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HomeMy WebLinkAboutRDA ANN'L RPT FY 81-82 10-20-82DATE: Oct. 8, 1982 REDEVELOPMENT AGENCY No. 6 10-20-82 Inter-Corn TO: FROH: S UBJ ECT: REDEVELOPMENT AGENCY BILL HUSTON, EXECUTIVE DIRECTOR REDEVELOPMENT AGENCY ANNUAL REPORT FOR FISCAL YEAR 1981-82 RECOMMENDATION: That the Agency adopt the resolution approving the 1981-82 Annual Report and authorizin§ its submittal to the City Council. DISCUSSION: State Redevelopment law requires the Agency to prepare an annual report of its activities for submittal to the City Council and State Department of Housing and Community Development. The report follows the same fomat as the Agency's 1980-81 Annual Report. Following the Agency's approval of the report, it will be submitted to the City Council, which according to State law, is allowed twenty-one days to review the report prior to formally approving it. WH: dmt 4 5 6 7 8 9 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 RESOLUTION NO. RDA 82-8 A RESOLUTION OF THE CITY OF TUSTIN REDEVELOPMENT AGENCY APPROVING AND TRANSMITTING THE ANNUAL REPORT. The Redevelopment Agency of the City of Tustin does hereby resolve as follows: I. The Redevelopment Agency finds and determines as follows: Ae That an annual report for the City of Tustin Redevelopment Agency for FY 1981-82 was prepared pursuant to Part 1, Chapter 1, Article 6 of the California Redevelopment Law. Be An independent financial audit report has been received and incorporated within the annual report of the Agency indicating that the Agency is in compliance with laws, regulations and administrative requirements governing activities of the Agency. II. The City of Tustin Redevelopment Agency hereby adopts the annual report and directs that said report with report of the auditor, pursuant to Sections 33080 and 33080.1 of the California Community Redevelopment Law, shall be transmitted to the State Department of Housing and Community Development and to the City Council. PASSED AND ADOPTED at a regular meeting of the City of Tustin Redevelopment Agency, held on the 20th day of October, 1982. RICHARD B. EDGAR, Chairman ATTEST: MARY WYNN, Secreta~ to Redevelopment Agency ANNUAL REPORT C~TY OF TU~TZN REDEVELOPMENT AGENCY FY 1981-82 ROA BOARD Richard B. Edgar, Chairman Ursula E. Kennedy Donald J. Saltarelli Ronald B. Hoesterey Frank H. Greinke ST~F Bill Huston, Executive Director Ron Nault, Treasurer Mary Wynn, Secretary/Clerk James B. Rourke, Attorney ASSOCIATE STEF Robert Ledendecker, Public Works Director Mike Brotemarkle, Community Development Director R. Kenneth Fleagle, D.P.A. Consultant Katz, Hollis, Coren & Associates, Inc., Financial Consultants Submitted by: William A. Huston, Executive Director October 4, 1982 TRBLE OF CONTENTS PAGE I. INTRODUCTION II. REDEVELOPMENT AGENCY REVIEW III. A. Purpose and Activities B. Personnel C. Resources and Expenditures D. Projected Revenues CHRONOLOGICAL HISTORY OF THE TUSTIN REDEVELOPMENT AGENCY 1981-82. IV. MAJOR PUBLIC PROJECTS WITHIN REDEVELOPMENT A. REA V. MAJOR PRIVATE PROJECTS WITHIN REDEVELOPMENT AREA VI. GOALS A~ND ACHIEVEMENTS FOR 1981-82 VII. GOALS AND PROJECTS FOR 1982-83 VIII. RECOMMENDATIONS FOR NEEDED LEGISLATION IX. AUDIT REPORT I. INTRODUCTION The Community Redevelopment Law, (Division 24, Part I, Chapter I. Article 6 Sec. 33080. of the California Health and Safety Code) requires each agency to file an annual report with the Department of Housing and Community Development and with the City Council. The report shall contain: ae de An independent financial audit report for the previous fiscal year A work program and goals for the coming year An examination of the previous year's achievements related to the goals of the work program Recommendation for needed legislation The City Council is required to review the report and take appropriate action at the first meeting of the Council which is held 21 days after receipt of the report from the Redevelopment Agency. The first formal report of the Agency was presented on September 8, 1982. The audit report showing no discrepancies was appendixed on December 21, 1982 and transmitted to the City Council by Resolution No. RDA 81-15. the report was approved by the City Council on January 18, 1982. The Annual Report for FY 1981-82 follows the same format as the previous year by indicating the major achievements of the Redevelopment Agency and private developers in revitalizing the Town Center Area in accordance with the intent and purpose of the Community Redevelopment Law. Immeasurable contributions to the success of a redevelopment project are the many hours of workshop sessions by the Agency to assure that policies and programs are in the interest of the total community and the understanding and tolerance of the business community during the periods of construction which have caused them inconvenience. This report would be amiss if it failed to recognize the faith of developers and businesspersons in the economic future of the community and the cooperation of those affected. II. REDEVELOPMENT AGENCY REVIEW Ao Purpose and Activities The basic purpose and objectives of the Redevelopment Agency, as stipulated by City Council Ordinance No. 696 adopted on October 4, 1976, remains viable in 1981-82. As further evidence of the intent of the Redevelopment Agency, the following policies were adopted by the Agency on Nov. 2, 1982: Priority for the expenditure of tax increment revenue will be given to projects which stimulate and facilitate sales tax generating commercial projects. Agency funded capital improvements within public rights-of-way (infra-structure) should be integrated with private developments which are consistent with the Agency's adopted redevelopment project area plans. Agency funded capital improvements within public rights-of-way should be prioritized and scheduled so as not to preclude the option to finance critical non-capital improvement projects. Consistent with California Redevelopment Law, the Agency will exercise its powers of eminent domain, condemnation, or negotiated acquisition and sale of land where such actions result in achievement of objectives set forth in redevelopment project area plans. These powers shall only be executed where it can be demonstrated that without Agency participation, a development (consistent with the objectives of the project area plan) would not otherwise proceed. A financial analysis will be prepared which indentifies the most appropriate means of financing Agency projects. The financial analysis will be prepared taking into account State laws concerning debt (incurring debt to receive annual tax increment) and the Agency's project plans (level and rate of Agency expenditures). Land use, economic base and financial feasibility studies will be prepared for the Irvine land to determine the need for Agency participation in development of this area. Project area plans will be prepared for the Bonita/Bryant area and the South Tustin area (bounded by Newport Avenue and Freeways I-5 and 55). A legal and financial analysis will be prepared concerning the use of Town Center Project Area tax increment funds for public improvements (e.g., Newport Avenue extension) outside the project Area, but which benefit it (e.g., improved traffic circulation). Personnel William A. Huston, City manager, assumed the office of Executive Director of the Redevelopment Agency on September 1, 1981, vice interim director, Charles R. Thayer, as approved by Resolut-l'~No. RDA 81-10 on September 8, 1981. Frank H. Greinke was elected to the City Council and assumed membership on the Redevelopment Agency on April 20, 1982, vice James B. Sharp. The Redevelopment Agency on June 30, 1982 was comprised of the following: Chairman: Members: Richard B. Edgar Frank Greinke Ron Hoesterey Ursula E. Kennedy Don Saltarelli Executive Director: Treasurer: Secretary/Clerk: Attorney: William A. Huston Ron Nault Mary Wynn James B. Rourke Resources & Expenditures Fund Balance 6/30/81 $ 544,260 Revenues: Property Tax Increment Interest Income $1,163,485 137,232 $1,305,717 Expenditures: Operations $ 166,006 Capital Improvements 1,242,830 Fund Balance 6/30/82 $1,408,836 $ 441,141 (Source: Audited Financial Report 6/30/82) Projected Revenues Based upon approved and pending projects, revenues of the Tustin Town Center Project are projected as follows: Year Revenue 1982-83 $1,277,000 1983-84 1,392,000 1984-85 1,501,000 1985-86 1,720,000 1986-87 1,873,000 1987-88 1,882,000 1988-89 1,890,000 1989-90 1,897,000 1990-91 1,903,000 1919-92 1,908,000 (Source: Katz, Hollis, Coren & Associates) III. duly August September October CHRONOLOGICAL HISTORY OF THE TUSTIN REDEVELOPNENT AGENCY 1981-82 Approved the FY 1981-82 Budget as proposed with amendments deleting $84,000 for the Prospect Avenue Storm Drain and making a total allocaton of $150,000 for Columbus-Tustin Park development plans. (Res. No. RDA 81-9) Approved plans and specifications for Irvine Boulevard Storm Drain Facility No. F 07P13 and SIP14. Accepted the sanitary sewer improvements for Second and "C" Streets. Approved a loan agreement with terms and conditions with the City in the amount of $1,125,000. Established a four year program for undergrounding utilities. Joint public hearing opened for purpose of amending the RDA Finance Plan and continued to August 17. Awarded a bid in the amount of $157,630 to Desatoff Construction Co. for the Irvine Blvd. Storm Drain, Holt to Prospect. Conducted a joint hearing with the City Council to amend the RDA Finance Plan and adopted Joint Resolution 81-94. Ordinance No. 855 was adopted amending the Financial Limitations of the RDA Plan to authorize an annual tax increment of $3,000,000 and authorize bonded indebtedness of $20,000,000. Approved "C" Street Plaza development and appropriated $50,000 for improvements. Directed vacation of "C" Street. Authorized by Ordinance No. 857 Agency members to receive $30.00 per meeting attended, not to exceed four meetings per month. Appointed RDA Staff (Resolution RDA No. 81-10) Approved Annual Report subject to fund audit. Accepted the undergrounding for Utility District No. 5 (Res. RDA 81-11) Awarded a bid in the amount of $1,775 to M.P.A., Inc. for the design of the E1Camino Real/Sixth Street traffic signal and approved a supplemental budget appropriation in that amount. November December February March April Approved demands in the amount of $701,599.86 Approved plans and specifications for Newport Avenue Bike Trail Berm (Res. RDA 81-12) Adopted Redevelopment Agency Policies Accepted the Irvine Blvd. Storm Drain improvements (Res. RDA 81-14) Awarded a bid in the amount of $13,147.50 to Alfredo's Excavating for Newport Avenue Bike Trail Berm Replacement. Approved demands in the amount of $429,991.18. Approved design plans for 160 Prospect Avenue. Adopted a preliminary plan for the South/Central Redevelopment Project (Res. RDA 81-13). Approved and transmitted the Annual Report (Res. RDA 81-15). Accepted the Main Street and 6th Street Storm Drain improvements (Res. RDA 81-16). Selected Berryman and Stephenson as consultants for the E1 Camino Real/Main Street improvement project. Approved demands in the amount of $132,968.29 for Nov. and Dec. Approved demands in the amount of $443,912.60 for Jan. Transferred $220,000 from the E1 Camino Real Project to Segment "B" of the Irvine Blvd. Underground Utility District No. 6. Accepted Newport Avenue Bike Trail Berm Replacement (Res. RDA 82-1) Accepted offer of loan from the city in the amount of $350,000 for purchase of interests in the "C" Street parking structure. Approved plans and specifications for Central Alley improvements. Appropriated $14,000 for Prospect Street improvements. Received the preliminary E1 Camino Real Design Plan and approved the plans, following a workshop, with modifications. Approved demands in the amount of $38,186.07 for Feb. Approved a bid in the amount of $80,741.58 to Porter Construction Co. for central alley improvements. Approved plans and specifications for E1Camino Real/Sixth Street traffic signal (Res. RDA 82-3). Ma~ ,June Retained Katz, Hollis, Coren & Associates, Inc. as financial consultants to the RDA. Approved demands in the amount of $386,459.75 for March. Aproved demands in the amount of $23,914.70 for April. Awarded a bid in the amount of $49,428 to W.R. Hahn for the E1 Camino Real/Sixth Street Signal. Approved plans and specifications for E1Camino Real Improvement Project (Res. RDA 82-4) Approved demands in the amount of $3,467.35. Deferred further action on the South/Central project until receipt of the financial consultant's report. The loan agreement with the City Council approved in February 1982 was increased by $100,000 for a total loan of $450,000 for FY 1981-82, subject to terms and conditions. IV. FI/~OR PUBLZC PROJECTS WITHIN REDEVELOPMENT AREA (1981-4)2) Street Projects Commenced the E1Camino Real Improvement Project Completed improvements of the centralcity alleys Traffic Signals E1 Camino Real and Sixth Street Beautification Reconstructed Newport Avenue Bike Trail Berms. Participated in the development of the "C" Street Plaza Flood Control Projects Irvine Blvd. Storm Drain Facility No. FO7P13 and SIP14 Main Street and 6th Street Storm Drains * Undergrounding of Utilities Completed the undergrounding for Utility District No. 5 (El Camino Real) * Sanitary Sewers Completed Sanitary Sewer Improvements for Second and "C" Streets * Parking Facilities Participated with Gfeller Development Co. in the construction of the "C" Street Parking Structure * Carry-over projects from previous years. V. 14~OR PRIVATE PRO~ECTS WITHIN THE REDEVELOP#ENT AREA EXCEEDING $100,000 PERNIT VALUE (1981-82) Office Buildings Gfeller Development Kornwasser Prime Construction Spirit Development O'Connor Address 210-250 W. Main 730 E1Camino 150 E1Camino 145 Main 160-190 Prospect Permit Value $ 1,900,400 1,049,515 1,300,000 205,038 600,000 Motel Bharat Gala (14 unit addition) 750 E1Camino 144,350 Parking Structure Gfeller/City 445 "C" Street 700,000 VI. GOJ)J.S /)lid AI;HIEVF. I~ENTS FOR IOB1--liZ A primary goal of the 1981-82 FY was t~ provide public parking accommodations in the Town Center Area. This goal was achieved by the participation of the RDA with the Gfeller Development Corporation in the construction of a parking facility on "C" Street. The objective of creating public parking facilities northerly of Main Street has not been achieved but remains a viable project. Design plans were approved, contracts awarded, and construction is underway on the E1 Camino Real Project, bringing to fruition the public improvement plans for the E1 Camino Real area. Recreation Systems were retained in January to prepare a design plan for Columbus Tustin Park and a citizen's Committee was appointed. Plans are now in progress in accordance with the 1981-82 goals. Design plans were approved, contracts awarded, and construction completed for the improvement of alleys in the Town Center Area. By adoption of Ordinance No. 855, the Redevelopment Plan was amended to increase the limitation on tax increment revenues and bonded indebtedness to carry out the objectives of the plan. Private redevelopment was encouraged, and in the presence of an economic and building decline, privat~ redevelopment accounted for a substantial increase of approximately $4,000,000 in land values from 1981-82 to 1982-83. With the exception of providing public parking facilities northerly of Main Street, all objectives of FY 1981-82 were accomplished by the Town Center Redevelopment Agency. VII. GOALS AND PROdECTS FOR FY 1982--~3 The Redevelopment Agency will determine the feasibility of issuing tax allocation bonds for the purpose of financing public improvements and aiding private developers in the acquisition and development of blighted properties. Budgeted projects for FY 1982-83, including carry-over projects from previous years, include: E1 Camino Real Signing $ 10,000 * E1Camino Real Furniture 40,000 * Irvine Blvd. Center Island Landscape 55,600 Columbus-Tustin Park Design 83,000 E1Camino Real Reconstruction 1,230,219 * Prospect Avenue Widening 14,000 Irvine Blvd./Fashion Lane traffic signal 33,600 * E1Camino Real/6th Street traffic signal 53,100 * First and Prospect traffic signal 55,000 ** Total funds appropriated for Capital Improvements for FY 1982-83 is $2,296,764. In addition to the current and approved projects, the Redevelopment Agency has established a list of priorities for the expenditure of proceeds from the sale of tax allocation bonds. Priorities as adopted by the Redevelopment Agency on September 20, 1982 are as follows: 2. 3. 4. General Property Acquisition for Resale - $2,000,000; Property Acquisition for Sr. Citizen Housing - $200,000; Columbus Tustin Community Center - $1,000,000; Underground Utilities for the specific area bounded by Holt, Irvine and Newport triangle and continue southerly on Newport to Larwin Square - $750,000; Additional Parking Structure in the Downtown Area - $1,000,000; Drilling and installation of a well for the water system and replacement of undersized and/or deteriorated water main lines; $500,000; and RepaJ~nent of Debt to City of Tustin - $1,125,000. Total - Approximately $6.6 million The design study for Columbus Tustin Park will be completed during this year and commitments will be made for the development of the park and its facilities. Further consideration will be given to the South/Central Redevelopment Project upon receipt of financial report and determination of financial feasibility. * Carry-over projects ** Subject to fund availability VIII. RECI)I~EIIDATIONS FOR I~EDED LEGISLATION Experiences of smaller cities and projects has indicated that redevelopment with tax increment financing is impractical unless there are large commercial developments to create substantial tax revenues. In addition, the demands of other taxing agencies for a portion of the tax increment, which they did not assist in creating, further depletes the revenue available to carry out the objectives of redevelopment. The numerous bills that have been considered by the California Legislature that would restrict the authority and disperse the tax increment funds further defeats the incentive and purpose of redevelopment. It is proposed that Section 33354.4 of the Health and Safety Code be amended to read: "33354.4 No plan is required to be submitted to a fiscal review committee where--~-~T the affected taxing jurisdictions are governed by the sme legislative body as the redevelopment agency or where any project is comprised of 904 or more residential land use area with a ~rojected average annual tax increment of not more than two million dollars. It is further recommended that legislative proposals to amend the California Redevelopment Law do not divert the tax increment revenues to finance other than redevelopment programs. I:X. AUDI'T REPORT _ imonls oreland 610 NEWPORT CENTER DRIVE. SUITE 1325 NEWPORT 8EACH. CALIFORNIA 92660 (714) 640-1333 September 28, 1982 The Board of Directors of the Tustin Community Redevelopment Agency We have examined the balance sheet of the Tustin Community Redevelopment Agency at June 30, 1982, and the related statement of revenues, expenditures, and changes in fund balance-budget and actual for the year then ended. Our examination was made in accordance with generally accepted auditing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. In our opinion, the financial statements referred to above present fairly the financial position of the Tustin Community Redevelopment Agency at June 30, 1982, and the results of its operations for the year then ended, in conformity with generally accepted accounting principles applied on basis consistent with that of the preceding year. Tustin Community Redevelopment Agency Balance Sheet June 30, 1982 Governmental Fund Type Capital Projects Account Group General Long-Term Debt Assets Cash and short-term investments Taxes receivable Interest receivable Amount to be provided for payment of long-term debt Total Assets $2,079,672 17,231 38,437 $2,135,340 $450,000 $450,000 Totals (Memorandum Only) 1982 1981 $2,079,672 $1,537,711 17,231 150,777 38,437 4,986 450,000 $2,585,340 $1,693,474 Liabilities and Fund Equity Liabilities: Accounts payable Due to City of Tustin Loans and accrued interest payable to City of Tustin {Note 2} $ 20,537 45,462 1,178,200 1,244,199 Total Liabilities Fund Equity: Fund balance - designated for capital outlay 891,141 Total Liabilities and Fund Equity $2,135,340 $450,000 450,000 $450,000 $ 20,537 $ 2,818 45,462 21,396 1,628,200 1,125,000 1,694,199 1,149,214 891,141 544,260 $2,585,340 $1,693,474 See Accompanying Notes to Financial Statements. Tustin Community Redevelopment Agency Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 1982 1982 Budget Actual Over (Under) Budget Revenues: Tax increments $ 921,688 $1,110,858 $ 189,170 Interest earned 16,000 137,232 121,232 Other taxes 55,000 57,627 2,627 Total Revenues Expenditures: Administration Capital expenditures Total Expenditures Excess of Revenues Over (Under) Expenditures Other Financing Sources: Long-term loan from City of Tustin Excess of Revenues and Other Financing Sources Over (Under) Expenditures 1981 Actual $704,507 76,144 53,204 992,688 1,305,717 313,029 833,855 109,832 166,006 56,174 44,018 2,648,118 1,242,830 (1,4Q5,288) 765,263 2,757,950 1,408,836 (1,349,114) 809,281 Fund balance, beginning of year (1,765,262) (103,119) 1,662,143 24,574 Fund balance, end of year 450,000 450,000 (1,765,262) 346,881 2,112,143 24,574 544,260 544,260 519,686 $(1,221,002) $ 891,141 $ 2,112,143 $544,260 See Accompanying Notes to Financial Statements. Tustin Community Redevelopment Agency Notes to Financial Statements June 30, 1982 1. Sun~ary of Significant Accounting Policies Description of Fund and Account Group The accounting records of the Agency are organized in a capital projects fund which is used for the receipt and disbursement of monies used for financing capital expenditures. The General Long-Term Debt Account Group is used to record the outstanding balance of loans to the City of Tustin due beyond one year. Basis of Accounting The Agency's capital projects fund is maintained on the modified accrual 6asis of accounting. Cash and Short-Term Investments The Agency pools idle cash with the City of Tustin for the purpose of increasing income through investment activities. Investments are carried at cost, which approximates market value. Appropriations and Encumbrances Unexpended and unencumbered appropriations of the Agency automatically lapse at the end of the fiscal year. Budgetary Practices Each year the Agency Board adopts a budget which provides for the operations of the Agency. Budgets are prepared on the modified accrual basis of accounting. An encumbrance system is utilized to assist in controlling expenditures and enforcing revenue provisions. The Agency Board anticipated loans from the City of Tustin to finance the budgeted deficit. Administrative Charges From the City of Tustin The Agency was charged approximately $43,000 for administrative costs for the fiscal year ended June 30, 1982 by the City of Tustin. These charges were for salaries and supplies paid by the City for the Agency. Additionally, $53,200 of interest was charged by the City to the Agency for the fiscal year ended June 30, 1982 on the loans payable to the City. Tustin Community Redevelopment Agency Notes to Financial Statements {Cont.} June 30, 1982 Loans and Accrued Interest Payable to City of Tustin Loans and accrued interest payable to the City of Tustin at June 30, 1982 were as follows: Included in the capital projects fund: 8% Loan Payable Accrued Interest Included in long-term debt: 12% Loan Payable $1,125,000 53,200 1,178,200 450,O0O $1,628,200 The 8% loan is payable on demand while the 12% loan is payable within three years. Both loans are payable from property tax increments. If no funds become available to repay the loans and accrued interest, the loans and accrued interest are forgiven and need not be repaid to the City.