HomeMy WebLinkAboutRDA RDA LOAN SO CENT 06-06-88 _ ~ REDEVELOPMENT AGENCY
r ! No..5
DATE: JUNE 2, 1988 ~__~~
TO: WILLIAM~ HUSTON, CITY
MANAGER
FROM:
AGREEME~ FOR A LOAN BETWEEN THE CITY OF TUSTIN AND THE
SUBJECT: TUSTIN COMMUNITY RDA ON BEHALF OF THE SOUTH CENTRAL PROJECT
RECOMMENDATION:
Authorize the Mayor and Chairman of the Redevelopment Agency to
execute the attached Loan Agreement offering and accepting a loan
to the Agency of an additional $300,000.
DISCUSSION:
Section 33610 of the Health and Safety Code stipulates that tax
increments can only be distributed to Redevelopment Agencies for
the explicit purpose of repaying debt. Any tax increment in excess
of the outstanding debt will be returned to the County. As we have
done for the past 3 years, the General Fund will be lending funds
to the Agency in order to accomplish the goals and objectives of
the South Central Project Area. This loan will be paid back to the
General Fund from the tax increment generated in this project ar~ea
only. Based on the needs of the South Central Project area for t~he
fiscal 1988-89, an additional $300,000 loan between the City and
the Agency will be required to receive the full estimated tax
increment for the coming year. The total outstanding loan to the
Agency will be $1,275,000 as of June 30, 1988.
RAN:is
Attachment
AGREEMENT
THIS AGREEMENT is made and entered into this 6th day of
June, 1988, by and between the CITY OF TUSTIN, a muqicipal
corporation of the County of Orange, State of California,
hereinafter referred to as "City", and the TUSTIN COMMUNITY
REDEVELOPMENT AGENCY, a California Redevelopment Agency,
hereinafter referred to as "Agency".
RECITALS
Wq~EREAS, the City Council of the City, pursuant to
Health and Safety Code Section 33610, has deemed it necessary to-
loan the Agency Three Hundred Thousand Dollars ($300,000) for the
administrative expenses and overhead of the Agency; and
WqIEREAS~ THE City Council of the City offered said loan
to the Agency; and
W~EREAS, the Agency, pursuant to Health and Safety Code
Section 33601, has accepted said offer; and
W-SEREAS, this loan is in addition to the amount of One
Hundred Twenty-Five Thousand Dollars ($125,000) accepted by the
Agency on June 18, 1984, and Two Hundred Fifty Thousand Dollars
($250,000) accepted by the Agency on June 2, 1986, and Six
Hundred Thousand Dollars ($600,000) accepted by the Agency on
June 1, 1987, making a total loan on One Million Two Hundred
Seventy Five Thousand Dollars ($1,275~,000), plus accrued
interest; and
W~EREAS, the parties intend to further memoralize their
agreement as to said loan and to set forth the terms and
conditions thereof as agreed to at the time of offer and
acceptance.
NOW, T~EREFORE, in consideration of the mutual
covenants, agreements and considerations contained herein, City
and Agency hereby~agree as follows:
1. Said loan is to be used by the Agency in carrying
out the South Central Area Redevelopment Project and any other
lawful purposes.
2. The sum loaned to the Agency is 'to be repaid to
City as follows:
a: Simple interest on said sum shall accrue at the
rate of twelve percent (12%) per annum from the
date of transfer of said sum until such time as
said sum is repaid to City.
b. The sum loaned to the Agency, as well as accrued
interest thereon, shall be repaid to City by the
Agency from tax increment revenues received
pursuant to Health and Safety Code Sections 33670
et seq.
c. If no funds become available to the Agency to repay
said sum, the money loaned and accrued interest
thereon is forgiven and need not be repaid to City.
Executed this 6th Day of June, 1988
"CITY" CITY OF TUSTIN
BY
Ronald B. Hoesterey, Mayor
"AGENCY"
TUSTIN COMMUNITY REDEVELOPMENT AGENCY
BY
Ronald B. Hoesterey, Chairman
ATTEST:
Mary E. Wynn, City Clerk
Mary E. Wynn, Redevelopment Agency Secretary