communication facilities to underground locations 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. The conversion of overhead electric and cammunication facilities to underground locations wi11 mitigate safety hazards associated with overhead facilities, increase the effectiveness of utility service and improve the aesthetics of the subject areas, all for the benefit of the health, safety and weifare of the residents and taxpayers af the Project Areas, 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 Proj�ct Areas and facilitating the redevelopment of the Project Areas. Section 6. Pursuant to budget considerations of the City, the City's proposed contributions toward the cost of the conversions has been allocated to the Agency. While the City intends to initially pay for up to 50 percent of the cost of each conversion as set forth in Section 4 hereof, any moneys paid initially by the City toward the cost of a conversion will constitute a loan of such moneys by the City to the Agency. The budget constraints of the City prevent the City from financing the conversions by any means. Except for the moneys to be loaned from the City to the Agency for the conversions (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 conversions. 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 will be utilized to pay for 50 percent of the cost of each conversion, but assessing the entire cost of the conversions to the benefitting properties is -- infeasible and would overburden such properties. P6402\0001\617765.2 -2- Resolution No. 436 Section 7. The Agency hereby finds and determines that based upon the foregoing and other information presented to the Agency: {i) the conversions will benefit the Project Areas and the immediate neighborhood in which the projects are located; (ii) the payment of funds for the conversions will assist in the elimination of one or more blighting conditions inside the Project Areas; (iii) the payment of funds for the conversions 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 conversions is available to the City. Section 8. Section 1.150-2 of the Treasury Regulations gaverns 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 9. 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. Section 10. As set forth in Section 6 hereof, the City Council intends to advance the costs of the conversions and the Agency intends to reimburse the City for such advances. 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 Agency expects that all such City expenditures will be reimbursed with proceeds of the bonds. Section 11. The maximum principal amount of obligations expected to be issued for the purposes of reimbursing the City for the costs of �he conversions is $3,000,000.00. Section 12. 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 advances for the costs of the conversions. Section 13. The Agency hereby approves payment by the Agency for part of the cost of the conversions as set forth herein 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 Areas. Any moneys paid initially by the City for the P6402\0001\617765.2 -3 - Resolution No. 436 conversions will constitute loans of such moneys by the City to th� 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 tzme, upon demand by the City. PASSED, APPROVED and ADOPTED this 14th day of February , 2002. ' — AYE S: BENSON, CRITES, FERGUSON, SPIEGEL, KELLY NOES : NONE ABSENTS: NONE ABSTAINS: NONE � � " RI S. KELLY, IRMAN � I A'�t�ie s t : , ' � ;1 - SHEILA R. GILLIGAN,�F�CRETARY P6902\0001\617765.2 -4-