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HomeMy WebLinkAboutAgenda Statement 1983/08/02 Item 11a-b COUNCIL AGENDA STATEMENT Item 11a,b Meeting Date 8/2/83 ITEM TITLE: a. Resolution /4537 Transferring $10,000 of appropriated Block Grant Funds to the Otay Valley Road Area Study b. Resolution //3 3 d Authorizing a loan to the Redevelopment Agency of Block Grant Funds to conduct a study for Otay Valley Road Area Study 41111111 SUBMITTED BY: Community Development Director 'Oths Vote: Yes X No ) REVIEWED BY: City Manager jar 4r1019 As part of the Community Development Block Grant program for 1982-83, $35,600 was transferred from appropriated Block Grant funds to conduct a study for the Otay Valley Road area. The study, in conjunction with staff work, could possibly result in the formation of a redevelopment project. This being the case, an indebtedness should be established in order to receive tax increments. Therefore, a loan to the Redevelopment Agency is in order so as to comply with State law for the receipt of such funds. RECOMMENDATION: The City Council : a. Transfer $10,000 of previously appropriated Block Grant funds from prior program years to the Otay Valley Road Project Block Grant account to cover staff costs; and b. Loan that $10,000 amount, plus the previously-appropriated amount of $35,600, to the Redevelopment Agency to be paid back to the Block Grant fund at the established rate of interest paid by the Agency for all such loans from the City at such time that tax increment receipts are available. BOARDS/COMMISSIONS RECOMMENDATION: Not applicable. DISCUSSION: The Redevelopment Agency has received several staff reports relative to the possibility of the formation of a redevelopment project for the Otay Valley Road area of the City. The Engineering Department is in the process of forming an assessment district for specific improvements. The City Council authorized funding for a study of this area last February. Proposals were requested and received. In accordance with City policy, a committee was set up to review the proposals submitted. At the August 4 meeting of the Redevelopment Agency, a proposed consultant will be recommended for hire by the Agency. It is proposed that the funds for the study and the necessary staff work come from the Community Development Block Grant Program and that these funds be loaned to the Redevelopment Agency by the City. On February 15, 1983, the City Council appropriated $35,600 of Block Grant funds for this purpose. The additional $10,000 proposed to be transferred and loaned for staff costs will allow a total of $45,600 for study activity. Page 2, Item lla,b Meeting Date 8/2/83 The resolution proposes that payback will be in the form of tax increment receipts in accordance with Agency-established policy. The loan is for the specific purpose of complying with State Redevelopment Law wherein tax increments may not be received unless there is an established indebtedness. If the redevelopment project is not formed, the loan will not be repaid. The purpose of the study is to review feasibility of the potential of a redevelopment project for the area in question. The purposes for which HUD provided the money under the Block Grant Program will, therefore, be satisfied whether or not the results of the report indicate the desirability of a project. If repayment is made, the funds must be appropriated to comply with HUD regulations for other eligible Block Grant uses. FISCAL IMPACT: $6,426.77 will be transferred from surplus Block Grant funds in Fund 633 to Otay Valley Road Account 633-6330-BG127. $3,573.23 will be transferred from surplus funds in the Central Storm Drain Block Grant Account 630-6300-BG69 to Otay Valley Road Account 630-6300-BG127. Community Development Block Grant funds will be loaned to the Agency in the same manner that other funds loaned to the Agency have been accomplished. The funds will be drawn down from our account with the Department of Housing and Urban Development. DKG:fp WPC 0477X +L .A L y Chula VisM o pia %.3 (�- 11337 COUNCIL AGENDA STATEMENT Item 11a,b Meeting Date 8/2/83 ITEM TITLE: a. Resolution /7337 Transferring $10,000 of appropriated Block Grant Funds to the Otay Valley Road Area Study b. Resolution //31 ? Authorizing a loan to the Redevelopment Agency of Block Grant Funds to conduct a study for Otay Valley Road Area Study 411* SUBMITTED BY: Community Development Director j .ths Vote: Yes X No ) REVIEWED BY: .//Manager r 4101) As part of the Community Development Block Grant program for 1982-83, $35,600 was transferred from appropriated Block Grant funds to conduct a study for the Otay Valley Road area. The study, in conjunction with staff work, could possibly result in the formation of a redevelopment project. This being the case, an indebtedness should be established in order to receive tax increments. Therefore, a loan to the Redevelopment Agency is in order so as to comply with State law for the receipt of such funds. RECOMMENDATION: The City Council : a. Transfer $10,000 of previously appropriated Block Grant funds from prior program years to the Otay Valley Road Project Block Grant account to cover staff costs; and b. Loan that $10,000 amount, plus the previously-appropriated amount of $35,600, to the Redevelopment Agency to be paid back to the Block Grant fund at the established rate of interest paid by the Agency for all such loans from the City at such time that tax increment receipts are available. BOARDS/COMMISSIONS RECOMMENDATION: Not applicable. DISCUSSION: The Redevelopment Agency has received several staff reports relative to the possibility of the formation of a redevelopment project for the Otay Valley Road area of the City. The Engineering Department is in the process of forming an assessment district for specific improvements. The City Council authorized funding for a study of this area last February. Proposals were requested and received. In accordance with City policy, a committee was set up to review the proposals submitted. At the August 4 meeting of the Redevelopment Agency, a proposed consultant will be recommended for hire by the Agency. It is proposed that the funds for the study and the necessary staff work come from the Community Development Block Grant Program and that these funds be loaned to the Redevelopment Agency by the City. On February 15, 1983, the City Council appropriated $35,600 of Block Grant funds for this purpose. The additional $10,000 proposed to be transferred and loaned for staff costs will allow a total of $45,600 for study activity. Page 2, Item 11a,b Meeting Date 8/2/83 The resolution proposes that payback will be in the form of tax increment receipts in accordance with Agency-established policy. The loan is for the specific purpose of complying with State Redevelopment Law wherein tax increments may not be received unless there is an established indebtedness. If the redevelopment project is not formed, the loan will not be repaid. The purpose of the study is to review feasibility of the potential of a redevelopment project for the area in question. The purposes for which HUD provided the money under the Block Grant Program will, therefore, be satisfied whether or not the results of the report indicate the desirability of a project. If repayment is made, the funds must be appropriated to comply with HUD regulations for other eligible Block Grant uses. FISCAL IMPACT: $6,426.77 will be transferred from surplus Block Grant funds in Fund 633 to Otay Valley Road Account 633-6330-BG127. $3,573.23 will be transferred from surplus funds in the Central Storm Drain Block Grant Account 630-6300-BG69 to Otay Valley Road Account 630-6300-BG127. Community Development Block Grant funds will be loaned to the Agency in the same manner that other funds loaned to the Agency have been accomplished. The funds will be drawn down from our account with the Department of Housing and Urban Development. DKG:fp WPC 0477X � `�, ia /?- / 3