HomeMy WebLinkAboutRDA TOWN CTR RDA BDS 10-20-82REDEVELOPMENT AGENCY
NO. 9
10-20-82
ADOPTED RESOLUTION ?aL
AGENDA ITEM
RESOLUTION NO. IDA 82-11 - A Resolution of the Tustin Community
Redevelopment Agency PROVIDING FOR THE SALE OF NOT TO EXCEED $8,500,000
PRINCIPAL AMOUNT OF TUSTIN COMMUNITY REDEVELOPMENT AGENCY, TOWN CENTER
AREA REDEVELOPMENT PROJECT, TAX ALLOCATION BONDS, SERIES 1982.
This item was delivered to you in a separate packet.
Draft 10/12/82 #3.2
LNote: To be adopted after Authorizing Resolution] #3.5
RESOLUTION NO. RDA 82-11
RESOLUTION OF THE TUSTIN COMMUNITY
REDEVELOPMENT AGENCY PROVIDING FOR THE ,SALE OF
NOT TO EXCEED $8;500,000 PRINCIPAL- AMOUNT OF-
TUSTIN COMMUNITY REDEVELOPMENT AGENCY, - TOWN
CENTER AREA REDEVELOPMENT -PROJECT, TAX "
ALLOCATION BONDS, SERIES 1982.
RECITALS:
A. The Tustin Community Redevelopment Agency (the
"Agency") is a redevelopment agency, a public body, corporate and
politic, duly created, -established and authorized to transact busi-
ness and exercise its powers, all under and pursuant to the Community
Redevelopment Law, California gealth and Safety Code Sections 33000
et seq. and the powers of the Agency include the power to issue bonds
for any of its corporate purposes.
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#(8)
#(8)
#(8)
#(8)
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S. The Agency has heretofore adopted a resolution #19
entitled: "Resolution -of the Tustin Community Redevelopment Agency #20
Authorizing the Issuance of 18,500,000 principal amount of Tustin #21
Community Redevelopment Agency Town Center Area Redevelopment Project #(21)
Tax Allocation Bonds, Series 1982 (the "Resolution"). #22
D. The Agency deems it necessary to sell at this time #24
$8,500,000 principal amount of Bonds as authorized by the #25
Resolution. #(25)
NOW, THEREFORE, THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY #26
HEREBY FINDS, DETERMINES, RESOLVES, AND ORDERS AS FOLLOWS: #27
Section 1. Sale Authorized. The sale by the Agency of
$8,500,000 TUSTIN COMMUNITY REDEVELOPMENT AGENCY, TOWN CENTER AREA
REDEVELOPMENT PROJECT, TAX ALLOCATION BONDS, SERIES 1982 (the
"Bonds"). on an all or none basis and in accordance with law, is
hereby authorized. The principal amount of the Bonds may change in
accordance with the municipal bond insurance made available in con-
nection with the Bonds, as further described under the caption
"Municipal Bond Insurance" in the Notice Inviting Bids authorized in
Section 2 of this Resolution.
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#30
#(30)
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#32,32.1
#32.2
#32.3
#32.4
#(32.4)
Section 2. Notice Inviting Bids. The invitation for bids #34
for the purchase of the Bonds is hereby authorized, such invitation #35
to be substantially in accordance with the Notice Inviting Sids #36
attached hereto, marked "Exhibit A" and by this reference #(36)
incorporated herein. Such Notice Inviting Bids and the Bid Form, #37
including the memorandum of interest cost, attached hereto and marked #38
"Exhibit B" and by this reference incorporated herein, are hereby #39
approved. #(39)
Section 3. Publication of Notice Inviting Bids. The #41
Secretary of the Agency shall cause to be published in the manner #(41)
provided by law, such Notice Inviting Bids. #42
Section 4. Terms and Conditions of Sale. The terms and #44
conditions of the offering and the sale of the Bonds shall be As #45
specified in such Notice Inviting Bids. #(45)
Section 5. Preliminary Official Statement Approved. The #47
Agency hereby approves, to be furnished to prospective bidders for #(47)
fhe Bonds, the Preliminary Official Statement, Substantially in the #48,49
form of the draft copy attached hereto as Exhibit C. The Executive #50
Director, upon the advice of the Financial Consultant or So -Bond #51
Counsel, or both, is hereby authorized and directed, prior to final #52
preparation for distribution, to make such changes as are necessary #(52)
Qr desirable to correct errors or clarify or expand upon the meaning #53
Qf parts thereof. A copy of the Preliminary Official Statement, as #54
distributed, shall be filed in the office Qf the Secretary of the #55
Agency. #(55)
Section 6. Official. Statement Furnished. The Secretary #57
and the Financial Consultant are hereby- authorized and -directed to #58
cause to be furnished to prospective bidders reasonable numbers of #59
copies of the Notice Inviting Bids, the Bid Form, and -the Preliminary #60
official Statement. #(60)
Section 7. Opening of Bids. The Financial Consultant is
hereby Authorized and directed to open the bids at the time and place
specified in such Notice Inviting Bids and to present the same to the
Agency. The Financial Consultant is hereby authorized And directed,
in addition to taking the above actions, to receive and record fhe
receipt of all bids made pursuant to such Notice Inviting Bids, to
cause ,such bids to be examined for compliance with such Notice
Inviting Bids, -to cause computations to be made as to which bidder
has bid the lowest net interest cost to the Agency and to present
such bids to the Agency as provided in such Notice Inviting Bids,
along with a report. as to the foregoing and any other matters deemed
pertinent to the award of the Bonds And the proceedings for the issu-
ance thereof.
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#63
#64
#65,66
#67
#(67)
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#69
#70
#71
#72
#73
#(73)
Section 8. General Authorization. The members of the #75
Agency, and its officers, deputy officers, employees, Consultants and #76
counsel, are hereby authorized to do all acts and things necessary Qr #77,79,8C
desirable in carrying out the financing contemplated by the #(80)
Resolution And this Resolution. #80.1
.Section 9. Effective Date. This Resolution shall take 983
effect upon its adoption. #(83)
2ASSED, APPROVED AND ADOPTED this 20th day of October, #84
1982. #(84)
ATTEST:
.Secretary
1SEAL)
Chairman
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#89
#90
#92
#93
#95
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V]
JOB NO. 97576B002 ST: 97576A JEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 00:30 SEQ NO: 1
TUSTIN COMMUNTt'Y REDEVELOPMENT AGENCY
(a public body, corporate and politic, of the State of California)
NOTICE INVITING BIDS
NOT TO EXCEED $8,500,000*
TUSTIN COMMUNITY REDEVELOPMENT AGENCY
TOWN CENTER AREA REDEVELOPMENT PROJECT
TAX ALLOCATION BONDS
SERIES 1982
NOTICE IS HEREBY GIVEN that sealed proposals for the purchase of Eight Million Five Hundred
IThousand Dollars ($8,500,000) principal amount* of tax allocation bonds of the Tustin Community
Redevelopment Agency (hereinafter referred to as the "Agency") will be received by the Agency up to the
time and at the place specified:
TIME: November 1, 1982
11:00 O'Clock A.M.
Pacific Standard Time
PLACE: Mudge Rose Guthrie & Alexander
Tower One, Suite 3166,
333 South Grand Avenue
Los Angeles, California 90071
OPENING OF BIDS: The bids `will be received at the above time and place, will be opened by the
Financial Consultant and will be presented to the Agency at its meeting to be held later that day.
ISSUE:* Eight Million Five Hundred Thousand Dollars ($8,500,000)* designated "Tustin Commu-
nity Redevelopment Agency Town Center Area Redevelopment Project, Tax Allocation Bonds, Series
1982" (the "Bonds"), consisting of 1,700 bonds, numbered 1 to 1,700, both inclusive, of the denomination of
five thousand dollars ($5,000) each, dated as of November 1, 1982; provided that the total principal amount
of Bonds (and, consequently, the number of bonds) may be established in a lesser amount as shall be
determined prior to the opening of bids as set forth under "Municipal Bond Insurance" herein.
MATURITIES:* The Bonds will mature on November 1 in each of the years, and in the amounts,
shown below:
Year of
Maturity
1983 .....................................................
1984 ......... :...........................................
1985 .....................................................
1986 ...................... :..............................
1987 .....................................................
1988 .....................................................
1989 .....................................................
1990 .....................................................
Prioeipal
Year of
Prhtdpw
Ammmt*
Nutarity
Amome
$ 85,000
1991 .....................................................
$ 190,000
95,000
1992 .....................................................
215,000
100,000
1993 .....................................................
235,000
115,000
1994 .....................................................
260,000
125,000
1995 .....................................................
290,000
140,000
1996 .....................................................
325,000
155,000
1997 .....................................................
360,000
175,000
2006 .....................................................
5,640,000
$8,500,000
MANDATORY REDEMPTION:* The Bonds maturing on November 1, 2006 shall be retired by
redemption at 100%, without premium, through operation of the Sinking Account established by the
* The aggregate principal amount, maturity amounts and mandatory redemption amounts of the Bonds are
subject to change prior to the opening of bids in accordance with the provisions of a policy of insurance on
the Bonds as further explained under the caption "Municipal Bond Insurance."
JOB NO. 97576B002 ST: 97576A JEFFRIES BANKNOTE CO. (213) 742-8800 12 -Oct -82 21:41 SEQ NO: 2
Resolution, prior to their maturity, commencing on November 1, 1998 and on November 1 each year
thereafter, by deposit into the Sinking Account of the amounts specified hereafter:
2002 ........................... :........................... 605,000
4 OPTIONAL REDEMPTION: The Bonds are also subject to redemption (at par), under the circum-
stances prescribed and as provided in a resolution of the Agency authorizing the issuance of the Bonds (the
"Resolution"), at the option of the Agency, as a whole or in part, through the application of proceeds of
insurance and eminent domain proceedings. Bonds maturing on or after November 1, 1993 are also subject
to redemption prior to their respective stated maturities, at the option of the Agency, as a whole, or in part
in inverse order of maturities, and by lot within any such maturity if less than all of the Bonds of such
maturity be redeemed, from any source of available funds, on any interest payment date on or after
November 1, 1992, at the respective redemption prices (expressed as percentages of the principal amount of
the Bonds or portions thereof to be redeemed) set forth below, in each case together with accrued interest to
the redemption date:
Redempton Dates
November 1, 1992 and May 1, 1993..........
November 1, 1993 and May 1, 1994.........
November 1, 1994 and May 1, 1995.........
November 1, 1995 and May 1, 1996.........
November 1, 1996 and May 1, 1997..........
November 1, 1997 and thereafter ..............
Redemption Price
102Yz%
102
101'/2
101
1001/2
100
S INTEREST: The Bonds will bear interest from November 1, 1982 at a rate to be fixed upon the sale
thereof, but not to exceed twelve percent (12%) per annum, payable commencing on May 1, 1983 and
semiannually thereafter on November 1st and May, 1st in each year.
PAYMENTS: The Bonds and the interest thereon and any premiums upon the redemption thereof
prior to maturity are payable in lawful money of the United States of America and (except for interest on
Fully Registered Bonds, which is payable by mailed check or draft) are payable at the principal office of the
Fiscal Agent for the Agency in Los Angeles, California, or, at the option of the holder, at the office of any
Paying Agent of the Agency in Chicago, Illinois or New York, New York.
REGISTRATION: Two forms of Bonds have been provided: (i) those which shall be initially issued
and which are in negotiable form, payable to bearer with negotiable coupons ("Bearer Bonds"), and (ii)
those which are issued to facilitate registration and so are issued as fully registered bonds payable to the
registered owner ("Fully Registered Bonds"). The Bearer Bonds are not registrable by endorsement and, to
facilitate their registration, they may be exchanged for Fully Registered Bonds as provided in the
EResolution. A Bearer Bond or Bearer Bonds may be registered by exchanging the same for a Fully
Registered Bond or Fully Registered Bonds, as the case may be. A Bearer Bond or Bearer Bonds and Fully
Registered Bond or Fully Registered Bonds may be exchanged for a Fully Registered ' Bond or Fully
* The aggregate principal amount, maturity amounts and mandatory redemption amounts of the Bonds are
subject to change prior to the opening of bids in accordance with the provisions of a policy of insurance on
the Bonds as further explained under the caption "Municipal Bond Insurance."
2
Minimum
Minimum
Year
Sinking
Year
Sinking
Ending
Account
Ending
Account
November 1
Payments*
November 1
Payments*
1998 .......................................................
$400,000
2003......................................................
$670,000
1999 .......................................................
440,000
2004 ......................................................
745,000
2000 .......................................................
490,000
2005 ......................................................
825,000
2001 .......................................................
545,000
2006 ......................................................
915,000
2002 ........................... :........................... 605,000
4 OPTIONAL REDEMPTION: The Bonds are also subject to redemption (at par), under the circum-
stances prescribed and as provided in a resolution of the Agency authorizing the issuance of the Bonds (the
"Resolution"), at the option of the Agency, as a whole or in part, through the application of proceeds of
insurance and eminent domain proceedings. Bonds maturing on or after November 1, 1993 are also subject
to redemption prior to their respective stated maturities, at the option of the Agency, as a whole, or in part
in inverse order of maturities, and by lot within any such maturity if less than all of the Bonds of such
maturity be redeemed, from any source of available funds, on any interest payment date on or after
November 1, 1992, at the respective redemption prices (expressed as percentages of the principal amount of
the Bonds or portions thereof to be redeemed) set forth below, in each case together with accrued interest to
the redemption date:
Redempton Dates
November 1, 1992 and May 1, 1993..........
November 1, 1993 and May 1, 1994.........
November 1, 1994 and May 1, 1995.........
November 1, 1995 and May 1, 1996.........
November 1, 1996 and May 1, 1997..........
November 1, 1997 and thereafter ..............
Redemption Price
102Yz%
102
101'/2
101
1001/2
100
S INTEREST: The Bonds will bear interest from November 1, 1982 at a rate to be fixed upon the sale
thereof, but not to exceed twelve percent (12%) per annum, payable commencing on May 1, 1983 and
semiannually thereafter on November 1st and May, 1st in each year.
PAYMENTS: The Bonds and the interest thereon and any premiums upon the redemption thereof
prior to maturity are payable in lawful money of the United States of America and (except for interest on
Fully Registered Bonds, which is payable by mailed check or draft) are payable at the principal office of the
Fiscal Agent for the Agency in Los Angeles, California, or, at the option of the holder, at the office of any
Paying Agent of the Agency in Chicago, Illinois or New York, New York.
REGISTRATION: Two forms of Bonds have been provided: (i) those which shall be initially issued
and which are in negotiable form, payable to bearer with negotiable coupons ("Bearer Bonds"), and (ii)
those which are issued to facilitate registration and so are issued as fully registered bonds payable to the
registered owner ("Fully Registered Bonds"). The Bearer Bonds are not registrable by endorsement and, to
facilitate their registration, they may be exchanged for Fully Registered Bonds as provided in the
EResolution. A Bearer Bond or Bearer Bonds may be registered by exchanging the same for a Fully
Registered Bond or Fully Registered Bonds, as the case may be. A Bearer Bond or Bearer Bonds and Fully
Registered Bond or Fully Registered Bonds may be exchanged for a Fully Registered ' Bond or Fully
* The aggregate principal amount, maturity amounts and mandatory redemption amounts of the Bonds are
subject to change prior to the opening of bids in accordance with the provisions of a policy of insurance on
the Bonds as further explained under the caption "Municipal Bond Insurance."
2
6
JOB NO. 97576B002 ST: 97576A JEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 00:30 SEQ NO: 3
Registered Bonds. A Fully Registered Bond may be exchanged in whole for a Bearer Bond or Bearer Bonds
or in part for such Bearer Bond or Bearer Bonds and the balance for a Fully Registered Bond or Fully
Registered Bonds. Transfer of ownership of a Fully Registered Bond or Fully Registered Bonds shall be
made by exchanging the same for a new Fully Registered Bond or Fully Registered Bonds. All of such
exchanges shall be made in such manner and upon such reasonable terms and conditions as may from time
to time be determined and prescribed by the Agency; provided, however, no such exchange shall be made
between the fifteenth (15th) day preceding any interest payment date and such interest payment date. Such
exchanges shall be free of any costs or charges to the person, firm, or corporation requesting such exchange,
except for any tax or governmental charge that may be imposed in connection therewith. Each Bearer Bond
issued pursuant to the Resolution shall be of the denomination of five thousand dollars ($5,000). Each Fully
Registered Bond issued pursuant to the Resolution shall be of a denomination which is five thousand dollars
($5,000) or any whole multiple thereof.
PURPOSE OF ISSUE: The Bonds are to be issued by the Agency under and pursuant to the
Community Redevelopment Law of the State of California (Part 1 of Division 24 of the Health and Safety
Code) in order to aid in the financing of a redevelopment project in the City of Tustin, California, known as
the Town Center Area Redevelopment Project, pursuant to the Resolution.
SECURITY: The Bonds are payable, as to both principal and interest, from Tax Revenues (as defined
in the Resolution) and interest earnings. The Bonds are not obligations of the City of Tustin, the State of
California or any of its political subdivisions and do not constitute an indebtedness within the meaning of
any constitutional or statutory debt limitation or restriction.
TERMS OF SALE
INTEREST RATE: The interest rate bid may not exceed twelve percent (12%) per annum. The Bonds
will bear interest from November 1, 1982, payable commencing May 1, 1983, and semiannually thereafter
on November 1st and May 1st in each year. Bidders may specify any number of separate interest rates, and
any rate may be repeated as often as desired; provided, however, that (i) the difference between the highest
and lowest coupon rates specified in any bid shall not exceed two percent (2%); (ii) each interest rate
specified must be in a multiple of'�o of 1% and a zero rate of interest cannot be specified; (iii) no Bond shall
bear more than one rate of interest, no interest payment shall be evidenced by more than one coupon and
supplemental coupons are not permitted; (iv) each bond shall bear interest from its date to its stated
maturity date at the interest rate specified in the bid; (v) all bonds of the same maturity date shall bear the
same interest; and (vi) any premium must be paid in bank funds as part of the purchase price, and no bid
will be accepted which provides for the cancellation and surrender of any interest coupon or for the waiver of
interest or other concession by the bidder as a substitute for payment in full of the purchase price in bank
funds. Bids which do not conform to the terms of this paragraph will be rejected.
PURCHASE PRICE: The Bonds shall be sold for cash only. All bids must be for not less than all of
the Bonds and each bid shall state the purchase price (not less than ninety-seven percent (97%) of the
principal amount of the Bonds, plus accrued interest to the date of delivery) at which the bidder offers to
buy the Bonds. Each bidder shall state in his bid the total net interest cost in dollars and the average net
interest rate determined thereby, which shall be considered informative only and not a part of the bid.
HIGHEST BID: The Bonds will be awarded to the highest responsible bidder for Bonds maturing in
accordance with the Maturity Schedule, assuming that the Bonds maturing on November 1, 2006 are
retired in accordance with the provisions for the mandatory redemption thereof as explained herein under
"Mandatory Redemption". As noted, the Maturity Schedule will be as set forth herein under "Maturities",
subject to change as further explained herein under "Municipal Bond Insurance". With respect to all bids
submitted for Bonds maturing in accordance with the Maturity Schedule, the highest bid will be determined
by deducting the amount of the premium bid (if any) from, and adding the amount of the discount bid (if
any) to, the total amount of interest which would be required to be paid on all Bonds from November 1,
1982 to their respective maturity dates (except that for purposes of such determination with respect to
Bonds maturing November 1, 2006 an assumption shall be made that during the years 1998 through 2006
3
JOB NO. 97576B002 ST: 97576A JEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 00:30 SEQ NO: 4
an amount of such Bonds shall be retired in accordance with the schedule for minimum sinking account
payments as set forth herein under "Mandatory Redemption") at the applicable interest rate or rates
specified in the bid, and the award will be made on the basis of the lowest net interest cost. The purchaser
must pay accrued interest, computed on a 360 -day year basis, from the date of the Bonds to the date of
delivery. The cost of printing the Bonds will be borne by the Agency.
RIGHT OF REJECTION: The Agency reserves the right, in its discretion, to reject any and all bids
and, to the extent not prohibited by law, to waive any irregularity or informality in any bid.
PROMPT AWARD: The Agency will take action awarding the Bonds or rejecting all bids not later
than twenty-six (26) hours after the time herein prescribed for the receipt of bids; provided that the award
may be made after the expiration of the specified time if the bidder shall not have given to the Agency notice
in writing of the withdrawal of such bid.
CUSIP: CUSIP identification numbers may be imprinted on the Bonds, but such numbers shall not
constitute a part of the contract evidenced by the Bonds and no liability shall hereafter be attached to the
Agency or any of the officers or agents thereof because of or on account of said numbers. Any error or
omission with respect to said numbers shall not constitute cause for refusal by the successor bidder to accept
delivery of and pay for the Bonds.
DELIVERY AND PAYMENT: Delivery of the Bonds will be made to the successful bidder at Jeffries
Banknote Company, 1330 West Pico Boulevard, Los Angeles, California, or at such other place as may be
agreed upon by the successful bidder and the officer of the Agency making delivery. Payment for the Bonds
must be made in funds immediately available to the Agency in Los Angeles, California.
PROMPT DELIVERY; CANCELLATION FOR LATE DELIVERY: The Bonds will be delivered
to the successful bidder on or about November 16, 1982, and such prompt delivery time is of the essence of
the contract to be made hereunder for the sale of the Bonds. The Agency, at its sole option, shall have the
right to delay the delivery of the Bonds beyond said date; provided, however, that the successful bidder shall
have the right, at his option, to cancel the contract of purchase if the Agency shall fail to execute the Bonds
and tender them for delivery within sixty (60) days from the date herein fixed for the receipt of bids, and in
such event the successful bidder shall be entitled to the return of the proceeds of the check accompanying its
bid.
7 FORM OF BID: Each bid, together with the bid check, must be in a sealed envelope, addressed to the
Agency, with* the envelope and bid clearly marked "Bid for Tax Allocation Bonds Series 1982 of the Tustin
Community Redevelopment Agency." Each bid must be unconditional and in accordance with the terms
and conditions set forth herein, or permitted herein, and must be submitted on, or in substantial accordance
with, bid forms provided by the Agency.
BID CHECK: A certified or cashier's check on a responsible bank or trust company in the amount of
Eighty-five Thousand Dollars ($85,000), payable to the order of the Agency, must accompany each bid as a
guaranty that the bidder, if successful, will accept and pay for the Bonds in accordance with the terms of his
bid. The check accompanying any accepted bid shall be cashed and the proceeds thereof applied to the
purchase price. If such bid is accepted but not performed, unless such failure of performance shall be caused
by any act or omission of the Agency, the proceeds of the check accompanying any accepted bid shall be
retained by the Agency. The check accompanying each unaccepted bid will be returned promptly.
CHANGE IN TAX EXEMPT STATUS: At any time before the Bonds are tendered for delivery, the
successful bidder may disaffirm and withdraw the bid if the interest received by private holders from bonds
of the same type and character shall be declared to be taxable income under present federal income tax laws,
either by a ruling of the Internal Revenue Service or by a decision of any federal court, or shall be declared
taxable by the terms of any federal income tax law enacted subsequent to the date of this notice.
LEGAL OPINION: The opinion of Mudge Rose Guthrie & Alexander, Los Angeles, California and
Rourke & Woodruff, Santa Ana, California, Co -Bond Counsel, approving the validity of the Bonds and
stating that interest on the Bonds is exempt from Federal income taxes and from State of California
personal income taxes under existing statutes, regulations and court decisions, will be furnished the
n
u
JOB NO. 97576B002 ST: 97576A JEFFRIES BANKNOTE CO. (213) 742-8800 12 -Oct -82 21:41 SEQ NO: 5
successful bidder at or prior to the time of delivery of the Bonds at the expense of the Agency. A copy of
such opinion, certified by an officer of the Agency by his facsimile signature, will be printed on the back of
each definitive Bond. No charge will be made to the purchaser for such printing or certification.
MUNICIPAL BOND INSURANCE: The Agency has applied for a policy of insurance on the Bonds
from the Municipal Bond Insurance Association ("MBIA"). If the Agency receives a commitment from
MBIA to issue such a policy, said policy of insurance would guarantee the payment, when due, of the
principal of and interest on the Bonds. The policy does not insure against nonpayment caused by the
insolvency or negligence of any paying agent or the fiscal agent of MBIA, or nonpayment of redemption
premiums, and does not provide for any accelerated payments in the event that bonds insured thereunder are
declared due and payable prior to maturity. Such a policy would be non -cancellable and the premium would
be fully paid at the time of the delivery of the Bonds.
The Agency anticipates that MBIA will make its decision whether or not to provide such insurance by
the bid date of November 1, 1982. Should MBIA commit to insure an amount less than $8,500,000, the
aggregate principal amount of the Bonds will be reduced to equal the amount of insurance coverage so
provided and the maturity schedule will be adjusted in accordance with the terms of the commitment.
Should MBIA not issue a commitment by the bid date of November 1, 1982, the bid date will be postponed.
Information with respect to whether there is a change in the principal amount of Bonds to be issued in light
of the MBIA decision will be available over the "Munifacts" wire by or before October 29, 1982.
OFFICIAL STATEMENT: Upon the determination of the successful bidder, the Agency will prepare
its final Official Statement (the "Official Statement") with respect to the Bonds. The Agency will furnish to
the successful bidder, at no charge, such number of copies of the Official Statement (and any amendment or
supplement thereto) as the successful bidder may reasonably request (but not to exceed 200) for use in
connection with any resale of the Bonds.
8 BLUE SKY LAWS: The successful bidder will be responsible for the clearance or exemption with
respect to the status of the Bonds for sale under the securities or "Blue Sky" laws of the several states and
the preparation of any surveys or memoranda in connection therewith.
CLOSING DOCUMENTS: In addition to the opinion of Co -Bond Counsel referred to above, at the
time of payment for and delivery of the Bonds, the Agency will furnish the successful bidder the following
documents all to be dated as of the date of delivery:
1. No Litigation Certificate — A certificate of the Agency Attorney certifying that there is no
direct litigation pending affecting the validity of the Bonds.
2. Signature Certificate — A certificate of the appropriate officers of the Agency indicating that
they have signed the Bonds by manual or facsimile signature and that they were duly authorized to
execute the same.
3. Fiscal Agent's and Treasurer's Receipts — The receipts of the Fiscal Agent and the Treasurer
of the Agency showing that the purchase price of the Bonds, including accrued interest to the date of
delivery, has been received by the Agency and the Fiscal Agent, respectively, and the distribution of the
funds to be made.
4. Certificate Concerning Official Statement — A certificate of an appropriate officer of the
Agency to the effect that to the best of such officer's knowledge and belief, and after reasonable
investigation, (a) neither the Official Statement nor any amendment or supplement thereto contains
any untrue statement of a material fact or omits to state any material fact necessary to make the
statements therein, in light of the circumstances in which they were made, not misleading; (b) since the
date of the Official Statement, no event has occurred which should have been set forth in an
amendment or supplement to the Official Statement which has not been set forth in such an amendment
or supplement; and (c) there has not been any material adverse change in the operations or financial
affairs of the Agency since the date of the Official Statement.
Is
JOB NO. 97576B002 ST: 97576A JEFFRIES BANKNOTE CO. (213) 742-8800 12 -Oct -82 21:41 SEQ NO: 6
I5. Opiniun of the General Counsel to Agency — An opinion of the General Counsel to the Agency
that the activation and certain subsequent procedures of the Agency (exclusive of the issuance and sale
of the Bonds) have been taken in accordance with all applicable laws.
6. Arbitrage Certificate — A certificate of a responsible officer of the Agency certifying that, on
the basis of the facts, estimates and circumstances in effect at the time of delivery of the Bonds, it is not
expected that the proceeds of the Bonds will be used in a manner that will cause the Bonds to be
arbitrage bonds.
INFORMATION AVAILABLE: Requests for copies of the Resolution and. the Official Statement, or
for other information concerning the Agency, should be addressed to the Financial Consultant to the
Agency: Miller & Schroeder Municipals, Inc., 505 Lomas Santa Fe Drive, Suite 200, Solana Beach, CA
92075. Attention: Michael Whipple or Pamela Wiget. Telephone (714) 481-5894..
GIVEN by order of the Agency adopted on October 20, 1982.
/s/ Mary E. Wynn
Secretary of the Tustin Community Redevelopment
Agency
6
JOB NO. 97576B002 ST: 97576A JEFFRIES BANKNOTE CO. (213) 742-8800 12 -Oct -82 21:41 SEQ NO: 7 1
9 BID FOR THE PURCHASE OF
TUSTIN COMMUNITY REDEVELOPMENT AGENCY
TOWN CENTER AREA REDEVELOPMENT PROJECT
TAX ALLOCATION BONDS
SERIES 1982
NOT TO EXCEED $8,500,000
Tustin Community Redevelopment Agency
City of Tustin, California
On behalf of a group which we have formed, consisting of
and pursuant to the Notice Inviting Bids hereinafter mentioned, we offer to purchase the Bonds designated
as "Tustin Community Redevelopment Agency Town Center Area Redevelopment Project, Tax Allocation
Bonds, Series 1982' in total principal amount pursuant to the Maturity Schedule as follows:
Maturity Schedule
Not to Exceed $8,5009000 Aggregate Principal Amount
Maturity Date
Pdadpal Interest
Norember t
Anown Rate
1983...........................................................
$ 85,000
1984...........................................................
95,000
1985; ..........................................................
100,000
1986...........................................................
115,000
1987...........................................................
125,000
1988...........................................................
140,000
1989...........................................................
155,000
1990...........................................................
175,000
1991...........................................................
190,000
1992...........................................................
215,000
1993...........................................................
235,000
1994...........................................................
260,000
1995...........................................................
290,000
1996...........................................................
320,000
1997...........................................................
360,000
2006...........................................................
5,640,000
and to pay therefor the aggregate sum of $
interest
..........................."
of delivery thereof.
plus accrued on the Bonds to the date
10 This bid is made subject to all the terms and conditions of the Notice Inviting Bids heretofore
published, all of which terms and conditions are made a
part hereof as fully as though set forth in full in this
bid.
• Principal amount of the Bonds plus premium or less discount, if any (discount not to exceed five percent
(5%)).
Vi
JOB NO. 9757613002 ST: 97576A JEFFRIES BANKNOTE CO. (213) 742-8800 12 -Oct -82 21:41 SEQ NO: 8
As specified in the Notice Inviting Bids, this bid is subject to acceptance not later than twenty-six (26)
hours after the expiration of the time for the receipt of bids, and the opinion of Co -Bond Counsel firms
Mudge Rose Guthrie & Alexander, Los Angeles, California, and Rourke & Woodruff, Santa Ana,
California, approving the validity of the Bonds, will be furnished us (if we are the successful bidder) at the
time of delivery of the Bonds at the expense of the Agency.
There is enclosed herewith a ..................** check in the amount of Eighty-five Thousand Dollars
($85,000), payable to the order of the Agency.
There is submitted herewith a memorandum (which shall not constitute a part of this bid) stating the
total net interest cost in dollars on the Bonds (deducting the amount of any premium or adding the amount
of any discount) during the life of the issue (deducting the amount of any premium or adding the amount of
any discount), and the average net interest rate determined thereby.
Respectfully submitted,
Name
(Account Manager)
By:
Address
City
State
MEMORANDUM OF INTEREST COST
The total net interest cost on the Bonds during the life of the issue to November 1, 2006 (deducting the
amount of any premium or adding the amount of any discount), under the above bid is $ .................................
..., and the average net interest rate determined thereby is ..................%.
** Insert "certified" or "cashier's".
8
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3
JOB NO. 97576X002 ST: 97576X JEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 07:54 SEQ NO: 2
071119 n355nn
TUSTIN COMMUNITY REDEVELOPMENT AGENCY
TUSTIN, CALIFORNIA
MEMBERS OF THE AGENCY
Richard B. Edgar, Chairman
Ursula E. Kennedy, Vice Chairman
Ronald B. Hoesterey
Donald J. Saltarelli
Frank H. Greinke
William A. Huston, Executive Director
Ronald A. Nault, Teasurer
Mary E. Wynn, Secretary
Michael Brotemarkle, Community Development Director
R. Kenneth Fleagle, Consultant
James G. Rourke, General Counsel
MAYOR AND CITY COUNCIL
Richard B. Edgan, Mayor
Ursula E. Kennedy, Mayor Pro Tem
Ronald B. Hoesterey
Donald J. Saltarelli
Frank H. Greinke
William A. Huston, City Manager
Ronald A. Nault, Director of Finance
James G. Rourke, City Attorney
SPECIAL SERVICES
Co -Bond Counsel
Mudge Rose Guthrie & Alexander
Los Angeles, California
and
Rourke & Woodruff, A Professional Corporation
Santa Ana, California
Financial Consultant
Miller & Schroeder Municipals, Inc.
Solana Beach, California
Fiscal Consultant
Katz, Hollis, Coren & Associates, Inc.
Los Angeles, California
Fiscal Agent
Security Pacific National Bank
Los Angeles, California
N
JOB NO. 97576X002 ST: 97576X JEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 15:03 SEQ NO: 3
TABLE OF CONTENTS
In connection with this offering, the underwriters may overallocate or effect transactions which stabilize
or maintain the market price of the Bonds at a level above that which might otherwise prevail in the open
market. Such stabilizing, if commenced, may be discontinued at any time.
No dealer, broker, salesman or other person has been authorized to give any information or to make any
representations, other than those contained in this Official Statement, and, if given or made, such other
information or representations must not be relied upon as having been authorized by the Agency. The
information and expressions of opinion stated herein are subject to change without notice. The delivery of this
Official Statement shall not, under any circumstances, create any implication that there has been no change in
the affairs of the Agency, the City or the Town Center Area Redevelopment Project since the date hereof.
122427 001232
Page
IntroductoryStatement.........................................................................................................................
1
TheBonds..............................................................................................................................................
2
Authorityfor Issuance.......................................................................................................................
2
Descriptionof the Bonds...................................................................................................................
2
Registration........................................................................................................................................
2
Redemption.......................................................:.................................................................................
2
Securityfor the Bonds..........................................................................................................................
3
Sourcesand Uses of Funds...................................................................................................................
4
TheAgency............................................................................................................................................
4
General................................................................................................................................................
4
Members, Officers and Staff.............................................................................................................
5
AgencyPowers...................................................................................................................................
5
The Town Center Area Redevelopment Project.................................................................................
6
GeneralHistory..................................................................................................................................
6
Redevelopment Goals and Objectives...............................................................................................
6
Recent and Proposed Development..................................................................................................
6
Proposed Development and Use of Bond Proceeds.........................................................................
7
TaxRevenues.........................................................................................................................................
8
HistoricTax Revenues......................................................................................................................
8
ProjectedTax Revenue......................................................................................................................
8
Coverage.............................................................................................................................................
9
MajorProperty Owners.....................................................................................................................
9
AnnualDebt Service..........................................................................................................................
10
RiskFactors...........................................................................................................................................
11
Reduction of Tax Revenues..............................................................................................................
11
Constitutional Amendment XIII A/Property Tax Rate................................................................
11
Business Inventory Subvention..........................................................................................................
11
Constitutional Amendment XIII B/Government Spending Limitation .........................................
12
SerranoDecision................................................................................................................................
13
Summaryof the Resolution..................................................................................................................
13
Funds — Allocation of Bond Proceeds............................................................................................
13
Flowof Funds....................................................................................................................................
14
Deposit and Investment of Moneys in Funds..................................................................................
16
Issuance of Additional Bonds and Agency Indebtedness...............................................................
16
Other Covenants of the Agency.......................................................................................................
17
Events of Default and Remedies......................................................................................................
19
ConcludingInformation.........................................................................................................................
20
FinancialConsultant..........................................................................................................................
20
LegalOpinion.....................................................................................................................................
20
TaxExempt Status............................................................................................................................
21
Legality for Investment in California..............................................................................................
21
Municipal Bond Insurance................................................................................................................
21
BondRating................................................................................................................:......................
22
Audited Financial Statements...........................................................................................................
22
FiscalConsultant................................................................................................................................
22
Miscellaneous......................................................................................................................................
22
Supplemental Information on the City of Tustin...............................................................................
23
Katz, Hollis, Coren & Associates, Inc. Report to the Agency ................................................. Appendix
A
Auditor's Report and Financial Statements of the Agency ....................................................... Appendix B
In connection with this offering, the underwriters may overallocate or effect transactions which stabilize
or maintain the market price of the Bonds at a level above that which might otherwise prevail in the open
market. Such stabilizing, if commenced, may be discontinued at any time.
No dealer, broker, salesman or other person has been authorized to give any information or to make any
representations, other than those contained in this Official Statement, and, if given or made, such other
information or representations must not be relied upon as having been authorized by the Agency. The
information and expressions of opinion stated herein are subject to change without notice. The delivery of this
Official Statement shall not, under any circumstances, create any implication that there has been no change in
the affairs of the Agency, the City or the Town Center Area Redevelopment Project since the date hereof.
122427 001232
JOB NO. 97576X005 ST: 97576X #EFFRIES BANKNOTE CO. (213) 742-6800 13 -Oct -82 12:46 SEQ NO: 1
5 $895009000
TUSTIN COMMUNITY REDEVELOPMENT AGENCY
TOWN CENTER AREA REDEVELOPMENT PROJECT
TAX ALLOCATION BONDS,
SERIES 1982
INTRODUCTORY STATEMENT
This Official Statement, including the cover page and appendices hereto, is provided to furnish
information in connection with the sale by the Tustin Community Redevelopment Agency (the "Agency"),
of $8,500,000 principal amount Town Center Area Redevelopment Project, Tax Allocation Bonds, Series
1982 (the "Bonds"). The Bonds are being issued pursuant to the Constitution and the laws of the State of
California (the "State"), including the Community Redevelopment Law (Part 1, Division 24, commencing
with Section 33000 of the Health and Safety Code of the State of California) (the "Law") and Resolution
No.......... adopted by the Agency on October 20, 1982 (the "Resolution").
The City of Tustin (the "City") is located in Orange County (the "County"). Incorporated on
September 21, 1927, the City encompasses an area of approximately 11.2 square miles. The Agency was
established pursuant to the Law and the appropriate ordinance of the City Council of the City, enacted on
October 4, 1976. The Agency is charged with the authority and responsibility of redeveloping and upgrading
blighted areas of the City. The five members of the City Council serve as the governing body of the Agency,
and exercise all rights, powers and privileges of the Agency. The Redevelopment Plan for the Town Center
Area Redevelopment Project (the "Project Area") was approved by Ordinance No. 701 enacted by the City
Council on November 22, 1976, as amended by Ordinance No. 855, enacted by the City Council on
September 8, 1981, (the "Redevelopment Plan".)
The Law authorizes the financing of redevelopment projects by the Agency through the use of tax
allocation revenues. This method provides that the taxable valuation of the property within a defined
redevelopment project area on the assessment role that was last equalized prior to the effective date of the
enabling ordinance which adopts the redevelopment plan becomes the "base" valuation. Any increase in
taxable valuation in subsequent years over that established as the base year becomes the incremental taxable
valuation upon which taxes are levied by or on behalf of other taxing entities and the resulting tax revenues
are allocated to the Agency. All taxes, subject to the limitation contained in the Redevelopment Plan for the
Project Area, thereafter collected by the County upon the increase in taxable valuation above the base
valuation in the Project Area (the "Tax Revenues") are available to the Agency for the payment of debt and
such moneys may be pledged to the payment of debt service on obligations issued to finance the Agency's
redevelopment activities in the Project Area. The Redevelopment Plan for the Project Area limits the
amount of Tax Revenues which may be allocated to the Agency for the Project Area to $3,000,000 per year
and limits the amount of outstanding indebtedness payable from Tax Revenues to $20,000,000; however,
such annual limitations may be increased by amendment of the Redevelopment Plan for the Project Area.
The projections of future Tax Revenues contained in this Official Statement are based on current and
projected taxable valuations within the Project Area and on the current and projected tax rates applicable to
the taxable property in the Project Area. (See Appendix A, Katz Hollis Coren and Associates, Inc. Report
to the Agency.) Any decrease in the taxable valuation or in the applicable tax rates may reduce the Tax
Revenues allocated to the Agency and correspondingly would have an adverse impact on the ability of the
Agency to pay debt service on the Bonds.
The Agency intends to utilize of Bond proceeds for property acquisition, utilities undergrounding,
parking, water system improvements and construction of a Community Center in the Town Center Area
Redevelopment Project. In addition, the Agency will use $1,125,000 to repay its debt to the City.
(See the section herein entitled "TOWN CENTER AREA REDEVELOPMENT PROJECT — Proposed
Development and Use of Bond Proceeds".)
027574 057756
JOB NO. 97576X005 ST: 97576X JEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 15:01 SEQ NO: 2
Brief descriptions of the Bonds, the Resolution, the Agency, and the City are included in this Official
Statement, as well as the financial statements of the Agency for the fiscal year ended June 30, 1982. Such
descriptions and information do not purport to be comprehensive or definitive. All references herein to the
Resolution, the Law, the Constitution and the laws of the State and the proceedings of the Agency and the
City are qualified in their entirety by reference to such documents. References herein to the Bonds are
qualified in their entirety by reference to the form thereof included in the Resolution and the information
with respect thereto included herein, copies of which are all available for inspection at the offices of the
Agency. During the period of the offering of the Bonds, copies of the forms of all documents are available at
the office of the Financial Consultant, Miller & Schroeder Municipals, Inc., 505 Lomas Santa Fe Drive,
Suite 200, Solana Beach, California.
6 THE BONDS
Authority for Issuance
The Bonds, in the principal amount of $8,500,000 were authorized for issuance pursuant to the
Resolution adopted by the Agency on October 20, 1982. The Bonds are being issued in accordance with the
Law and other applicable laws and the Constitution of the State.
Description of the Bonds
The Bonds shall be issued in the principal amount of $8,500,000 in the form of Bearer Bonds in the
denomination of $5,000 each, or as Fully Registered Bonds, in the denomination of $5,000 or any whole
multiple thereof. The Bonds are dated November 1, 1982 and mature on November 1 in the years and
amounts shown on the cover page of this Official Statement.
Registration
Two forms of Bonds have been provided as contained in the Resolution: (1) those which shall be
initially issued and which are in negotiable form, payable to bearer with negotiable coupons ("Bearer
Bonds"); and (2) those which are issued to facilitate registration and so are issued as non-negotiable Fully
Registered Bonds payable to the registered owner ("Fully Registered Bonds"). The Bearer Bonds are not
registrable by endorsement, but may be exchanged for Fully Registered Bonds as provided in the Resolu-
tion. A Bearer Bond or Bearer Bonds may be registered by exchanging the same for a Fully Registered Bond
or Fully Registered Bonds, as the case may be. A Bearer Bond or Bearer Bonds and a Fully Registered Bond
or Fully Registered Bonds may be exchanged for a Fully Registered Bond or Fully Registered Bonds. A
Fully Registered Bond may be exchanged in whole for Bearer Bonds or in part for such Bearer Bonds and
the balance for Fully Registered Bonds. Transfer of ownership of a Fully Registered Bond or Fully
Registered Bonds shall be made by exchanging the same for a new Fully Registered Bond or Fully
Registered Bonds. All of such exchanges shall be made in such manner and upon such reasonable terms and
conditions as may from time to time be determined and prescribed by the Agency; provided, however, no
such exchange shall be made between the fifteenth (15th) day preceding any interest payment date and such
interest payment date. Such exchanges shall be free of any costs or charges to the person, firm or
corporation requesting such exchange, except for any tax or governmental charge that may be imposed in
connection with such exchange. Each Bearer Bond issued pursuant to the Resolution shall be of the
denomination of $5,000. Each Fully Registered Bond issued pursuant to the Resolution shall be of a
denomination which is 55,000 or a whole multiple thereof and shall be of the same issue.
7 Redemption
Optional Redemption. Bonds maturing on or after November 1, 1993 are also subject to redemption
prior to their respective stated maturities, at the option of the Agency, as a whole, or in part in inverse order
of maturities, and by lot within any such maturity if less than all of the Bonds of such maturity be redeemed,
from any source of available funds, on any interest payment date on or after November 1, 1992, at the
2
, LO., ^I- IICl/,
107441 17J/Vl
JOB NO. 97576X005 ST: 97576X JEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 15:01 SEQ NO: 3
respective redemption prices (expressed as percentages of the principal amount of the Bonds or portions
thereof to be redeemed) set forth below, in each case together with accrued interest to the redemption date:
Redemption Dates
Amount
November 1, 1992 and May 1, 1993
Redemption Price
.............. I...................................................
November 1, 1993 and May 1, 1994
102/2%o
..................................................................
November 1, 1994 and May 1, 1995
102
..................................................................
November 1, 1995 and May 1, 1996..................................................................
101'h
November 1, 1996 and May 1, 1997..................................................................
101
November 1, 1997 and thereafter
1001/2
................................................................
100
Sinking Account Redemption. The Resolution creates a Sinking Account to be used for the payment
and redemption of the Bonds maturing on November 1, 2006 (the "Term Bonds"). The Agency is required
to deposit annually therein the amounts, if available, required to make annual Sinking Account payments on
the Term Bonds to be applied each year to the redemption of the Term Bonds. Failure by the Agency to
deposit such amounts in full each year is not an event of default under the Resolution, provided that the
Agency shall make up any such deficiency from the first amounts available in succeeding years.
Bonds maturing November 1, 2006, shall be subject to mandatory redemption at a redemption price
equal to the principal amount thereof to be redeemed together with accrued interest thereon to the
redemption date, without premium, from minimum sinking account payments made by the Agency under
the Resolution on November I in the years and amounts as follows:
Year
Amount
1998 ....................................
$400,000
1999 ....................................
440,000
2000 ....................................
490,000
2001 ....................................
545,000
2002 ....................................
605,000
Year
Amount
2003
....................................
$670,000
2004
....................................
745,000
2005
....................................
825,000
2006
(Maturity) ................
915,000
Notice of Redemption. As provided in the Resolution, notice of redemption shall be given by publica-
tion at least once a week for two successive weeks in a financial paper or newspaper of general circulation in
Los Angeles, California, and in a financial paper or newspaper circulated in New York, New York, and
printed in the English language, the first such publication to be not less than thirty nor more than sixty days
before the redemption date. Notice of redemption shall also be mailed no less than thirty nor more than
sixty days prior to the redemption date to the respective registered owners of any registered Bonds
designated for redemption at their addresses appearing on the bond registration books, but neither failure to
mail such notice nor any defect in the notice so mailed shall affect the sufficiency of the proceedings for
redemption.
8 SECURITY FOR THE BONDS
The Bonds are secured by and payable from a lien upon and pledge of the Tax Revenues allocated to
the Agency from property within the Project Area, all of the moneys in the Reserve Account initially
deposited from Bond proceeds and interest earnings on funds held on deposit in trust for the Bondholders by
the Fiscal Agent. Tax Revenues in the Special Fund, arising as above, are pledged in their entirety to the
payment of the Bonds or to the Reserve Account by transfer for that purpose, so long as any Bonds remain
outstanding or unprovided for. Tax Revenues are defined to mean those taxes received by the Agency
produced by that year's tax rates applied to increases in taxable valuation in excess of the taxable valuation
of such property within the Project Area last equalized prior to the effective date of the ordinance approving
the Redevelopment Plan (the "base year" assessment roll), including all payments and reimbursements, if
any, to the Agency specifically attributable to ad valorem taxes lost by reason of tax exemptions and tax rate
limitations. The Redevelopment Plan provides that the amount of Tax Revenues which may be allocated to
the Agency from the Project Area is 53,000,000 per year; however, such limitation may be increased by
amendment of the Redevelopment Plan.
3
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The Agency has no power to levy and collect taxes, and any legislative property tax de -emphasis or
provision of additional sources of income to taxing agencies having the effect of reducing the property tax
rate must necessarily reduce the amount of Tax Revenues that would otherwise be available to pay the
principal of and interest on the Bonds. Likewise, broadened property tax exemptions could have a similar
effect. Conversely, any increase in the tax rate or taxable valuation, or any reduction or elimination of
present exemptions, would necessarily increase the amount of Tax Revenues that would be available to pay
principal of and interest on the Bonds.
Detailed information regarding Tax Revenues and projection of debt service coverage is in the section
entitled "TAX REVENUES," as well as "APPENDIX A," the Katz, Hollis, Coren 8t Associates, Inc.
Report to the Agency.
The Bonds are not a debt of the City of Tustin, the State of California, or any of its political
subdivisions, and neither said City, said State, nor any of its political subd
limitation or restriction. ivisions is liable therefor. The
Bonds do not constitute an indebtedness within the meaning of any constitutional or statutory debt
Particular attention is directed to the section entitled "RISK FACTORS" herein which describes
certain matters which may have an adverse effect on the payment of and security for the Bonds.
SOURCES AND USES OF FUNDS -
The anticipated sources and uses of the Funds, excluding accrued interest, are as follows:
So.
Principal Amount of Bonds.................................................................
Less Bond Discount ...................
$8,500,000
Net Bond Proceeds...............................................................................
Z_ _
55_000(2)
$8,245,000
Uses
Redevelopment Fund ..........................................
Reserve Account ................
Costs of Issuance..........................................................
1,020,650
Bond Insurance Premium................................
Total ................
.....................................
...........................................................................
$8,245,000
(1) Accrued interest and premium, if any, will be deposited into the Interest Account.
(2) Assumes discount of 3%.
" Preliminary estimates, subject to change.
General
THE AGENCY
The Tustin Community Redevelopment Agency was activated on October 6, 1976 by City Ordinance No.
696 pursuant to the California Community Redevelopment Law (Section 33000 et. seg. Health and Safety
Code). The City Council serves as the governing board for the Agency and the City Manager serves as the
Executive Director of the Agency. The Agency is a separate public body which is charged with the authority
and responsibility of redeveloping and upgrading blighted areas of the City. City staff provides technical
services connected with redevelopment projects, including fiscal planning, engineering, planning and other
functions necessary for implementation of the Redevelopment Plan.
4
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Members, Officers and Stair
Name & Office
Occupation
Expiration of Term
Richard B. Edgar, Chairman
Ursula E. Kennedy, Vice Chairman Businessman April 1984
Ronald B. Hoesterey Personnel Consultant April 1986
Donald I Saltarelli Businessman April 1984
Frank Greinke Realtor April 1984
Businessman
1986
Mr. Richard B. Edgar, Mayor, was elected to the City Council in 1974 and served as Mayor in 1976-
77. He was appointed to the Tustin Parks and Recreation Commission in 1968 and to the Planning
Commission in 1973. He served as first chairman of the Tustin Redevelopment Agency in 1976 and is
currently serving in that position. Mr. Edgar is the manager of the Electronic Standard Stock program at
TRW Defense Space Systems.
Mrs. Ursula Kennedy is Vice Chairman of the Agency and Mayor Pro Tem. She was the first woman
elected to the City Council, in March 1978. She was reelected in April 1982. Mrs. Kennedy is a Personnel
Consultant for Abigail Abbott Personnel Services and she has a freelance writing business.
Mr. Ronald B. Hoesterey was elected to the City Council in 1980, and served as Mayor Pro Tem
during 1981. Mr. Hoesterey is the western regional manager of an energy management controls company
and also serves as President of the Board of Directors for Public Agency Data Systems.
Mr. Donald I Saltarelli was first elected to the City Council in 1972. He was reelected in 1976 and in
1980. Mr. Saltarelli served as Mayor in 1973-74, 1975-76 and again in 1980-81. He is currently a member
of the Local Agency Formation Commission of Orange County. Mr. Saltarelli owns the Saltarelli Realty
Company.
Mr. Frank Greinke was elected to the City Council in April 1982. He has been active in the Tustin
Chamber of Commerce as Director, Chairman of numerous committees and President in 1969-70. He has
worked on civic committees and commissions such as the Development Preview Committee, Tustin Now and
Tomorrow Committee and the Park and Sewer Bond Committee. Mr. Greinke owns the Southern Counties
Oil Company.
Mr. William B. Huston is City Manager and Executive Director of the Agency. He was appointed
Tustin's first City Manager on September 1, 1981. Prior to Tustin, Mr. Huston was City Administrator of
Milbrae, California. Mr. Huston is a graduate of the University of Southern California.
Agency Powers
All powers of the Agency are vested in governing body who are the elected members of the City
Council. Pursuant to the Law, the Agency is a separate public body and exercises governmental functions in
planning and implementing redevelopment projects.
The Agency may exercise broad governmental functions and authority to accomplish its purposes,
including, but not limited to, the right of eminent domain, the right to issue bonds for authorized purposes
and to expend their proceeds and the right to acquire, sell, rehabilitate, develop, administer or lease
property. The Agency may demolish buildings, clear land, and cause to be constructed certain improvements
including streets, sidewalks, and utilities, and can further prepare for use as a building site any real property
which it owns or administers.
The Agency may, from any funds made available to it for such purposes, pay for all or part of the value
of land and the cost of buildings, facilities, or other improvements to be publicly owned and operated,
provided that such improvements are of benefit to a redevelopment project area and cannot be financed by
any other reasonable method. The Agency may not construct or develop buildings, with the exception of
public buildings, and must sell or lease cleared property which it acquires within a redevelopment project
area for redevelopment in conformity with a particular redevelopment plan, and may further specify a
period within which such redevelopment must begin and be completed.
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TOWN CENTER AREA REDEVELOPMENT PROJECT
General History
The Redevelopment Plan for the Town Center Area Redevelopment Project (the "Project Area") was
approved by Ordinance No. 701 on November 22, 1976, and amended by Ordinance No. 855 enacted by the
City Council on September 8, 1981. The Project Area encompasses approximately 360 acres in the center of
the City of Tustin, an area formerly characterized by older and somewhat deteriorating development. The
Project Area contains commercial, service -commercial and neighborhood commercial and residential land
uses.
The Project Area was initiated after central city merchants and the Tustin Chamber of Commerce
expressed the need to revitalize and expand the City's commercial base along the El Camino Real. El
Camino Real had been the major north -south route in California since the early 1800's. By 1971 when the
movement for revitalization began, the area consisted of mixed residential and commercial uses on
substandard lots. Most of the commercial facilities were nonconforming uses due to lack of off-street
parking and some of the businesses dated back to the early 1900's, only one new structure had been built in
the area during the previous decade.
The Project Area includes all of the commercial properties within the central city. Three community
shopping centers and two specialty commercial developments comprise the economic base of the central city.
A shopping center on the southerly side of El Camino Real was built in 1961 and was becoming obsolete due
to its limited access from the Santa Ana Freeway and due to its age. Other shopping centers constructed in
the early 1960's had failed to capture an increase in sales commensurate with the increasing population due
to their obsolescence and deterioration. The City of Tustin, with a population that had grown from 1,143
residents in 1950 to 32,000 in 1976, and a market area of 165,000 residents, was not keeping pace with the
demand for goods and services. The assistance of the City government was determined to be necessary for
the promotion and redevelopment of the commercial area and the renewal of the public infrastructure.
Redevelopment Goals and Objections
General objectives of the Redevelopment Plan adopted by the Agency are to eliminate and prevent the
spread of blight in the Project Area. The Redevelopment Plan proposes to accomplish this by constructing
streets, utilities or other public improvements, acquiring real property, providing for participation by owners
and tenants presently located in the Project Area, by the management of property under ownership and
control of the Agency, and the demolition or removal of buildings and improvements. Furthermore, the
Redevelopment Plan provides for the disposition of property and the redevelopment of land in accordance
with the Redevelopment Plan, and the rehabilitation of structures and improvements.
Recent and Proposed Development
The three community shopping centers have all undergone redevelopment and revitalization since 1976.
Two additional shopping centers have been constructed. Mervyn's Department Store is located in the new
Courtyard Shopping complex. Packers Square on Newport Boulevard was developed by the Warmington
Company to accommodate the Irvine Ranch Market, restaurants, boutique shops, and an adjoining 138 unit
residential condominium project.
In 1982 the Stevens Square office condominium complex on West Main Street consisting of eight
Victorian office buildings with a permit value in excess of $2,000,000 was completed. Four additional office
building complexes were completed in the Project Area in 1981-82. A parking structure was completed in
conjunction with the Stevens Square project which accomodates 214 vehicles, of which 83 parking spaces
are owned by the Agency. The Agency intends to either lease these spaces or sell them on a condominium
basis.
Plans have been approved for development by California Pacific Properties of a 10 acre site which is
proposed to contain 390,000 square feet of office and commercial developments including restaurants and
theaters in the Project Area. Parking requirements will be satisfied by the construction of an adjoining 900
6
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JOB NO. 97576X005 ST: 97576X „c1FFRIES BANKNOTE CO. (213) 742-a800 13 -Oct -82 12:46 SEQ NO: 7
space four story parking structure. Construction is scheduled to start on this $62,000,000 complex by April
1983.
Burnett Ehline is the developer of a 42,000 square foot office building at Newport Avenue and Irvine
Boulevard. Construction is scheduled to begin in fiscal year 1982-83.
Public improvements completed by the Agency include the widening and beautification of Newport
Avenue as a 100' primary arterial with a landscaped center median, traffic signal installations, storm drains,
new water mains, and sanitary sewers. Most of the utilities in the Project Area have been undergrounded
along Irvine Boulevard, First Street and EI Camino Real. A major project, now underway and scheduled for
completion in December, 1982, is the El Camino Real improvement project. This project, at a cost of $1.2
million, includes paving, street furniture, landscaping, street lighting, and design features for the El Camino
Real business area.
Throughout the Project Area the Agency assisted in making public improvements including the
widening and upgrading of Newport Avenue, El Camino Real and First Street, undergrounding of utilities
on those streets, the extension of Sixth Street, installation of traffic signals, water mains on EI Camino Real
and Sixth Street, beautification on the Newport Avenue Center islands and the Brian Street and Main
Street triangle, storm drains along El Camino Real, Main Street, Sixth Street and Irvine Boulevard, and
sewers along EI Camino Real and C Streets.
Proposed Development and Use of Bond Proceeds
The Agency intends to continue its efforts to upgrade and revitalize the Project Area through the
reconstruction of street improvements, alleys, sign identification, landscaping and street furniture and the
development of public parking to serve the area. In addition, the Agency intends to develop the Columbus -
Tustin Park and Community Center, sink a new water well and replace inadequate pipes for the water
system, and acquire property in the area for development of senior citizens housing and for resale to
developers.
Specific use of Bond proceeds is outlined below:
Land Acquisition: The Agency plans to acquire land within the Project Area which currently is not
utilized at its highest and best use. Property acquired by the Agency will be sold for private commercial
development through negotiated sales, including the use of developer disposition agreements. The purpose of
land acquisition is to facilitate private commercial development consistent with the goals and objectives of
the Redevelopment Plan for the Project Area. Approximate cost: $2,000,000
Senior Citizen Housing: The Agency plans to acquire land for subsequent sale or lease to a private
developer who covenants to develop the site as affordable housing for senior citizens for a term fixed by the
Agency. The site acquired will be located in an area which provides the public and private amenities
necessary for senior citizen housing. Approximate cost: $200,000
Undergrounding of Utilities: The Agency plans to underground approximately 3,200 feet of overhead
utility lines and to install street lights along the arterial highway street system. This project is adjacent to an
undergrounding project recently completed by the Agency, the City and Southern California Edison
Company. The location to be undergrounded is in a commercial district situated within the Project Area.
Approximate cost: $750,000
Parking Facility: Acquisition of land and construction of a parking facility is planned by the Agency in
the Old Town area of the Project Area. The Agency will construct the improvements in conjunction with an
Agency selected private development which will be entitled to use of parking spaces based upon a pre-
determined allocation of public-private parking. This proposed project is similar to a recently completed 214
space parking facility constructed jointly by the Agency and the Stevens Square Office Condominium
Association. Approximate cost: $2,000,000
Water System Improvements: The Agency plans to replace a water main and install a water well in the
Old Town area of the Project Area. The improvements are identified in the City's water system capital
7
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JOB NO. 97576X005 ST: 97576X jEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 15:01 SEQ NO: 8
improvement plan as needed to improve the reliability of the water system in the Old Town area.
Approximate cost: $500,000
Repayment of General Fund Loan: The Agency plans to repay a loan made from the General Fund of
the City to the Agency when it was established. The loan was made in order for the Agency to have working
capital until it had sufficient annual tax increment income. Approximate cost: $1,125,000
TAX REVENUES
Historic Tax Revnues
The following table presents the historical taxable valuation and Tax Revenue for the Project Area:
Tustin Community Redevelopment Agency
Town Center Area Project Area
Taxable Value and Tax Revenues
Fiscal
Year
1977-78 ..................................................
1978-79 ..................................................
1979-80 ..................................................
1980-81 ..................................................
1981-82 ..................................................
(1) Includes business inventory subvention revenues.
Source: Katz, Hollis, Coren & Associates.
Projected Tax Revenue
The following table reflects projected Tax Revenues based partially on new construction within the
Project Area, the 2 percent annual increase in valuation permitted by Proposition 13 and replacement
income for business inventories.
Projection of Taxable Value and Tax Revenues(1)
Incremental
Tustin Community Redevelopment Agency
Value
Business
Secured
Unsecured
Total
Above Bax
Inventory
Tax
Value
Value
value
Roll
Subvention
Revemtes(1)
$ 55,778
$16,335
$ 72,113
$ 8,375
$10.1
$ 209
72,714
17,784
90,498
27,172
16.9
275
79,780
26,013
105,793
42,493
31.7
596
94,340
16,890
111,230
52,744
53.2
758
123,697
22,987
146,684
88,198
57.6
1,168
(1) Includes business inventory subvention revenues.
Source: Katz, Hollis, Coren & Associates.
Projected Tax Revenue
The following table reflects projected Tax Revenues based partially on new construction within the
Project Area, the 2 percent annual increase in valuation permitted by Proposition 13 and replacement
income for business inventories.
(1) Full projection of value and revenue is included in the Report of the Fiscal Consultant, Appendix A.
Source: Katz, Hollis, Coren & Associates, Inc. October 1982.
172015 120451
8
Projection of Taxable Value and Tax Revenues(1)
Tustin Community Redevelopment Agency
Town Center Area Redevelopment Project
a
Excess
Total
Over Base
Tax
Fiscal Year
Taxable Value
Roll
Revenues
1982/83 ......................................................................................
161,324,000
102,838,000
1,261,000
1983/84 ......................................................................................
168,618,000
110,132,000
1,322,000
1984/85 ......................................................................................
181, 711,000
123,225,000
1,444,000
1985/86 ......................................................................................
200,300,000
141,814,000
1,622,000
1986/87......................................................................................
222,371,000
163,885,000
1,829,000
1987/88 ......................................................................................
226,432,000
167,946,000
1,83 5,000
1988/89 ......................................................................................
230,574,000
172,088,000
1,837,000
1989/90 ......................................................................................
234,799,000
176,313,000
1,841,000
1990/91......................................................................................
239,109,000
180,623,000
1,856,000
1991/92 ......................................................................................
243,504,000
185,018,000
1,903,000
(1) Full projection of value and revenue is included in the Report of the Fiscal Consultant, Appendix A.
Source: Katz, Hollis, Coren & Associates, Inc. October 1982.
172015 120451
8
1
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Coverage
The following table presents the estimated Bond retirement and flow of Tax Revenues based on an
assumed interest rate of 11% per annum. Tax Revenues are received as shown in the preceding table above.
Annual Debt Service Coverage
Fiscal Year Fiscal Year Fiscal Year
1982/83 1983/84 1984/85
Net Tax Increment Revenues ................................................ $1,261,000 $1,322,000 $1,444,000
Earnings on Reserve Account(2)........................................... 102,000 102,000 102,000
Revenues Available for Debt Service .................................... $1,363,000 $1,424,000 $1,546,000
Maximum Annual Debt Service ............................................ 1,020,650 1,020,650 1,020,650
Coverage.................................................................................. 1.33 1.39 1.51
(1) Increase in net tax increment revenues:
(2) Assumes funded Reserve Account equal to the Maximum Annual Debt Service to be invested at 10%
per annum.
Major Property Owners
The following table lists the ten largest property taxpayers in the Project Area and the taxable value of
their property based on 1982-83 assessed valuations. Combined, the assessed valuations of these properties
equals $41,758,831, or approximately 26% of the Project Area's assessed value.
Major Property Taxpayers
Town Center Area Redevelopment Project
Property Owner
Larwin Square Ltd. (Larwin Square Shopping Center) .......................................
Rreef IV, Inc. (Tustin Heights Shopping Center) ................................................
Tustin Main Associates............................................................................................
Robert P. Warmington Co. (Packers Square).......................................................
Sav-On Stores....................................................................................................:......
Northwood Realty (Mervyn's)................................................................................
Tustin Lanes (bowling alley)...................................................................................
John S. Griffith & Co. (Courtyard Square Shopping Center) .............................
El Camino Real Properties (Blanco Buildings).....................................................
William Zappas (El Camino Plaza Shopping Center) ..........................................
053124 072752
9
Taxable
Property Value
$14,710,522
6,258,553
4,598,870
3,264,209
2,742,000
2,542,906
2,263,320
2,152,651
1,813,320
1,412,480
$41,758,831
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JOB NO. 97576X005 ST: 97576X ' aEFFRIES BANKNOTE CO. (213) 742-8800 13 -Oct -82 07:56 SEQ NO: 10
Annual Debt Service
Set forth below is the annual debt service for the term of the Bonds.
$8,500,000
Redevelopment Agency of the City of Tustin
Town Center Area Redevelopment Project
Tax Allocation Bonds,
Series 1982
Annual Debt Service
' Preliminary, subject to change.
(1) Assumes 11% interest rate.
inigAn na�)ign
It]
Sinking
Total
Principal
Account
Debt
November 1
Maturing
Redemption
Interest(l)
Service
1983.............................................................
$ 85,000
-0-
$ 935,000
$ 1,020,000
1984.............................................................
95,000
-0-
925,650
1,020,650
1985.............................................................
100,000
-.0-
915,200
1,015,200
1986.............................................................
115,000
-0-
904,200
1,019,200
1987.............................................................
125,000
4)-
891,550
1,016,550
1988.............................................................
140,000
4)-
877,800
1,017,800
1989.............................................................
155,000
4)-
862,400
1,017,400
1990.............................................................
175,000
-0-
845,350
1,020,350
1991.............................................................
190,000
-0-
826,100
1,016,100
1992.............................................................
215,000
-0-
805,200
1,020,200
1993.............................................................
235,000
-0-
781,550
1,016,550
1994:............................................................
260,000
-0-
755,700
1,015,700
1995.............................................................
290,000
4-
727,100
1,017,100
1996.............................................................
325,000
-.0-
695,200
1,020,200
1997.............................................................
360,000
-0-
659,450
1,019,450
1998.............................................................
-0-
$ 400,000
619,850
1,019,850
1999.............................................................
--0
440,000
575,850
1,015,850
2000.............................................................
-0-
490,000
527,450
1,017,450
2001.............................................................
-0-
545,000
473,550
1,018,550
2002.............................................................
-0-
605,000
413,600
1,018,600
2003..............................................................
-0-
670,000
347,050
1,017,050
2004.............................................................
-0-
745,000
273,350
1,018,350
2005.............................................................
-0-
825,000
191,400
1,016,400
2006.............................................................
-0-
915,000
100,650
1,015,650
Total ...........................................,
$2,865,000
$5,635,000
$
$24,430,200
' Preliminary, subject to change.
(1) Assumes 11% interest rate.
inigAn na�)ign
It]
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JOB NO. 97576X005 ST: 97576X jEFFRIES BANKNOTE CO. (213) 74a-8800 13 -Oct -82 12:46 SEQ NO: 11
RISK FACTORS
Reduction of Tax Revenues
Tax Revenues allocated to the Agency are determined by the amount of incremental (increased)
reduction of taxable values of taxable property in the Project Area caused by a relocation out of the Prtaxable value in the Project Area and the current rate at which property in the Project Area is taxed. The
oject
Area by one or more major property owners, or the complete or partial destruction of such property could
result in a reduction in the Tax Revenues that secure the Bonds. In addition, any reduction in tax rates or
the valuation of taxable property in the Project Area could cause a reduction in the Tax Revenues that
secure the Bonds. Such reduction of Tax Revenues could have an adverse effect on the Agency's ability to
make timely payments of principal of and interest on the Bonds.
Constitutional Amendment XIII A/Property Tax Rate
On June 6, 1978, California voters approved Proposition 13 or the Jarvis -Gann Initiative, which added
Article XIII A to the California Constitution. The principal thrust of Article XIII A is to limit the amount
of ad valorem taxes on real property to 1% of "full cash value" as determined by the County Assessor.
Article XIII A defines "full cash value" to mean "the County Assessor's valuation of real property as shown
on the 1975-76 tax bill under `full cash value,' or thereafter, the appraised value of real property when
purchased, newly constructed, or a change in ownership has occurred after the 1975 assessment period."
Furthermore, all real property valuation may be increased to reflect the inflationary rate, as shown by the
consumer price index, not to exceed 2% per year or may be reduced.
Article XIII A has subsequently been amended to permit reduction of the "full cash value" base in the
event of declining property values caused by damage, destruction or other factors, and to provide that there
would be no increase in the "full cash value" base in the event of reconstruction of property damaged or
destroyed in a disaster.
Article XIII A exempts from the 1% tax limitation any indebtedness incurred prior to July 1, 1978,
requires a vote of two-thirds of the qualified electorate to impose special taxes, while totally precluding the
imposition of any additional ad valorem, sales or transaction tax on real property. In addition, Ar-
ticle XIII A requires the approval of two-thirds of all members of the State legislature to change any State
tax laws resulting in increased tax revenues.
On September 22, 1978, the California Supreme Court upheld the general validity of Article XIII A
against a series of challenges which attacked the Jarvis -Gann Initiative as a whole (Amador Valley Joint
Union School District vs. State Board of Equalization, 22 Cal. 3d 208 (1978)). The Court found that it was
premature to rule on the claim that Article XIII A impermissibly interfered with contracts in violation of
the U.S. Constitution, stating that such a challenge must come when a specific contract or obligation is
impaired.
The effect of Article XIII A on the Agency has been to reduce tax rates and commensurately Tax
Revenues. The 1978-79 tax rate for the Project Area was approximately 52% of the tax rate for the fiscal
year (1977-78) prior to the passage of Article XIII A.
The Agency has no power to levy and collect taxes. Any further reduction in the tax rate or the
implementation of any constitutional or legislative property tax de -emphasis will reduce the Tax Revenues,
and, accordingly, would have an adverse impact on the ability of the Agency to pay debt service on the
Bonds.
Business Inventory Subvention
In 1979 the State Legislature enacted a measure, Assembly Bill 66 (Chapter 1150, Statutes of 1979),
which eliminated the assessment and taxation of business inventory property and provided a formula for the
State to reimburse local agencies for the loss of tax revenues generated by business inventory value. Due to a
technical drafting error, redevelopment agencies were not included among the local agencies eligible for
reimbursement of lost business inventory tax revenue. The error was corrected by the Legislature in 1980
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through the passage of Assembly Bill 1994 (Chapter 610, Statutes of 1980) which specifically provided for
replacement, in part, of the revenue lost by redevelopment agencies as a result of AB 66.
AB 1994 provides for restoration of business inventory revenue amounts through the annual addition of
"artificial" taxable value not actually existing in a project area to the tax rolls of redevelopment projects.
The initial taxable value amount, that for 1980-81, was determined by reducing actual 1979-80 business
inventory taxable value by a factor computed by dividing a one percent tax rate by the actual tax rate
applicable within the project area. The effect of this adjustment is to have the new taxable value yield
revenues equivalent to those that would be generated if a project area had a tax rate of one percent of
market value.
The amount of taxable value to be added in subsequent years is adjusted annually to reflect changes in
population of the city or county in which the project is located and the rate of inflation. In computing this
adjustment for the two years subsequent to the enactment of AB 1994 the actual rate of Statewide inflation
(based on CPI) was used. In adjusting between 1980-81 and 1981-82, however, the Legislature mandated an
inflation adjustment of only 2.92 percent. Further, the Legislature has mandated that there will be no
increase in business inventory subventions for 1982-83.
The County of Orange, in implementing AB 1994, has computed business inventory subvention
revenues on the basis of a one percent tax rate against the "artificial" taxable value rather than the total tax
rate, inclusive of override tax rates. This varies from a literal application of the California Redevelopment
Law (Chapter 29, Statutes of 1979) which requires any year's project revenues to be calculated through the
utilization of the current year tax rate, which includes override tax rates levied by taxing entities to repay
voter -approved indebtedness. For fiscal year 1982-83, the amount of the business inventory subvention for
the Project Area will be $52,979 or approximately 4.2% of the total Tax Revenues allocated to the Agency
for the Project Area in fiscal year 1982-83. No assurance can be given that the State will, or will be able to,
continue such reimbursement. Any reduction in the amount of State reimbursement or a change in the
allocation formula may have an adverse effect on the Agency's ability to pay principal of and interest on the
Bonds.
Constitutional Amendment XIII B/Government Spending Limitation
On November 6, 1979, California voters approved Proposition 4 or the Gann Initiative, which added
Article XIII B to the California Constitution. The principal thrust of Article XIII B is to limit the annual
appropriations of the State and any city, county, city and county, school district, authority or other political
subdivision of the State to the level of appropriations for the prior fiscal year, as adjusted for changes in the
cost of living, population and services rendered by the governmental entity. The "base year" for establishing
such appropriations limit is the 1978-79 fiscal year and the limit is to be adjusted annually to reflect changes
in population, consumer prices and certain increases in the cost of services provided by these public agencies.
Appropriations subject to Article XIII B include generally the proceeds of taxes levied by the State or
other entity of local government, exclusive of certain State subventions, refunds of taxes, benefit payments
from retirement, unemployment insurance and disability insurance funds. "Proceeds of taxes" include, but
are not limited to, all tax revenues and the proceeds to an entity of government, from (1) regulatory licenses,
user charges, and user fees (but only to the extent such regulations, charges and fees exceed the cost of
providing the service or regulation), and (2) the investment of tax revenues. Article XIII B includes a
requirement that if an entities' revenues in any year exceed the amounts permitted to be spent, the excess
would have to be returned by revising tax rates or fee schedules over the subsequent two years. To the extent
such tax rates are revised, Tax Revenues may be affected, since taxes allocated to the Agency are generated
by taxes levied by certain taxing agencies having jurisdiction within the Project Area.
Statutes of 1980, Chapter 1342 (Senate Bill 1972) enacted by the California Legislature and effective
as an urgency measure on September 30, 1980 added Section 33678 to the Law. Section 33678 provides that
the allocation of taxes to the Agency for the purpose of paying principal of, or interest on, loans, advances or
indebtedness shall not be deemed the receipt by the Agency of proceeds of taxes levied by or on behalf of
Agency within the meaning or for the purposes of Article XIII B of the California Constitution, nor shall
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such portion of taxes be deemed receipt of proceeds of taxes by, or an appropriation subject to the limitation
of, any other public body within the meaning or for the purposes of Article XIII B of the California
Constitution or any Statutory provision enacted in implementation of Article XIII B. To date, no court has
addressed the question of whether allocation of taxes to a redevelopment agency are proceeds of taxes within
the meaning of Article XIII B of the California Constitution. The Agency has not adpted an appropriations
limit. However, based upon an analysis of the constitution and laws of the State of California including
Section 3378 of the Law, it is the opinion of the General Counsel to the Agency, James G. Rourke of the
firm of Rourke and Woodruff, that the Tax Revenues are not proceeds of taxes and that accordingly the
Agency need not adopt an appropriations limit under Article XIII B. The constitutionality of Section 33678
of the Law has not been tested in the Courts and the Agency can give no assurance as to the constitutionali-
ty or scope of such Section.
Serrano Decision
On December 30, 1976, in the case of Serrano Y. Priest, 18 Cal.3d 728 (1976), the California Supreme
Court affirmed a lower court decision holding the State's system of financing public elementary and
secondary education unconstitutional under the equal protection provisions of the California Constitution
and setting a period, ending September 3, 1980, for bringing such systems into constitutional compliance.
The Court so held based on the premise that educational opportunity under the present system varies as a
function of the assessed valuation per student in average daily attendance in a given school district, and that
there was no compelling State interest justifying such discrimination.
The State Legislature during the 1978 session made certain adjustments in the system of financing
public elementary and secondary schools in an effort to meet the requirements set forth in Serrano v. Priest.
The legislation significantly increases the amount of State money supplied to public school districts having a
low local property tax basis and provides for some equalization of tax moneys by redistributing some tax
revenues of school districts having a high per -pupil property tax basis to school districts having a low per -
pupil property tax basis. Whether or not these adjustments will be held by the courts to be adequate, and, if
not, what system of financing public elementary and secondary schools will be chosen for enactment by the
State Legislature (and whether such system will meet the applicable constitutional provisions) is open to
speculation.
To the extent any future decision or legislation may limit the levy of property taxes for financing public
elementary and secondary education, Tax Revenues may be reduced adversely affecting the security of the
Bonds. The debt service coverage computations contained in this official statement assume that there will be
no property tax de -emphasis as a result of the Serrano decision.
SUMMARY OF THE RESOLUTION
The following is a summary of certain provisions of the Resolution and does not purport to be complete,
and reference is hereby made to the Resolution for further particulars. Copies of the Resolution are
available from the Agency upon request. All capitalized terms used herein, and not otherwise defined, shall
have the same meaning as used in the Resolution.
Funds — Allocation of Bond Proceeds
The Resolution establishes with the Treasurer of the Agency a special trust fund called the
"Tustin Community Redevelopment Agency, Town Center Area Redevelopment Project, Redevelopment
Fund" (the "Redevelopment Fund").
The Resolution establishes with the Fiscal Agent a special trust fund called the "Tustin Community
Redevelopment Agency, Town Center Area Redevelopment Project, Special Fund" (the "Special Fund"),
comprised of the following special trust funds: the "Interest Account"; the "Principal Account"; the
"Reserve Account"; the "Sinking Account"; and the "Surplus Account".
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The Fiscal Agent, on behalf of the Agency, shall receive the proceeds from the sale of the Bonds, upon
the delivery of the Bonds to the purchasers thereof, and shall dispose of such proceeds and moneys as
follows:
19 (1) Deposit in the Interest Account the accrued interest and premium, if any,
purchasers of the Bonds; paid by the
(2) Deposit in the Reserve Account a sum equal to Maximum Annual Debt Service;
(3) Pay the necessary expenses in connection with the issuance and sale of the Bonds and fees of
the Fiscal Agent and Paying Agents; and
(4) After making the above deposits, the balance of the proceeds from the sale of the Bonds shall
be transferred to the Treasurer of the Agency who shall place the same in the Redevelopment Fund.
The moneys set aside and placed in the Redevelopment Fund shall remain therein until from time to
time expended solely for the purpose of financing a portion of the cost of the Redevelopment Project and
other costs related thereto, and also including in such costs:
(1) The payment, in any year during which the Agency owns property in the Project Area, to any
city, county, city and county, district or other public corporation which would have levied a tax upon
such property had it not been exempt, an amount of money in lieu of taxes as authorized by Section
33401 of the Law; and
(2) The cost of any lawful purpose in connection with the Redevelopment Project, including,
without limitation, those purposes authorized by Section 33445 of the Law; and
(3) The necessary expenses in connection with the issuance and sale of the Bonds and fees of the
Fiscal Agent and Paying Agents.
20 Flow of Funds
Without limiting the generality of the foregoing and for the purpose of assuring that the payments
referred to above will be made as scheduled, the Tax Revenues shall be deposited and accumulated in the
Special Fund and shall be used in the following priority; provided, however, that to the extent that deposits
have been made in any of the Accounts referred to below from the proceeds of the sale of the Bonds or
otherwise, the deposits below need not be made:
(1) Interest Account. On or before the last day of each April and October, so long as the Bonds
are outstanding, commencing in April 1983, and the Fiscal Agent will set aside from the Special Fund
into the Interest Account, an amount which when added to any amount in the Interest Account will
equal the amount of interest due and payable on the Bonds on the next interest payment date.
(2) Principal Account. On or before the last day of October of each year commencing in October
1983, so long as Bonds remain outstanding, the Fiscal Agent will set aside from the Special Fund into
the Principal Account an amount which when added to any amount in the Principal Ac
coun[ will equal
the principal due and payable on the Outstanding Serial Bonds on the next principal payment date.
(3) Sinking Account. No later than October 31 of each year, beginning October 1998, the Fiscal
Agent shall, but only to the extent of available Tax Revenues, set aside from the Special Fund and
deposit in the Sinking Account an amount which, when added to the amount then contained in the
Sinking Account, will be equal to the minimum sinking account payment required to be on deposit
therein in such year, as set forth in the following table:
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Minimum
Sinking
Year Ending Account
November I Payment
1998.......................................................................................................... $400,000
1999.......................................................................................................... 440,000
2000.......................................................................................................... 490,000
2001.......................................................................................................... 545,000
2002.......................................................................................................... 605,000
2003.......................................................................................................... 670,000
2004.......................................................................................................... 745,000
2005.......................................................................................................... 825,000
2006 (Maturity)....................................................................................... 915,000
In the event that available Tax Revenues shall in any year be insufficient to make the minimum sinking
account payment then required, such deficiency shall be made up from the first available Tax Revenues in
succeeding years, and the failure to make such payment in full shall not be deemed an event of default
within the meaning of the Resolution. In the event and to the extent that, pursuant to any other provision of
the Resolution, any Bonds shall be called for redemption other than pursuant to optional redemption
provisions in the Resolution, the amount of Bonds to be retired from minimum sinking account payments
shall be reduced for each succeeding year by the amount obtained by multiplying the principal amount of
Bonds so called for redemption by the ratio which the principal amount of Bonds to be retired from
minimum sinking account payments bears to the total remaining principal amount of Bonds to be retired
from sinking account payments and by rounding each such payment to the nearest $5,000 multiple.
(4) Reserve Account. This account, held by the Fiscal Agent within the Special Fund, will consist of
an amount equal to Maximum Annual Debt Service on all Outstanding Bonds. Initially it will be funded
from Bonds proceeds. On or before November 2 of each year, beginning November 2, 1983, the Fiscal
Agent will set aside from the Special Fund any amount of money from Tax Revenue necessary to restore
the Reserve Account to the full amount of Maximum Annual Debt Service. The amounts on deposit in the
Reserve Account will be used and withdrawn by the Fiscal Agent solely to replenish the Interest Account,
the Principal Account or the Sinking Account in such order, in the event of a deficiency at any time in of
such accounts, or for the purpose of paying the interest on or principal of or redemption premiums, if any on
the Bonds in the event no other money of the Agency is available, or to retire all the Bonds then Outstand-
ing, except that so long as the Agency is not in default under the Resolution, any amount in the Reserve
Account in excess of the Maximum Annual Debt Service may be transferred to the Special Fund.
(5) Surplus Account. It is the intent of the Resolution that: (i) the deposits provided for in
subparagraphs (1), (2) and (3), if any, above to the Interest Account, the Principal Account and the
Sinking Account, respectively, shall be made as scheduled, (ii) that the deposits provided for in
subparagraph (4) above to the Reserve Account shall be made as necessary to maintain a balance equal
to Maximum Annual Debt Service. Any moneys remaining in the Special Fund (other than those
moneys in the Interest Account, Principal Account, Sinking Account or Reserve Account) after the
above transfers have been made, may, upon receipt of a certificate of an Independent Financial
Consultant certifying that Tax Revenues to be received in the next succeeding Bond Year, based upon
the most recent assessed valuations, are at least one and ten -hundredths (1.10) times the amount
required to pay Debt Service in such Bond Year, be declared "Surplus" and shall be used and applied
by the Fiscal Agent, at the direction of the Agency:
(a) to purchase of the Bonds, provided that such Bonds shall not be purchased at a price in
excess of the current redemption price or in excess of the maximum redemption price if such Bonds
are not then subject to redemption, or
(b) to call and redeem Bonds prior to maturity, or
(c) for transfers to the Agency to be used and applied by the Agency for any lawful purpose.
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n
21 Deposit and Investment of Moneys in Funds
Subject to the provisions of the Resolution, all moneys held by the Fiscal Agent in the Special Fund,
except such moneys which are at the time invested, shall be held in time or demand deposits in any bank or
trust company authorized to accept deposits of public funds (including the banking department of the Fiscal
Agent) and shall be secured at all times by bonds or other obligations which are authorized by law as
security for public deposits, of a market value at least equal to the amount required by law.
Moneys in the Special Fund may, and upon written request of the Agency, shall, be invested by the
Fiscal Agent as provided by law only in obligations which will by their terms mature on such dates as to
insure that before each interest payment date there will be in the Special Fund, from matured obligations
and other moneys already in the Special Fund, cash equal to the interest and principal payable on such date.
Moneys in the Reserve Account shall be invested in obligations which will by their terms mature prior to
November 1, 2006.
Obligations purchased as an investment of moneys in any of said Funds and Accounts shall be deemed
at all times to be a part of such Fund or Account, and the interest accruing thereon and any gain realized
from such investment shall be credited to such Fund or Account and any loss resulting from any such
authorized investment shall be charged to such Fund or Account without liability to the Agency or the
members and officers thereof or to the Fiscal Agent.
22 Issuance of Additional Bonds and Agency Indebtedness
Limitation on Bonded Indebtedness. The Redevelopment Plan limits the amount of outstanding
indebtedness payable from Tax Revenue to twenty million dollars ($20,000,000). This limitation may not be
exceeded unless there is an amendment to the Redevelopment Plan.
Parity Bonds. The Agency will not issue any obligation or security superior to or on a parity with the
Bonds payable in whole or in part from the Tax Revenues which are pledged to the payment of the principal
of and interest on the Bonds, other than Additional Bonds or refunding bonds. If at any time the Agency
determines it needs to do so, the Agency may provide for the issuance of, and sell, Additional Bonds in such
principal amounts as it estimates will be needed for such purposes. The issuance and sale of any Additional
Bonds shall be subject to the following:
(1) The Agency shall be in compliance with all covenants set forth in the Resolution.
(2) Tax Revenues derived based on the equalized assessment roll (as reported by the County
Auditor -Controller), next preceding the issuance of Additional Bonds shall be equal to at least one and
ten hundredths (1.10) times the Maximum Annual Debt Service on all series of Bonds and Additional
Bonds then outstanding and on the additional series of Bonds (except refunding bonds issued to refund
the Bonds or Additional Bonds) proposed to be issued. At the option of the Agency, there may be added
to such Tax Revenues the estimated amount of additional Tax Revenues available for such computa-
tion, based on the tax rates in effect on the date on which the estimate is made, from the estimated
taxable valuations of that portion of any improvements the construction of which has been completed
prior to the date of issuance of Additional Bonds, but which are not yet on the tax rolls, including any
increase in taxable valuation of the land underlying such improvements. Such estimates must be
verified and shown in an opinion of the County Assessor or Auditor -Controller, or the Report of an
Independent Real Estate Consultant or Independent Financial Consultant.
(3) The Agency shall have received from an Independent Financial Consultant a certificate
stating that the requirements of subsection (2) above have been complied with, or a certificate of the
Auditor -Controller setting forth such taxes.
(4) The Supplemental Resolution providing for the issuance of such Additional Bonds under the
Resolution shall provide that:
(i) Money shall be deposited in the Reserve Account from the proceeds of the sale of
Additional Bonds to increase the amount on deposit in the Reserve Account to an amount equal to
the Maximum Annual Debt Service on the Bonds and the Additional Bonds; and
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(ii) The proceeds of such Additional Bonds shall be applied solely for (i) the purpose of
aiding in financing the Redevelopment Project, including payment of all costs incidental to or
connected with such financing, and/or (ii) the purpose of refunding any Bonds, including payment
of all costs incidental to or connected with such refunding.
(5) The Agency shall have received all required approvals or rulings from any governmental
authority having jurisdiction over such series of bonds or their terms, including, without limitation,
compliance with all requirements of the Department of the Treasury of the United States.
Subordinate Lien Obligations. If the Agency is in compliance with all covenants set forth in the
Resolution, the Agency may, for any purpose, issue obligations having a lien on the Tax Revenues which is
junior to the Bonds payable solely from Surplus as defined in the Resolution.
Other Covenants of the Agency
(1) Punctual Payment. The Agency will punctually pay or cause to be paid the principal and interest
to become due in respect of all the Bonds, in strict conformity with the terms of the Bonds and of the
Resolution, and it will faithfully observe and perform all of the conditions, covenants and requirements of
the Resolution and all Supplemental Resolutions and of the Bonds. Nothing herein contained shall prevent
the Agency from making advances of its own moneys howsoever derived to any of the uses or purposes
referred to in the Resolution.
(2) Extension of Bonds and Coupons. The Agency will not, directly or indirectly, extend or consent to
the extension of the time for the payment of any Bond or any coupon appertaining to or claim for interest on
any of the Bonds and will not, directly or indirectly, be a party to approve any such arrangement by
purchasing or funding the Bonds, coupons or claims for interest or in any other manner. In case the maturity
of any such Bond, coupon or claim for interest shall be extended or funded, whether or not with the consent
of the Agency, such Bond, coupon or claim for interest so extended or funded shall not be entitled, in case of
default hereunder, to the benefits of the Resolution, except subject to the prior payment in full of the
principal of all of the Bonds then Outstanding and of all coupons and claims for interest which shall not
have been so extended or funded.
(3) Against Encumbrances. The Agency will not encumber, pledge or place any charge or lien upon
any of the Tax Revenues superior to or on a parity with the pledge and lien herein created for the benefit of
the Bonds, except as permitted by the Resolution.
(4) Management and Operations of Properties. The Agency will manage and operate all properties
owned by the Agency and comprising any part of the Project in a sound and businesslike manner, and will
keep such properties insured at all times in conformity with sound business practice.
(5) Payment of Claims. The Agency will pay and discharge, or cause to be paid and discharged, any
and all lawful claims for labor, materials or supplies which, if unpaid, might become a lien or charge upon
the properties owned by the Agency or upon the Tax Revenues or any part thereof, or upon any funds in the
hands of the Fiscal Agent or any Paying Agent, or which might impair the security of the Bonds. Nothing
contained in the Resolution shall require the Agency to make any such payment so long as the Agency in
good faith shall contest the validity of said claims.
(6) Books and Accounts; Financial Statement. The Agency will keep, or cause to be kept, proper
books of record and accounts, separate from all other records and accounts of the Agency and the City, in
which complete and correct entries shall be made of all transactions relating to the Project and to the Tax
Revenues. The Agency will cause to be prepared and filed with the Fiscal Agent annually, within one
hundred and twenty (120) days after the close of that Fiscal Year so long as any of the Bonds are
Outstanding, complete financial statements with respect to that Fiscal Year showing the Tax Revenues, all
disbursements from the Tax Revenues and the financial condition of the Project, including the balances in
all funds and accounts relating to the Project, as of the end of such Fiscal Year, which statement shall be
accompanied by a certificate or opinion in writing of an Independent Certified Public Accountant. The
Agency will furnish a copy of such statements to any Bondholder upon written request.
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(7) Protection of Security and Rights of Bondholders. The Agency will preserve and protect the
security of the Bonds and the rights of the Bondholders, and will warrant and defend their rights against all
claims and demands of all persons. From and after the sale and delivery of any of the Bonds by the Agency,
the Bonds and coupons appertaining thereto shall be incontestable by the Agency.
(8) Payments of Taxes and Other Charges. Subject to the provisions of the Resolution, the Agency
will pay and discharge, or cause to be paid and discharged, all taxes, service charges, assessments and other
governmental charges which may hereafter be lawfully imposed upon the Agency or the properties then
owned by the Agency in the Project Area, or upon the Revenues therefrom, when the same shall become
due. Nothing herein contained shall require the Agency to make any such payment so long as the Agency in
good faith shall contest the validity of said taxes, assessments or charges. The Agency will duly observe and
conform with all valid requirements of any governmental authority relative to the Project or any part
thereof.
(9) Completion of Project. The Agency will commence, and will continue to completion, with all
practicable dispatch, the Project, and the Project will be accomplished and completed in a sound and
economical manner and in conformity with the redevelopment plan for the Project and the Law.
(10) Taxation of Leased Property. Whenever any property in either of the Project Area has been
redeveloped and thereafter is leased by the Agency to any person or persons (other than the City or the
County) or whenever the Agency leases real property in the Project Area to any person or persons for
redevelopment, the property shall be assessed and taxed in the same manner as privately owned property (in
accordance with Section 33673 of the Health and Safety Code of the State), and the lease or contract shall
provide (1) that the lessee shall pay taxes upon the taxable value of the entire property and not merely upon
the assessed value of his or its leasehold interest, and (2) that if for any reason the taxes paid by the lessee on
such property in any year during the term of the lease or contract shall be less than the taxes which would
have been payable upon the taxable value of the entire property if the property were assessed and taxed in
the same manner as privately owned property, the lessee shall pay such difference to the Fiscal Agent within
thirty days after the taxes for such year become payable to the taxing agencies and in any event prior to the
delinquency date of such taxes established by law. All such payments to the Fiscal Agent shall be treated as
Tax Revenues and shall be deposited by the Fiscal Agent in the Special Fund.
(11) Amendment of Redevelopment Plan and Disposition of Property. (1) The Agency will not
authorize the disposition of any land or real property in the Project Area to anyone which will result in such
property becoming exempt from taxation because of public ownership or use or otherwise (except property
planned for such ownership or use by the Redevelopment Plan in effect on the date of the Resolution) so that
such disposition shall, when taken together with other such dispositions, aggregate more than ten percent
(10%) of the land area in the Project Area unless the Redevelopment Plan is amended with the approval of
the Fiscal Agent as provided in the Resolution. If the Agency proposes to make such a disposition, it shall
propose an amendment to such Redevelopment Plan which expressly provides for the disposition of such real
property with such an effect and shall apply to the Fiscal Agent for approval of said proposed amendment.
The Agency shall thereupon appoint a reputable Independent Financial Consultant and direct said con-
sultant to report on the effect of said proposed disposition. If the Report of the Independent Financial
Consultant concludes that the security of the Bonds or the rights of the Bondholders will not be materially
impaired by said proposed disposition, and that taxes allocated to the Agency will not be significantly
diminished by the proposed disposition, the Fiscal Agent shall approve the proposed amendment and the
Agency may thereafter adopt the amendment (pursuant to all applicable provisions of the Law) and make
the disposition. If said Report concludes that taxes allocated to the Agency will be significantly diminished
or that such security will be materially impaired by said proposed disposition, the Fiscal Agent shall either
disapprove said proposed amendment, or, in its discretion and as a condition precedent to its approval of said
proposed amendment, declare that the requirements set forth in subsection (2) below, must be required by
the amendment to be imposed on any new owner or owners who acquire real property pursuant to
dispositions authorized by said amendment. The Agency shall have the sole and exclusive authority to
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appoint said consultant. Neither the Fiscal Agent nor said consultant shall be liable in connection with the
performance of their duties hereunder, except for their own negligence or willful misconduct.
(2) If the Fiscal Agent is not required to approve said proposed disposition pursuant to subsection (1)
above, the Fiscal Agent may nevertheless approve said proposed disposition, provided that, as a condition
precedent to said approval, the Agency shall be required not to dispose of any property in the Project Area
to anyone which will result in such property becoming exempt from taxation because of public ownership or
use or otherwise (except property planned for such ownership or use by the Redevelopment Plan in effect on
the date of adoption of the Resolution), without imposing the following requirements on such new owner or
owners:
(a) Such owner or owners shall pay to the Fiscal Agent, so long as any of the Bonds are
Outstanding, an amount equal to the amount that would have been received by the Fiscal Agent as
taxes allocated to the Agency if the property were assessed and taxes in the same manner as privately
owned non-exempt property; and
(b) Such payment shall be made to the Fiscal Agent within thirty (30) days after taxes foreach
year would become payable to the taxing agencies for non-exempt property and in any event prior to
the delinquency date of such taxes established by law.
All such payments in lieu of taxes to the Fiscal Agent shall be treated as Tax Revenues and shall be
deposited by the Fiscal Agent in the Special Fund.
(12) Single Sum Payments in Lieu of Taxes. As an alterative to payment to the Fiscal Agent pursuant
to the Resolution, the new owner or owners of property becoming exempt from taxation provided for in the
Resolution may elect to make payment to the Fiscal Agent in a single sum equal to the amount estimated by
the Fiscal Agent to be receivable by the Agency from taxes on saidproperty from the date of said payment
to the maturity date of the Bonds, less a reasonable discount value. All such single sum payments in lieu of
taxes shall be treated as Tax Revenues and shall be deposited by the Fiscal Agent in the Special Fund.
(13) Tax Revenues. The Agency shall comply with all requirements of the Law to insure the allocation
and payment to it of the Tax Revenues, including without limitation the timely filing of any necessary
statements of indebtedness with appropriate officials of the County, and shall forward information copies of
each such filing to the Fiscal Agent.
(14) Eminent Domain. The net proceeds received by the Agency from any eminent domain proceeding
shall be deposited by the Agency in the Special Fund; provided that the net proceeds received by the Agency
from the taking of any property in the Project Area the redevelopment of which was financed by the Agency
through the issuance of lease revenue bonds shall be deposited, used and applied in the manner provided by
the resolution authorizing the issuance of such lease revenue bonds.
(15) Further Assurances. The Agency will adopt, make, execute and deliver any and all such further
resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention
or to facilitate the performance of the Resolution, and for the better assuring and confirming unto the
Holders of the Bonds of the rights and benefits provided in the Resolution.
24 Events of Default and Remedies
2s
Any one or more of the following events shall constitute an "event of default' under the Resolution:
(1) Default in the due and punctual payment of any installment of interest on any Bond when and
as such interest installment shall become due and payable, and such default shall have continued
period of thirty (30) days; or for a
(2) Default in the due and punctual payment of the principal of any Bond when and as the same
shall become due and payable, whether at maturity as therein expressed, by declaration or otherwise,
and such default shall have continued for a period of thirty (30) days; or
19
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(3) Default by the Agency in the observance of any of the covenants, agreements or conditions
contained in the Resolution or in the Bonds, and such default shall have continued for a period of ninety
(90) days; or
(4) If the Agency files a petition or answer seeking reorganization or arrangement under the
federal bankruptcy laws or any other applicable law of the United States of America, or if a court of
competent jurisdiction shall approve a petition, filed with or without the consent e the Agency seeking
reorganization under the federal bankruptcy laws or any other applicable law of the United States of
America, or if, under the provisions of any other law for the relief or aid of debtors, any court of
competent jurisdiction shall assume custody or control of the Agency or of the whole or any substantial
part of its property.
In each and every such case during the continuance of such event of default, the Fiscal Agent may,
upon the notice in writing to the Agency, and shall, if so requested by the holders of not less than 60% in
aggregate principal amount of the Bonds at the time outstanding (such request to be in writing to the Fiscal
Agent and to the Agency) declare the principal of all of the Bonds then outstanding and the interest accrued
thereon, to be due and payable immediately, and upon any such declaration the same shall become and shall
be immediately due and payable, anything in the Resolution or in the Bonds to the contrary
notwithstanding.
Such declaration may be rescinded by the holders of not less than a majority of the Bonds then
outstanding provided the Agency cures such default or defaults including the deposit with the Fiscal Agent
of a sum sufficient to pay all principal on the Bonds matured prior to such declaration and all matured
installments of interest (if any) upon all the Bonds, with interest at the rate of 12% per annum on such
overdue installments of principal and, to the extent such payment of interest on interest is lawful at that
time, on such overdue installments of interest, so that the Agency is currently in compliance with all
payment, deposit and transfer provisions of the Resolution, and an amount sufficient to pay any expenses
incurred by the Fiscal Agent in connection with such default.
CONCLUDING INFORMATION
Financial Consultant
Miller & Schroeder Municipals, Inc. ("Miller & Schroeder") has acted as financial consultant to the
Agency concerning the Bonds. As financial consultant, Miller & Schroeder will receive compensation
contingent upon the sale and delivery of the Bonds. In the event Miller & Schroeder purchases the Bonds,
Miller & Schroeder may resell all or a portion thereof to the public. Miller & Schroeder is not required to
and does not intend to waive its financial consultant's fee if Miller & Schroeder is the winning bidder, and,
in addition, will receive compensation as underwriters. As underwriters, Miller & Schroeder may offer and
sell the Bonds to certain dealers (including dealers depositing the Bonds into investment trusts) at prices
lower than the public offering prices.
Legal Opinion
The opinion of Mudge Rose Guthrie & Alexander, Los Angeles, California and Rourke & Woodruff,
Santa Ana, California, Co -Bond Counsel, will be delivered to the purchaser of the Bonds, at the expen: a of
the Agency, upon delivery thereof, approving the validity of the Bonds and stating that interest on the Bonds
is exempt from income taxes of the United States of America under present federal income tax laws and
such interest is also exempt from personal income taxes of the State of California under present State
income tax laws.
A copy of such opinion, certified by an officer of the Agency by his facsimile signature, will be printed
on the back of each definitive Bond. No charge will be made to the purchaser for such printing or
certification.
11:)hi3 041m9
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a
The legal opinion is only as to legality and is not intended to be nor is it to be interpreted or relied upon
as a disclosure document or an express or implied recommendation as to the investment quality of the
Bonds.
Tax Exempt Status
In the opinion of Bond Counsel, interest on the Bonds is exempt from federal income taxes and from
State of California personal income taxes under existing statutes, regulations, rulings and court decisions.
27 Legality for Investment in California
The California Community Redevelopment Law provides that obligations authorized and issued under
the Law shall be legal investments for all banks, trust companies and savings banks, insurance companies,
and various other financial institutions, as well as for trust funds. The Bonds are also authorized security for
public deposits under the Community Redevelopment Law.
The Superintendent of Banks of the State of California has previously ruled that obligations of a
redevelopment agency are eligible for savings bank investment in California.
Municipal Bond Insurance
The Agency has applied for a commitment from the Municipal Bond Insurance Association ("MBIA")
for a policy of insurance on the Bonds. If the Agency's application is approved, then the policy uncondition-
ally guarantees the timely payment of principal of and interest on the Bonds to the Fiscal Agent of the
Bonds. The policy is non -cancellable and the premium will be fully paid at the time of the delivery of the
Bonds. Upon notification of failure by the Agency to deposit full payment of principal and interest coming
due with the Fiscal Agent, MBIA's members are obligated to deposit funds promptly with Citibank, N.A.,
New York, New York, as fiscal agent for MBIA, sufficient to fully cover the deficit in the Fiscal Agent's
account.
The insurers will be responsible for such payments, less any amounts received by the holders of the
Bonds from the Agency or from any other sources other than the insurers. Normally, notice of an impending
default will be received in advance of the payment date of the Bonds allowing MBIA time to make the funds
available for payment on the due date. If notice on non-payment is received on or after the due date, MBIA
will provide for payment on the business day following receipt of the notice. Upon payment by MBIA of any
Bonds or coupons, MBIA becomes the owner thereof.
The insurance companies comprising MBIA and their respective percentage liability are as follows: The
Aetna Casualty and Surety Company, 33%; Fireman's Fund Insurance Company, 30%; Travelers Indemnity
Company, 15%; Aetna Insurance Company, 12%; and The Continental Insurance Company, 10%. The
Policy is a several and not a joint insurance policy obligation of the participating insurance companies. Each
company's participation is backed by its entire resources.
The following table sets forth financial information with respect to the five member companies of
MBIA. The statistics are as reported by the member companies to the New York State Insurance
Department.
Municipal Bond Insurance Association
Five Member Companies
Assets and Policyholders' Surplus
As of September 30, 1981
(Amounts in Thousands)
Aetna
Casualty
Fireman's
F
Travelers
Indemnity
Aetna
Insurance
Continental
Assets ............................ $6,841,262
Policyholders' Surplus..... $1,046,920
$3,345,366
$5,236,061
52,289,909
Insurance Total
$1,143,314 $18,355,712
$ 805,942
5 968,420
$ 273,782
$ 116,162 $ 3,211,225
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The MBIA companies listed above or their parent organizations have been in the insurance business
from 70 to in excess of 100 years. Each MBIA company enjoys the highest policyholder rating accorded
insurers (Excellent, A, or A+) by the nationally recognized insurance company rating authority, A.M. Best
Company, Inc.
MBIA has obtained a ruling from the Internal Revenue Service that neither the insurance protection
nor payment thereunder will affect the exemption from Federal income tax of interest on bonds so insured.
The Securities and Exchange Commission has issued a no -action letter stating that municipal bonds insured
by MBIA are not subject to registration under the Securities Act of 1933.
The premium for the MBIA policy of insurance will be paid by the Agency from Bond proceeds at the
time Bonds are delivered.
Bond Rating
If MBIA issues its policy of insurance for the Bonds, then Standard & Poor's Corporation will assign
its municipal bond rating of "AAA" to the Bonds on the understanding that the standard policy of MBIA
insuring the timely payment of the principal of and interest on the Bonds will be issued by MBIA upon
issuance of the Bonds. The rating reflects the views of the Standard & Poor's Corporation and an
explanation can be obtained from said firm at 25 Broadway, New York, New York 10004, (212) 248-2525.
There is no assurance that the rating will continue for any period of time, and it is subject to being
withdrawn or revised downward. Such a revision or withdrawal may have an adverse impact on the market
price of the Bonds.
Audited Financial Statements
The financial statements of the Agency for the year ended June 30, 1982 have been examined by
Simonis Moreland Accountants, Inc., Newport Beach, California. The auditors' report, the financial
statements, and the notes to the financial statements for the period July 1, 1981 to June 30, 1982 are
included as Appendix A of this Official Statement.
Fiscal Consultant
Katz, Hollis, Coren & Associates, Inc. has been retained by the Agency as its Fiscal Consultant. Katz,
Hollis, Coren & Associates has prepared for the Agency a projection of future Tax Revenue which is
included in this Official Statement, as Appendix A.
Miscellaneous
All of the preceding summaries of the Resolution, the California Community Redevelopment Law,
other applicable legislation, the Redevelopment Plan for the Project Area, Agreements and other documents
are made subject to the provisions of such documents, respectively, and do not purport to be complete
statements of any or all of such provisions. Reference is hereby made to such documents on file with the
Agency for further information in connection therewith.
This Official Statement does not constitute a contract with the purchasers of the Bonds.
Any statements made in this Official Statement involving matters of opinion or estimates, whether or
not so expressly stated, are set forth as such and not as representations of fact, and no representation is made
that any of the estimates will be realized.
The execution and delivery of this Official Statement by its Chairman have been duly authorized by the
Tustin Community Redevelopment Agency.
TUSTIN COMMUNITY REDEVELOPMENT AGENCY
/s/
Chairman
22
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t
28 SUPPLEMENTAL INFORMATION ON
THE CITY OF TUSTIN
The following information concerning the City of Tustin, the County of Orange and surrounding areas
is included only for the purpose of supplying general information regarding the community. The Bonds are
n, the County of Orange, the State of California,
not a debt of the City of Tustin, or any of its political
subdivisions, and neither said City, said County, said State nor any of its political subdivisions is liable
therefor.
General
The City of Tustin is located in the central portion of Orange County. Tustin lies adjacent to the cities
of Orange to the north, Santa Ana to the west and Irvine to the south. Tustin includes approximately 11 .2
square miles at an average elevation of 356 feet above sea level. Typical of Southern California, the City has
a temperate climate with a mean average temperature of 63.1 degrees and average annual rainfall of 13.25
inches.
Incorporated on September 21, 1927, Tustin operates as a general law city. It has a council/manager
form of government, with the five City Council members elected at large for staggered four-year terms. The
Mayor is appointed by the City Council.
Population
A summary of the City's population from 1950 to 1982 is shown below.
City of Tustin
Population
Year
1950..............................................................................
Popwadon
1960 .......................
...............
1,143........
1970.............................................................................................
...................................................
2,006
1976................................................................
21,178
1977.............................................................................................
...................
31,290
1978.............................................................................................
3 2, 792
1979.............................................................................................
32,792
1980.............................................................................................
3 3, 700
1981 ....................................................
36,962
1982 ..................................
...................
37,264
..................................... ...........
38,223
Source: State Department of Finance.
City's Taxable Valuation
Taxable valuations within the City are established by the Orange County Assessor, except for utility
property, which is assessed by the State Board of Equalization. Article XIII A of the State Constitution
provides that, beginning with the 1978-79 fiscal year, property taxes in California are limited to one percent
of full cash value, except for taxes to pay debt service on indebtedness approved by the voters prior to July 1,
1978. Article XIII A defines full cash value as the County Assessor's valuation of real property as shown on
the 1975-76 tax bill ("base year"), except in the case of newly -constructed property or property which
undergoes a change in ownership which must be valued as of the date of completion of construction or of the
change in ownership. Yearly taxable value increases following the base year are limited to the growth in the
Consumer Price Index, but may not exceed two percent annually.
Prior to the 1981-82 fiscal year, property was assessed at 25 percent of cash value, and therefore,
Article XIII A imposed a maximum tax rate of $4.00 per $100 of assessed valuation, except for taxes to
meet debt service on indebtedness approved by the electorate prior to July 1, 1978. Beginning in 1981-82,
23
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property is assessed at 100 percent of cash value and property tax rates are expressed in terms of their ratio
to such full cash value.
The taxable valuations reflect homeowner's and business inventory exemptions. Tax revenues lost as a
result of the homeowner's exemption is reimbursed by the State based on the total taxes which would be due
on the taxable valuation of the property qualifying for the exemptions, without allowance for delinquencies.
The homeowner's exemption is $7,000 of the taxable valuation of an owner -occupied dwelling, providing the
owner files for the exemption.
In 1979, the California Legislature increased the business inventory exemption, beginning in 1980-81,
from 50 to 100 percent of the value of such property, and reimbursed property tax revenues lost as a result
of the exemption on a formula basis. The formula is based on the revenue loss resulting only from the one
percent general property tax rate on business inventories, not for the revenue loss resulting from the tax
rates levied for indebtedness, approved by the voters prior to July 1, 1978.
Beginning in 1980-81, the reimbursement was twice the amount of the 1979-80 reimbursement (less the
amount corresponding to the tax rates levied for indebtedness), increased by the Inventory Tax Factor. This
factor is determined by the percent change in cost of living plus the percent change in the population of the
jurisdiction. The business inventory exemption will be increased by this factor in subsequent years, unless
the State Legislature changes the applicable law.
A five year summary of the City's taxable valuations are set forth below. These figures are presented for
historical comparison, with reference only to the time frame of the years shown, inasmuch as Article XIII A
of the California Constitution, discussed previously, will have an effect upon future taxable valuations of the
City.
City of Tustin
Summary of Taxable Valuations
FiseaiNet
Year
Net
Net
State
Reimbursed
Total
Valuations for
Revenue
Secured
Utility
Unsecured
Exemptions
purposes(1)
1977-78........
$ 145,986,800
$ 3,754,680
$ 17,803,170
$11,011,730
$ 178,556,380
1979-80........
169,863,840
3,638,480
26,151,550
18,506,970
218,160,840
1980-81........
194,344,864
4,751,170
20,987,770
7,537,310
227,621,114
1981-82(2)...
965,113,156
20,433,080
96,898,408
35,269,640
1,117,714,234
1982-83........
1,100,836,596
22,086,110
145,611,939
34,064,548
1,302,599,193
Source: Orange County Auditor -Controller.
(1) Net for revenue purposes only, before deduction of homeowner's and business inventory exemptions.
(2) According to the provisions of Article XIII A of the State Constitution, taxable valuations are listed at
100 percent of cash value. Prior to fiscal year 1981-82, taxable valuations were calculated at 25 percent
of cash value. The change in this procedure is the reason for the significantly larger taxable valuation
figures for fiscal year 1981-82.
Tax Rates
Article XIII A of the California Constitution limits the combined tax rate for all operating levies to one
percent of full cash value. This limitation does not apply to tax levies for voter -approved indebtedness
authorized prior to July 1, 1978.
There are four tax rate areas (Tax Rate Areas 13-049, 13-050, 13-051, 13-052) located in the Project
Area. Set forth below is a six year summary of the tax rates for such tax rate areas.
09124A 01n664
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Tax Rate Areas 13-049, 13-050, 13-051 and 13-052
Tax Rate per $100 of Assessed Valuation
The following table presents the historical tax rates for Tax Rate Area
represents ......% of the total taxable valuation in
the Project Area.
13-049.
Tax Area
Tax Rate Area 13-049
1977-78 1978-79 1979-80
198041
1981-82
1982-83
Tax Rate Area 13-050
.................... 9.7772 5.0618 4.8817
4.8497
1.21425
1.17458
Tax Rate Area 13-051
.................... 9.6612 5.0618 4.8817
4.8497
1.21425
1.17458
Tax Rate Area 13-052
.................... 9.8171 5.0618 4.8817
4.8497
1.21425
1.17458
$1.00000
.................... 9.5777 5.9903 4.7899
4.8089
1.21425
1.17458
Source: Orange County Auditor -Controller.
The following table presents the historical tax rates for Tax Rate Area
represents ......% of the total taxable valuation in
the Project Area.
13-049.
Tax Area
13-049
TAX RATE AREA 13-049
Tax Rate per $100 Taxable Valuation
1M-78
Basic levy .....................
1979-791979-80
1980-81
1981-82
1982-83
................................
Tustin Elementary Sch. Dist. bond
$4.0000
$4.0000
$4.0000
$1.00000
$1.00000
........................
Tustin H.S. Dist. E. bonds
.2132
.1696
.1450
.01994
.00622
.....................................
Tustin Unified School Dist. bond
.0844
.0672
.0581
.01304
.01039
...........................
Tustin Unified Sch. bldg. fund
.0283
0250
.00453
.03592
...............................
Saddleback Community College bond
•3088
2665
.3055
.07548
.06735
...................
County improvement bonds
0337
•0243
.0194
.00391
.00328
.....................................
City of Tustin bonds
.0032
•0028
•0023
.00050
.00043
................................................
Orange Co. Flood Control District
.1249
.01474
.01135
........................
East Orange Co. Water District bond
.0171
.0146
.0130
.00270
.00237
...................
Metro. Water Dist-Mun. O.C. original area.........
.0631
.0299
.0861
.04970
.02067
Orange Co. Sanitation Dist. #7
.1100
.1000
.0890
.01980
.01660
.............................
Total Rate on all Pro ert
p y
.0751.0598
.0492
.00991
....I ...................••••
Rate on Land & Improvements
4.9867
4.8219
4.8050
1.20434
1.17458
.............................
TOTAL TAX RATE
.0751.0598
0492
.00991
..............................................
$5.0618
$4.8817
$4.8497
$1.21425
$1.17458
Source:Orange County Auditor -Controller.
Tax Levies and Delinquencies
For assessment and collection purposes, property is classified either as "secured" or "unsecured", and is
listed accordingly on separate parts of the assessment roll. The "secured roll' is that part of the assessment
roll containing State assessed property and property the taxes on which are a lien on real property sufficient,
in the opinion of the assessor, to secure payment of the taxes. Other property is assessed on the "unsecured
roll'.
The Orange County Tax Collector collects ad valorem property tax levies for each fiscal year
representing taxes levied for such fiscal year on taxable real and personal property which is situated in the
County as of the preceding March 1. Unsecured taxes are assessed and payable on March 1 and become
delinquent on August 31 in the next fiscal year. One-half of the secured tax levy is due November 1, and
becomes delinquent December 10; the second installment is due February 1, and becomes delinquent April
10. A ten percent penalty is added to any late installment as of the 1982 tax roll. On June 30, delinquent
properties are sold to the State.
Property owners may redeem property upon payment of delinquent taxes and penalties. Properties sold
to the State incur a redemption penalty of one and one-half percent per month on the tax due. Properties
may be redeemed under an installment plan by paying current taxes, plus 20 percent of delinquent taxes for
five years. Interest accrues at one-half percent per month on the unpaid balance. If no payments have been
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made on delinquent taxes at the end of five fiscal years, the property is deeded to the State. Such properties
may thereafter be conveyed to the County Tax Collector as provided by law.
Set forth below is a summary of the secured property tax levies, collections and delinquencies levied by
all taxing jurisdictions within the City for the five most recent years.
City of Tustin
Tax Levies and Delinquencies
Source: Orange County Auditor -Controller.
26
013793 093745
Estimated
Delinquency as of
Secured Tax
Amount
June 30
1977 -78
�Y
Codected
Amount
Percent
.......................................................
1978-79 .............................
$1,362,269
$1,339,631
$22,
1979 -80 .......................................................
715,761
703,604
12,157
1.67%
1980-81 ......................
1,109,513
1,079,925
29,588
2.67%
.................................
1981 -82 .......................................................
1,161,051
1,123,623
37,419
3.22%
1,421,196
1,368,163
53,032
1.04%
Source: Orange County Auditor -Controller.
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Direct and Overlapping Debt
Set forth below is a statement of the City's direct and overlapping bonded debt and debt ratios as of
October 4, 1982.
City of Tustin
Direct and Overlapping Bonded Debt
Orange County ...............
PM"'nkpl
Debt
.........................................
Orange County Building Authorities
....................................... 0.12%
Debt
$ 52,305
..........................................................
Orange County Flood Control District
1.813%
296,402
.......................................................
Metropolitan Water District..................................................277,932
1.813
Saddleback Community College District "'
0.356
1,716,091
.........................
Irvine Unified School District .............. """.....
6.734
217,844
Orange Unified School District...................................................................
0.323
117,200
Santa Ana Unified School District, High School District,
0.025
4,033
and School
District.................................
$31 034 093
......................................................................
Tustin Union High School District (Various issues)
0.023
5,178
.................................
Tustin School District .........................
9.970.023 62
503,429
San Joaquin School District (Various issues) """"""""""'
41.059
961,191
............................................
City of Tustin .................... ............................................................................
Orange County Sanitation District #1.......................................................100.000
0.134-0.151
11,231
1,475,000(2)
Orange County Sanitation District #7 (Various issues)
58
...........................
East County County Water District ................
9.803-0152681
649,179
Irvine Ranch Water District........................................................................
2.9
36.880
2,239,342
Irvine Water District, I.D.#2...............................................
407,076
Irvine Ranch Water District, I.D. #105 """""
5.540
1,487,490
...................
Municipal Water District of Orange County Water Facilities19.428
7,101,905
Corporation .....................
..........................................................................
TOTAL GROSS DIRECT AND
2.337
1_ 27'534
OVERLAPPING BONDED
DEBT...........................................
Less: MWDOC Water Facilities Corp. (100% ""'
$19,350,420
self-supporting)
TOTAL NET DIRECT AND OVERLAPPING
1,827.534
BONDED
DEBT.........................................
........................................................
$17,522,886
(1) Based on 1981-82 valuations.
(2) Excludes tax allocation bonds to be sold.
Ratios to 1982-83 Assessed Valuation:
DirectDebt
....................................... 0.12%
Debt
TTotalGross ......................................... .......................... 1.53%
otal Net Debt
............................................ 1.38%
SHARE OF AUTHORIZED BONDS:
Metropolitan Water District
......................................
Tustin Union High
$ 1,299,400
School District ...........................
San Joaquin School
$ 172,597
District ......................................
Irvine Ranch Water District
$ 15,032
......................................
Irvine Ranch Water District, I.D. #2
$ 4,714,927
......................
Irvine Ranch Water District,
$ 105,592
I.D. #105 ..............
$31 034 093
STATE SCHOOL AID REPAYABLE AS OF 6/30/82: $1,206,594
Source: California Municipal Statistics, Inc.
27
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Employment and Industry
The following tabulation lists the largest manufacturing and non -manufacturing employers in the
community area.
MANUFACTURING EMPLOYMENT
Company
Product
Employment
Basic Four Corp
Small Business Computers
1,150
Steelcase
Office Furniture
Silicon Systems
Semi -conductors
800 800
Thiokel/Dynachem
Chemicals
247
Fesco
Plastics & Rubber
150
Ocean Pacific
Clothing
150
Westercorp
Computer Disc Controllers
144
140
NON -MANUFACTURING EMPLOYMENT
Company
Type of Business
Empbymeut
Tustin Unified School
Education
District
1,063
Tustin Community
Medical Services
Hospital
395
Fireman's Funds
Insurance
Shick Moving &
Moving Company
22 0
20
Storage
Mervyn's
Retail Department Store
150
City of Tustin
Government Services
Sunwest Bank
Banking
163
Coors Distributing
Distributor
130
116
Source: Tustin Chamber of Commerce.
114414 162179
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Regional Labor Force
The City of Tustin is included in the Anaheim -Santa Ana -Garden Grove Standard Metropolitan
Statistical Area, which comprises all of Orange County. The civilian labor force employment and unemploy-
ment for the Anaheim -Santa Ana -Garden Grove SMSA is shown below.
ORANGE COUNTY
Civilian Labor Force, Employment and Unemployment
1978............................................................
1979............................................................
1980 ....................................................................
1981 ............
1982(1)
LAbOrUnemployment
Force
Empbymeat
Unemployment
Rate
1,002.6
953.7
48.9
4.9%
1,063.4
1,019.3
44.1
4.1
1,094.2
1,046.8
47.3
4.3
1,166.4
1,113.4
53.0
4.5
1,230.3
1,157.9
72.4
5.9
(1) Data recorded as of June 30, 1982.
Source: State of California, Employment Development Department.
The following lists the annual average number of wage and salary employees by industry within Orange
County for 1977 to June, 1982. Wholesale and Retail Trade is the largest employer in the county with
almost 25 percent of all wage and salary workers. The diversified service industry represents the second
largest source of employment with approximately 22 percent of all employment. Manufacturing of durables
is the third largest employer. Combined retail/ wholesale, services and manufacturing of durables comprise
approximately 65 percent of total non-agricultural employment in the county.
ORANGE COUNTY
Annual Average Employment by Industry(1)
(000's omitted)
Mining......................................................
................................
Construction ...............
.............................................................
Manufacturing, Nondurables .................................................
Manufacturing, Durables ...........................................
............
Transportation &Public Util..........................
........
Wholesale Trade .......................... ..............
Retail Trade......................................I.........
.......................................................................
Finance, Ins. & Real Estate ......................................
............
Service Industries ..........................................
..........................
Federal Government .................................
..............................
State & Local Government....................................................
Total Nonagricultural.............................................................
Agriculture, Forestry & Fisheries .........................................
Total All Industries................................................................
1977
1978
1979
1980
1981
1982(2)
2.1
2.2
2.2
2.3
2.7
2.4
40.6
46.7
51.4
50.0
49.8
48.6
43.8
49.5
53.6
54.5
56.6
57.2
131.2
148.5
162.4
166.1
167.3
168.1
20.6
23.0
26.2
27.3
29.4
30.7
30.4
33.7
36.4
40.2
44.7
46.8
132.5
147.4
155.6
161.1
166.4
169.8
39.7
46.8
52.7
57.2
61.7
64.1
132.2
147.7
162.4
172.1
182.6
193.0
9.4
9.8
10.6
12.4
12.5
12.4
91.8
92.1
90.7
93.2
92.7
91.5
674.2
747.3
804.3
836.4
866.4
884.6
7.7
8.5
7.0
7.4
7.2
7.1
681.9
755.8
811.3
843.8
873.6
891.7
Source: State of California, California Employment Development Department.
(1) Employment reported by place of work excluding workers involved in labor disputes, self-employed,
unpaid family and domestic workers.
(2) Data recorded as of June, 1982.
161704 167714
29
35
JOB NO. 97576X028 ST: 97576X' JEFFRIES BANKNOTE CO. (213) 74�-8800 13 -Oct -82 15:03 SEQ NO: 8
Construction Activity
The following table shows building permit valuation for the City from 1977 through August 31, 1982.
Nonresidential
New commercial ......................................
City of Tustin
$ 2,209
$ 8,542
$ 3,461
$11,212
$1,975
Building Permit Valuation
8,811
25,616
9,814
7,959
11,056
(Valuation in Thousands of Dollars)
Other.........................................................
3,557
1,677
1,351
1977 1978
1979
1980
1981
1982(1)
Residential
4,903
5,147
3,574
2,355
Total Nonresidential .........................
New single -dwelling ................................. $ 1,971 $ 312
$ 4-
$ 2,376
$ 626
$ 207
New multi -dwelling ..................................
3,247 1,004
5,334
1,859
1,057
$24,752
Additions, alterations ...............................
718 467
609
2,317
638
1,193
Total Residential
.............................. $ 5,936 $ 1,783
S 5,942
$ 6,552
$ 2,321
$1,400
Nonresidential
New commercial ......................................
$ 4,594
$ 2,209
$ 8,542
$ 3,461
$11,212
$1,975
New industrial ..........................................
8,811
25,616
9,814
7,959
11,056
609
Other.........................................................
3,557
1,677
1,351
1,633
382
1,437
Additions, alterations ...............................
1,978
3,917
4,903
5,147
3,574
2,355
Total Nonresidential .........................
18,869
33,419
24,610
18,200
26,225
6,375
Total Valuation .................................
$24,805
$35,202
$30,553
$24,752
$28,546
$7,775
No. of New Dwelling Units
330,200
1982(1) .............................................
409
51,717
1,288
88,040
Single -dwelling .........................................
37
9
0
8
9
3
Multi -dwelling ..........................................
175
31
241
37
23
-0-
Total Units ........................................
212
40
241
45
32
3
(1) Year-to-date Summary, August 31, 1982.
Source: "California Construction Trends," Security Pacific National Bank and City of Tustin Building
Department.
Commerce
The number of establishments selling merchandise subject to sales tax and the valuation of taxable
transactions is presented in the following table.
City of Tustin
Number of Permits and Valuation of Taxable Transactions
(1) As of March 31, 1982.
Source: California State Board of Equalization.
164174 030679
30
Retail
Stores
Total All Outlets
No. of
Taxable
No. of
Taxable
Year
Permits
Transactions
Permits
Transactions
f000's omitted)
(000's omitted)
1977 ..................................................
325
$ 87,732
891
$155,558
1978 ..................................................
392
129,194
1.053
212,840
1979 ..................................................
404
159,204
1,113
281,332
1980 ..................................................
404
179,452
1,191
301,673
1981 ..................................................
404
202,379
1,258
330,200
1982(1) .............................................
409
51,717
1,288
88,040
(1) As of March 31, 1982.
Source: California State Board of Equalization.
164174 030679
30
JOB NO. 97576X028 ST: 97576X JEFFRIES BANKNOTE CO. (213) 74. -6800 13 -Oct -82 15:03 SEQ NO: 9
Community Facilities
Primary and secondary education is provided by the Tustin Unified School District. The District
operates on a regular September to June schedule and is not currently at capacity. There are twelve
elementary schools, three junior high schools and three senior high schools. There are also two Catholic
schools, two Lutheran schools and a private Montesorri School. There are eight preschools in the area. The
total public school enrollment for the entire district for the 1982-83 year is 14,362 students.
Advanced education is available at Univeristy of California at Irvine, California State University at
Fullerton and the Saddleback Community College District.
Tustin has one general hospital with a 203 total bed capacity. Also practicing in Tustin are 122
physicians/surgeons, 48 dentists, 10 optometrists, 12 chiropractors and 6 podiatrists.
There are 14 churches within the City limits representing a broad range of religious denominations.
There are an additional 10 churches within five minutes of Tustin. There is one library, one newspaper
(published weekly) and one local television station (Channel 40). All of the Los Angeles metropolitan area
TV stations are received. There are I1 banks and 10 savings and loans.
Transportation
One of City's most valuable assets is its accessibility via two of the major freeways serving Orange
County. The Santa Ana Freeway (Interstate 5) and the Newport Freeway (State Route 55) both pass
through the City of Tustin. In addition, three other major Southern California freeways are all within 5
miles of Tustin.
The Orange County Transit District (OCTD) provides bus service to Tustin with linkages to the Los
Angeles Metropolitan Area. Other bus facilities include the Greyhound depot and the Southern California
Rapid Transit District services, all a short distance from Tustin.
Santa Fe Railroad provides freight service through Tustin on eight scheduled stops daily. Trains
connect throughout the continental United States, and switching service is around the clock. The nearest
Amtrak passenger station is located only two miles away in Santa Ana.
The John Wayne Airport (formerly Orange County Airport) is only five miles from Tustin. It is served
by the following airlines: Air California, Golden West, PSA, Frontier, Western and Republic. It has two
lighted asphalt runways up to 5,700 feet in length.
Trucking service is available through 73 certified carriers including 65 which service California and
intrastate points. Overnight service is available to San Diego, Los Angeles, Phoenix and San Francisco Bay
Area.
Utilities
Tustin residents are provided with water services primarily through the City of Tustin. The City has a
maximum pumping capacity of 12.5 million gallons/day. Average consumption is 9.1 million gallons/day.
Sewer Service is supplied by County Sanitation District No. Seven of Orange County which has a
primary and secondary treatment plant and no facilities for non-recoverable industrial waste water.
The Southern California Gas Company supplies natural gas, Southern California Edison provides
electrical power, and Pacific Telephone and Telegraph Company provides phone service in the City.
31
053641 105432
i
36
JOB NO. 97576X028 ST: 97576X JEFFRIES BANKNOTE CO. (213) 74�,-6800 13 -Oct -82 13:57 SEQ NO: 10
n i 546 »m 7n
APPENDIX A
KatzHollis Katz Hollis Corer
& Associates, Inc
Financial
Consultants
The Oviatt
October 4, 1982 Building
617 S
Tustin Community Redevelopment Agency Suite 710 Olive
300 Centennial Way Los
Tustin, California 90014ngeles, CA
Attention: Mr. William A. Huston (213)629-3065
Executive Director --
Dear Mr. Huston:
Enclosed is a tabulation of projected taxable value and —._—
resulting tax revenue for the Town Center Redevelopment
Project. The projected revenues are based on information
supplied by Agency staff, assumptions determined during
our review of Project assessed value history and the
property assessment and tax apportionment procedures
of Orange County.
General Assumptions
The tax rates used in the determination of incremental
revenues are based on averaged actual tax rates since the
passage of Proposition 13. The override tax rate for
1983-84 and subsequent years has been reduced by a
factor approximately equal to the average annual de-
cline from 1978-79 to 1982-83. The decline is allowed
to continue and is assumed to stabilize at the basic
$1.00 per $100.00 of taxable value rate established by _
Article %IIIA of the California Constitution (Proposition
13). The reduction is an assumed reflection of the inter-
play between taxable value within jurisdictions levying
taxes in the Project area and the effective limit on the
amount which can be levied (i.e. annual debt service on
voter -approved indebtedness).
In 1980, the Governor signed into law legislation (Chapter
801, Statutes of 1980) which, among other provisions, estab-
lished a method by which taxing entities could reduce the
amount of property taxes due them from within their juris-
dictions. Language in the measure seems intended at insulat-
ing other taxing entities and redevelopment agencies from
the effects of such reductions. Because the method pre-
scribed for the reduction. involves the computation of an ---
"effective tax rate reduction," a possibility exists of a
misinterpretation which could reduce the amount of tax
increment revenue generated in a redevelopment project
area.
A-1
KatzHollis
Tustin Community Redevelopment Agency
October 4, 1982
Page 2
It is assumed for purposes of this analysis that any use
of the reduction procedure by taxing entities in the Pro-
ject would not effect the Agency's receipt of tax incre-
ment revenue.
The 1982-83 taxable value for the Town Center Project in-
cludes approximately $8,000 in business inventory value.
Business inventory property has been exempted from tax-
ation since the 1980-81 fiscal year, as discussed below.
It is therefore assumed that this 1982-83 business inven-
tory value represents escapes from taxation in previous
years and will not be included in subsequent Project Area
valuations.
The taxable values for Fiscal Year 1982-83 utilized in the
enclosed projection of value and resulting tax allocations
are based on 1982-83 actual tax assessments. The value of
state -assessed utility property has been maintained through-
out the projection at its 1982-83 level. Personal property
taxable value has been adjusted to reflect value which is
assumed added to the tax rolls in conjunction with new real
property construction. Real property taxable value is
assumed to increase 2% annually, as allowed per Article
XIIIA of the California Constitution (Proposition 13).
Assembly Bill (AB) 1994
In 1979 the Legislature enacted a measure, Assembly Bill 66,
which eliminated the assessment and taxation of business in-
ventory property and provided a formula for the state to
reimburse local agencies for the loss of tax revenues
generated by business inventory value. Due to a technical
drafting error, redevelopment agencies were not included
among the local agencies eligible for reimbursement of
lost business inventory tax revenue. The error was correct-
ed by the Legislature in 1980 through the passage of Assembly
Bill 1994 which specifically provided for replacement, in
part, of the revenue lost by redevelopment agencies as a
result of AB 66.
AB 1994 provides for restoration of business inventory revenue
amounts through the annual addition of the tax rolls of re-
development projects of "artifical" taxable value.
WWA
KatzHollis
Tustin Community Redevelopment Agency
October 4, 1982
Page 3
Per AB 1994, the initial taxable value amount, that for 1980-81,
was to be determined by reducing actual 1979-80 business inven-
tory taxable value by a factor computed by dividing a one percent
tax rate by the actual tax rate applicable within the project
area. The effect of this adjustment is to have the new tax-
able value yield revenues equivalent to those that would be
generated if a project area has a tax of one percent of market
value. The County of Orange, in implementing AB 1994, has
computed business inventory subvention revenues on the basis
of a one percent tax rate against the "artificial" taxable
value rather than the total tax rate, inclusive of override
tax rates. This varies from a literal application of the
California Redevelopment Law (Chapter 29, Statutes of 1979)
which requires any year's project revenues to be calculated
through the utilization of the current year tax rate, which
includes override tax rates levied by taxing entities to
repay voter -approved indebtedness.
is The amount of taxable value to be added in subsequent years
citydorsted countyninlly to which thelect chageprojectnissin population of the
located and the
ate
of inflation. In computing this adjustment for the tworyears
subsequent to the enactment of AB 1994 the actual rate of
statewide inflation (based on CPI) was used. In adjusting
between 1980-81 and 1981-82, however, the Legislature mandated
an inflation adjustment of only 2.92 percent. Further, the
Legislature has mandated that there will be no increase in
business inventory subventions for 1982-83. It is our o
based on conversations with persons familiar with the activities
of the Legislature and the status of State fiscal affairs, that
the adjustment for inflation will continue to be done at rates
lower than actual CPI growth. For this reason, the projection
does not include any adjustment to business inventory subvention
revenue beyond the 1982-83 amount.
New Construction Activit
The taxable value added as a result of new construction activity
is based on information provided by Agency staff and developers
regarding existing and proposed developments in the Project. The
value of personal property has been increased to reflect personal
property taxable value which would be added to the tax rolls as
a'result of new real property construction.
A-3
KatzHoiiis
Tustin Community Redevelopment Agency
October 4, 1982
Page 4
The developments which are included are set forth in Schedule
C (New Development Assumptions). The enclosed Schedule of
New Development provides further detailrelative to the
developments themselves and the year to year addition of
taxable value to the Town Center Project as these develop-
ments are implemented.
We hope this information is
answer any questions you may
Sincerely,
useful and are available to
have.
KATZ, HOLLIS$ COREN & ASSOCIATES, INC.
A-4
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A-5
KatzHoiiis
Schedule Aa
Tustin Community Redevelopment Agency
Town Center Redevelopment Project
NOTES TO TAX INCREMENT PROJECTION
09308,
(1) Reflects increase of 2% above prior year's total real
property for valuation increases allowable under
Proposition 13.
(2) See Schedules B and C for assumptions of new development
timing and valuation estimates.
(3) Includes locally assessed personal property and public
utility value assessed by the State Board of Equalization.
(4) Projected tax rate reflects annual average decrease since
the passage of Proposition 13.
(s) Assumed to remain constant due to uncertainty of State
budgetary constraints.
(6) Reflects removal of $8,160 in business inventory value as
shown on the 1982-83 tax roll.
A-6
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A-10
KatzHollis
Schedule C
Tustin Community Redevelopment Agency
Town Center Redevelopment Project
NEW DEVELOPMENT ASSUMPTIONS
093082
Stevens Square - 210 - 250 West Main
Description: An eight building complex with 55,362
square feet of office.
Development Schedule: Construction started third quarter
1981.
85% valuation March, 1982.
100% valuation March, 1983.
Tenant Improvements/
Personal Property: 100% valuation March, 1983.
730 E1 Camino
Description: A 39,679 square foot 3 -story office
condominium with 132 parking spaces at
ground level.
Development Schedule: Construction time projected from second
quarter 1983 to fourth quarter 1983.
100% valuation March, 1984.
New Value/Transfer
of Ownership: 100% valuation March, 1984.
750 E1 Camino
Description: A fourteen unit addition to an exist-
ing motel.
Development Schedule: 100% valuation March, 1982.
Fixtures/Improvements: 100% valuation March, 1982.
A-11
Katz Hollis
Tustin Community Redevelopment Agency
NEW DEVELOPMENT ASSUMPTIONS
Page 2
150 E1 Camino
Description: A 43,056 square foot office building
with surface parking of 144 spaces.
Development Schedule: Construction started third quarter
1981.
60% valuation March, 1982.
100% valuation March, 1983.
Tenant Improvements/
Personal Property: 100% valuation March, 1983.
445 South "C" Street
Description: 2 -level
parking structure with 211
spaces (83 spaces to be publicly owned)
Development Schedule: Construction started first quarter
1982.
100% valuation March, 1983.
180 South Prospect
Description: A 15,000 square foot office building
with surface parking of 50 spaces.
Development Schedule: Construction started second quarter
1982.
100% valuation March, 1983.
Tenant Improvements/
Personal Property: 100% valuation March, 1983.
A-12
KatzHollis
Tustin Community Redevelopment Agency
NEW DEVELOPMENT ASSUMPTIONS
Page 3
145 West Main
Description:
A 5,840 square foot office building
with
surface parking
of 20 spaces.
Development Schedule:
Construction started
first
1982.
ouarter
15% valuation March,
1982.
100% valuation March,
1983.
Tenant Improvements/
Personal Property:
100% valuation March,
1983.
17496 Holt Avenue
Description:
A 6,605 square foot office building
with
surface parking of 22 spaces.
Development Schedule:
Constructed
Projected
quarter 1983to]third
15%
quarter 1983.
valuation March, 1983.
1008 valuation March,
1984.
Tenant Improvements/
Personal Property:
100% valuation March,
1984.
18302 Irvine Boulevard
Description: A low-rise office of 45,536 square feet
with 1,708 square feet of retail with
surface parking of 159 spaces.
Development Schedule: Constructed projected to begin Second
quarter 1983.
75% valuation March, 1984.
100% valuation March, 1985.
Tenant Improvements/
Personal Property: 100% valuation March, 1984.
A-13
KatzHollis
Tustin Community Redevelopment Agency
NEW DEVELOPMENT ASSUMPTIONS
Page 4
SW of Newport and Main
Description:
Development Schedule:
Tenant Improvements/
Personal Property/Fixtures:
A three building mid -rise development
with a four-story parking structure of
approximately 900 spaces.
Building A - a four-story 100,000
square foot structure consisting of
80,000 square feet of office, 15,000
square feet of retail and a 5,000
square foot restaurant.
Building B - a five -story 152,500
square foot structure consisting of
123,000 square feet of office, a 16,500
square foot movie theatre, an 8,000
square foot restaurant and 5,000 square
feet of retail.
Building c - a five -story 96,580 square
Foot office building.
Building A projected to begin fourth
quarter 1984.
208 valuation March 1, 1985.
100% valuation March 1, 1986.
Building B - projected to begin second
quarter 1982.
40% valuation March 1,
1984.
1008 valuation March 1,
1985.
Buildin C - projected
to begin fourth
quarter 1984.
20% valuation March 1,
1985.
100% valuation March 1,
1986
Parking stru-t
second u198re to begin
20% valution March 1, 1985.
100% valuation March 1, 1986.
Building A - 100% valuation March -1,
1986.
Bui-- 1 n B - 100% valuation March 1,
1985.
Build C - 100% valuation March 1,
1986.
A-14
JOB NO. 97576X028 ST: 97576X JEFFRIES BANKNOTE CO. (213) 742-88()0 13 -Oct -82 13:57 SEQ NO: 11
APPENDIX B
TUSTIN COMMUNITY REDEVELOPMENT AGENCY
AUDITOR'S REPORT AND FINANCIAL STATEMENTS
FOR FISCAL YEAR ENDED JUNE 309 1982
176062 170237
September 28, 19E2
The Board of Directors of the
Tustin Community Redevelopment Agency
610 NEWPORT CENTER DRIVE, SUITE 1325
NEWPORT BEACH. CALIFORNIA 92660
17141 640-1333
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 baiance-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.
F035
Tustin
Community Redevelopment Agency
$ 20,537
$ 2,8'
Balance
Sheet
45,462
21,3!
June 30,
1982
Governmental
Account Group
Fund Type
General Long -Term
Totals
Capital
Projects
Debt
(Memorandum Only)
1,694,199
1,149,2
Fund Equity:
1982 1981
Assets
Fund balance - designated
Cash and short-term
for capital outlay
891,141
investments
$2,0792672
Total Liabilities and
$2,079,672 $1,537,71
Taxes receivable
179231
Fund Equity
17,231 15027
interest receivable
38,437
See Accompanying Notes to Financial Statements.
38,437 4,9E
Amount to be provided for
B-2
payment of long-term debt
$450,000
450,000
Total Assets
$2,135,340
$450,000
$2,585,340 $1,693,4;
Liabilities and Fund Equity
Liabilities:
Accounts payable
$ 209537
$ 20,537
$ 2,8'
Due to City of Tustin
45,462
45,462
21,3!
Loans and accrued interest
payable to City of
Tustin (Note 2)
1,178,200 $450,000
1,628,200
1,125,01
Total Liabilities
1,2449199 450,000
1,694,199
1,149,2
Fund Equity:
Fund balance - designated
for capital outlay
891,141
891,141
544,2
Total Liabilities and
Fund Equity
$29135,340 $450,000
$2,585,340
$1,693,4'
See Accompanying Notes to Financial Statements.
B-2
Tustin Community Redevelopment Agency
Statement of Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual
For the Year Ended June 30, 1982
Revenues:
Tax increments
Interest earned
Other taxes
Total Revenues
Expend i tures:
Administration
Capital expenditures
Total Expenditures
Excess of Revenues Over
(Under) Expenditures
Other Financing Sources:
Long-term loan from City of
Tustin
l 4
992,688
1,305,717
Over
109,832
166,006
(Under)
Budget
Actual
Budget
$ 921,688
$1,110,858
$ 189,170
169000
137,232
121,232
55,000
57,627
2,627
992,688
1,305,717
313,029
109,832
166,006
56,174
296489118
1,2429830
(1,405,288)
29757,950
1,408,836
(1,349,114)
(1,765,262)
(103,119)
1,662,143
450,000
450,000
Excess of Revenues and
Other Financing Sources
Over (Under) Expenditures (1,765,262)
Fund balance,
beginning of year
Fund balance,
end of year
544,260
346,881
544,260
2,112,143
$(1,221,002) $ 891,141 $ 2,112,143
See Accompanying Notes to Financial Statements.
B-3
Tustin Community Redevelopment Agency
Notes to Financial Statements
June 30, 1982
Summary of Significant Accounting Policies
Description of Fund and Account Group
The accounting records of the Agency are organized in a vital proiects 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 basis
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 Citv 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.
B-4
C
Tustin Community Redevelopment Agency
Notes to Financial Statements (Cont.)
June 30, 1982
2. Loans and Accrued Interest Pa able to Cit 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 $1,125,000
Accrued Interest
53,200
Included in long-term debt: 1,1781200
12% Loan Payable
a--. 50,00_0
$1,628,200
The 81 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.
LID