HomeMy WebLinkAboutStaff ReportSuccessor Agency Council Meeting
September 16, 2014
ROPS 14-15 B
Staff Report
September 16, 2014
ROPS 14-15B includes payments for debt service on bonds, a debt service reserve to be used towards
bond payments due during ROPS 15-16A, payments for legal services, professional services and
miscellaneous property maintenance expenses expected to be necessary during the period, and
payments related to three capital projects: the WI-TOD low and moderate income housing project, 8`h
Street Smart Growth and the Aquatic Center. The funding sources for this ROPS include bond proceeds
totaling $25,057,000, the Redevelopment Property Tax Trust Fund (RPTTF) in the amount of $7,166,847
and "Other Funding" (interest and loan repayments) of $60,000. Of significance in this ROPS is the
request for the use of 2011 bond proceeds as described below.
2011 Bond Proceeds (AB 2493 pending final approval)
In March 2011, the CDC -RDA issued bonds to finance several community projects. (See Exhibit "A" to the
Resolution.) These projects had been in various stages of planning over the years leading up to the sale
of the bonds as evidenced by adopted specific plans and the 2005 -2009 and 2010-2014 Redevelopment
Implementation Plans (see Exhibits "B" and "C" to the Resolution, respectively). The redevelopment
dissolution legislation put conditions on the use of bond proceeds from issuances prior to 2011, but was
silent on the use of bonds issued in 2011. Legislation was introduced last year to clarify the matter, but
no action was taken. Legislation was reintroduced this year (AB 2493) and as of this writing is awaiting
the Governor's signature. The State Department of Finance has approved the use of 2011 bond
proceeds in instances where contracts were executed on or before June 27, 2011. Significantly, Phase I
of the WI-TOD project utilizing $14,957,000 of the 2011 bond proceeds (Items 7 and 8 on the ROPS) met
that requirement. Other street and park projects also had executed agreements, but primarily for design
work. None of them had executed construction contracts. As a result, the Successor Agency has
approximately $15.8 million of "stranded" bond proceeds.
AB 2493 allows agencies that have received a finding of completion to use these stranded bond
proceeds for projects that meet five criteria. The National City Successor Agency received a finding of
completion by the State Department of Finance on September 9, 2014. For this ROPS cycle, pending the
enactment of AB 2493, staff proposes to request the use of a portion of the outstanding bond proceeds
for three projects, all of which were identified in the bond indenture. The five criteria are summarized
as follows:
1. Project shall be consistent with regional sustainable communities strategy or regional
transportation plan that includes programs and policies to reduce greenhouse gas emissions;
2. Two or more significant planning or implementation actions shall have occurred prior to
December 31, 2010. These actions are defined as any of the following: a.) an action approved by
the governing body of the city, the board of the redevelopment agency or the planning
commission directly related to the planning or implementation of the project, b.) the project is
included in an approved planning document, or c.) the expenditure by the city or project
sponsor of more than $25,000 in one year or $50,000 in total over multiple years;
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ROPS 14-15 B
3. Documentation dated on or before December 31, 2010 of RDA plans to issue long-term debt to
finance the project;
4. Requirement that each construction contract over $100,000 include a provision that prevailing
wage will be paid by the contractor and subcontractors; and
5. Requirement that for construction contracts over $250,000, prospective contractors
demonstrate the financial ability and experience to perform large construction projects.
AB 2493 also requires that the resolution adopting the ROPS detail how each project meets the five
criteria. The supporting documentation must also be attached to the resolution.
The three projects and a description of how each one meets the specified criteria are detailed below:
Item 8: WI-TOD Phase II
Description of project: Phase I of this multi -family housing project is under way and will provide 109
units and related amenities. Phase II will provide an additional 92 units.
Amount of bond proceeds requested: $5,000,000
Requirement 41: Sustainable Communities
The Comprehensive Land Use Update EIR included the analysis of impacts resulting from the
implementation of the updates to the General Plan, specific plans, other adopted planning policies. (See
Exhibit "D" to the Resolution.) The plan that is implemented by the WI-TOD project is consistent with
the regional planning documents (including the Sustainable Communities Strategy (SCS) and Regional
Transportation Plan (RTP)) and do not result in land use impacts. The projects are therefore consistent
with the SCS and RTP.
Requirement #2: Significant Planning or Implementation Actions
A. The Westside Specific Plan, the EIR for which was certified by the City Council in March 2010,
includes project level approvals for the WI-TOD project. Chapter 3 of the Plan describes land
use. On page 30, future development Goal 3.9 states: "Actively pursue partnerships to construct
200 affordable housing units throughout the plan area and to concentrate efforts towards
meeting these affordable housing goals on parcels surrounding Paradise Creek." On page 37 the
vision for a transit oriented development district within the plan area is described followed by a
concept plan on page 38. (See Exhibit "E" to the Resolution.) Further, in the Findings of Fact and
Statement of Overriding Considerations on pages 2-3 to 2-4 (see Exhibit "F" to the Resolution),
the following statement is made: "The Westside Specific Plan also explores the effects of
redeveloping the Public Works yard and surrounding area into a transit -oriented infill affordable
housing project. The goals for this transit oriented development (TOD) are to (1) transform the
proposed property into affordable housing with linkages to the 24th Street Metropolitan Transit
System Trolley Station; (2) enhance Paradise Creek and ensure the expansion of the Paradise
Creek Education Park; and (3) prepare and provide facilities and ongoing program management
for an "incubator" that would provide training and services that assist project tenants in more
effectively pursuing home ownership and higher payingjobs. The 14-acre TOD area would be
located within the MCR-2 zone. The zone allows residential uses at a maximum density of 45
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dwelling units per net acre and would seek to achieve a minimum of 30 employees per acre. At
maximum build -out, the area would support 360 dwelling units, 295,000 to 450,000 gross
square feet of office space, and 45,000 to 65,000 gross square feet of retail space (not including
existing development). The project -specific development may include an adult educational
center within the TOD area and relocation of the public works yard."
B. On March 3, 2009, the CDC -RDA authorized the Mayor to execute the Exclusive Negotiation
Agreement with The Related Companies of California and Community Housing Works for a
transit -oriented infill mixed -use and affordable housing project (CDC Resolution 2009-51) (see
Exhibit "G" to the Resolution). Further, on March 17, 2009 (Resolution 2009-61) (see Exhibit "H"
to the Resolution), the CDC -RDA authorized the submittal of an application to the California
Department of Housing and Community Development for funding under the Infill Infrastructure
and Transit Oriented Development Grant Programs (Proposition 1C of 2006).
C. From July 1, 2008 through December 31, 2010, approximately $80,000 was spent by the RDA on
the WI-TOD project (see Exhibit "I" to the resolution).
Requirement #3: Plans to issue long-term debt
The redevelopment plans dated July 18, 1995 and July 17, 2007 contain methods for financing projects,
including ongoing provisions for issuing bonds. (See Exhibits "J" and "K", respectively to the Resolution.)
In addition, staff met with its financial advisor in October of 2010 to determine the CDC -RDA's capacity
to issue additional debt and a timeline to accomplish a bond sale (See Exhibit "U' to the Resolution).
Requirement #4: Prevailing Wage
Each construction contract over one hundred thousand dollars ($100,000) shall include a provision that
prevailing wage will be paid by the contractor and all of that contractor' s subcontractors.
Requirement #5: Financial Ability and Experience of Contractors
For each construction contract over two hundred fifty thousand dollars ($250,000), the successor
agency shall require prospective contractors to submit a standardized questionnaire and financial
statements as part of their bid package, to establish the contractor' s financial ability and
experience in performing large construction projects.
Item #23: 8th Street Smart Growth Revitalization
Description of project: Public right-of-way improvements to eliminate factors hindering economically
viable uses and inadequate public infrastructure. This project is underway utilizing other sources of
funds originally programmed for three other projects. The bond proceeds are necessary to reimburse
the other projects and to complete the 8`h Street project as planned.
Amount of bond proceeds requested: $1,800,000
Requirement #1: Sustainable Communities
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The Comprehensive Land Use Update EIR included the analysis of impacts resulting from the
implementation of the updates to the General Plan, specific plans, other adopted planning policies. (See
Exhibit "D" to the Resolution.) The plan that is implemented by the 8`h Street project is consistent with
the regional planning documents (including the Sustainable Communities Strategy (SCS) and Regional
Transportation Plan (RTP)) and do not result in land use impacts. The project is therefore consistent
with the SCS and RTP.
Requirement #2: Significant Planning or Implementation Actions
A. The desired improvements to 81" Street were designed and approved in the Downtown Specific
Plan, adopted in February 2005 (see Exhibit "M" to the Resolution). The 81h Street project was
included in the 5-year Capital Improvement Program that was a component of the Adopted
Budget for the City of National City for Fiscal Year 2010-11 (See Exhibit "N" to the Resolution).
B. The City received a grant of $2.0 million from SANDAG for this project in May 2009 for which
$500,000 in tax increment revenue was pledged as matching funds (see Exhibit "0" to the
Resolution).
C. As of December 31, 2010, over $213,000 in tax increment funds were spent on the project (see
Exhibit V" to the Resolution).
Requirement #3: Plans to issue long-term debt
The redevelopment plans dated July 18, 1995 and July 17, 2007 contain methods for financing projects,
including ongoing provisions for issuing bonds. (See Exhibits "J" and K, respectively to the Resolution.)
In addition, staff met with its financial advisor in October of 2010 to determine the CDC -RDA's capacity
to issue additional debt and a timeline to accomplish a bond sale (See Exhibit "U' to the Resolution).
Requirement #4: Prevailing Wage
Each construction contract over one hundred thousand dollars ($100,000) shall include a provision that
prevailing wage will be paid by the contractor and all of that contractor's subcontractors.
Requirement #5: Financial Ability and Experience of Contractors
For each construction contract over two hundred fifty thousand dollars ($250,000), the successor
agency shall require prospective contractors to submit a standardized questionnaire and financial
statements as part of their bid package, to establish the contractor's financial ability and experience in
performing large construction projects.
Item #65: Aquatic Center
Description of project: Aquatic recreational center with boat and kayak access to the San Diego Bay. This
project is near completion with financing made possible by reallocating San Diego Unified Port District
grants from another National City project to this one Release of these bond proceeds will enable the
other planned project to go forward and enable the City to complete the Aquatic Center project.
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Amount of bond proceeds requested: $3,300,000
Requirement #1: Sustainable Communities
The Comprehensive Land Use Update EIR included the analysis of impacts resulting from the
implementation of the updates to the General Plan, specific plans, other adopted planning policies. (See
Exhibit "D" to the Resolution.) The plans that are implemented by the Aquatic Center project are
consistent with the regional planning documents (including the Sustainable Communities Strategy (SCS)
and Regional Transportation Plan (RTP)) and do not result in land use impacts. The projects are
therefore consistent with the SCS and RTP.
Requirement #2: Significant Planning or Implementation Actions
A. Since 2004, the City of National City and the San Diego Unified Port District (Port) have worked
to develop the National City Aquatic Center on land owned by the Port. In May 2010 the CDC
authorized the Chairman to execute a 30-year lease agreement with the Port for property in
Pepper Park for the construction of the National City Aquatic and Education Center (Resolution
2010-105) (see Exhibit "Q" to the Resolution). Pursuant to that resolution, an agreement was
executed on July 29, 2010 granting the lease on the condition that the CDC spend at least
$2,137,561 on project improvements. (See Exhibit "R" to the Resolution.) On June 8, 2010 the
Port committed $830,000 to the project with the remainder of the estimated total cost of
$3,318,364 to be provided by the CDC (see Exhibit "S" to the Resolution). In March 2011 the CDC
issued bonds to fund various projects including the Aquatic Center (see Exhibit "A" to the
Resolution). To date, the State Department of Finance has denied the use of bond proceeds for
construction of this project. The City sought other means to complete the project and on July
16, 2013 the Port approved the allocation of $3,080,000 to the Aquatic Center from a separate
park project in National City (see Exhibit "T" to the Resolution).The Aquatic Center project was
included in the 5-year Capital Improvement Program that was a component of the Adopted
Budget for the City of National City for Fiscal Year 2010-11 (see Exhibit "N" to the Resolution).
Reference to this project, including a general description of its amenities, is also included in the
Port Master Plan for the San Diego Unified Port District dated January 2010 (see Exhibit "U" to
the Resolution).
B. From FY2008 through December 31, 2010, the CDC -RDA spent approximately $80,000 on the
Aquatic Center project (see Exhibit "V" to the Resolution).
Requirement #3: Plans to issue long-term debt
The redevelopment plans dated July 18, 1995 and July 17, 2007 contain methods for financing projects,
including ongoing provisions for issuing bonds. (See Exhibits "J" and "K", respectively to the Resolution.)
In addition, staff worked with its financial advisor and bond underwriters in 2010 to determine the CDC -
RDA's capacity to issue additional debt and a timeline to accomplish a bond sale (See Exhibit "U' to the
Resolution).
Requirement #4: Prevailing Wage
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Each construction contract over one hundred thousand dollars ($100,000) shall include a provision that
prevailing wage will be paid by the contractor and all of that contractor's subcontractors.
Requirement #5: Financial Ability and Experience of Contractors
For each construction contract over two hundred fifty thousand dollars ($250,000), the successor
agency shall require prospective contractors to submit a standardized questionnaire and financial
statements as part of their bid package, to establish the contractor's financial ability and experience in
performing large construction projects.
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