Response Form Grand Jury Report Title: RDA Successor Agencies from A-z, Starting with the Letter U (Ukiah) Report*

Since the passage of AB 1484, there is now greater flexibility for refunding debt. Additional debt can be created and debt service can be accelerated. Such actions require review and approval from the Oversight Board and Department of Finance (DOF).

AB 1484 amended the procedures/requirements for property disposition. Upon satisfying a number of provisions in AB 1484, the Successor Agency can receive a "Finding of Completion" from the Department of Finance (DOF). Within six months of receiving the Finding, the Successor Agency can seek approval from the Oversight Board and DOF on a property management plan that would enable the Successor Agency and the Sponsoring Community to direct the use of specified properties and/or revenues generated from those properties for community development activities.

AB 1484 amended the procedures/requirements for property disposition. See comments to Finding 13.

The total cost for salaries/benefits for non-housing activities for Fiscal Year 2010-11 was approximately $664,188. The $808,288 cited in the Finding was the total revenue credited in the Fiscal Year 2010-11 Budget to the 960 Administration Fund.

As amended by AB 1484, the Successor Agency's administrative cost allowance can be less than the annual minimum amount of $250,000. AB 1484 also excludes litigation costs related to assets or obligations, settlements and judgments, and predisposition carrying costs for property transferred to a Successor Agency. In addition, project-specific employee costs are excluded from a Successor Agency's administrative cost allowance. AB 1484 grants express authority to separately list enforceable obligations for such costs on the Recognized Obligation Payment Schedule (ROPS) for payment separate from the administrative cost allowance.

The ROPS was approved by the Oversight Board at the second meeting (April 11, 2011), not "certified."

The City Manager expressed her dissatisfaction with ABx1 26 and the dissolution process, not with the "Board's process" as suggested in the Finding.

Oversight Board members have the same immunities applicable to public entities and public employees (Section 34179(d)) when exercising the authority granted to the Oversight Board under the Dissolution Act and AB 1484. While the Oversight Board did not have their own legal counsel, City Staff did advise the Board of this Section in ABx1 26 at the initial meeting. At the direction of the Board, City Staff did follow up with supplemental information related to this topic at subsequent meetings.

ABx1 26 and AB 1484 limit the liability of the Successor Agency to the total sum of property tax revenues it receives pursuant to the Dissolution Act and the value of assets transferred to it. However, the lack of clarity of the legislation could result in legal action to resolve disputes. Furthermore, AB 1484 exposes the Dissolved RDA's Sponsoring Community and the County Auditor-Controller to penalties and other liabilities for actions and inactions pursuant to the legislation.

The website related to post redevelopment maintained by the League of California Cities is updated on a regular basis with new content and "key areas." The website is located at the following address: http://www.cacities.org/redevelopment.

The purpose of the Coalition for Jobs and Neighborhood Renewal was to support Senate Bill 659 which would have temporarily postponed the February 1, 2012 dissolution of redevelopment agencies. Given that dissolution has occurred, the Coalition appears to be inactive given the lack of updated information on the Coalition's website and stale purpose. The assertion in the Finding that the Coalition "complicated the picture even further" is an opinion of the author.

In part, a question is proposed by the author rather than a finding to which a response of agree or disagree cannot be applied.

Pursuant to ABx1 26 and as amended by AB 1484, the purpose of the agreed-upon procedures audit is "to establish each redevelopment agency's assets and liabilities, to document and determine each redevelopment agency's pass-through payment obligations to other taxing entities, and to document and determine both the amount and the terms of any indebtedness incurred by the redevelopment agency pursuant to the initial Recognized Obligation Payment Schedule. [Section 34182 (a) (2)]

Concern was expressed by some Oversight Board Members during the review of the initial Recognized Obligation Payment Schedule related to the timeline for approval and ambiguity related to the requirements of ABx1 26. The Oversight Board requested additional documentation related to each of the items listed on the initial ROPS. Staff complied with the request and provided the documents for review and consideration at a subsequent meeting.