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ABx1 26 Redevelopment Agency Dissolution

HOUSING ASSETS

Pursuant to HSC section 34176 (a) (2), the entity assuming the housing functions of the former redevelopment agency is required to submit to the Department of Finance a list of all housing assets by August 1, 2012.  The list must adequately detail how the housing asset meets the criteria specified in HSC section 34176 (e) and must also include all assets transferred between February 1, 2012 and the date upon which the list is created.

HSC section 34176 (a) (2) also states that Finance is to prescribe the format for the list.  For purposes of this notification,  housing successor agencies should use the following Excel spreadsheet form. 

Housing Entity Asset Reporting Form

The completed Excel spreadsheet form should be sent to the redevelopment_administration@dof.ca.gov e-mail address, and should have the following title in the e-mail subject line:

XXX Housing Successor Agency Asset Reporting Form

The Excel spreadsheet form should be submitted to Finance in Excel format – scanned pdf. copies, or copies provided in any form other than an Excel spreadsheet are not acceptable.

If you have any questions concerning how the form should be completed, please reference the following document:

July True-Up Process

On June 27, 2012 the Governor signed AB 1484, which imposes important new tasks on county auditor-controllers and successor agencies.  Health and Safety Code (HSC) section 34183.5 subdivision (b) as added by AB 1484 clarifies that property tax distributed to redevelopment agencies in December 2011 or January 2012 should have been subject to distribution through the AB x1 26 mechanism.  In part due to confusion about the Supreme Court’s order regarding the changes in deadlines under AB x1 26, Finance believes very few, if any, counties correctly adjusted the June 1 property tax payments to successor agencies to capture the amount of funds owed to taxing entities for the January through June period.

To accomplish the correct distribution of funds anticipated in AB x1 26 and as clarified in AB 1484, the following steps are now required:

  • No later than July 9, 2012, county auditor-controllers are required to notify each successor agency of the “residual” amount it still owes to affected taxing entities (ATEs), if anything, pursuant to HSC section 34183 (a) (4) for the period covered by the January 2012 to June 2012 ROPS, after the payment of property tax-funded enforceable obligations and agency administrative costs that were  approved by Finance. 

    If the county auditor-controller applied any amounts owed to ATEs for the January to June 2012 ROPS to fund enforceable obligations on the July through December  2012 ROPS, this was incorrect.  The amounts owed ATEs for the January to June 2012 ROPS should be recomputed without any such deductions.  

    AB 1484 also provides that the county auditor-controller must not withhold any distribution to ATEs or successor agencies based on disputes or for any other reason, unless ordered to do so by a court. Thus, in the absence of a court order, any amounts held by counties that are owed to ATEs or successor agencies for either the January through June period or the July through December period must be distributed immediately.

    Notice need not be sent to a successor agency if the county auditor-controller determines the successor agency does not owe any monies to the ATEs pursuant to HSC section 34183 (a) (4) for the January 2012 to June 2012 ROPS.

    County auditor-controllers are asked to provide Finance with affirmative notice that they have provided the required notice to each successor agency that owes an amount to the ATEs.  The Finance notification should be sent to the redevelopment_administration@dof.ca.gov e-mail address no later than July 9, 2012.  The notice should state as follows:

    “The xxx County Auditor-Controller’s Office hereby affirms it has provided the successor agencies listed below with the notification required by Health and Safety Code section 34183.5 (b) (2) (A).” 

    A list of those successor agencies to which billings were sent and the amounts of those billings should be part of the notice to Finance.
  • For purposes of determining the total amount of property tax available to a successor agency for the January 2012-June 2012 ROPS, the county auditor-controller should include all property tax increment remitted to the former RDA for the fall of 2011 property tax distributions.  Typically, these took place in December 2011 or January 2012, but would also include any monthly allocations up to that time made during fiscal year 2011-12.
  • For purposes of determining the amount of RPTTF that a successor agency was authorized by Finance to expend for the January 2012-June 2012 period, county auditor-controllers must use the amounts shown in Column E of the Exhibit 12 document on this webpage.  These amounts must be considered final determinations as provided in AB 1484.
  • County auditor-controllers should reflect in their calculations those HSC section 34183 (a) (1) passthrough payments that were listed on the January 2012 to June 2012 ROPS approved by Finance.  County auditor-controllers also should reflect in their calculations any HSC section 34183 (a) (1) passthrough payments that the auditor-controller made on behalf of a successor agency, but which were not listed on the ROPS, during the period covered by the January 2012 to June 2012 ROPS.

    County auditor-controllers should use the special July process to distribute to the ATEs those HSC section 34183 (a) (1) passthrough payments that were included on the Finance-approved January 2012 to June 2012 ROPS, but which were not remitted by the successor agency to the ATEs, if the successor agency chooses to provide the amounts necessary to fund pass-through payments in amounts in addition to that which are otherwise owed in accordance with 34835.5(b).  Please note, these pass-through payments do not constitute a payment required by section 34835.5(b)(2)(A).  As such any failure to remit pass-through payments are not controlled by section 345835.5(b) but are instead controlled by section 345835.5(a) and other applicable law.

    County auditor-controllers should not use the July process to distribute to the ATEs any HSC section 34183 (a) (1) passthrough payments currently owed to the successor agencies that were not included on the Finance-approved January 2012 to June 2012 ROPS. AB 1484 provides for an adjustment to be made in the next ROPS distribution process in January 2013 to account for these particular unpaid passthrough payments.
  • No later than July 12, 2012, each successor agency is required to remit to the county auditor-controller the total amount specified in the above notification.  Successor agencies must make the remittances in the form and manner specified by the county auditor-controller. 

    If a successor agency fails to remit the required amount, county auditor-controllers should notify Finance by July 13, 2012.  This notification should be sent to the redevelopment_administration@dof.ca.gov e-mail address.  The notification should state (1) the amount the successor agency was required to remit, and (2) the amount actually remitted.

    One comprehensive notification should be provided from each county; in counties where multiple successor agencies fail to remit the required amount, please do not send a separate e-mail for each non-compliant successor agency.

    The required notification should have the following title in the e-mail subject line:

XXX County – Notification of Successor Agency Failures to Remit

If all of a county’s successor agencies make the required remittances, a notice to that effect should be sent to the redevelopment_administration@dof.ca.gov e-mail address with the following title in the e-mail subject line:

XXX County – Notification of Compliance With AB 1484 Remittances

  • No later than July 16, 2012, the county auditor-controller is required to pay to each ATE the amounts owed from funds that were remitted by the successor agencies.
  • By July 26, 2012, the county auditor-controller is asked to notify Finance of the amounts provided to the ATEs.  For purposes of this notification, county auditor-controllers should use the following Excel spreadsheet form:

    Redevelopment Funds Allocation Reporting Form

    The completed Excel spreadsheet form should be sent to the redevelopment_administration@dof.ca.gov e-mail address, and should have the following title in the e-mail subject line:

XXX County July 2012 Reporting Form

The Excel spreadsheet form should be submitted to Finance in Excel format – scanned pdf. copies, or copies provided in any form other than an Excel spreadsheet are not acceptable.

The Excel spreadsheet form contains two tabs, respectively titled “Jan-June ROPS” and “July-Dec ROPS”.  Both tabs should be completed in accordance with the instructions contained therein.  Improperly completed spreadsheet forms will be returned.

County auditor-controllers must not change the formulas in the spreadsheet form.  Furthermore, county auditor-controllers must not lock cells, hide cells or columns, or otherwise make any changes to the spreadsheet form that would inhibit Finance’s ability to view the information in a given cell or column.  Improperly modified spreadsheet forms must be corrected.

There are significant penalties than can be applied if county auditor-controllers fail to perform or successor agencies fail to pay required amounts under HSC section 34183.5. The deadlines provided in the law are not discretionary and are needed to remedy the state and local government cash situations.

Contact Information:

To contact the staff who are reviewing recognized obligation payment schedules and other aspects of implementation of ABx1 26 and AB 1484, please e-mail:

Persons wishing to report actions taken by Successor Agencies, such as questionable payments or asset transfers, are encouraged to send an e-mail with pertinent details to the following address:

Bond Questions:

We are aware of some questions that have been raised by many in the financial community with regard to redevelopment agency bonds. The document linked to below provides Department of Finance views on the content of ABx1 26 that applies to these issues. While we cannot answer every specific question in this document, we will endeavor to provide guidance if provided with sufficient information. Please forward your questions to the e-mail and phone numbers noted above.

Common Dissolution Questions:

We are also aware of several questions that have been asked with regard to specific dissolution issues not directly related to bonds. The document linked below has questions and answers to common issues. While we cannot answer every specific question in this document, we will endeavor to provide guidance if provided with sufficient information. Please forward your questions to the e-mail and phone numbers noted above.

Webpage Links:

County Auditor Controller Letter issued on 7-20-12

Successor Agency July Billing Review Letter issued on 7-20-12

Revised ROPS and Appeals Letter issued on 7-12-12

Redevelopment AB1484 Guidance Letter issued on 7-11-12

ROPS Review Letters Issued by Finance (as of 6/1/2012 at 10:00am)

A consolidated version of the dissolution law is now available at: www.leginfo.ca.gov/calaw.html under the Health and Safety Code Division 24, Parts 1.8 and 1.85 (begining with Section 34161)

 

The full text of ABx1 26 is provided in the link below:

The Full text of AB1484 (Chapter 26, Statutes of 2012) is provided in the link below

On December 29, 2011, the Supreme Court issued its decision in RDAs v. Matosantos. The full text of the decision can be found here:

Questions and answers regarding Recognized Obligation Payment Schedules

Pass Through Payments

Questions and answers regarding redevelopment agency bonds:

Questions and answers regarding common dissolution issues:

Recognized Obligation Payment Schedule (ROPS III) Template and Instructions:

Administrative Cost Caps:

Questioned and Approved SA Recognized Obligation Payments to be Paid by RPTTF: