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HomeMy WebLinkAboutRDA ANNUAL REPORT 11-21-83DATE: THRU: TO: FRO~: November 16, 1983 WILLIAM HUSTON, EXECUTIVE THE REDEVELOPMENT AGENCY R. KENNETH FLEAGLE SUBJECT: RDA ANNUAL REPORT REDEVELOPMENT AGENCY NO. 5 11-21-83 nter - C om RECOMMENDED ACTION: Adoption of Resolution No. RDA 83-7, approving and transmitting the Annual Report for FY 1982-83. BACKGROUND: The Redevelopment Agency is required by law to adopt an annual report and forward the report to the City. Council and to the State Department of Housing and Community Devel- opment. The City Council must review the report and take appropriate action at the first meet- ing held 21 days after receiving the report. The report of the Redevelopment Agency will be scheduled for review by the City Council on December 19, 1983. 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 RESOLUTION NO. RDA 83-7 A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF TUSTIN APPROVING AND TRANSMII~FING THE ANNUAL REPORT FOR FY 1982-83 The Redevelopment Agency of the City of Tustin, California does hereby resolve as follows: I. The Redevelopment Agency finds and determines as follows: a. Article 6, Chapter I, Part I Commun!ty Redevelopment Law, California Health and Safety Code requires every redevelopment agency t~ file an annual report for the agency's fiscal year with the City Council and the Department of Housing and Community Development. b. A report of the Agency's activities for fiscal year 1982-83 has been prepared pursuant to applicable State Statutes. c. An independent financial audit report will be added as Section X of the annual report. II. The Redevelopment Agency of the City of Tustin hereby adopts the annual report and directs that said report, incorporating the report of the auditor, shall be transmitted to the State Department of Housing and Community Development and to the City Council. PASSED AND ADOPTED at a regular meeting of the City of Tustin Redevelopment Agency, held on the day of , 1983. ATTEST: Ronald 8. Hoesterey, Mayor. Mary E. Wynn City Clerk 28 TUSTIN REDEVELOPMENT AGENCY ANNUAL 1982-83 REPORT The Tustin Drug and The First National Bank of Tusfin, intersection of Main and "D" Streets in 1945. Historfcal Collection First American Ti~e Insurance Company ANNUAL REPORT CITY OF TUSTIN REDEVELOPMENT AGENCY FY 1982-83 RDA BOARD Ronald B. Hoesterey, Chairman Ursula E. Kennedy, Chairman Pro-Tempore Richard B. Edgar Donald J. Saltarelli Frank N. Greinke STAFF Bill Huston, Executive Director Ron Nault, Treasurer m Mary Wynn, Secretary/Clerk James B. Rourke, Attorney ASSOCIATE STAFF Robert Ledendecker, Public Works Director Donald D. Lamm, Director of Community Development R. Kenneth Fleagle, D.P.A. Consultant Katz, Hollis, Coren & Associates, Inc., Financial Consultants Submitted by: William A. Huston Executive Director November 21, 1983 TABLE OF CONTENTS PAGE I. INTRODUCTION 1 II. REDEVELOPMENT AGENCY REVIEW 2 A. Purpose and Activities 2 B. Personnel 3 C. Resources and Expenditures 4 D. Projected Revenues 5 III. CHRONOLIGICAL HISTORY OF THE TUSTIN REDEVELOPMENT 6 AGENCY 1982-83 IV. MAJOR PUBLIC PROJECTS WITHIN REDEVELOPMENT AREA 9 V. MAJOR PRIVATE PROJECTS WITHIN REDEVELOPMENt AREA 10 VI. GOALS AND ACHIEVEMENTS FOR 1982-83 11 VII. GOALS AND PROJECTS FOR 1983-84 12 VIII. RECOMMENDATIONS FOR NEEDED LEGISLATION 13 IX. HOUSING AND DISPLACEMENT X. AUDIT REPORT (SEPARATE COVER) APPENDIX A TAX ALLOCATION BOND OFFICIAL STATEMENT, NOVEMBER 15, 1982 I. INTRODUCTION The City of Tustin Redevelopment Agency was created by Ordinance No. 696 on October 4, 1976. This report for FY 1982-83 is the third annual report of the Agency and the year of activity is the most significant thus far in the history of redevelopment in Tustin. The Community Redevelopment Law, (Division 24, Part I, Chapter I. Article 6 Sec. 33080. of the California Health and Safety Code) requires each agency to file an annual report with the Department of Housing and Community Development and with the City Council. The report shall contain: de an independent financial audit report for the previous fiscal year; a work program and goals for the coming year; an examination of the previous year's achievements related to the goals of the work program; recommendations for needed legislation; a description of the Agency's activities affecting housing and displacement. The City Council is required to review the report and take appropriate action at the first meeting of the Council which is held 21 days after receipt of the report from the Redevelopment Agency. The Annual Report for FY 1982-83 follows the same format as the previous years by indicating the major achievements of the Redevelopment Agency and private developers in revitalizing the Town Center Area in accordance with the intent and purpose of the Community Redevelopment Law. In addition, a section is included to show the Agency's activities affecting housing and displacement during the fiscal year, in compliance with Sec. 33080.4 of the Community Redevelopment Law. Since the Tustin Town Center Redevelopment Project was created prior to the requirement for a 20% housing fund set-aside, the report does not include this data. The significance of 1982-83 activities is the authorization and sale of $8,500,000 in Town Center Area Redevelopment Project Tax Allocation Bonds and the completion of the E1Camino Real Main Street Improvement Project. -1- II. REDEVELOPMENT AGENCY REVIEW A. Purpose and Activities The basic purpose, goals and objectives of the Redevelopment Agency, as stipulated by City Council Ordinance No. 696 and as further elaborated upon by the policies adopted by the Redevelopment Agency on November 2, 1982, remain in effect. On-going policies which have not reached fruition are as follows: Priority for the expenditure of tax increment revenue will be given to projects which stimulate and facilitate sales tax generating commercial projects. Agency funded capital improvements within public rights-of-way (infra-structure) should be integrated with private developments which are consistent with the Agency's adopted redevelopment project area plan. e Agency funded capital improvements within public rights-of-way should be prioritized and scheduled so as not to preclude the option to finance critical non-capital improvement projects. Consistent with California Redevelopment Law, the Agency will exercise its powers of eminent domain, condemnation, or negotiated acquisition and sale of land where such actions result in achievement of objectives set forth in redevelopment project area plans. These powers shall only be executed where it can be demonstrated that without Agency participation, a development {consistent with the objectives of the project area plan} would not otherwise proceed. B. Personnel There was no change is the membership of the Redevelopment Agency during FY 1982-83 from the previous year, with the exception of Ron Hoesterey assuming the office of chairman upon the reorganization on April 4, 1983. Mr. Don Lamm, Director of Community Development was added to the associate staff vice Mike Brotemarkle on May 31, 1983. -2- The Redevelopment Agency, on June 30, 1983, was comprised of the following: Chairman: Members: Ronald B. Hoesterey Richard B. Edgar Frank H. Greinke Ursula E. Kennedy Donald J. Saltarelli Executive Director: Treasurer: Secretary/Clerk: Attorney: William A. Huston Ron Nault Mary Wynn James G. Rourke -3- Resources and Expenditures Capital Projects Fund: Fund Balance - June 30, 1982 Revenues: Interest Earned Other $ 387,087 136,747 Other Financing Sources: Bond Proceeds Operating Transfers In $ 6,991,549 257,200 Expenditures: General Government Capital Improvements $ 1,211,270 2,272,363 Fund Balance - June 30, 1983 Debt Service Fund: Fund Balance - June 30, 1983 Revenues: Taxes Interest Earned Intergovernmental Revenues $ 1,201,369 181,724 133,984 Other Financing Sources (uses): Bond Proceeds Operating Transfers Out $ 1,261,412 (257,200) Expenditures: Principal Debt Retirements Interest and Fiscal Charges $ 0 399,576 Fund Balance - June 30, 1983 -4- $ 891,141 523,834 7,248,749 3,483,633 $ 5,180,091 $ 0 1,517,077 1,004,212 399,576 $ 2,121,713 D. Projected Revenues Based on approved and pending projects, tax allocation revenues of the Tustin Town Center Project Area are projected as follows: Year Revenue 1983-84 $ 1,392,000 1984-85 1,501,000 1985-86 1,720,000 1986-87 1,873,000 1987-88 1,882,000 1988-89 1,890,000 1989-90 1,897,000 1990-91 1,903,000 1991-92 1,908,000 (Source: Katz, Hollis, Coren & Associates) -5- III. CHRONOLOGICAL HISTORY OF THE TUSTIN REDEVELOPMENT AGENCY July August September 1982-83 Awarded contract for construction engineering services for E1 Camino Real/Main Street Improvements to Berryman & Stephenson, Inc. in the amount of $65,841.00. Accepted the Alley Reconstruction Improvements for the alleys east of E1 Camino Real between Main and Third Street, Tract No. 3994 and E1 Camino Bank alley between Third and E1 Camino Real by Porter Construction Company. Total project cost = $91,212.91. Authorized a sign for the Tustin Area Museum in the amount of $2,000.00. Selected the Western Redland tree for the northerly and southerly ends of E1Camino Real. Awarded contract for E1Camino Real/Main Street Improvements to R.J. Noble Company in the amount of $1,201,141.50. Directed the preparation of a pictorial history of Redevelopment Agency projects. Received Phase I of the Redevelopment Agency's financial plan from Katz, Hollis, Coren & Associates. Conducted a workshop on August 30 to prioritize projects for a Redevelopment Bond Program. Approved demands for the month of July in the amount of $181,039.71. Approved demands for the month of August in the amount of $112,070.96. Adopted the Agency budget and appropriated revenue for FY 1982-83. Appropriated $55,000 for the signalization Of Prospect Avenue and First Street. Reappropriated $825,245 for the unexpended appropriation from FY 1981-82. Authorized the retention of Mudge, Rose, Guthrie and Alexander and Rourke and Woodruff as the Agency's bond counsel. Authorized the retention of Miller & Schroeder Municipals, Inc. as financial consultant for the issuance of tax allocation bonds. -6- October November December Adopted the following project priorities for funding from bond proceeds: 1. Land Acquisition 2. Senior Citizen Housing 3. Columbus Tustin Park/Community Center 4. Undergrounding of Utilities (Holt-Irvine-Newport) 5. Parking Structure 6. Water System Improvements 7. Repayment of General Fund Loan 1,800,000 200,000 1,0o0,000 750,000 1,000,000 500,000 1,125,000 $ 6,375,000 Authorized the Executive Director to publish notices of sale of tax allocation bonds. Authorized a ribbon-cutting ceremony and recognition of the TNT Committee for the dedication of the E1 Camino Real/Main Street Improvement Project. Approved demands for the month of September in the amount of $888,799.52. Authorized supplemental appropriations for E1Camino Real project as follows: 1. Contract Administration. $ 1,458 2. Construction Inspection 34,181 3. Construction Contract 35,000 Approved the 1981-82 Annual Report. Approved check and warrant procedures. Authorized the issuance and sale of $8,500,000 Tax Allocation Bonds. By Resolution No. RDA 82-13, the Agency accepted the bid of Merrill Lynch White Weld Capital Markets Group and Associates for the purchase of Tax Increment Bonds in the amount of $8,500,000 at 9.7715% interest rate with a 2.0963364% discount rate. Approved demands for the month of October in the amount of $290,412.25. Approved demands for the month of November in the amount of $689,481.14. Authorized the acquisition of property located at 450 E1 Camino Real. -7- January (1893) February March April May June Authorized the Redevelopment Agency membership in the Local Agency Investment Fund. Directed staff to proceed with steps necessary to establish the South/Central Redevelopment Area Project. The E1Camino Real Project was dedicated on January 15, 1983, signifying the completion of a project envisioned more than ten years ago. Approved demands for the month of December in the amount of $238,362.56. Accepted the installation of traffic signals at E1Camino and 6th Street. Accepted the completion of the E1Camino Real/Main Street Improvement Project. Approved demands for the month of January in the amount of $808,745.92. Approved the traffic signal modification at Prospect and First Street. Approved demands for the month of February in the amount of $53,11.3.22. Authorized staff to conduct a study utilizing Redevelopment Funds for a water well site. Adopted an amendement to the Conflict of Interest Code. Elected Ronald B. Hoesterey as Chairman and Ursula E. Kennedy as Chairman Pro Tempore of the Redevelopment Agency. Approved the addition and site modifications at 601-607 E1Camino Real. Approved demands for the month of March in the amount of $6,101.79. Allocated $18,400 for the modification of the entrance to Tustin Heights Shopping Center. Authorized the reproduction of the "Walk Through Tustin" historical brochure. Approved demands for the month of April in the amount of $818,383.03. Approved demands for the month of May in the amount of $33,435.25. Approved plans and specifications for landscape maintenance for FY 1983-84. IV. MAJOR PUBLIC PROJECTS WITHIN REDEVELOPMENT AREA (1982-83) Street Projects Completion and dediction of the E1Camino Real/Main Street Improvement Project* Prospect Avenue Widening in 100 Block Signing Tustin Museum E1Camino Real Town Center Traffic Signals Prospect at First Street Irvine Boulevard/Yorba Interconnect Irvine BouleVard/Fashion Lane Interconnect E1Camino Real Landscaping & Street Furniture Irvine Boulevard Center Island* Property Acquisition Acquired the property located at 450 E1Camino Real ($11g,000) Park Development Columbus-Tustin Park Recreation Facility Study* Carry-over projects from previous year -9- V. HA~OR PRIVATE PROJECTS WITHIN THE REDEVELOPHENT AREA EXCEEDING $100,000 PER~IT VALUE (1982-83) Office/Commercial Craddock Klages Burnett/Ehline Ralph's Market Tustin Motor Lodge Marshalls New Developments Address Permit Value 18301 Irvine Blvd. 181-185 E1Camino Real 18302 Irvine Blvd. Redevelopments 1096 Irvine Blvd. 750 E1Camino Real 630 E1Camino Real $ 275,000 172,000 1,750,000 $ 937,000 137,000 285,000 -10- VT. GOALS AND ACHIEVEI~E#TS FOR 1982-83 The Redevelopment Agency established a~ a primary goal the issuance of a tax increment bond to finance capital improvements within the Tustin Town Center Project area. Favorable market conditions resulted in the sale of an $8,5 million tax allocation bond issue at a 9.7715% interest rate, Funds in the amount of $2,296,764 were appropriated for major public improvements. All planned projects were completed, as follows: E1Camino Real Signing E1Camino Real Furniture Irvine Boulevard Center Island Landscaping Columbus-Tustin Park Design E1Camino Real Improvement Project Prospect Avenue Widening Irvine Boulevard/Fashion Lane Signalization E1 Camino Real/6th Street traffic signal First and Prospect traffic signal The Agency proposed determining the feasibility of creating a South/Central Redevelopment Project. The plans were completed during the fiscal year and hearing scheduled for FY 1983-84. Design studies were completed for the development of Columbus-Tustin Park. It was the intent of the Agency to repay its debt to the City of Tustin in the amount of $1,125,000 from the proceeds of a bond sale. This has been accomplished. The Redevelopment Agency was thus able to accomplish the two major and significant goals in FY 1982-83: the completion and dedication of the E1 Camino Real Improvement Project; and the sale of tax allocation bonds. These were the most significant achievements in the history of the Agency. -11- VII. GOALS JUtD PRO,.1ECTS FOR FY 1983-84 Capitals Improvement Projects budgeted for 1983-84 include improvements of- the water system consisting of a new well and a nitrate blending line between wells No. 1 and No. 2, at a total estimated cost of $450,000, underground conduit at Holt/Newport at $20,000 and, First/Prospect street signal modification at an estimated cost of $10,800. Goals for 1983-84 include the adoption of the South/Central Redevelopment Project area and the identification and prioritizing of projects within the area. The Project Committee has recommended that public improvements which are necessary for the health and safety of the area residents be completed prior to the receipt of tax increment revenues from the area. Projects considered to be a priority include South "B" Street and the local streets serving Tustin High School. These projects may be funded in whole or in part from HCDA funds thereby relieving the Redevelopment Agency of the total financial liability. As established by the Agency in September, 1983, priority will be given to the identification and acquisition of blighted parcels in need of redevelopment. -12- VIII. RECOP~4ENDATIONS FOR NEEDED LEGZSLATXON The recommendations for amendment to Section 33354.4 of the Health and Safety Code made in the 1981-82 annual report are still valid. The threat of litigation by other governmental agencies serves to blackmail a redevelopment agency into relinquishing needed revenues to carry out the intent of the redevelopment law. A governmental agency should be able to proceed with assurance of project completion pursuant to State enabling law without being forced to negotiate with other governmental agencies under the threat of litigation. An amendment to Section 33353.5 of the Health and Safety Code could relieve the impact of litigation threats and harassment by adding: "The Redevelopment Agency shall not be obliged to comply with the suggestion of the fiscal review committee nor shall the loss of tax increment financing be the basis of litigation in the coqrts of the State of California. -13- IX. HOUSING INPACT Section 33080.4 of the Community Redevelopment Law requires the annual report to include data pertaining to the Agency's activities affecting housing and displacement as follows: Total Number A. Households Displaced During FY 1982-83 Households Estimated to be Displaced During FY 1983-84 C. Demolitions Total number of dwelling units housing low and moderate income families that were demolished during FY 1983-84 Total number of dwelling units housing low and moderate income families that were demolished as part of a redevelopment project during FY 1983-84 Affordable Housing Constructed, Rehabilitated or Developed During FY 1982-83 (Sec. 3308.4(d)) The Federal Housing and Community Development Block Grant' Program allocated $50,000 for residential rehabilitation loans in Tustin during FY 1982-83. For FY 1983-84, this amount was increased to $75,000. A pending request, that has been approved by the City Council, would allocated $250,000 during FY 1984-85 for rehabilitation of the housing stock through the low interest loan program for owner occupied dwellings and apartment buildings within redevelopment areas. This program is administered by the County of Orange and data on the number of beneficiaries within Tustin's Redevelopment area is not available. Twenty percent (20%) Set-aside for Low and Moderate Income Housing (Sec. 33334.2) Section 33334.2 of the Community Redevelopment Law requiring a 20% set-aside of .taxes allocated to the project to be used for low and moderate income housing is not applicable to the Town Center Redevelopment Project' due to the date of adoption. -14- APPENDIX "A" NEW ISSUE Standard & Poor's Rating: AAA (MBIA Insured) (See "Bond Rating" herein) In the opinion of Co-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. $8,500,000 TUSTIN COMMUNITY REDEVELOPMENT AGENCY (a public body, corporate and politic, of the State of California) TOWN CENTER AREA REDEVELOPMENT PROJECT TAX ALLOCATION BONDS, SERIES 1982 Dated: November 1, 1982 Due: November 1, as shown below Interest on the Bonds is payable on May 1, 1983 and semi-annually thereafter on each May 1 and November 1 of each year until maturity. The Bonds will be initially issued as Bearer Bonds, in the denomination of $5,000, or as Fully Registered Bonds, in the denomination of $5,000 or any whole multiple thereof. Principal of and interest on the Bonds will be payable at the principal office of Security Pacific National Bank, the Fiscal Agent for the Agency in Los Angeles, or, at the option of the holder, at the office of the paying agent in New York, New York. The Bonds maturing November 1, 2006 are subject to redemption from amounts available in the Sinking Account in part by lot on November 1, 1998 and on each November I thereafter at a redemption price equal to the principal amount thereof plus accrued interest to the date of redemption. The Bonds are subject to optional redemption prior to maturity, in whole or in part, on November 1, 1992 and on each interest payment date thereafter, at the redemption prices and in the manner described herein. MATURITY SCHEDULE Pri~i~l Mamd~ Capoa Pri~i~| Mnturi~ Coupon Amount N~ember I Ra~ Yield Amount Novt, mkn' I Ra~ Yi~d $ 85,000 ................... 1983 7.75% 6.00% $190,000 .................. 1991 8.50% 8.50% 95,000 ................... 1984 7.75 6.50 215,000 .................. 1992 8.75 8.75 100,000 ................... 1985 7.75 7.00 235,000 .................. 1993 9.00 9.00 115,000 ................... 1986 7.75 7.25 260,000 .................. 1994 9.20 9.20 125,000 ................... 1987 7.75 7.50 290,000 .................. 1995 9.30 9.30 140,000 ................... 1988 7.75 7.75 325,000 .................. 1996 9.40 9.40 155,000 ................... 1989 8.00 8.00 360,000 .................. 1997 9.50 9.50 175,000 ................... 1990 8.25 8.25 $5,635,000 9.75% Term Bonds due November 1, 2006 -- Yield 9.90% (Plus accrued interest from November 1, 1982) The interest on and principal of the Bonds are payable from and secured by tax revenues'generated by increased taxable valuation of property in the Town Center Area Redevelopment Project over and above its assessed valuation last equalized before the adoption of the Redevelopment Plan for the Town Center Area Redevelopment Project. Such tax revenues shall be delivered to the Agency to be deposited in the Special Fund administered by the Fiscal Agent for the payment of interest on and principal of the Bonds. .4ttention is hereby directed to certain Risk Factors, including legislation and constitutional amendments, more fully described herein. THE BONDS ARE NOT A DEBT OF THE CITY OF TUSTIN, THE STATE OF CALIFORNIA OR ANY OF IFS POLITICAL SUBDIVISIONS, AND NEITHER SAID CITY, SAID STATE NOR ANY OF ITS POLITICAL SUBDIVISIONS IS LIABLE THEREFOR. The Bonds are offered, when. as and if issued, subject to the approval of legality by Mudge Rose Guthrie & ,41exander, Los `4ngeles, California. and Rourke & rdoodruff, Santa `4na. California, Co-Bond Counsel. It is anticipated that the Bonds will be available for delivery in Los ,4ngeles, California on or about December 14, 1982. The date of this Official Statement is November 15, 1982.