HomeMy WebLinkAbout2006-02-21; Housing & Redevelopment Commission; 380; Educational Revenue Augmentation Fund Payment1HOUSING AND REDEVELOPMENT COMMISSION - AGENDA BILL B
AB# 380
MTG. 02-21-06
DEPT. FIN
TITLE:
APPROVE A REDEVELOPMENT AGENCY SPECIAL
PAYMENT TO THE COUNTY OF SAN DIEGO
EDUCATIONAL REVENUE AUGMENTATION FUND
(ERAF) AND APPROPRIATION OF FUNDS
DEPT. HP.
CITY ATTY.
CITY MGR
RECOMMENDED ACTION:
Adopt Resolution No. 409 authorizing the Administrative Services Director to appropriate
$90,599 and make a one-time payment in the amount of $293,377 from the Redevelopment
Agency's Debt Service Fund to the County of San Diego as mandated by California State legislation.
ITEM EXPLANATION:
ERAF stands for the Educational Revenue Augmentation Fund. This fund is the tool that the State
has used to reallocate property taxes away from local governments and into the schools so that the
State does not have to fund as much to the schools. The latest version of this shift is called ERAF
III, as it is the third such take of property taxes. The first two occurred in the early 1990's.
ERAF III requires, cities, counties and special districts to pay a set amount of money to the State
(through the ERAF fund) in fiscal years 2004-05 and 2005-06. For Carlsbad, the amounts are $1.8
million from the General fund for each of those two years, and $219,285 and $293,377 for fiscal
years 2004-05 and 2005-06 respectively from the Redevelopment Agency. The City's share will be
withheld by the County from property tax receipts. The Redevelopment Agency's share is to be
remitted to the County by May 10th of each year.
With the passage of Proposition 1A in November of 2004, the State is no longer able to take property
taxes from local government. The exception to this would be in a case of severe state financial
hardship as declared by the Governor and approved by 2/3 of the legislature (both houses).
Q Furthermore, if the taxes are shifted, the State will be required to repay those amounts with interest
within three years.
ECQ.Q_
< FISCAL IMPACT:
There is no additional appropriation needed in the City's General fund since this was addressed in
the 2005-06 fiscal budget. During the 2005-06 budget preparation, the Redevelopment ERAF
payment was estimated to be $202,778. The State Director of Finance did not calculate the
Carlsbad Redevelopment Agency's ERAF payment for fiscal year 2005-06 until November 2005.
The payment amount for each Redevelopment Agency was calculated by taking the total tax
8
PAGE 2
increment received in fiscal year 2003-04 for all agencies in the state and then the $250 million
ERAF total was spread to all agencies based on each agency's percentage share of tax increment
received. The Agency's ERAF payment to be paid in fiscal year 2005-06 was calculated by the State
to be $293,377.
Adoption of the attached resolution will appropriate an additional $90,599 from the Redevelopment
Agency's Debt Service Fund and approve payment to the County Auditor to bring the total ERAF
payment to $293,377. The Agency was budgeted to have a net decrease of $600,000 in fund
balance for fiscal year 2005-06, however revenues are now projected to come in higher than budget.
This increase along with a decrease in expected expenditures should result in a zero net change in
the Agency's fund balance for fiscal year 2005-06.
EXHIBITS:
1. Resolution No. 409 authorizing the Administrative Services Director to appropriate and
make a special payment to the County of San Diego.
2. Letter dated November 10, 2005 from the State Department of Finance Director announcing the
mandatory shift in property tax revenues to K-12 schools and community colleges.
DEPARTMENT CONTACT: Roxanne Muhlmeister, 760-602-2430, email rmuhl@ci.carlsbad.ca.us
1 RESOLUTION NO. 409
2 A RESOLUTION OF THE HOUSING AND REDEVELOPMENT COMMISSION OF
3 THE CITY OF CARLSBAD, CALIFORNIA, APPROVING A REDEVELOPMENT
AGENCY SPECIAL PAYMENT TO THE COUNTY OF SAN DIEGO EDUCATIONAL
4 REVENUE AUGMENTATION FUND AND APPROPRIATION OF FUNDS
5
WHEREAS, the adopted legislation for the State of California requires redevelopment
7 agencies to shift property tax revenues to K-12 schools and community colleges during the 2005-
8 06 fiscal year; and
9 WHEREAS, in accordance with this legislation, the Carlsbad Redevelopment Agency
must make a special payment of $293,377, as determined by the State Director of Finance to the
County of San Diego Auditor for deposit in the Education Revenue Augmentation Fund on or
12 before May 10,2006; and
13 WHEREAS, $202,778 has been appropriated for the Redevelopment Agency's ERAF
14
payment in the 2005-06 budget.
15
16
NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment
17
Commission of the City of Carlsbad, California, as follows:
18 1. That the above recitations are true and correct.
19 2. That the Administrative Services Director is authorized to appropriate and additional
20 $90,599 from the Redevelopment Agency Debt Service Fund and submit payment in the amount
21 of $293,377 to the County Auditor of San Diego for deposit into the Education Revenue
22 Augmentation Fund on or before May 10,2006.
23 ///
24 ///
25 ///
26 ///
27 ///
28
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
PASSED, APPROVED AND ADOPTED at a regular meeting of the Housing and
Redevelopment Commission of the City of Carlsbad, California held on the 21st day of
February 2006 by the following vote, to wit:
AYES: Commission Members Hall, Kulchin, Packard, Sigafoose
NOES: None
ABSENT: Chairperson Lewis
MATT
ATTEST:
5 ESTABLISHED
RAYMOND R. PATCHETT, Secretary **r '*•*
DEPARTMENT OF
Exhibit 2
ARNOLD SCHWARZENEGGER, BDVERNOR
STATE CAPITOL • RactM 1 1 43 • SACRAMENTO CA • 95B 1 4-499B • WWW.DCIF.CA.BCIVOFFICE: OF~ THE: DIRECTOR
November 10, 2005
TO ALL COUNTY AUDITORS, REDEVELOPMENT AGENCIES, AND THEIR LEGISLATIVE
BODIES:
Chapter 610, Statutes of 2004, requires redevelopment agencies to shift $250 million in property
tax revenues to K-12 schools and community colleges during the 2004-05 and 2005-06 fiscal
years. The Director of Finance is required to determine an amount each redevelopment agency
shall transfer to the Education Revenue Augmentation Fund (ERAF). It further requires the
Director of Finance to notify each redevelopment agency and legislative body of the amount
determined.
In accordance with the above requirements, the attached document provides the amount
determined for your redevelopment agency.
Each agency must allocate the specified amount to the county auditor for deposit into the ERAF
on or before May 10, 2006. By March 1, the legislative body shall report to the county auditor
how the agency intends to remit the amount required, or that the legislative body intends to
remit the amount in lieu of the agency pursuant to Section 33681.14 of the Health and Safety
Code.
If the legislative body, pursuant to Section 33681.12 of the Health and Safety Code, reported to
the county auditor that it intended to remit the amount in lieu of the agency and the legislative
body fails to transmit the full amount as authorized by May 10 of the applicable fiscal year, the
county auditor, no later than May 15 of the applicable fiscal year, shall transfer an amount
necessary to meet the obligation from the legislative body's allocations pursuant to Chapter 6
(commencing with Section 95) of Part 0.5 of Division 1 of the Revenue and Taxation Code. If
the amount of the legislative body's allocations are not sufficient to meet this obligation, the
county auditor shall transfer an additional amount necessary to meet this obligation from the
property tax increment revenue apportioned to the agency pursuant to Section 33670, provided
that no moneys allocated to the agency's Low and Moderate Income Housing Fund shall be
used for this purpose.
If you have any questions regarding this matter, please contact Pat Landingham, Assistant
Program Budget Manager, at (916) 322-2263.
TOM CAMPBELL
Director
By:
MICHAEL C. GENEST
Chief Deputy Director
Attachment
Exhibit 2
a>
CO
CM
SCO
CO
UJ
«»!af N
.2. « o•o > *•
O w — 00o £ a •£ CM 3-o o ,5 5 T- 3s
T- = X O
o
00
CO
CM
*
§
18
CO«9