HomeMy WebLinkAbout2014-15 CC Reso - Support of AB 2493 �
RESOLUTION NO. 2014- 15
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH IN SUPPORT OF
ASSEMBLY BILL (AB) 2493 (BLOOM) - USE OF 2011 REDEVELOPMENT BOND
PROCEEDS THE CITY COUNCIL OF THE CITY OF UKIAH DOES HEREBY RESOLVE AS
FOLLOWS:
WHEREAS, redevelopment has been an essential tool in the revitalization of communities
across California and in the City of Ukiah; and
WHEREAS, the elimination of Redevelopment Agencies (RDAs) has left cities without the
necessary tools to continue the important work of reducing blight, creating safer, more livable
neighborhoods that meet residents' expectations; and
WHEREAS, the City of Ukiah issued tax-exempt redevelopment bonds in the amount of
$4,393,046 million in March 2011, for various projects that had been in the planning stages for
several years; and I
WHEREAS, the City of Ukiah was engaged in the planning and development of several
affordable housing projects prior to the dissolution of the redevelopment agency; and I
WHEREAS, the City of Ukiah issued redevelopment housing bonds in the amount of
$2,731,344 million in March 2011, to assist in the completion of those affordable housing
projects; and
WHEREAS, the passage of ABx1 26, which led to the elimination of the redevelopment
agencies, has halted these important redevelopment projects; and ,
WHEREAS, ABx1 26 assumed that proceeds generated as a result of the sale of bonds would I
be used for the purposes for which they were originally issued; and
WHEREAS, statewide approximately 39 successor agencies have similar 2011 redevelopment
bond proceeds, totaling approximately $750 million, which they are currently unable to use; and
WHEREAS, over 70% of the 2011 redevelopment bonds were issued under tax-exempt status
and can only be used for their originally intended purposes; any other use would potentially '
trigger a loss of the tax-exempt status and the imposition of monetary penalties; and
WHEREAS, bondholders who purchased tax-exempt bonds for specific public works and
affordable housing projects were promised tax-free returns; and
WHEREAS, based on the State Department of Finance's interpretation of the dissolution law
these bonds must be defeased; however, over 90% of the 2011 redevelopment bonds cannot ,
be defeased for 10 years; and
WHEREAS, during this ten year period nearly $1 billion will be spent on debt service payments
for these bonds, and their proceeds will continue to go unused; and
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WHEREAS, if the proceeds were used for their intended purposes, the construction of the i
projects would generate over $2.8 billion in statewide economic activity, more than the debt
service on the bonds during the ten year period; and
WHEREAS, these "unused funds" mean hundreds of construction projects that would generate
thousands of prevailing wage construction jobs; and
WHEREAS, expenditure of the 2011 bond proceeds would generate an estimated 19,000 jobs
and, conservatively, over $130 million dollars in new State and local tax revenues, as well as,
$2.8 billion in statewide economic activity; and
WHEREAS, AB 1484 granted successor agencies the ability to use bond proceeds issued prior
to January 1, 2011, but was ambiguous on the use of bonds issued between January 1, 2011
and June 28, 2011 (prior to the dissolution of redevelopment agencies); and
WHEREAS, AB 2493 would amend the agency dissolution law (AB 1484) to adjust the cutoff
date for the use of redevelopment bond proceeds, from December 31, 2010, to June 28, 2011,
authorizing the expenditure of the 2011 redevelopment bond proceeds, that meet specific
provisions included in AB 2493.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Ukiah
supports AB 2493 (Bloom) - Use of 2011 Redevelopment Bond proceeds.
PASSED AND ADOPTED this 16`" day of April 2014, by the following roll call vote:
AYES: Councilmembers Scalmanini, Crane, Thomas, Landis, and Mayor Baldwin
NOES: None
ABSENT: None
ABSTAIN: None
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Philip E. Baldwin, Mayor
ATTEST. ` �
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Kristine Lawler, City Clerk
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