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Home My WebLink About09D Rpymnt Schedule to the PDHA - 2009-2010 SERAFTHE SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY STAFF REPORT REQUEST: APPROVE THE REPAYMENT SCHEDULE TO THE PALM DESERT HOUSING AUTHORITY FOR THE OUTSTANDING LOAN FROM THE LOW AND MODERATE INCOME HOUSING FUND FOR THE 2009-10 SUPPLEMENTAL EDUCATIONAL REVENUE AUGMENTATION FUND (SERAF) PAYMENT SUBMITTED BY DATE: Recommendation Janet M. Moore, Director of Housing March 22, 2012 By Minute Motion, that the board approves the repayment Palm Desert Housing Authority for the loan from the lo income housing fund for the 2009-2010 SERAF payment. Executive Summary schedule to the w and moderate In the 2009-10 fiscal year the Palm Desert Redevelopment Agency ("Agency") was allowed to suspend its annual deposit to the Low and Moderate Income Housing Fund ("LMIHF" also known as 20% set-aside) in order to offset the costs of the Agency's portion of the 2009-10 shift to Supplemental Education Revenue Augmentation Fund ("SERAF"). The suspension was considered a loan from the LMIHF and was required to be repaid by the Agency by June 30, 2015. On February 9, 2012 the City Council designated the Palm Desert Housing Authority ("Authority") as the successor housing agency. The recently enacted legislation related to the elimination of redevelopment agencies provides that this loan is an enforceable obligation provided the Oversight Board approves the repayment schedule. This loan is listed on the Recognized Obligation Payment Schedule ("ROPS") as an obligation of the former redevelopment agency. Backqround In 2009 the Governor declared a fiscal emergency and signed legislation that required redevelopment agencies across the State of California to shift $2.05 billion in property tax increment revenues to SERAF for K-12 schools and community colleges during the 2009-10 and 2010-11 fiscal years. In 2009-10 the Redevelopment Agency was required to pay $25,526,215 to SERAF for its portion of the shift. In order for redevelopment agencies to make such large payments, there was specific language in the legislation that allowed the agencies to suspend the 2009-10 deposit to the LMIHF for the purpose of paying the SERAF payment. The suspension was considered a G:\rda\Patty Leon1JMM\staff reportlStaff Report-SERAF Repayment 3-22-12.doc Staff Report Approval of SERAF Repayment Page 2 of 2 March 22, 2012 6/30/2010 6/30/2012 6/30/2013 6/30/2014 4,455,322.15 4,455,322.15 4,455,322.15 17,821,288.59 13,365,966.44 8,910,644.29 4,455,322.14 6/30/2015 4,455,322.14 0.00 17,821,288.59 `loan' that was required to be repaid by June 30, 2015. Of the $25 million paid, the Agency borrowed $17,821,288.59 from the annual deposit to the LMIHF in 2009/10. As part of the 2011-2012 State budget, the Governor signed legislation that effectively eliminated redevelopment agencies ("AB1X 26"). The constitutionality of that legislation was upheld by the State Supreme Court and redevelopment agencies were eliminated as of February 1, 2012. As part of AB1X 26, certain activities were prohibited and that prohibition was retroactive to January 1, 2011. Because of this, the Agency did not make any payments on the loan to the LMIHF during that time. AB1X 26 states that loans to or from the LMIHF that had been deferred as of the effective date of the legislation requires that the Oversight Board approve the repayment schedule (Health and Safety Code Section 34171(d)(1)(G)). The repayment schedule below provides for repayment of that loan with four equal payments in the amount of $4,455,322.15 to be paid over the next four years. In order to meet the repayment deadline of June 30, 2015, staff recommends that the Successor Agency Board and the Oversight Board approve the above repayment schedule. Fiscal Analvsis There is no affect to the City's General Fund due to this repayment schedule. The payments will go to the Housing Authority to offset the costs of providing affordable housing to restricted income households. Submitted by: -� � �� _ an Moore, Director of Housing , � Pau7 S. Gib on, D J n M. Wohlmutl Leon\JMMlslaff SERAF Repayment Schedule Payment Due F� Director Repayment3-22-12.doc :men Hea : � McCarthy, Assistant C� , anager CC ��'% � �)�� ' -Y��1/`�q� fo F� � `J-C� ��$ ,�.. ��.�,�� P20/� �'��i�:�� z�'r`�..��CJ� /�'1�'S _. _ �._.� F! � � ��sE�;��i i�;-, :.?. ��,;�., :>>`�,, �,`;��, 's Office Balance