March 8, 2005
SUBJECT: Ordinance Adopting the Fifth Amendment to the Redevelopment Plan for the Central Core Redevelopment Project Area Amending Certain Time Limitations by One year Pursuant to Health and Safety Code Section 33333.6(e)(2)(C).
REPORT IN BRIEF
The State Legislature passed legislation that required redevelopment agencies to contribute to the Educational Revenue Augmentation Fund (ERAF). For Fiscal Year 2003-2004, the Sunnyvale Redevelopment Agency’s payment to ERAF was $160,591. To assist agencies with covering that unexpected financial burden, the legislature authorized agencies to extend by one year the last date to undertake redevelopment activity within a project area and the time limit to collect tax increment. Staff recommends that the City Council adopt the attached proposed ordinance amending the Redevelopment Plan for the Central Core Redevelopment Project Area.
BACKGROUND
The State Legislature passed SB1045 in 2003 that required redevelopment agencies to contribute a cumulative $135,000,000 to the Educational Revenue Augmentation Fund (ERAF). For the Sunnyvale Redevelopment Agency, this ERAF contribution amounted to $160,591 for the 2003-2004 fiscal year. As part of the legislation, Agencies are also authorized to extend their redevelopment plan time limits on plan effectiveness and receipt of tax increment by one year to compensate for the ERAF payment. The amendment does not trigger statutory payments to other taxing agencies either now or in the year added to the Plan time limits.
EXISTING POLICY
The Redevelopment Implementation Plan Goal 1 states: Meet the Agency’s Existing Financial and Administrative Obligations.
DISCUSSION
Section 33333.6(e)(2) of California Redevelopment Law permits the City Council to bypass most of the procedures normally required for redevelopment plan amendments. The City Council may adopt the proposed amendment in accordance with the normal procedures for the enactment of ordinances.
The negotiations with developers, for the redevelopment of the Town Center Mall, as documented in the adopted Disposition, Development and Owner Participation Agreement, anticipated that the Agency would extend the time limit of the Redevelopment Plan as permitted by SB1045.
Pursuant to CEQA Guidelines, adoption of the Amendment is not a “project,” and is therefore exempt from CEQA review.
FISCAL IMPACT
There is no direct cost to the Agency from amending the Redevelopment Plan to extend the time limit for the effectiveness of the plan and the time limit to collect tax increment. The Agency will benefit from one additional year of tax increment receipts.
PUBLIC CONTACT
Public contact was made through posting of the agenda on the City's official notice bulletin board, posting of the agenda and report on the City's web page, and the availability of the report in the Library and the City Clerk's Office.
ALTERNATIVES
- Adopt the attached proposed ordinance amending the Redevelopment Plan for the Central Core Redevelopment Project Area.
- Do not adopt the attached proposed ordinance amending the Redevelopment Plan for the Central Core Redevelopment Project.
RECOMMENDATION
Staff recommends Alternative 1.
The effect of extending these time limits will benefit the agency by providing one additional year of tax increment receipts within the Redevelopment Project Area. These time limits extensions will also allow for an additional year for conducting redevelopment activity.
Reviewed by:
Robert Paternoster, Director, Community Development
Prepared by: Brice McQueen, Manager, Redevelopment Agency
Reviewed by:
Mary Bradley, Director, Finance
Approved by:
Amy Chan
City Manager
Attachments
A. Ordinance Adopting the Fifth Amendment to the Redevelopment Plan…