HomeMy WebLinkAbout7/30/2008 - STAFF REPORTS - RA.3. a fpALM SA?
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COMMUNITY REDEVELOPMENT AGENCY
c4W�o�N�P STAFF REPORT
DATE: July 30, 2008 Consent Calendar
SUBJECT: BUDGET AMENDMENT FOR FISCAL YEAR 2007-2008 RELATED TO
ASSET PURCHASES BY CRA:
INTEREST INCOME AND PRINCIPAL REPAYMENT TO CITY;
INTEREST EXPENSE AND PRINCIPAL REPAYMENT FROM CRA
FROM: David H. Ready, Executive Director
BY: Department of Finance and Treasury
SUMMARY
The proposed Budget Amendment appropriates the annual promissory note repayment
in the Community Redevelopment Agency and a like revenue amount will be set up in
the City's General Fund. The amount due from the promissory notes between the
Redevelopment Agency (Obligor) and the City (Holder) totals $9,498,000 approved on
December 17, 2007 with a 6% annual interest rate, and additional promissory notes for
$55,762,000 approved on February 6, 2008 with a 10% annual interest rate.
RECOMMENDATION:
Adopt Resolution No. A RESOLUTION OF THE COMMUNITY
REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA,
AMENDING THE BUDGET FOR THE 2007-08 FISCAL YEAR.
STAFF ANALYSIS:
On December 17, 2007, the City sold to the Agency the Frances Stevens Park and the
Convention Center Parking Lot, with a total value of $9,498,000. The City took
promissory notes as payment with an initial interest rate of 6% for the year.
Likewise, on February 6, 2008, the City sold Sunrise Park, Village Green, and the
Visitor's Center to the Agency for a total value of $55,762,000. The initial interest rate
on the promissory notes was set as 10%.
Item No. RA3 ■
City Council Staff Report
July 30, 2008—Page 2
Budget Amendments Related to Asset Purchase by CRA
The calculation of the interest is:
$9,498,000 x 6% - $569,880 per year
_ $1,557.05 per day (366 day year)
x 202 days (12/7/2007 --6/30/2008)
$314,524
$55,762,000 x 10% _ $5,576,200 per year
_ $15,235.52 per day (366 day year)
x 145 days (2/7/2008 -6/30/2008)
$2,209,150
The total amount of interest due for the 2007-2008 fiscal year is $2,523,674. The City
has the discretion to receive and record a lesser amount of interest and have the
interest not received added to the principal amount owed the following fiscal year. The
amount required by the General Fund will be determined by staff as part of the year-end
closing process.
FISCAL IMPACT.
The Redevelopment Agency has sufficient current year revenues and fund balance to
absorb the expense. The expected revenue in the General Fund will help that Fund to
remain balanced and maintain adequate cash reserves.
John aymo d Geoffrey S. Kiehl
D' ctor of munity and Director of Finance and Treasurer
Economic Development
Thomas WilsoK, Assistant City Manager David H. Ready, anager
Attachments:
Budget Amendment, Redevelopment Agency
RESOLUTION NO.
A RESOLUTION OF THE COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA,
AMENDING THE BUDGET FORTHE 2007-08 FISCALYEAR.
WHEREAS, Resolution 1328 approving the budget for the fiscal year 2007-08 was
adopted on June 6, 2007; and
WHEREAS, the Executive Director has recommended, and the Agency desires to
approve, certain amendments to said budget;
NOW, THEREFORE BE IT RESOLVED thatthe Director of Finance is authorized to
record inter-fund cash transfers as required in accordance with this Resolution, and
that Resolution 1328, adopting the budget for the 2007-08 fiscal year is hereby
amended as follows:
SECTION 1. ADDITIONS
Fund Activity Account Amount
851 8201 Central 49647 City Asset $336,604
Merged Area #1 Business District Purch Note Repay
852 8202 Tahquitz 49647 City Asset $2,187,070
Merged Area #2 Andreas Purch Note Repay
SECTION 2. SOURCE
Fund Activity Account Amount
851 29301 $336,604
Merged Area #1 Fund Balance
852 29301 $2,187,070
Merged Area #2 Fund Balance
ADOPTED THIS day of July, 2008.
David H. Ready
Executive Director
ATTEST:
James Thompson
Assistant Secretary
Resolution No.
Page 2
CERTIFICATION
STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.
CITY OF PALM SPRINGS )
I, JAMES THOMPSON, Assistant Secretary of the City of Palm Springs, hereby
certify that Resolution No. is a full, true and correct copy, and was duly
adopted at a regular meeting of the City Council of the City of Palm Springs on
by the Agency:
AYES.
NOES:
ABSENT:
ABSTAIN:
James Thompson
Assistant Secretary,
City of Palm Springs, California
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