HomeMy WebLinkAboutRDA PLANNING 03-16-81DATE:
March 11, 1981
REDEVRTOPMS~T Ac~RMCY
Inter-Corn
TO:
FROH:
SUBJECT:
HONORABLE MAYOR Ab~3 CITY COUNCIL
DAN RrAZNK~I~SHIP, CITY ADMINISTRATOR
REDEVELOPMENt2 PLANNING
After clarification of the intent of Councilman Edgar's suggestion regarding
securing a consultant for the Redevelot~nent Agency, we understand that the
primary purpose was to insure that we did not lose our eligibility for tax
increment funds due to a lack of an updated plan or fund co~itments.
Attached is a memorandum frcml ~Dn Nault, Finance Director relating he has
researched that question and is satisfied we will b~ve no problew~. Staff is
working on the update of the plan and has been for some time. In January, the
potential projects were identified except for some of the potential recreation
projects. The Director of Cozmnunity Services needed ~re time to finalize her
suggestions and so the task force suspended its work until April. In April,
all of the identified projects will be reported to the ;~ency Board, along with
reconvm~ndations on priorities and funding approach. We may, following the
Agency's conclusions on priorities, need the services of a financial consultant
for any bond or loan needs. Also, the Director of Public Works will be able to
review the nature of the projects and reconTnend either: (1) they he
accomplished with existing staff, (2) the staff he supplemented with Agency
funded positions, (3) engineering contracts be awarded, or (4) a combination of
the above be utilized. The objective will be to secure the engineering rapidly
in order to expedite the projects as funding is available.
It will be appropriate at some point to consider revising the plan to adjust
the self-imposed tax increment limits to the rapid increase in construction
costs and inflation. Our present thinking is that the best time for sud~ an
adjustment will be when our $600,000 averase annual tax increment limit starts
to apply in 3 to 7 years. A revision will mean conplying with the 25 percent
use for housing and other provisions.
DAN BLANKENSHIP, /
City ~dministrator
DB:dmt
DATE:
March 10, 1981
Inter - ¢ om
TO: Dan Blankenship, City Admi~t~rator
FROM: Ron Nault, Finance Director~~
CITy
SUBJECT: Redevelopment Agency Tax Increment Status
As part of Councilman Edgar's request for a review of the City's Redevelopment
Agency options, I have been looking into the tax increment question. I have
discussed the situation with Ron Rubino, County Auditor Controller's Office,
and have been told that regardless of the amount of available funds in the
Agency we are entitled to the tax increment as long as any debt we have in-
curred is greater than the increment we will receive.
This eliminates any concern on our part to try and spend Agency funds prior
to June 30, 1981 to avoid the loss of next years' increment. We will make the
transfer from the general fund to the Redevelopment Agency of the $1,125,000
prior to June 30. Also, I will be taking the necessary steps, with the co-
operation of the Public Works and Community Development Departments, to ensure
that we get a clean Redevelopment audit this year.
DATE:
TO:
FROM:
SUBJECT:
January 19, 1981
inter-Corn
Dan Blankenship, City Administrator
Ron Nault, Finance Director ~~/,/~l
RDA TAX INCREMENT AVERAGING
The Health & Safety Code does not address the method of
determining the average annual tax increment that can be
collected per the RDA plan. I have attempted to maximize
the available tax increment in the early years of the agency
in order to finance projects with pre-inflated dollars,
and not be forced to sell bonds unless it is absolutely
necessary.
The attached exkibit compares (a) beginning to average
revenues from the year they are received, and (b)
beginning to average from the year that the agency was
formed. The advantage of (b) is that we can continue to
receive an increased amount of tax increment three years
longer than with alternative (a). These three years will
give us an additional $500,000 for projects before we must
settle for a fixed $600,000 per year.
The graphs illustrate the growth curve for both alternatives,
assuming a 2% post 13 growth rate.
Exhibit I
Year
76-77
77-78
--78-79
79-80
80-81
-- 81-82
82-83
83-84
-- 84-85
85-86
-86-87
87-88
8~-89
-90
06-07
Alternative A
Actual/
Projected
-0-
$208,791
274,939
694,550
$708,441
722,610
737,062
751,803
701,807
$599,995
600,000
600,000
600,000
600,000
$600,000
TUSTIN COMMUNITY RDA
(fo~med November 1976)
Tax Increment Revenue
Average
-0-
$208,791
241,865
392,760
$471,680
521,866
557,732
585,457
600,000
$600,000
600,000
600,000
600,000
600,000
600,000
Alternative B
Actual/
Projected
Average
-0-
$208,791
274,939
694,550
-0-
$104,396
161,243
294,570
$708,441
722,610
737,062
751,803
766,839
$377,344
434,889
478,056
512,275
540,559
$782,176
797,819
754,971
600,000
600,000
$564,721
585,912
600,000
600,000
600,000
600,000
600~000