Loading...
HomeMy WebLinkAboutRDA Packet 2005/09/13 ~v~ :: ~-_-: -=~-- = - - - - CllY OF CHUlA VISTA TUESDAY, SEPTEMBER 13, 2005 6:00 P.M. (immediately following the City Council meeting) COUNCIL CHAMBERS PUBLIC SERVICES BUILDING A JOINT MEETING OF REDEVELOPMENT AGENCY I CITY COUNCIL OF THE CITY OF CHULA VISTA CALL TO ORDER ROLL CALL Agency/Council Members Castaneda, Davis, McCann, Rindone; Chair/Mayor Padilla CONSENT CALENDAR The staff recommendations regarding the following itemls) listed under the Consent Calendar will be enacted by the Agency/Council by one motion without discussion unless an Agency/Council member, a member of the public or City staff requests that the item be pulled for discussion. If you wish to speak on one of these items, please fill out a "Request to Speak Form" available in the lobby and submit it to the City Clerk prior to the meeting. Items pulled trom the Consent Calendar will be discussed after Public Hearing items. Items pulled by the public will be the first items of business. 1. JOINT RESOLUTION OF THE CITY COUNCIL AND REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA AUTHORIZING THE ADDITION OF ONE ASSOCIATE ACCOUNTANT, ONE ACCOUNTING TECHNICIAN AND ONE SENIOR MANAGEMENT ANALYST POSITION TO THE FINANCE DEPARTMENT AND APPROPRIATING FUNDS BASED ON UNANTICIPATED REVENUES - During fiscal year 2005, the Finance Department completed its Strategic Business Plan. Through this process the department identified the need to add three additional positions to ensure the department will be able to continue to meet various financial reporting requirements and lay the foundation needed to achieve the long-term financial reporting goals identified in the Strategic Business Plan. [Director of Finance/Treasurer] 4/5THS VOTE REQUIRED STAFF RECOMMENDATION: Council/Agency adopt the resolution. 2. JOINT RESOLUTION OF THE CITY COUNCIL AND REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA AMENDING THE FISCAL YEAR 2004-05 BUDGET IN ACCORDANCE WITH THE BUDGET TRANSFER POLICY AND APPROVING ADDITIONAL APPROPRIATIONS IN VARIOUS FUNDS - The Council Policy on Financial Reporting and Transfer Authority requires that all departments complete the fiscal year with a positive balance in each budget summary category. [Director of Finance/Treasurer] 4/5THS VOTE REQUIRED STAFF RECOMMENDATION: Council/Agency adopt the resolution. 3. RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA APPROVING A SUBORDINATION AGREEMENT WITH THE SAN DIEGO TRUST BANK AND AUTHORIZING THE TRANSFER OF A PORTION OF THE PROPERTY AT 760 BROADWAY AVENUE WITHIN THE SOUTHWEST REDEVELOPMENT PROJECT AREA PRIOR TO THE ISSUANCE OF THE CERTIFICATE OF COMPLETION - On 6/10/03, the Agency entered into a Disposition and Development Agreement with Carter Reese and Associates and the Bitterlin Development Corporation for the development of a mixed-use project located at 760 Broadway. The mixed-use retail component of the project is close to completion and most of the 40 lane homes are in escrow. The developer is requesting the proposed subordination agreement and the transfer of property in order to satisfy the requirements of the lender of the buyer of the mixed-use retail component. [Director of Community Development] STAFF RECOMMENDATION: Agency adopt the resolution. ORAL COMMUNICATIONS This is an opportunity for the general public to address the Redevelopment Agency on any subject matter within the Agency's jurisdiction that is not an item on this agenda. (State law, however, generally prohibits the Redevelopment Agency from taking action on any issues not included on the posted agenda.) If you wish to address the Agency on such a subject, please complete the II Request to Speak Under Oral Communications Form" available in the lobby and submit it to the Secretary to the Redevelopment Agency or City Clerk prior to the meeting. Those who wish to speak, please give your name and address for record purposes and follow up action. OTHER BUSINESS 4. DIRECTOR'S REPORT 5. CHAIR REPORT 6. AGENCY COMMENTS ADJOURNMENT The Redevelopment Agency will adjourn to a meeting on September 20, 2005, at 6:00 p.m., in the Council Chambers. AMERICANS WITH DISABILITIES ACT The City of Chula Vista, in complying with the Americans with Disabilities Act (ADA), request individuals who require special accommodates to access, attend, and/or participate in a City meeting, activity, or service request such accommodation at least 48 hours in advance for meetings and five days for scheduled services and activities. Please contact the Secretary to the Redevelopment Agency for specific information at (619) 691-5047 or Telecommunications Devices for the Deaf (TOO) at (619) 585-5647. California Relay Service is also available for the hearing impaired. RDA/City Council, September 13, 2005 Page 2 JOINT CITY COUNCIL/REDEVELOPMENT AGENCY AGENDA STATEMENT Item Meeting Date I 9/13/05 ITEM TITLE: Resolution of the City Council of the City of Chula Vista authorizing the addition of one Associate Accountant, one Accounting Technician and one Senior Management Analyst position to the Finance Department and appropriating funds based on unanticipated revenues REVIEWED BY: Director of FinancefTreasurer ~ City Manager 1f~ 7K' (4/5ths Vote: Yes -X-No_) SUBMITTED BY: Summary: Mission Statement The Chula Vista Finance Department is dedicated to ensuring the long-term financial stability of the City and enhancing public and organizational trust through integrity of financial reporting and sound financial management practices. Vision Statement Ensuring maximum financial resources so that City visions can be realized. During fiscal year 2005, the Finance Department completed its Strategic Business Plan which was developed over a period of several weeks and allowed for participation from the entire Finance Department as well as input from other city staff. Through this process the Finance Department identified issues that will be affecting the department in the next two to five years, established goals to address those issues proactively, and developed performance measures to track the progress in achieving those goals. The Strategic Business Plan was presented to Council via an information item and is included as an attachment to this report. As part of the Strategic Business Plan, the department identified the need to add one Associate Accountant, one Accounting Technician and one Senior Management Analyst to the department. These positions are critical in order to ensure that the department will be able to continue meeting various financial reporting requirements and lay the foundation needed to achieve the long-term financial reporting goals identified in the Strategic Business Plan. As the department transitions from a primary financial reporting focus to a combined financial reporting and compliance/audit focus, additional staffing requests will be submitted as part of the bi-annual budget process for consideration. The request to add positions in the Finance Department was not addressed in the 2006 and 2007 budgets because the Department was in the process of completing its Strategic Business Plan. This involved determining organizational goals and identifying staffing needs at the same time was assisting in the completion of the budget document for Council review and approval. Recommendation: Council adopt the resolution authorizing: . the addition of the one Accounting Technician, one Associate Accountant, one Senior Management Analyst within the Finance Departments and . appropriate $114,248 to the Finance Department's personnel services budget from the available balance of the general fund based on unanticipated revenues of $114,248. Agency adopt the resolution authorizing: . appropriations from the Merged Project Area fund for staff time reimbursements of $38,096 to the Finance Department. Discussion The primary functions of the Finance Department are to administer the City's financial affairs, supervise the disbursements of all monies, manage all fiscal systems, collect and record all revenues, assist in the preparation of the citywide budget, manage all investments and borrowing, and provide centralized procurement services to all City departments. The development of the Strategic Business Plan put renewed focus on achieving results for our customers both externally and internally. The addition of three new positions within the Finance Department is necessary in order to ensure continued compliance with various financial reporting requirements and to lay the foundation needed to achieve the long-term financial reporting goals identified in the Strategic Business Plan which includes improving services to our clients which include the citizens of Chula Vista, Mayor and Council Members, City Manager and City Departments. It is important to note that the Finance Department has not added any new positions since fiscal year 1999. The continued growth and expansion of the City has placed increased service demands on the Finance Department. In addition, there are several major projects that will require extensive involvement by Finance staff to ensure that current financial data is available for economic analysis and fiscal impact studies. Associate Accountant Over the past several years, the City has issued an unprecedented number of Community Facility District (CFD) Bonds to fund the acquisition of public improvements related to new developments in the eastern section of the City. From 1999 - 2004, the City issued ten CFD bonds for a total of $182 million. Currently, the City is in the process of establishing an additional four CFDs in fiscal year 2006. All in all the Finance staff administers a total of 12 assessment districts and ten CFDs. As part of the annual assessments related to the CFDs, administrative fees are allocated to fund the administrative costs of managing the funds. Although the City has contracted with NBS to assist in the administration of the CFDs, the Finance Department continues to playa key role managing these funds over the life of the bonds. This includes processing draw down requests of bond proceeds, working with the fiscal agent in monitoring uses of all funds, updating cash flow projections to ensure that funds are available for project draw downs, assisting in the preparation and review of all annual disclosure documents to ensure compliance with Securities and Exchange Commission Rule 15c2-12, monitoring funds for possible bond call and/or refunding opportunities, budgeting and processing all annual debt service payments and reviewing arbitrage calculations to ensure compliance with IRS regulations. It is becoming increasingly difficult to keep up with the administration of the CFDs with existing staff levels. Therefore, the addition of an Associate Accountant position dedicated to the managing of the CFD bonds is being requested. This position will be fully funded through the administrative fees discussed previously. Accountina Technician Over the past 5 years, the number of full time equivalent positions citywide has increased approximately 25%. The Payroll Section currently has one Accounting Technician position assigned full time to processing payroll. The section is supervised by an Accountant who is increasingly being pulled from her duties in order to ensure that the processing of payroll is completed on time. Adding an additional Accounting Technician to the payroll section would provide appropriate staffing levels, cross training opportunities and necessary coverage for vacation and sick leave days. It would also provide the Accountant the opportunity to take on higher level accounting tasks such as financial statement compilation and grant accounting including grant compliance reviews for programs such as CDBG, Housing, transportation and public safety. Senior Manaqement Analvst In addition to assisting in the preparation of the City's Operating Budget, the Finance Department is responsible for the monitoring of all City fund budgets throughout the fiscal year. This involves reviewing expenditure and revenues on a periodic basis and working closely with Departments to ensure that any significant variances are addressed in a timely manner to mitigate significant impacts to reserves. Due to the increased activities throughout the City in relation to the operating budgets and capital projects, an analyst is needed in the Finance Department to provide assistance in monitoring budgets, reviewing revenue projections, monitoring departmental performance measures, providing legislative analysis on fiscal matters, providing timely fiscal status reports to Department Heads, City Manager and City Council, and assisting in the preparation of the City and RDA's Long Term Financial Plan. The analyst will also provide assistance to the Finance Director in compiling information related to the Redevelopment Agency and the new Chula Vista Redevelopment Corporation (CVRC). As redevelopment activity increases the demand for further data analysis will also increase. The ability to be able to turn around management reports will be critical to the operations of the Agency as well as the CVRC. Due to Redevelopment Agency related work, we anticipate that the position will be 50% funded from tax increment revenues. Fiscal Impact: Due to anticipated savings in the Finance Department's operating budget and projected revenue offsets from CFD administration fees and Redevelopment Agency funding, the addition of these positions will result in no net impact to the General Fund in fiscal year 2006. The ongoing net General Fund fiscal impact of these positions will be approximately $120,000. Since ongoing resources have not yet been identified to fund this ongoing expense, approval of this action may require offsetting budget reductions in future years. The net impact to the Redevelopment Agency in fiscal year 2006 will be $38,096. The ongoing impact to the Agency is projected to be approximately $50,000 per year. If at any time tax increment revenues are insufficient to fund the Senior Management Analyst position, there would be an additional impact to the General Fund of approximately $50,000 per year. CllY OF CHUIA VISTA Finance Department Department Mission Statement The Chula Vista Finance Department is dedicated to ensuring the long-term financial stability of the City and enhancing public and organizational trust through integrity of financial reporting and sound financial management practices. The combination of City growth in population and corresponding government services, additional reporting requirements, and greater expectations for faster turnaround results in an increasing risk of errors and threatens the of financial controls. An underutilization of computer technology results in inefficient financial and City staff have not been fully trained on financial accounting software, resulting in less productivity, duplication of effort, and increased workload. Retirement of key employees with long experience and deep knowledge of policies, procedures, and issues will result in a loss of institutional knowledge that will further strain the current resources of the department and reduce efficiency and timeliness. 2 <92004 Weidner Consulting, Inc. ..'," iJ!-, iii"',' ; JM ;!I!!!!",," "ilL '" . By FY 2007, the Finance Department will complete a long-range financial plan document which will evaluate the implications of current and projected service levels needs, programs and policies; developing strategies to achieve the City's goals and address potential gaps between expenditure and revenues on a long term basis. . By FY 2009, the Finance Department will be recognized by professional associations as a model financial management organization, . The Finance Department will strive to maintain or improve the City's credit rating with the various rating agencies. . The Finance Department will continue to maintain an unqualified audit opinion on annual financial reports. . By FY 2008, in order to safeguard the City's financial reputation, the Finance Department will implement an internal audit function. . By FY 2007, in order to ensure that payroll is being processed in an accurate and efficient manner the Finance Department, in conjunction with Human Resources, will conduct a payroll operational review. . By FY 2007, 95% of Finance Department customers will report that they received accurate, consistent, and timely information. . By FY 2007, the Finance Department (in conjunction with MIS) will deploy all accounting software upgrades within 6 months of release. . By FY 2007, the Finance Department will utilize the Internet and other technology to improve the convenience of conducting business with the City. . By FY 2007, the Finance Department will design and implement succession plans for key Department positions. . By FY 2006, all key Finance Department positions will have appropriate coverage that is not compromised by vacancies. 3 11;)2004 Weidner Consulting, Inc. l!! ~ - o ~ ... - en 1/1 ~ ~ 1/1 ~ ... .E Cl s::: .- Cl III s::: III :!!: - s::: Ql E 1:: III C. Ql C Ql o s::: III s::: .- u. "'1" oS ..s .~ - "3 en s:: o U .... " .e ." :::: "'1" o o N Q . % of funds with appropriate reserve levels . % of cash on hand to monthly payroll and accounts payable obligations (liquidity ratio) . % of reports filed within statutory deadlines . % of bond issues in compliance with continuing disclosure requirements . % of IFAS users satisfied with the financial system . % of payments received in full within gO days of invoice (e.g., sewer bills, contract billings) 5 tQ2004 Weidner Consulting, Inc. Purpose Statement LOB One - Key Results The purpose of the Operations Line of Business is to provide financial accounting, payroll services and reporting services to the public, other agencies and City staff so they can be assured of the City's financial integrity. . % of reports filed within statutory deadlines . % of bond issues in compliance with continuing disclosure requirements . 90% of accounts payable checks issued within 1 week of receiving properly completed payment request . % of IFAS users satisfied with the financial system Purpose Statement LOB Two - Key Results The purpose of the Treasury Line of Business is to provide billing and collection services to the public and other entities so they can pay for services rendered in a timely manner. . % of payments received in full within gO days of invoice (e.g., sewer and contract billings) Purpose Statement LOB Three - Key Results The purpose of the Purchasing Line of Business is to provide acquisitions and contract management services to City staff so they can obtain products and services at best value. . % of customers satisfied with acquisitions services . % of City purchases (in dollars) made using high volume City-wide contracts Purpose Statement LOB Four - Key Results The purpose of the Administration Line of Business is to provide financial management, banking, and management support services to City staff so they can make sound financial decisions and productively perform their duties. . % of funds with appropriate reserve levels . % of cash on hand to monthly payroll and accounts payable obligations (liquidity ratio) . % of quarterly reports issued within 3 weeks of the end of the quarter 6 11':)2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Operations Line of Business is to provide financial accounting and payroll services to City staff, the public and other agencies so they can be assured of the City's financial i nteg rity. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) The purpose of the Financial Compliance Reporting Program is to provide financial reports to the public, City Departments, and other agencies so they can be in compliance with legal requirements. . % of reports filed within statutory deadlines . # of repo rts fi led . # of reports required to be filed Family of Measures: . $ cost per report filed Efficiency Measure(s) Services Responsible Person(s) Budget . Housing and Community . Annual Street Report Development Annual Report . Miscellaneous Financial Reports . Single Audit Report . Comprehensive Annual Financial . Transportation Development Act Report (CAFR) Reports . Auditors Consultations . Transnet Report . Development Impact Fee . State Controller Reports Reports . Statement of Indebtedness . GANN Appropriation Limit Report . Growth Management Oversight . Annual Disclosure Reports Commission Report fiscal Operations Manager To be determined 7 @2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Operations Line of Business is to provide financial accounting and payroll services to City staff, the public and other agencies so they can be assured of the City's financial i nteg rity. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Payroll Services Program is to provide pay checks and reports to employees and other government agencies so they can receive compensation and information in an accurate and timely manner. . % of pay checks and EFT pay stubs issued accurately and on time . % of payroll reports completed on time . # of pay checks and EFT pay stubs issued . # of payroll reports completed . # of pay checks and EFT pay stubs expected to be issued . # of payroll reports expected to be completed . $ cost per pay check/EFT pay stub issued . $ cost per payroll report completed . Pay History Reports . Employment Development . Electronic Funds Transfer Department Quarterly Reports Remittances . Leave Balance Reports . Pay Checks . CalPERS Reports . Payroll Tax Forms (W 2 & W 4) . Labor Statistical Reports . Wage Garnishment Orders . Payroll Tax Deposits . Employee Verification . Annual Reconciliation Reports Statements . 941 Quarterly Reports Senior Accountant To be determined 8 i!J2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Operations Line of Business is to provide financial accounting and payroll services to City staff, the public and other agencies so they can be assured of the City's financial i nteg rity. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Accounts Payable Services Program is to provide payments and reports to vendors, employees, and other entities in a timely manner. . gQ% of accounts payable checks issued within 1 week of receiving properly completed payment request . % of accounts payable reports completed on time . # of payment requests processed . # of accounts payable reports completed . # of payment requests anticipated . # of accounts payable reports anticipated . $ cost per payment request processed . $ cost per accounts payable report completed . Accounts Payable Checks . Workers Compensation Fund Reimbursements . Petty Cash Reimbursements . Invoices . Refunds . Sales Tax Report . Sales Tax Remittance . Utility Usage Reports . 1099 Forms . Travel Advances and Reimbursements . DE 542 Report Accounting Technician To be determined 9 1!;)2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Operations Line of Business is to provide financial accounting and payroll services to City staff, the public and other agencies so they can be assured of the City's financial integrity. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Debt Service Program is to provide debt management services to creditors and the public so they can receive timely payments and safeguard the City's credit rating. . % of debt service payments made on time . % of bond issues in compliance with continuing disclosure requirements . % of City bonds issued at "A" rating or better . # of debt service payments made . # of continuing disclosure reports submitted . # of bonds issued . # of debt service payments scheduled . # of continuing disclosure reports required . $ cost per debt service payment made . $ cost per disclosure report submitted . Bond Proceed Draw Downs . Bond Call . Annual Bond Disclosures . Assessment Payoffs . Loan Remittances . Loan Payoffs . Debt Service Payments . Debt Refundings Fee-based Services . Community Facility Districts (Issuance, Maintenance and Oversight) . Assessment Districts Senior Accountant To be determined 10 1[;)2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Operations Line of Business is to provide financial accounting and payroll services to City staff, the public and other agencies so they can be assured of the City's financial integrity. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Fixed Asset Management Program is to provide capital asset inventory and reporting services to City Departments so they can safeguard City property. . % of fixed assets accurately inventoried and tagged . % of property accounted for . # of fixed asset tags issued . # of fixed asset items inventoried . # of fixed asset tags requested . # of fixed asset items requiring physical inventory . $ cost per fixed asset tag issued . $ cost per fixed asset item inventoried . Fixed Asset Inventories . Property Tags . Surplus Property Disposals . Property Donations . Property Sales . Vehicle Certificates of Ownership Accounting Technician To be determined 11 i[)2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Operations Line of Business is to provide financial accounting and payroll services to City staff, the public and other agencies so they can be assured of the City's financial integrity. Program Purpose Statement Family of Measures: Result Measure(s) The purpose of the Financial Accounting Systems Program is to provide on-line financial information and system training to City Departments so they can obtain timely and accurate financial and employee information. . % of new IFAS users properly trained within 6 months of hire/transfer date . % IFAS users satisfied with system Family of Measures: . # of new IFAS users trained Output Measure(s) Family of Measures: . # of new IFAS users Demand Measure(s) Family of Measures: . $ cost per new IFAS user trained Efficiency Measure(s) Services Responsible Person(s) Budget . IFAS Training Sessions . IFAS Consultations . IFAS Access Rights . Chart of Accounts . General Ledger Maintenance Transactions . Job Ledger Maintenance Transactions . Scanned Documents Fiscal Operations Manager To be determined 12 <<':J2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Treasury Line of Business is to provide billing, collection and parking meter services to the public and other entities so they can pay for services rendered in a timely manner. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Billing and Collections Program is to provide invoices, reports and collection services to the public and other agencies so they can pay for services rendered in a timely manner. . % of invoices/notices/collection letters generated within established time lines . % of payments processed within 3 days of receipt . % of collection accounts paid prior to second letter . % of payments received in full within 90 days of invoice (e.g., sewer bills, contract billings) . # of invoices generated . # of past due accounts referred to collections . # of collection letters sent . # of customer inquiries handled . # of invoices required to be generated . # of past due accounts . $ cost per invoice generated . $ cost per thousand dollars of past due collections . Accounts Receivable Invoices . Sewer Bills . Past Due Account Collections . Parking Citation Administration Services . Payment Receipts . Cashiering Services . Staff Time Reimbursements . Fiscal Consultations . Grant Draw Downs . Grant Billings . Grant Reports . State Mandate Reports . Credit Card Merchant Accounts Collections Supervisor To be determined 13 <1J2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Treasury Line of Business is to provide billing, collection and parking meter services to the public and other entities so they can pay for services rendered in a timely manner. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Parking Meter Operations Program is to provide metered parking spaces to downtown visitors and patrons so they can conveniently conduct their business. . % change in number of parking complaints . % of inoperable meters repaired within 2 days of report . % of meters emptied according to schedule . # of operational meters . # of meters repaired . $ parking meter collections . # of metered parking spaces . $ cost per parking meter . $ cost per dollar parking meter collections . Parking Meter Maintenance Services Fee-based Services . Parking Meter Collections Collections Supervisor To be determined 14 i!']2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Purchasing Line of Business is to provide acquisitions and contract management services to City staff so they can obtain products and services at best value. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) The purpose of the Acquisitions Program is to provide procurement and related services to City Departments so they can obtain required products and services for the best value in a timely manner. . % of purchase orders up to $10,000 issued within 2 weeks of complete and accurate requisition . % of purchase orders greater than $10,000 issued within 3 weeks of complete and accurate requisition . % of stores orders filled complete within 48 hours . % of customers satisfied with acquisitions services . # of purchase orders issued . # of stores orders filled . # of parcels delivered . # of purchasing requisitions anticipated . # of stores requisitions anticipated . # of parcels anticipated Family of Measures: . $ cost per million dollars of goods and services purchased Efficiency Measure(s) Services Responsible Person(s) Budget . Purchase Orders . Store Orders . Purchase Cards . Insurance and Bonds . Delivered Goods . Vendor Relations . Purchasing Workshops . Warehousing Services . Gasoline Cards Senior Buyer To be determined 15 @2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Purchasing Line of Business is to provide acquisitions and contract management services to City staff so they can obtain products and services at best value. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Contract Management Program is to provide contract negotiation and administrative services to City Departments and suppliers so that they can establish and maintain mutually beneficial buying arrangements that comply with contract terms. . % of City purchases (in dollars) made using high volume City- wide contracts . # of new contracts issued . # of contracts renewed . # of cooperative contracts . # of new contracts anticipated . # of contract renewals anticipated . # of cooperative contracts anticipated . $ contract management costs per million dollars of high volume City-wide contracts . Fuel Contract . Print Services Contracts . Mail Services Contract . Office Supplies Contract . Furniture Contracts . Cell Phone Contracts . Cell Phone Bill Audits . Uniform Rental Contract . Public Works Contracts . Administrative Contracts . Vending Services Contract Purchasing Agent To be determined 16 il'J2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Administration Line of Business is to provide financial management, banking services, deferred compensation, and management support services to City staff so they can make sound financial decisions and productively perform their duties. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Financial Management Information Program is to provide financial reports to the City Council, the City Manager, and Department Heads so they can be informed as to the current and projected financial status of the City. . % of quarterly reports issued within 3 weeks of the end of the quarter . % of funds with appropriate reserve levels . % of 5 year fiscal forecast reports completed within 3 weeks of the end of the second and fourth quarters . % of major discretionary revenue within 10% of year end actual amounts . # of reports issued . # of funds managed . # of reports anticipated to be issued . $ cost per report issued . 5 Year Projection Reports . Fund Balance Reports . Fiscal Quarterly Reports . Investment Quarterly Reports . Annual Fiscal and Investment Reports Director of Finance To be determined 17 192004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Administration Line of Business is to provide financial management, banking services, deferred compensation, and management support services to City staff so they can make sound financial decisions and productively perform their duties. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Banking and Investment Services Program is to provide cash and portfolio management services to the City so they can meet daily cash obligations and optimize return on investments. . % of investment sales prior to maturity or call date . % of cash on hand to monthly payroll and accounts payable obligations (liquidity ratio) . $ of investment earnings . # of cash transfers and investment purchases . $ of annual investments anticipated . # of cash transfers and investment purchases anticipated . $ cost per million dollars of investment earnings . Cash Management Services . Banking Services . Reserve Investments Assistant Director of Finance To be determined 18 <&J2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Administration Line of Business is to provide financial management, banking services, deferred compensation, and management support services to City staff so they can make sound financial decisions and productively perform their duties. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) The purpose of the Deferred Compensation Program is to provide administration and information services to City employees so they can take advantage of tax-deferred savings programs. . % of City employees participating in deferred compensation programs . % of new City employees participating in deferred compensation within 6 months of hire date . # of deferred compensation training attendees . # of deferred compensation informational contacts Family of Measures: . # of City employees Demand Measure(s) Family of Measures: . $ cost per employee participating in deferred compensation Efficiency Measure(s) Services Responsible Person(s) Budget . Deferred Compensation Informational Workshops . Record Updates . Payroll Adjustments . Deferred Compensation Administration Services Treasury Manager To be determined 19 <D2004 Weidner Consulting, Inc. PROGRAM Line of Business Purpose Statement The purpose of the Administration Line of Business is to provide financial management, banking services, deferred compensation, and management support services to City staff so they can make sound financial decisions and productively perform their duties. Program Purpose Statement Family of Measures: Result Measure(s) Family of Measures: Output Measure(s) Family of Measures: Demand Measure(s) Family of Measures: Efficiency Measure(s) Services Responsible Person(s) Budget The purpose of the Administrative Services Program is to provide office support and management services to the Finance Department and City staff so they can productively perform their duties. . % of employee performance evaluations submitted on time . % of Finance Department staff receiving at least 4 hours of job-related training per year . % of appropriate City staff trained on financial policies and procedures . % of Finance Department supervisors that receive management and leadership training within six months of appointment . % of Finance Department employees satisfied with performance recognition . # of Finance employees managed . # of employee performance evaluations completed . # of new Finance Department supervisors appointed . # of employee performance evaluations required . # of Finance Department supervisory appointments expected . $ cost per Finance Department full time equivalent employee supported . Records Management Services . Office Support Services o Requisitions o Office Supplies o Office Machines o Printing Services Assistant Director of Finance . Departmental Policies . Supervisory Services . Letters and Packages (Mail) . Council Agenda Reviews To be determined 20 11;12004 Weidner Consulting, Inc. AGENCY RESOLUTION NO. AND COUNCIL RESOLUTION NO. JOINT RESOLUTION OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA AUTHORIZING THE ADDITION OF ONE ASSOCIATE ACCOUNTANT, ONE ACCOUNTING TECHNICIAN AND ONE SENIOR MANAGEMENT ANALYST POSITION TO THE FINANCE DEPARTMENT AND APPROPRIATING FUNDS BASED ON UNANTICIPATED REVENUES. WHEREAS, during fiscal year 2005, the Finance Department completed its Strategic Business Plan; and WHEREAS, as part of the Business Strategic Plan, the Finance Department identified the need to add one Associate Accountant, one Accounting Technician and one Senior Management Analyst to the department; and WHEREAS, the request to add positions in the Finance Department was not addressed in the 2006 and 2007 budgets because the Department was in the process of completing its Business Strategic Plan; and WHEREAS, these positions are critical in order to ensure that the department will be able to continue to meet various financial reporting requirements and lay the foundation needed to achieve the long-term financial reporting goals identified in the Strategic Business Plan; and WHEREAS, these positions will result in no net impact to the General Fund in fiscal year 2006; and WHEREAS, the ongoing General Fund fiscal impact of these positions will be approximately $120,000; and WHEREAS, the net impact to the Redevelopment Agency in fiscal year 2006 will be $38,096 with an ongoing impact to the Agency projected to be approximately $50,000 per year. NOW, THEREFORE, BE IT RESOLVED the Redevelopment Agency and the City Council of the City of Chula Vista do hereby authorize the addition of one Associate Accountant, one Accounting Technician and one Senior Management Analyst position in the Finance Department; and BE IT FURTHER RESOLVED the Redevelopment Agency and the City Council of the City of Chula Vista do hereby authorize the appropriation of $114,248 to the Finance Department's personnel services budget from the available balance of the General Fund based on unanticipated revenues of$114,248; and BE IT FURTHER RESOLVED the Redevelopment Agency and the City Council of the City of Chula Vista authorize the appropriation from the Merged Project Area Fund for staff time reimbursements of$38,096 to the Finance Department. Presented by Approved as to form by Maria Kachadoorian Director of Finance and Agency Treasurer ~ Moore Attorney and Agency Counsel J:\attomeylresolfmancelbudget transfer-appropriations FY 05-06 JOINT CITY COUNCIUREDEVELOPMENT AGENCY AGENDA STATEMENT Item Meeting Date d-. 9/13105 REVIEWED BY: Resolution Amending the fiscal year 2004-05 budget in accordance with the Budget Transfer Policy and approving additional appropriations in various funds Director of Finance/Treasurer ~ City Manager f)~ 17 f\ (4/5ths Vote: Yes .lLNo_l ITEM TITLE: SUBMITTED BY: The Council Policy on Financial Reporting and Transfer Authority requires that all departments complete the fiscal year with a positive balance in each budget summary category (Personnel Services, Supplies and Services, Other Expenses and Capital). In order to comply with the intent of this policy, the transfers and appropriations listed on Attachment A and discussed below are recommended for approval. All recommended General Fund transfers can be done using existing appropriations and therefore will result in no impact to the reserves. RECOMMENDATION: That Council amend the fiscal year 2004-05 budget by approving additional appropriations or transferring existing appropriations to ensure that all departments end the fiscal year without exceeding the budget summary as required by Council Policy. BOARDS/COMMISSIONS RECOMMENDATION: Not applicable. DISCUSSION: As part of the budget process, all departments projected their total expenditures for the fiscal year. In the Third Quarter Status report, Council was advised that all General Fund departments, except Police and Fire, would end the fiscal year within their approved expenditure budgets. The remaining General Fund departments, with the exception ofthe City Clerk, did achieve expenditure savings through a combination of both positive and negative expenditure account variances within the budgetary categories. The City Clerk's office exceeded its budget in the Personnel Services category ($27,375) due to the hiring of the Senior Deputy City Clerk, which provided assistance to the Finance Department in setting up a filing system. It is recommended that a budget transfer from the Finance Department budget be used to offset the overage in the City Clerk's office. Page 2, Item Meeting Date 9/13/05 Community Development exceeded it's Services and Supplies ($42,180) budget primarily due to the payment of fiscal year 2004 administrative fees to the City of San Diego for the Enterprise Zone. Salary savings within Community Development will be used to offset the overage. Reauested Appropriations: Additional appropriations are necessary for the following funds due to various reasons: . CDBG Program Income Fund ($163,260) is utilized to account for CHIP loan repayments and loan payoffs. Periodically a transfer is made to the CDBG grant fund in order for these funds to be spent in accordance with HUD guidelines. . Pumped Sewer DIF ($55,060), Poggi Canyon Sewer Basin DIF ($20,220) due to greater than anticipated staff time charges . Salt Creek Sewer DIF ($65,820) to account for interest on advances. . 2000 Corporation Yard Certificate of Participation ($53,030) is necessary to account for a transfer of bond proceeds to the reserve fund due to closure of the project fund. This is in compliance with the bond indenture. . Southwest Pass Through Funds ($45,259) are necessary to account for underestimated pass through payments of tax increment revenues. The greater than anticipated revenue is sufficient to cover the additional appropriation. . Merged Redevelopment Project area fund experienced an unexpected claim in the Southwest ($267,260) Project Area late in the fiscal year. Additional appropriations are necessary to account for this payment. Attachment A, included herein, details the fund, department, category and brief description of each transfer or appropriation. FISCAL IMPACT: The recommended budget transfers in the General Fund and the RDA Merged Project Fund will be covered by savings achieved within their approved budgets. Therefore, there is no fiscal impact to their reserves. The net fiscal impact resulting from additional appropriations in the remaining funds will be $669,909 and in all cases will be funded by available reserves. AGENCY RESOLUTION NO. AND COUNCIL RESOLUTION NO. JOINT RESOLUTION OF THE CITY COUNCIL AND THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA AMENDING THE FISCAL YEAR 2004-05 BUDGET IN ACCORDANCE WITH THE BUDGET TRANSFER POLICY AND APPROVING ADDITIONAL APPROPRIATIONS IN VARIOUS FUNDS. WHEREAS, the Council Policy on Financial Reporting and Transfer Authority requires that all departments complete the fiscal year with a positive balance in each budget summary category (Personnel Services, Supplies and Services, Other Expenses and Capital); and WHEREAS, as part of the budget process, all departments projected their total expenditures for the fiscal year; and WHEREAS, in the Third Quarter Status report, Council was advised that all General Fund departments with the exception of Police and Fire, would end the fiscal year within their approved expenditure budgets; and WHEREAS, the remaining General Fund departments, with the exception of the City Clerk, did achieve expenditure savings through a combination of both positive and negative expenditure account variances within the budgetary categories; and WHEREAS, the City Clerk's office exceeded its budget in the Personnel Services category ($27,375) due to the hiring of the Senior Deputy City Clerk, which subsequently provided assistance to the Finance Department in setting up a filing system; and WHEREAS, Community Development exceeded its Services and Supplies budget by $42,180, primarily due to the payment of fiscal year 2004 administrative fees to the City of San Diego for the Enterprise Zone. WHEREAS, staff recommends a budget transfer from the Finance Department's budget, in the amount of $27,375, to offset the overage in the City Clerk's office budget, and a budget transfer from the Community Development personnel budget to its Supplies and Services budget, in the amount of $42, 180; and WHEREAS, additional appropriations are necessary for the following funds: . $163,260 from the CDBG Program Income Fund to . $55,060 from Pumped Sewer DIF to Other Expenses; . $20,220 from Poggi Canyon Sewer Basin DIF to Other Expenses; . $65,820 from Salt Creek Sewer DIF to Other Expenses; . $53,030 from 2000 Corporation Yard Certificate of Participation to . $45,259 from Southwest Pass Through Funds to Other Expenses; . $267,260 from Merged Redevelopment Project area fund to Other Expenses. WHEREAS, the recommended budget transfer in the General Fund and the Redevelopment Agency Merged Project Fund will be covered by savings achieved within their approved budgets and therefore there is no fiscal impact to their reserves; and WHEREAS, the net fiscal impact resulting from additional appropriations in the remaining funds will be $669,909 and in all cases will be funded by available reserves. NOW, THEREFORE, BE IT RESOLVED that the Redevelopment Agency and the City Council of the City of Chula Vista do hereby amend the fiscal year 2004-05 budget in accordance with the Budget Transfer Policy and by approving additional appropriations in various funds. Presented by Approved as to form by Maria Kachadoorian Director of Finance and Agency Treasurer ~ Moore City Attorney and Agency Counsel J:\attorney\reso\finance\Amend FY 04-05 budget finance 2 -15: 0000 "lJ "lJ"'O"'T1 OC1>:2:1110Cgo= Dr'" ;:;:(03 oooj -C1>"lJo'9.-o G)C1. )>a.Dl-'aCOO c.-o~mmc.Q:C c..., ro+:::-:;-:J 00-0 0 -'o::r '<CD C :!: co' a CJ) 0 :e -< !;Q. o 0 c CD :J CD m :J ;......ta:Ecn...,a.<e -::t>::T~CDO()"U >m(l)CD~:;;Oa m ~.., '1J~ "0 :5" CD Q) III 3 O!!!. 'ii:J g "'T1 "Tl""T1""T1"'T1"""Tl C C C c: c c C :J :J :J :J :J :J ::J a. a. a. a. a. a. a. o>mO"lOlOl~W Ol-.....J 01 01 J::i.-I:lo--" --" --" W....lo. W co....ll. Ol .... .... ... en '" ~ cnm.l:lo.O>NOlU1Q) CC......Olc.nOO'lWW ccr....,t..Jcot..Joo~ CmCJ1NNmWm CDOtDOOOOO 00000-1-10 stS=S=S=S=wOJa CD CD CD CD CD :J :J CD ..., ..., ..., ..., ..., (J) (I) mmmmmCD'<D'o x~{';~~@@ C1>C1>C1>C1>C1>00 :J :J :J :J :J C c: ~mmmm.-""" en en en (fl en !::"lJ:JS',?S',?::;I::;IQ mWarmmmDl(l) gmCiJ~~~~(') r+cn-l-l~_c :J'" ..... -. -. ro CD en 00 m33"""'!. jii"C x CD co 8.Q,o 3'c.g. ~ ~ g OJ m ~ ""C :J mOJo x Q) (I) ..., ..., :J ~ ,<(DecIDe. 30CDCD"U~ :J (I) en ..., ~ )> .2. 0 .....0. coI g~ a=c (f):J 1l"Tl CD 0 C c a. CD :J :::J 000 c.a. :J6" ~w :J" ....~ -. :f co --" 'g.ro 00 ~~ g:"lJ .- :J CD a ffia. rote :J 0 DJ Q) 5.3 '"" cr ::tl :J -C' m g *" <~ a. C1> or TJ~ xc :J :J S. a. a. " ....'" .. ~'" C1> ....'" 3 C1> '"" G) III '" -I OJ X "'T1 C :J a. G) C1> :J C1> .. !!!. "'T1 C :J a. "'T1"'T1 C C :J :J a. a. "'''' "'''' ~~ G) C1> :J C1> i!l. "'T1 C ::I a. ZZ00""T10C o 0 0 0 5'.;::;: CD :J ::I 3 3 III "< I I :J()I>> 0033,,_;::1. CD~33CD~3 DlQ)-.-.O"CD ;:+;:+ <<!"C1> " 33000J ~ ~~~~;+ c EiiEiiC1>C1>3 " --OOCO C. -0 :J 3 3 ~ C1> C1> ;a;a 01 01 01 01 WWWW~.,J::lo.NN (J)(J)(J)(J)NN............ mmmm~~ww ......-..J............OJOO............ oOOCOOOCOaOO1CJl -1-1-1-1 "lJ 00 "lJ"lJ DJwww~-6~~ ~~~ffi~"2.fS~ ;;;~5m'55 c c c :J CD (I) CD CD --.........-00-- oosocn:Jcnr.n G>CDa.CDCD 0G)0C1> < 00< < CD CD CD ::J o' CD c:;- o. ~::J~T1CD<CDCD (j) ~ (j) 5 Ul o' en en CD ::J CD a. CD < a. < '" 0 0 )> 0 C1> C1> a. g: g: a. 0 "" ijf 00 00 o' C1> C1> C1> ::I ~ < < !!!. 0 o' o' " < C1> C1> C1> C1> iil 00 III III C1> C1> a. a. '" ::I c' c' _C1> o' o. Ul Ul .. .. 3" 3" 5' 0 C1> C1> C1> C1> -0 :J :J 0 C ,... ,... ~ <<!" 0 0 - ro- 00 .. III ?"" :J -I 0 .. roO III :J co '" 0 CD' m .. ::I - 10 a .. 3 -0 .. ""T1 0;' C1> S' N III ::I 0 " ::I C1> C1> 0 C1> ~ ;0 CD .Q r:: CD In lil" 0- OJ r:: 0- CQ CD - -I ~ III :l In cr iil III :l 0- )> "C "C a "C ~ jij" - cr :l In )> ~ " ::r 3 CD :l - )> PAGE 1, ITEM NO.: ...3 MEETING DATE: 09/13/05 REDEVELOPMENT AGENCY AGENDA STATEMENT ITEM TITLE: RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA APPROVING A SUBORDINATION AGREEMENT WITH THE SAN DIEGO TRUST BANK AND AUTHORIZING THE TRANSFER OF A PORTION OF THE PROPERTY AT 760 BROADWAY AVENUE WITHIN THE SOUTHWEST REDEVELOPMENT PROJECT AREA PRIOR TO THE ISSUANCE OF THE CERTIFICATE OF COMPLETION SUBMITTED BY: REVIEWED BY: COMMUNITY DEVELOPMENT DIRECTOR EXECUTIVE DIRECTOR '1/ ".;/' ~ 4/5THS VOTE: YES c=J NO ~ BACKGROUND The agency entered into a Disposition and Development Agreement with Carter Reese and Associates and the Bitterlin Development Corporation on June 10, 2003 for the development of 40 lane homes a mixed-use component of 9 residential lofts and 9,000 square feet of commercial space. The project is the first mixed use residential project to be built along Broadway Avenue and is experiencing tremendous success. Subsequently, the rights and obligations under the DDA were assigned to CHBD Chula Vista. RECOMMENDATION Staff recommends that the Agency approve the subordination agreement and authorize the transfer of property prior to receipt of a certificate of completion. BOARDS/COMMISSIONS RECOMMENDATION Not applicable. DISCUSSION The project is almost complete and all but a few of the 40 lane homes are ready to close escrow. In addition, the mixed-use retail component is close to completion and a buyer has been identified. In order for the buyer [The Jeannine Louise Yusunas Living Trust] to purchase the mixed-use component of the project permanent financing must be obtained. The proposed permanent lender [San Diego Trust Bank] has requested the proposed subordination agreement so that they can issue the loan. The subordination agreement proposes the following: PAGE 2, ITEM NO.: MEETING DATE: 09/13/05 . Agency subordinate all of its rights and interest under the development agreement, the grant deed and any amendments or modification to the development agreement. . The loan shall be and remain at all times liens and charges on the real property prior to the lien and charge of the Agency and Agency documents. . That any enforcement action taken by the Agency not takes place until the lender indebtedness has been paid in full and the lender has released its lien in the real property. . That the Agencies give up its option and right of reentry contained in the Development Agreement and grant deed. The proposed language in the subordination agreement is standard when components of a proiect, subject to a Development Agreement, require permanent financing. Since the project is within weeks of final completion, Agency staff is not concerned with subordinating our position in the project. The terms of this subordination agreement are substantially similar to the terms of the original subordination agreement previously entered into by the Agency when the proiect was approved. In addition to the subordination agreement the developer has requested permission from the Agency to transfer the property to the buyer prior to receipt of a certificate of completion. The proiect is substantially complete and staff supports the request of the developer to transfer ownership of the site prior to receipt of their certificate of completion. ENVIRONMENTAL The Environmental Review Coordinator has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a "Proiect" as defined under Section 15378 of the State CEQA Guidelines; therefore, pursuant to Section 15060(93) of the State CEQA Guidelines the activity is not subject to CEQA. Thus, no environmental review is necessary. FISCAL IMPACT The Agency received $1, 350,000 as complete payment for the development site in April 2004. J: \COMMDEV\ST AFF .REP\2005\09 - 13-05\Subordi nation Agmt-Bitterlin.doc RESOLUTION NO. RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA APPROVING A SUBORDINATION AGREEMENT WITH THE SAN DIEGO TRUST BANK AND AUTHORIZING THE TRANSFER OF A PORTION OF THE PROPERTY AT 760 BROADWAY AVENUE WITHIN THE SOUTHWEST REDEVELOPMENT PROJECT AREA PRIOR TO THE ISSUANCE OF THE CERTIFICATE OF COMPLETION WHEREAS, the Redevelopment Agency of the City of Chula Vista entered into a Disposition and Development Agreement ("DDA") with Bitterlin development Corporation and Carter, Reese & Associates on June 10, 2003 by Agency resolution No. 1826 for the development of 760 Broadway Avenue ("Real Property"); and WHEREAS, Developer thereafter conveyed and assigned all of its rights, interests and obligations in the DDA to its successor, CHBD Chula Vista, LLC, a California Limited Liability Company (CHBD); and WHEREAS, Agency granted to CHBD the Real Property subject to the DDA through a Grant Deed April 20, 2004 and recorded in the Official Records of the County of San Diego on April 23, 2004 (Hereinafter, "Grant Deed") and WHEREAS, The Yusumas Living Trust ("Buyer") intends to acquire the retail component of the Real Property, together with all improvements now or hereinafter located or constructed thereon; and WHEREAS, the Redevelopment Agency is being asked to subordinate its position in the retail component of the Real Property by the San Diego Trust Bank in order for Buyer to secure permanent financing on the retail component of the project; and WHEREAS, the Redevelopment Agency subordinated its position in the Real Property on similar terms and conditions at the time the Grant Deed was conveyed to CHBD; and WHEREAS, Section 3.3(b) of the DDA prohibits the transfer of any portion of the Real Property prior to the receipt of a certificate of completion without the prior consent of the Agency; and WHEREAS, CHBD has requested the Agency consent to the transfer of the retail portion of the Real Property from CHBD to THE JEANNINE LOUISE YUSUNAS LIVING TRUST DATED AUGUST 1998 for property located at 760 Broadway prior to receipt of a certificate of completion; and, WHEREAS, in accordance with the requirements of California Environmental Quality Act (CEQA) the Environmental Review Coordinator reviewed the proposed project for compliance with CEQA and determined that the activity is not subject to CEQA at this time. NOW, THEREFORE, BE IT RESOLVED the Redevelopment Agency of the City of Chula Vista does hereby approve the subordination agreement with San Diego Trust Bank, authorizes the Chair to execute said agreement, and approves the transfer of the property from CHBD to THE JEANNINE LOUISE YUSUNAS LIVING TRUST DATED AUGUST 1998 for retail portion of the property located at 760 Broadway prior to receipt of a certificate of completion. PRESENTED BY Laurie Madigan Director of Community Development J :\COMMDEV\RESOS\2005\09-13-05\Bitterlin.doc APPROVED AS TO FORM BY d;~/Id~ !ku -Z:Moore 0 gency Attorney WHEREAS, Developer thereafter conveyed and assigned all of its rights, interests and obligations in the Development Agreement to its successor, CHBD Chula Vista, LLC, a California Limited Liability Company (CHBD). WHEREAS, Agency granted to CHBD the Real Property subject to the Development Agreement through a Grant Deed April 20, 2004 and recorded in the Official Records of the County of San Diego on April 23, 2004 (Hereinafter, "Grant Deed"). WHEREAS, certain covenants in the Development Agreement are or will be contained in the Grant Deed under which Borrower will obtain title to the Real Property and which are thereby relevant to Lender's financing of Borrower's purchase of the Real Property. Among those are the Agency's option to reenter and take possession of the Real Property and its improvements and to terminate Borrower's rights to the Real Property, in accordance with Section 5.7 of the Development Agreement and Section 7 of the Grant Deed. Among other rights contained in the Development Agreement, the Agency holds an option to purchase the Real Property from Developers in the event of a default by Developers in completion of the construction ofthe improvements pursuant to Section 6.4 of the Development Agreement. WHEREAS, it is a condition precedent to Borrower obtaining the Loan for the acquisition of the Real Property, that (i) the Loan Documents and all other documents arising from the Loan shall unconditionally be and remain at all times a Lien and charge upon the Real Property prior and superior to the Lien and charge of the Agency's rights and any and all of Agency's Documents pertaining to or arising from the development of the Real Property, arid, (ii) the Agency specifically and unconditionally subordinates the Lien and charge of the Agency rights and Agency Documents to the Deed of Trust and any other Loan Documents pertaining to the Loan, subject to the terms and conditions herein. WHEREAS, Lender would not make the Loan to Borrower without this Subordination Agreement. THEREBY, in consideration of the mutual benefits accruing to the parties hereto and other valuable consideration, the receipt and sufficiency of which consideration is hereby acknowledged, it is hereby understood and agreed as follows TERMS AND CONDITIONS OF AGREEMENT 1. Definitions. As used herein, the following terms have the meanings set forth below: "Borrower Default" means a Default or Event of Default as defined in any agreement or instrument evidencing, governing, or issued in connection with the Lender's Indebtedness, or any default under or breach of any such agreement or instrument. ... "Collateral" means all collateral now or hereafter securing payment of the Lender Indebtedness, including the Real Property and all proceeds thereof. 2 "Lien" means any security interest, mortgage, deed of trust, pledge, lien, charge, encumbrance, title retention agreement or analogous instrument or device, covenants pursuant to the Development Agreement and Deed of Trust whether now owned or hereafter acquired, and whether arising by agreement or operation oflaw. "Lender Indebtedness" means each and every debt, liability and obligation of every type and description which the Borrower may now or at any time hereafter owe to the Lender, whether such debt, liability or obligation now exists or is hereafter created or incurred, and whether it is or may be direct or indirect, due or to become due, absolute or contingent, primary or secondary, liquidated or unliquidated, or joint, several or joint and several, all interest thereon, and all fees, costs and other charges related thereto (including all interest, fees, costs and other charges accruing after the commencement of any case, proceeding or other action relating to the bankruptcy insolvency or reorganization of the Guarantor, whether or not allowed in such proceeding or other action), all renewals, extensions and modifications thereof and any notes issued in whole or partial substitution therefor. 2. Subordination of Agencv Rights. As a condition to making any loan or extension of credit to the Borrower, the Lender has required that Agency subordinate all of its rights and interests under the Development Agreement, the Grant Deed and any amendment or modification thereto, any Memorandum that is recorded to memorialize the Development Agreement, and all other documents executed pursuant thereto or in connection therewith, as each may be extended, amended or otherwise modified ("Agency Documents"). Thereby, subj ect to the terms and conditions set forth in this Agreement, Agency hereby confirms that Lender's Loan Documents and all other documents arising from the Loan shall unconditionally be and remain at all times liens and charges on the Real Property prior and superior to the lien and charge ofthe Agency and the Agency Documents. The Agency Documents shall continue to be subordinated to the Lender Indebtedness even if the Lender Indebtedness is subordinated, avoided or disallowed under the United States Bankruptcy Code or other applicable law. 3. Action on Subordinated Indebtedness. The Agency will not commence any action or proceeding against the Borrower on all or any part of the Agency Documents, including Sections 5.7 and 6.4 of the Development Agreement or Section 7 of the Grant Deed, or join with any creditor (unless the Lender shall so join) in bringing any proceeding against the Borrower under any bankruptcy, reorganization, readjustment of debt, arrangement of debt receivership, liquidation or insolvency law or statute of the federal or any state government, or take possession of, sell, or dispose of any Collateral, or exercise or enforce any right or remedy available to the Agency with respect to any such Collateral, unless and until the Lender Indebtedness has been paid in full and the Lender has released its Lien in the Collateral. 3.1 Survival of Deed of Trust for Borrower's Loan. As long as the Loan Documents have not been cancelled or terminated as a result of payment in full of the Loan obtained by Borrower from Lender, or as a result of the completion of a judicial or non-judicial foreclosure of the Deed of Trust, any exercise by the Agency of its Agency rights under the Agency Documents shall be subject to and secondary to the Loan and the Deed of Trust, and Agency specifically confirms that the title that shall transfer upon exercise of the Agency's right of reentry shall be subject and secondary to the Lender's Deed of Trust. ", 3 3.2 Agencv's Survival Rights. In the event of a default, and so long as the Agency has been given concurrent Notice of Default, and Notice of Trustee's Sale, Notice of Sheriff's Sale, or other statutory notices of a foreclosure, or in the case of a deed in lieu of foreclosure following a Notice of Trustee's Sale, Lender or its successor has given Agency at least thirty (30) days advance written notice of its intention to accept a deed in lieu of foreclosure, the consummation of any judicial or non-judicial foreclosure sale and/or any deed in lieu of foreclosure under the Lender's Deed of Trust ("Foreclosure Transfer") shall immediately terminate all Agency rights under the Agency Documents, except only for the following rights and remedies that shall be preserved and shall survive such Foreclosure Transfer: 3.2.1 Any owner of the Real Property following a Foreclosure Transfer shall, subject the qualifications in this section, continue to be obligated to comply with the prohibitions on discrimination and the obligations relating to the construction, use or leasing of the Real Property, all in accordance with those pertinent sections of the Development Agreement and the Grant Deed. This Section does not and shall not, under any circumstances, obligate Lender, its successors and assigns to construct or complete the project or to guarantee such construction or completion. 3.2.2 The Agency understands and agrees that its ability to utilize ordinary contract remedies, in addition to those delineated in the Development Agreement, for failure by a transferee of a Foreclosure Transfer to comply with the obligations of the Development Agreement, does not allow it to exercise the Option and right of Reentry contained in the Development Agreement and Grant Deed in the event of a Foreclosure Transfer. 3.2.3 Agency understands and agrees that the Options delineated in Section 6.4 (To purchase the Real Property); Section 5.7 (the Right of Reentry), and the prohibitions against Borrower's transfer of the Real Property pursuant to Section 3.3 of the Development Agreement, shall be extinguished by a Foreclosure Transfer, subject to the terms and conditions ofthis Subordination Agreement. 3.3 Right of First Refusal. Notwithstanding the extinguishment of the Agency Rights above, if Lender or an affiliate of Lender becomes the owner of the Property through a Foreclosure Transfer, Redevelopment Agency shall have a right of first refusal for the purchase of the Property in accordance with the terms of this Section 3.3 (the "Right of First Refusal"). Accordingly, prior to selling the Property to any other builder or other person, the Lender (or its affiliate) shall give Redevelopment Agency notice of the terms of such sale, including copies of the applicable sale documents, as soon as such sale terms have been negotiated and documented, and in any event at least 45 days in advance of the target closing date for such sale, and Redevelopment Agency shall have the right, upon timely notification of its exercise of such Right of First Refusal and timely closing, to acquire the Property in bulk on the same terms as have been offered by or agreed to by such builder or other person. " 3.3.1 To exercise the Right of First Refusal, Redevelopment Agency shall give written notice of its election to exercise such Right of First Refusal within 30 days after receiving notice of the terms of such proposed sale by Lender or its affiliate to the builder or other person, and Lender (or its affiliate) and Redevelopment Agency shall then enter 4 into a binding agreement on the same terms as were offered or agreed to by the other builder or other person, including price, condition of title, condition of property, and other terms (and the parties will agree to a modified or substituted term other than the essential terms listed above if by its special nature a term to another party is not reasonably capable of being met by Redevelopment Agency). Redevelopment Agency shall close its purchase of the Property under the Right of First Refusal by the later of (i) 15 days after the date the Agency provided notice to Lender of its election to exercise the Right of First Refusal, or (ii) the period of time for closing set forth in the purchase documentation between Lender and the builder or other person, unless, after having executed a purchase and sale agreement, such closing deadline is extended by mutual agreement of Agency and Lender. Bank understands that Redevelopment Agency may attempt to arrange a sale to a successor builder or other person, which may be a sale by the Redevelopment Agency that closes simultaneously with the sale by the applicable Lender to the Redevelopment Agency, but Lender shall not be required to assume any additional obligations as a result of or in connection with such simultaneous closing to another builder or other person and shall be defended and indemnified by Agency against any additional costs relating thereto. 3.3.2 Redevelopment Agency's failure to issue a written notice of its election to exercise the Right of First Refusal or Redevelopment Agency's refusal to accept such terms and agree in writing to purchase the Property on such terms shall enable Lender (or its affiliate) to sell the Property to such other purchaser on substantially the same terms (or more advantageous to such Lender or affiliate) as were offered to Redevelopment Agency for a period of 6 months from the date when such terms were offered to Redevelopment Agency until the closing of the sale, and such other purchaser shall be permitted to acquire the Property on such terms and free and clear of the Agency Rights (except the provisions of the DDA and the Grant Deed that are designated to survive pursuant to Section 3.2), the Right of First Refusal, and any other option or right of first refusal in favor of Redevelopment Agency. If the closing fails to occur within the 6 month period as provided herein, Redevelopment Agency shall continue to have its right of first refusal set forth in this Section 3.3. 4. Action Concerning Collateral. 4.1 Possession of Collateral. Notwithstanding any Lien now held or hereafter acquired by the Agency, the Lender may take possession of, sell, dispose of, and otherwise deal with all or any part of the Collateral, and may enforce any right or remedy available to it with respect to the Borrower or the Collateral, all without notice to or consent of the Agency except as specifically required by applicable law. (i) Agency understands and agrees that the lien granted to it under Section 6.5 of the Development Agreement for any expense incurred by it in curing a default by Developer under the Loan Documents is and shall be subordinate and inferior to the Deed of Trust held by Lender. '" (ii) Section 6.3 of the Development Agreement and Section 9 of the Grant Deed shall not be interpreted to prevent Lender, pursuant to the Loan Documents, from continuing or completing construction of improvements on the Real Property, should these be 5 necessary, in order to cure any default by Borrower, Developer or CHBD under the Development Agreement, and in doing so, Lender will shall not be deemed to have assumed any or all obligations of Developer of CHBD unless Lender in its sole discretion specifically assumes such obligations in writing. However, if Lender undertakes to continue or complete any improvements with respect to a particular lot or building, it shall do so in accordance with the Development Plan. 4.2 No Agencv. In no event shall the Lender be deemed the Agency's agent with respect to the Collateral. All proceeds received by the Lender with respect to any Collateral may be applied, first, to payor reimburse the Lender for all costs and expenses (including reasonable attorneys' fees) incurred by the Lender in connection with the collection of such proceeds, and, second, to any Lender Indebtedness secured by the Lender's Lien in that Collateral, in any order that it may choose. 5. Continuing Effect. This Agreement shall constitute a continuing agreement of subordination, and the Lender may, without notice to or consent by the, modify any term of the Lender Indebtedness in reliance upon this Agreement. Without limiting the generality of the foregoing, the Lender may, at any time and from time to time, without the consent of or notice to the Agency and without incurring responsibility to the Agency or impairing or releasing any of the Lender's rights hereunder: (a) sell, exchange, release or otherwise deal with the Real Property at any time securing payment of the Lender Indebtedness or any part thereof; (b) release anyone liable in any manner for the payment or collection of the Lender Indebtedness or any part thereof; and, (c) exercise or refrain from exercising any right against the Borrower, or any other person. 6. Modifications Requiring Reaffirmation of the Subordination Agreement. The following modifications to the Loan Documents may be categorized as a novation to this Agreement and shall thereby require the Agency's written reaffirmation of the subordination provisions of this Agreement, which shall not be umeasonably withheld by Agency so long as it is not sought under Section 6(c) in which case the Agency may provide or withhold affirmation in its sole discretion: (a) An increase in the interest rate charged under the Loan. This shall not include late charges after default or increases in the interest rate as a result of increases of the index rate that is used by Lender as its base or index rate under the loan; (b) An increase in the total amount of the Loan by more than five percent (5%) at anyone time, or in the aggregate; and, ~ (c) An authorization of disbursements of the Loan to be used for properties other than the Real Property or for purposes other than the acquisition of the Real Property. 6 7. Modifications Not Requiring Reaffirmation of the Subordination Agreement. The terms of this Subordination Agreement shall automatically apply to the following additional amendments or other modifications of the Loan Documents without the need for any written reaffirmation or other written Agreement: (a) Any and all additional advances, extensions, amendments or other modifications or the Loan Documents that do not contain any of the modifications defined in Section 7 herein; (b) Lender's election to advance funds sufficient to cure defaults, in the event of a default under the Loan, even if such advances may result in the aggregate amount advanced by Lender exceeding the original principal amount of the Loan; and, (c) Lender's Liens. Lender's election to advance additional funds to preserve or protect the 8. Notice. All notices and other communications hereunder shall be in writing and shall be (i) personally delivered, (ii) transmitted by registered mail, postage prepaid, or (iii) transmitted by telecopy, in each case addressed to the party to whom notice is being given at its address as set forth below: If to the Lender: San Diego Trust Banle 2550 Fifth Avenue, Suite 120 San Diego, CA 92103 Telephone: (619) 525-1700 Attention: Real Estate Lending Manager If to the Agency: Attention: Telephone: L->_- or at such other address as may hereafter be designated in writing by that party. All such notices or other communications shall be deemed to have been given on (i) the date received if delivered personally, (ii) the date of posting if delivered by mail, or (iii) the date of transmission if delivered by facsimile. -= 9. Conflict in Agreements. If the subordination provisions of any instrument evidencing a subordinated indebtedness conflict with the terms of this Agreement, the terms of this Agreement shall govern the relationship between the Lender and the Agency. 7 10. No Waiver. No waiver shall be deemed to be made by the Lender of any of its rights hereunder unless the same shall be in writing signed on behalf of the Lender, and each such waiver, if any, shall be a waiver only with respect to the specific matter or matters to which the waiver relates and shall in no way impair the rights of the Lender or the obligations of the Agency to the Lender in any other respect at any time. II. Other Agreements. This Subordination Agreement shall be the whole and only agreement with regard to the subordination of the Agency's rights and the Agency Documents to the lien and charge of the Deed of Trust. This Subordination Agreement shall supersede and cancel any prior agreements as to any provisions in the Agency Documents, which relate to the priorities of the Agency Documents. To the extent that any provisions in this Agreement are inconsistent with the provisions of the Agency Documents, the provisions of this Subordination Agreement shall supersede and control, and Agency may not enforce any provisions of the Agency Documents that are inconsistent with this Subordination Agreement if Lender objects thereto in writing. However, this Subordination Agreement is not intended for the benefit of Borrower. 12. Loan Proceeds. Lender's disbursement of the Loan proceeds to Borrower does not, in any way, obligate it to supervise their application and their disbursement shall not defeat the subordination made in this Agreement. 13. Binding Effect; Acceptance. This Agreement shall be binding upon the Agency and the Agency's heirs, legal representatives, successors and assigns and shall inure to the benefit of the Lender and its participants, successors and assigns irrespective of whether this or any similar agreement is executed by any other subordinated creditor. Notice of acceptance by the Lender of this Agreement or of reliance by the Lender upon this Agreement is hereby waived by the Agency. 14. Miscellaneous. The paragraph headings herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. 15. Governing Law: Consent to Jurisdiction and Venue: Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance with the substantive laws (other than conflict laws) of the State of California. Each party consents to the personal jurisdiction of the state and federal courts located in the State of California in connection with any controversy related to this Agreement and agrees that any litigation initiated by any of them in connection with this Agreement may be venued in either the state or federal courts located in San Diego County, California. THE PARTIES WAIVE ANY RIGHT TO TRIAL BY JURY '" IN ANY ACTION OR PROCEEDING BASED ON OR PERTAINING TO THIS ACKNOWLEDGMENT. 8 EXHIBIT A PARCEL 1 OF PARCEL MAP NO. 19583, IN THE CITY OF CHULA VISTA, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, SEPTEMBER 28,2004. .. 10 EXHIBIT B [attach copy of Subordinated Agency Documents with following legend] THESE INSTRUMENTS ARE SUBJECT TO THE TERMS OF A SUBORDINATION AGREEJ\1ENT BY THE REDEVELOPJ\1ENT AGENCY OF THE CITY OF CHULA VISTA IN FAVOR OF SAN DIEGO TRUST BANK, DATED AS OF SEPTEMBER ,2005. -- 11 ALL PURPOSE ACKNOWLEDGMENT State of Ga.l i fOY"lIt; d County of Sdl/\ 0 I fl-)O OnlXphVJ,1bfV (0 2005 beforeme,~i A. :Tdes., Norc~ VUhl,'r_ Date I Name and Title of Officer'(e.g., "Jane . Notary Public") personally appeared ~O e; S 1~'VI ~V10 Yl!> Name(s) of Signer(s) D personally known to me - OR o f.trovt.e1 to II''':'' 0" tl.<.. 68SiG gf iatidastsry Q"i88nGli~ to be the person(sJ whose name(S.@aI'&subscribed to the within instrument and acknowledged to me th~y executed the same in~r authorized capacity(~), and that by ~/h9l'ilReir signature(s.) on the instrument the person(sJ, or the entity upon behalf of which the person(s.) acted, executed the instrument. l.- - - - ~~=':lEE2:33 - t I NoIcIy Public . CaIIamIa ~ Ian DIego CculIy .. - - - ~~-~-~~~ WITNESS my hand and official seal. ~ ~tl1i{' n. dd} A. ) Signature of Notary Public DOCUMENT TYPE: SLlhorCULld:hoVl Ac)fuVWIA t DOCUMENT DATE: Sep~. QO()5 OTHER SIGNERS Kede velopvW'4-tr A~e-1'le ~ Clw Id V is r p .. ALL PURPOSE ACKNOWLEDGMENT State of County of On before me, Name and Title of Officer (e.9., "Jane Doe, Notary Public") Date personally appeared Name(s) of Signer(s) o personally known to me - OR - 0 proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature of Notary Public DOCUMENT TYPE: DOCUMENT DATE: OTHER SIGNERS: ""