TO: Honorable Mayor and Members of the City Council
THRU: Tom Kisela, City Manager
FROM: Trang Nguyen, Finance Director
1. Subject
title
Recognized Obligation Payment Schedule for the fiscal period covering July 1, 2025, through June 30, 2026. Resolution No. SAORA-038.
body
2. Summary
Approve the Recognized Obligation Payment Schedule (ROPS) 25-65 and related Administrative Budgets for the period covering July 1, 2025 through June 30, 2026, and authorize the transmittal of ROPS 25-26 to the Orange Countywide Oversight Board.
3. Recommended Action
recommendation
1. Adopt Resolution No. SAORA-038, A Resolution of the Governing Board of the Successor Agency to the Orange Redevelopment Agency approving a Recognized Obligation Payment Schedule for the fiscal period covering July 1, 2025 through June 30, 2026, pursuant to Health and Safety Code Section 34177, and taking certain related actions.
2. Direct staff to transmit ROPS 25-26 and related Administrative Budgets to the Orange Countywide Oversight Board of the Successor Agency to the Orange Redevelopment Agency.
end
4. Fiscal Impact
The preparation and submittal of the ROPS 25-26 allows the Successor Agency to pay its enforceable obligations for the period from July 1, 2025 through June 30, 2026. Items listed on the ROPS 25-26 will be included in the City’s FY 25-26 Annual Budget. The ROPS 25-26 shall become operative after it is approved by the Orange Countywide Oversight Board and the State of California Department of Finance.
5. Strategic Plan Goals
Goal 2: Be a fiscally healthy community
a: Expend fiscal resources responsibly.
6. Discussion and Background
With the dissolution of the Orange Redevelopment Agency (Agency) effective January 31, 2012, the City Council adopted Resolution No. 10625 authorizing the City to become the Successor Agency for the former redevelopment agency and enabling the City to fulfil the continued expenses of the Agency. A significant majority of Recognized Obligation Payment Schedule (ROPS) expenses are outstanding Agency bonds that are scheduled to be paid twice a year until they mature in the years ranging from 2023 - 2036.
Assembly Bill 113 (AB 113) provided additional amendments to obligations and deadlines for redevelopment wind-down activities, including specific language in Health and Safety Code (HSC) Section 34177(o)(1) with regard to preparation and approval of Annual ROPS covering the period of July 1 to June 30. The Annual ROPS lists all legally binding and enforceable agreements or contracts of the former Orange Redevelopment Agency (Agency) for each fiscal-year period, including those necessary for the continued administration of the Successor Agency to wind down the former Agency.
The State Department of Finance (DOF) requires submission of the Annual ROPS through the web-based application called the Redevelopment Agency Dissolution Web Application (RAD), first established in 2013. This Annual ROPS covers the period July 1, 2025 to June 30, 2026 (ROPS 25-26). It is comprised of the following four forms:
1) Summary Report: This form summarizes funding totals carried forward from the ROPS Detail Form by funding source and reports the Current Period Funding for Enforceable Obligations of ROPS 25-26A and 25-26B in separate columns;
2) ROPS Detail Form: This form lists the Agency outstanding obligations, debts, and payments due for ROPS A and B separately by fund source;
3) Report of Cash Balances Form: This form requires the Successor Agency to report all cash balances for each funding source in accordance with HSC section 34177(l), and;
4) Notes Form: The completion of this form is optional and available to Successor Agency to provide additional information associated with the ROPS Detail Form.
Overview of ROPS 25-26
Following the RAD process for ROPS 25-26, the estimated Redevelopment Property Tax Trust Fund (RPTTF) to be disbursed is $2,339,450 subject to approval of the Orange Countywide Oversight Board and the DOF.
|
Proposed ROPS 25-26 |
Amount Requested |
Administrative Budget |
Estimated RPTTF Disbursement Amount |
|
Other Funds |
$2,288,020 |
$0 |
$2,288,020 |
|
RPTTF |
$0 |
$51,430 |
$51,430 |
|
TOTAL |
$2,288,020 |
$51,430 |
$2,339,450 |
Along with preparing the Annual ROPS, the Successor Agency is required to prepare administrative budgets for the six-month fiscal periods from July 1, 2025 through December 31, 2025 and from January 1, 2026 through June 30, 2026. The proposed Administrative Budgets shall include estimated amounts for Successor Agency administrative costs that are to be paid from property tax revenues deposited in the RPTTF.
Deadline to submit ROPS 25-26
To comply with AB 113 and the upcoming February 1, 2025 deadline, it is recommended the Successor Agency approve ROPS 25-26 and the related Administrative Budget and transmit these documents to the Orange Countywide Oversight Board for approval. The DOF has indicated late ROPS submission will be subject to penalties set forth in Health and Safety Code 34177(o)(1). The penalty affects the entity that created the redevelopment agency which is subject to a penalty in an amount equal to $10,000 per day for every day the ROPS is not submitted to the DOF.
7. ATTACHMENTS
• Resolution No. SAORA-038