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HomeMy WebLinkAbout05 BOND PROCEEDS EXPENDITURE AGREEMENT AGENDA REPORT Oversight Board of the Successor Agency to the Tustin Community Redevelopment Agency MEETING DATE: JUNE 24, 2014 SUBJECT/ACTION: ADOPT OVERSIGHT BOARD RESOLUTION NO. 14-14, APPROVING THE BOND PROCEEDS EXPENDITURE AGREEMENT BETWEEN THE CITY AND SUCCESSOR AGENCY RECOMMENDATION / PROPOSED ACTION In accordance with the Dissolution Act, in particular California Health and Safety Code Section 34191.4(c) and 34180(h), it is recommended the Oversight Board of the Successor Agency to the Tustin Community Redevelopment Agency adopt Oversight Board Resolution No. 14-14, approving the Bond Proceeds Expenditure Agreement between the City and Successor Agency, subject to the following condition: a) Should any subsequent modifications be required, the City Manager and/or Finance Director, or their authorized designee, shall be authorized to make any augmentation, modification, additions or revisions as may be necessary subject to certification by the Oversight Board Chair. Note (: This Resolution shall be effective after transmittal of this Resolution to the Department of Finance (“DoF”) and the expiration of five (5) business days pending a request for review by DoF within the time periods set forth in the Dissolution Law. In this regard, if DoF requests review hereof, it will have 40 days from the date of its request to approve this Oversight Board action or return it to the Oversight Board for reconsideration and the action, if subject to review by DoF, will not be effective until approved by DoF.) BACKGROUND Pursuant to Parts 1.8 and 1.85 of Division 24 of the California Health & Safety Code (“Dissolution Law”), in particular Section 34191.4(c), a successor agency that has received a finding of completion (“Finding”) is authorized to use bond proceeds from bonds issued prior to 2011 for the purposes for which the bonds were sold, provided that such bond proceeds in excess of amounts needed to satisfy approved enforceable obligations shall be expended in a manner consistent with the original bond covenants, and further provided that such expenditures shall constitute “excess bond proceeds obligations” that shall be listed separately on the Successor Agency’s Recognized Obligation Payment Schedule (“ROPS”). The Successor Agency received the Finding from the DoF on May 1, 2014, dated and effective nunc pro tunc as of May 15, 2013, as ordered by the Honorable Timothy M. Frawley, Sacramento Superior Court, State of California in the petition titled Successor Agency to the Tustin Community Agenda Report June 24, 2014 Page 2 Redevelopment Agency, et al. v. Ana J. Matosantos, et al., Case No. 34-2013- 80001623 (“Petition”). The Successor Agency and the City have negotiated a Bond Proceeds Expenditure Agreement (“Agreement”), which provides for the transfer by the Successor Agency to the City of current and future excess bond proceeds from the MCAS Bonds, and for the City’s use of such proceeds consistent with all applicable covenants of the Tustin Community Redevelopment Agency Tax Allocation Bonds (MCAS-Tustin Redevelopment Project Area) Series 2010 (“MCAS Bonds”). In order to facilitate the use of excess bond proceeds obligations, a Bond Spending Plan, as referenced in the Agreement, has been prepared and approved by the City. Section 34178(a) of the Dissolution Law allows a successor agency and its sponsoring city to enter into agreements, subject to Oversight Board approval under Section 34180(h). Upon Oversight Board approval, the Agreement will be submitted to DoF for their review. In addition, the Successor Agency will list the Agreement and the requirement to transfer excess bond proceeds on its ROPS 14-15B for the January 1, 2015 through June 30, 2015 period as an obligation to be funded with excess bond proceeds. On June 17, 2014, the City Council and the Successor Agency approved the Agreement, subject to Oversight Board approval. Authorization for the City Manager/Executive Director or Finance Director to make any future modifications necessary to the Agreement, provided that any changes by the Successor Agency are subject to certification by the Oversight Board Chair, is requested. Staff is available to answer any questions the Oversight Board may have. Attachment: Oversight Board Resolution No. 14-14 OVERSIGHT BOARD RESOLUTION NO. 14-14 A RESOLUTION OF THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY APPROVING THE BOND PROCEEDS EXPENDITURE AGREEMENT BETWEEN THE CITY OF TUSTIN AND THE SUCCESSOR AGENCY TO THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY The Oversight Board of the Successor Agency to the Tustin Community Redevelopment Agency finds, determines and declares as follows: A. The former Tustin Community Redevelopment Agency (“Agency”) was a community redevelopment agency previously organized and existing under the California Community Redevelopment Law, Health and Safety Code Sections 33000, . et seq (“CRL”) and prior to its dissolution was authorized to transact business and exercise the powers of a redevelopment agency pursuant to action of the City Council (“City Council”) of the City of Tustin (“City”); and B. The City of Tustin is a municipal corporation of the State of California; and C. Assembly Bill X1 26 added Parts 1.8 and 1.85 to Division 24 of the California Health and Safety Code, which laws cause the dissolution and wind down of all redevelopment agencies (“Dissolution Law”); and D. On December 29, 2011, in the petition California Redevelopment Association, et al v. (“Matosantos Decision”), the California Supreme Court upheld the Ana Matosantos, et al Dissolution Act and thereby all redevelopment agencies in California were dissolved as of and on February 1, 2012 under the dates in the Dissolution Act that were reformed and extended thereby (“Supreme Court Decision”); and E. As of February 1, 2012, the former Agency was dissolved pursuant to the Dissolution Law and as a separate public entity, corporate and politic the Successor Agency administers the enforceable obligations of the former Agency and otherwise unwinds the former Agency’s affairs, all subject to the review and approval by a seven-member oversight board (“Oversight Board”); and F. Section 34179 provides that the Oversight Board has fiduciary responsibilities to holders of enforceable obligations and the affected taxing entities that benefit from distributions of property tax and other revenues pursuant to Section 34188 of Part 1.85 of the Dissolution Laws; and G. Pursuant to Section 34179, the Successor Agency’s Oversight Board has been formed and the initial meeting occurred on March 13, 2012; and H. Section 34179(e), as amended by Assembly Bill 1484 (“AB 1484”), requires all actions taken by the Oversight Board to be adopted by resolution; and Oversight Board Resolution 14-14 Page 1 of 5 I. Section 34191.4(c) of the Dissolution Law allows a successor agency that has received a Finding of Completion (“Finding”) to use bond proceeds from bonds issued prior to 2011 for the purposes for which the bonds were sold, provides that such proceeds in excess of amounts needed to satisfy approved enforceable obligations shall be expended in a manner consistent with the original bond covenants, and further provides that such expenditures shall constitute “excess bond proceeds obligations” that shall be listed separately on the successor agency’s Recognized Obligation Payment Schedule (“ROPS”); and J. The Successor Agency received the Finding from the State of California Department of Finance on May 1, 2014, dated and effective as of May 15, 2013, as nunc pro tunc ordered by the Honorable Timothy M. Frawley, Sacramento Superior Court, State of California in the petition titled Successor Agency to the Tustin Community , Case No. 34-2013- Redevelopment Agency, et al. v. Ana J. Matosantos, et al. 80001623 (“Petition”); and K. The CRL pre-dissolution provided for, and the Dissolution Law post-dissolution continues to provide for, a cooperative relationship between sponsoring cities and their redevelopment agencies, as well as their successor agencies who have assumed the duties and obligations of the former redevelopment agencies. Under CRL Section 33220, a city may aid and cooperate in the planning, undertaking, construction, or operation of redevelopment projects. CRL Section 33220(e) specifically authorizes a city to enter into an agreement with its redevelopment agency or any other public entity to further redevelopment purposes. Section 34178(a) of the Dissolution Law allows a successor agency and its sponsoring city to enter into agreements, subject to Oversight Board approval under Section 34180(h) of the Dissolution Law; and L. The Successor Agency has and will have proceeds (“Excess Bond Proceeds”) of its Tustin Community Redevelopment Agency Tax Allocation Bonds (MCAS-Tustin Redevelopment Project Area) Series 2010 (“MCAS Bonds”) that are not otherwise obligated for a project or other enforceable obligation; and M. The Successor Agency desires to transfer its Excess Bond Proceeds to the City to enable the City to use such Excess Bond Proceeds in a manner consistent with the covenants of the MCAS Bonds and to undertake projects and programs that were not previously funded and obligated by the former Agency pre-dissolution or by the Successor Agency post-dissolution, or by the City pre- or post-dissolution. The City has adopted a spending plan (“Bond Spending Plan”) for using such Excess Bond Proceeds to advance the City’s community development goals while maximizing fiscal and social benefits flowing to the affected taxing entities from successful development. The City Council and Successor Agency Board have found that the use of Excess Bond Proceeds are in accordance with the Bond Spending Plan to fund various capital improvements within and outside the former MCAS Tustin Redevelopment Project Area, including those that are contained in the Tustin Legacy Backbone Infrastructure Program established by the City, and are in accordance with CRL Sections 33445, 33445.1, and 33679 and other applicable law; and N. In order to facilitate the use of Excess Bond Proceeds consistent with all applicable bond covenants, the Successor Agency and the City have negotiated this Agreement Oversight Board Resolution 14-14 Page 2 of 5 requiring the transfer of current and future excess bond proceeds by the Successor Agency to the City, and the City’s agreement to use such proceeds consistent with all applicable covenants, conditions, restrictions and obligations under the MCAS Bonds. The parties intend that this Agreement shall constitute an excess bond proceeds obligation within the meaning of Section 34191.4(c)(2)(A) of the Dissolution Law to be paid from Excess Bond Proceeds. With Oversight Board approval, the Successor Agency will list this Agreement, and the requirement to transfer Excess Bond Proceeds herein, on its ROPS 14-15B for January 1, 2015 through June 30, 2015 as an obligation to be funded with Excess Bond Proceeds, and as and if applicable on successive ROPS if required by the Dissolution Law; and O. The Oversight Board has determined that the expenditure of Excess Bond Proceeds in accordance with this Agreement will benefit the affected taxing entities; and P. The Oversight Board has duly considered all other related matters and has determined that the approval of the Bond Proceeds Expenditure Agreement and submission to the California Department of Finance are in the best interest of the City and Successor Agency and in the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements. NOW, THEREFORE, BE IT RESOLVED BY A RESOLUTION OF THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY: Section 1. The foregoing recitals are incorporated into this Resolution by this reference, and constitute a material part of this Resolution. Section 2. The Oversight Board approves the Bond Proceeds Expenditure Agreement attached hereto as Attachment No. 1 and incorporated herein, and further authorizes the Successor Agency to transmit this Resolution to the County Auditor-Controller, the State Department of Finance (“DoF”), and the State Controller’s Office. Section 3. The City Manager of the Successor Agency or his authorized designee is directed to post this Resolution on the City/Successor Agency website. Section 4. This Resolution shall be effective after transmittal of this Resolution to the DoF and the expiration of five (5) business days pending a request for review by the DoF within the time periods set forth in Assembly Bill No. 1484. In this regard, if the DoF requests review hereof, the DoF will have 40 days from the date of its request to approve this Oversight Board action or return it to the Oversight Board for reconsideration and the action, if subject to review by DoF, will not be effective until approved by the DoF. Oversight Board Resolution 14-14 Page 3 of 5 Section 5. The Secretary of the Oversight Board shall certify to the adoption of this Resolution. th APPROVED AND ADOPTED this 24 day of June, 2014. Doug Davert, Chairman Oversight Board of the Successor Agency to the Tustin Community Redevelopment Agency ATTEST: Charles E. “Chuck” Puckett, Secretary Oversight Board of the Successor Agency to the Tustin Community Redevelopment Agency Oversight Board Resolution 14-14 Page 4 of 5 STATE OF CALIFORNIA ) COUNTY OF ORANGE )SS CITY OF TUSTIN ) I, CHARLES E. “CHUCK” PUCKETT, Secretary of the Oversight Board of the Successor Agency to the Tustin Community Redevelopment Agency, do hereby certify that the whole number of the members of the Agency Board is seven; that the above and foregoing Resolution No. 14-14 was duly passed and adopted at a regular meeting of the Oversight Board, held on the 24th day of June, 2014, by the following vote: BOARD MEMBER AYES: ________________________________ BOARD MEMBER NOES: ________________________________ BOARD MEMBERS ABSENT: ________________________________ BOARD MEMBERS ABSENT: ________________________________ _____________________________ Charles E. “Chuck” Puckett, Secretary Oversight Board of the Successor Agency to the Tustin Community Redevelopment Agency Attachment No. 1 – Bond Proceeds Expenditure Agreement Oversight Board Resolution 14-14 Page 5 of 5 ATTACHMENT NO. 1 BOND PROCEEDS EXPENDITURE AGREEMENT (attached) BOND PROCEEDS EXPENDITURE AGREEMENT BOND PROCEEDS EXPENDITURE AGREEMENT This (“Agreement”) is entered into CITY OF TUSTIN as of June 24, 2014, by and between the , a California municipal corporation SUCCESSOR AGENCY TO THE TUSTIN COMMUNITY (“City”), and the REDEVELOPMENT AGENCY , a public body corporate and politic pursuant to Parts 1.8 and 1.85 of Division 24 of the California Health & Safety Code (“Successor Agency”). RECITALS A. The City is a municipal corporation organized and operating under the laws of the State of California. B. The Successor Agency is a public body, corporate and politic, organized and operating under Part 1.85 of Division 24 of the Dissolution Law (as defined in Recital D below). C. The Tustin Community Redevelopment Agency (“former Agency”) previously was a California public body, corporate and politic, duly formed by the City Council of the City (“City Council”) and was organized, existed and exercised the powers of a community redevelopment agency under the California Community Redevelopment Law, Health and Safety Code Section 33000, et seq. (“CRL”). D. Assembly Bill x1 26 (“AB x1 26”), effective on June 28, 2011, added Parts 1.8 and 1.85 to Division 24 of the California Health and Safety Code and which laws were modified, in part, and determined constitutional by the California Supreme Court in the petition California Redevelopment Association, et al. v. Ana Matosantos, et al., Case No. S194861 (“Matosantos Decision”), which laws and court opinion caused the dissolution of all redevelopment agencies and winding down of the affairs of former redevelopment agencies. Thereafter, such laws were amended further by Assembly Bill 1484 (“AB 1484”) that was effective on June 27, 2012, and thereafter further amended by subsequent legislation (together AB x1 26, the Matosantos Decision, AB 1484, and subsequent legislation thereto are referred to as the “Dissolution Law”). All statutory references herein are to the Dissolution Law unless otherwise stated. E. As of February 1, 2012, the former Agency became a dissolved community redevelopment agency pursuant to the Dissolution Law. F. As of and on and after February 1, 2012, the Successor Agency is performing its functions as the successor agency under the Dissolution Law to administer the enforceable obligations of the former Agency and is engaged in activities necessary and appropriate to wind down the affairs of the former Agency, all subject to the review and approval by a seven-member “Oversight Board” formed thereunder. G. Section 34191.4(c) of the Dissolution Law allows a successor agency that has received a Finding of Completion (“Finding”) to use bond proceeds from bonds issued prior to 2011 for the purposes for which the bonds were sold, provides that such proceeds in excess of amounts needed to satisfy approved enforceable obligations shall be expended in a manner consistent with the original bond covenants, and further provides that such expenditures shall constitute “excess bond proceeds obligations” that shall be listed separately on the successor agency’s Recognized Obligation Payment Schedule (“ROPS”). H. The Successor Agency received the Finding from the State of California Department of Finance on May 1, 2014, dated and effective nunc pro tunc as of May 15, 2013, as ordered by the Honorable Timothy M. Frawley, Sacramento Superior Court, State of California in the petition titled Successor Agency to the Tustin Community Redevelopment Agency, et al. v. Ana J. Matosantos, et al., Case No. 34-2013-80001623 (“Petition”). I. The CRL pre-dissolution provided for, and the Dissolution Law post-dissolution continues to provide for, a cooperative relationship between sponsoring cities and their redevelopment agencies, as well as their successor agencies who have assumed the duties and obligations of the former redevelopment agencies. Under CRL Section 33220, a city may aid and cooperate in the planning, undertaking, construction, or operation of redevelopment projects. CRL Section 33220(e) specifically authorizes a city to enter into an agreement with its redevelopment agency or any other public entity to further redevelopment purposes. Section 34178(a) of the Dissolution Law allows a successor agency and its sponsoring city to enter into agreements, subject to Oversight Board approval under Section 34180(h) of the Dissolution Law. J. The Successor Agency has and will have proceeds of its Tustin Community Redevelopment Agency Tax Allocation Bonds (MCAS-Tustin Redevelopment Project Area) Series 2010 (“MCAS Bonds”) (together with other funds described in Section 2.1 below, “Bond Proceeds”) that are not otherwise obligated for a project or other enforceable obligation. The Successor Agency desires to transfer such Excess Bond Proceeds (defined below) to the City to enable the City to expend such Excess Bond Proceeds for redevelopment and other public purposes consistent with all applicable covenants of the MCAS Bonds. K. The Successor Agency desires to transfer its Excess Bond Proceeds to the City to enable the City to use such Excess Bond Proceeds in a manner consistent with the covenants of the MCAS Bonds and to undertake projects and programs that were not previously funded and obligated by the former Agency pre-dissolution or by the Successor Agency post-dissolution, or by the City pre- or post-dissolution. The City has adopted a spending plan for using such Excess Bond Proceeds (“Bond Spending Plan”) to advance the City’s community development goals while maximizing fiscal and social benefits flowing to the affected taxing entities from successful development. The City Council and Successor Agency Board have found that the use of Excess Bond Proceeds are in accordance with the Bond Spending Plan to fund various capital improvements within and outside the former MCAS Tustin Redevelopment Project Area (for which a benefit resolution shall have been adopted by the Successor Agency), including those that are contained in the Tustin Legacy Backbone Infrastructure Program established by the City, and are in accordance with CRL Sections 33445, 33445.1, and 33679 and other applicable law. On June 24, 2014, the Oversight Board determined that the expenditure of Excess Bond Proceeds in accordance with this Agreement will benefit the affected taxing entities, and approved the execution of this Agreement and the transfer of Excess Bond Proceeds to the City for the purposes described herein. L. In order to facilitate the use of Excess Bond Proceeds consistent with all applicable bond covenants, the Successor Agency and the City have negotiated this Agreement requiring the transfer of current and future excess bond proceeds by the Successor Agency to the City, and the City’s agreement to use such proceeds consistent with all applicable covenants, conditions, restrictions and obligations under the MCAS Bonds. The parties intend that this Agreement shall constitute an excess bond proceeds obligation within the meaning of Section 34191.4(c)(2)(A) of the Dissolution Law to be paid from Excess Bond Proceeds. With Oversight Board approval, the 2 Successor Agency will list this Agreement, and the requirement to transfer excess bond proceeds herein, on its ROPS 14-15B for January 1, 2015 through June 30, 2015 as an obligation to be funded with Excess Bond Proceeds, and as and if applicable on successive ROPS if required by the Dissolution Law. NOW, THEREFORE , the parties hereto do mutually agree as follows: RECITALS 1. The recitals above are an integral part of this Agreement and set forth the intentions of the parties and the premises on which the parties have decided to enter into this Agreement. DEFINITIONS 2. For purposes of this Agreement, the following terms shall have the indicated meaning: 2.1“Dissolution Law” is defined in Recital D. 2.2“Bond Proceeds” is defined in Recital J and also includes (1) proceeds from tax allocation bonds issued on or before December 31, 2010, (2) rents, sale proceeds and other revenues generated by properties acquired and/or improved with proceeds from tax allocation bonds issued on or before December 31, 2010, (3) interest and principal paid on loans funded by proceeds from tax allocation bonds issued on or before December 31, 2010, and (4) other income or revenues generated from assets acquired or funded with proceeds from tax allocation bonds issued on or before December 31, 2010. 2.3“Excess Bond Proceeds” means Bond Proceeds that are not needed to satisfy Enforceable Obligations listed on an approved ROPS. 2.4“Enforceable Obligations” mean enforceable obligations, other than Excess Bond Proceeds obligations, as defined under the Dissolution Law. 2.5“Bond Spending Plan” is defined in Recital J. SUCCESSOR AGENCY OBLIGATIONS 3. The Successor Agency shall have the following obligations under this Agreement: Current Excess Bond Proceeds 3.1. The Successor Agency shall transfer to the City, no later than January 1, 2015, Excess Bond Proceeds currently held by the Successor Agency in an amount not to exceed $32,067,977.89. Future Excess Bond Proceeds 3.2. The Successor Agency shall transfer to the City all future Excess Bond Proceeds held or received by the Successor Agency. Such future Excess Bond Proceeds shall include, without limitation, (1) Bond Proceeds previously obligated to a project or other Enforceable Obligation that become unobligated for any reason, (2) Bond Proceeds that become available in the form of rents, sale proceeds, loan repayments, other income, or other revenues that are generated by properties or other assets acquired and/or improved with Bond Proceeds and that are not otherwise obligated to a project, program, or other Enforceable Obligation, 3 and (3) any other funds held by the Successor Agency that qualify as Excess Bond Proceeds under this Agreement. The parties intend that payments of future Excess Bond Proceeds be made to the City as soon as possible after such Excess Bond Proceeds become available. The transfer of future Excess Bond Proceeds to the City shall be made pursuant to an approved ROPS within 30 days of the commencement of the relevant ROPS period. The Successor Agency shall be responsible for ensuring that payments of future Excess Bond Proceeds to the City, as such funds become available, are included on the next possible ROPS. Projects Funded By Excess Bond Proceeds 3.3. The Successor Agency assigns to the City all responsibilities in relation to the administration and implementation of any projects or programs funded by Excess Bond Proceeds. The Successor Agency assigns to the City all contracts entered into by the Successor Agency post-dissolution or the former Agency pre-dissolution related to the expenditure of Excess Bond Proceeds and any activities to be funded by Excess Bond Proceeds, with the exception of those contracts relating to Enforceable Obligations, including the MCAS bond documents, which shall be retained by the Successor Agency. CITY OBLIGATIONS 4. The City shall have the following obligations under this Agreement: Excess Bond Proceeds 4.1. The City shall accept, hold, disburse and administer Excess Bond Proceeds transferred to the City by the Successor Agency under this Agreement, including current Excess Bond Proceeds and future Excess Bond Proceeds. The City shall retain any Excess Bond Proceeds that it receives, such as revenue generated from properties acquired or improved with Excess Bond Proceeds or payments on loans funded from Excess Bond Proceeds, without any obligation to return such funds to the Successor Agency, and shall use such funds for uses consistent with applicable covenants of the MCAS Bonds. The City may spend Excess Bond Proceeds received or retained under this Agreement on any project, program, or activity authorized under the Bond Spending Plan. Notwithstanding anything to the contrary in this Agreement or the Bond Spending Plan, the City shall spend Excess Bond Proceeds consistent with all covenants of the MCAS Bonds applicable to the particular Excess Bond Proceeds. The City shall be solely responsible for ensuring that Excess Bond Proceeds are maintained and spent in accordance with all covenants of the MCAS Bonds and other applicable laws. The City may transfer funds between approved projects, programs and activities. The City hereby assumes all contracts entered into or assumed by the Successor Agency post dissolution or entered into by the former Agency pre-dissolution related to the expenditure of Excess Bond Proceeds and any activities to be funded by Excess Bond Proceeds, with the exception of those contracts relating to Enforceable Obligations, which shall be retained by the Successor Agency. The City shall perform its obligations hereunder, and under such assumed contracts, in accordance with the applicable provisions of federal, state and local laws, including the obligation to comply with environmental laws such as CEQA and/or NEPA, and shall timely complete the work required for each project commenced by the City pursuant to this Agreement and the Bond Spending Plan. 4 BOND SPENDING PLAN 4.2. The City shall be solely responsible for maintaining, administering, and implementing the Bond Spending Plan. The City may amend the Bond Spending Plan as the City deems reasonably necessary in its sole discretion. Any amendments to the adopted Bond Spending Plan will consider uses that advance the City’s community development goals while maximizing fiscal and social benefits flowing to the affected taxing entities from successful development. Notwithstanding any contrary provision hereof, unless the City expressly agrees otherwise, the City shall not be obligated to provide funding for any program or project in an amount exceeding the Excess Bond Proceeds provided to the City pursuant to this Agreement. ENTIRE AGREEMENT; WAIVERS; AND AMENDMENTS 5. 5.1This Agreement constitutes the entire understanding and agreement of the parties with respect to the transfer and use of Excess Bond Proceeds. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties with respect to the subject matter of this Agreement. 5.2This Agreement is intended solely for the benefit of the City and the Successor Agency. Notwithstanding any reference in this Agreement to persons or entities other than the City and the Successor Agency, there shall be no third party beneficiaries under this Agreement. 5.3All waivers of the provisions of this Agreement and all amendments to this Agreement must be in writing and signed by the authorized representatives of the parties. SEVERABILITY 6. If any term, provision, covenant or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions shall continue in full force and effect unless the rights and obligations of the parties have been materially altered or abridged by such invalidation, voiding or unenforceability. In addition, the parties shall cooperate in good faith in an effort to amend or modify this Agreement in a manner such that the purpose of any invalidated or voided provision, covenant, or condition can be accomplished to the maximum extent legally permissible. DEFAULT 7. If either party fails to adequately perform an obligation required by this Agreement within thirty (30) calendar days of receiving written notice from the non-defaulting party, the party failing to perform shall be in default hereunder. In the event of default, the non-defaulting party will have all the rights and remedies available to it at law or in equity to enforce the provisions of this contract, including without limitation the right to sue for damages for breach of contract or to seek specific performance. The rights and remedies of the non-defaulting party enumerated in this paragraph are cumulative and shall not limit the non-defaulting party’s rights under any other provision of this Agreement, or otherwise waive or deny any right or remedy, at law or in equity, existing as of the date of the Agreement or hereinafter enacted or established, that may be available to the non- defaulting party against the defaulting party. 5 BINDING ON SUCCESSORS 8. This Agreement shall be binding on and shall inure to the benefit of all successors and assigns of the parties, whether by agreement or operation of law. FURTHER ASSURANCES 9. Each party agrees to execute, acknowledge and deliver all additional documents and instruments, and to take such other actions as may be reasonably necessary to carry out the intent of this Agreement. [SIGNATURES ON NEXT PAGE] 6 In witness whereof, the undersigned parties have executed this Bond Proceeds Expenditure Agreement as of the date first above written. “CITY” CITY OF TUSTIN , a California municipal corporation By: __________________________________ Elwyn A. Murray, Mayor ATTEST: ____________________________________ Jeffrey C. Parker, City Clerk APPROVED AS TO FORM David Kendig, City Attorney “SUCCESSOR AGENCY” SUCCESSOR AGENCY TO THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY, a public body corporate and politic By: Elwyn A. Murray Successor Agency Chairman ATTEST: Jeffrey C. Parker, City Clerk on behalf of the Successor Agency APPROVED AS TO FORM David E. Kendig, Legal Counsel 7