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HomeMy WebLinkAbout2011-10-11 - AGENDA REPORTS - ALTERNATIVE REDEVELOPMENT PGM (2)CONSENT CALENDAR DATE: SUBJECT: DEPARTMENT: Agenda Item: 9 CITY OF SANTA CLARITA AGENDA REPORT City Manager Approval: Item to be presented by: October 11, 2011 SECOND READING AND ADOPTION OF AN ORDINANCE CREATING SECTION 2.80 OF THE SANTA CLARITA MUNICIPAL CODE TO COMPLY WITH THE VOLUNTARY ALTERNATIVE REDEVELOPMENT PROGRAM PURSUANT TO PART 1.9 OF DIVISION 24 OF THE CALIFORNIA HEALTH AND SAFETY CODE Community Development RECOMMENDED ACTION City Council adopt an ordinance entitled: "AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA, CREATING SECTION 2.80 OF THE SANTA CLARITA MUNICIPAL CODE ENTITLED "VOLUNTARY ALTERNATIVE REDEVELOPMENT PROGRAM" DETERMINING TO COMPLY WITH THE VOLUNTARY ALTERNATIVE REDEVELOPMENT PROGRAM PURSUANT TO PART 1.9 OF DIVISION 24 OF THE CALIFORNIA HEALTH AND SAFETY CODE IN ORDER TO PERMIT THE CONTINUED EXISTENCE AND OPERATION OF THE REDEVELOPMENT AGENCY OF THE CITY OF SANTA CLARITA." BACKGROUND On June 29, 2011, as part of adopting the State of California Fiscal Year (FY) 2011-12 budget, the Governor signed two trailer bills, AB X1 26 and AB X1 27, into law. The legislation was effective on June 29, 2011. AB X1 26 eliminates redevelopment agencies as of October 1, 2011. AB X 1 27 provides an opportunity for cities to "opt -in" and continue to have their redevelopment agencies operate and function if the sponsoring jurisdiction (in this case the City of Santa Clarita) adopts an ordinance by October 1, 2011. If a city is not able to adopt its ordinance by October 1, it may adopt a non-binding resolution of intent and upon doing so has until November 1, 2011, to adopt the "opt -in" ordinance. The City of Santa Clarita City Council adopted a resolution of intent and conducted the first reading of this ordinance on September 27, 2011. On July 18, the California Redevelopment Association and League of California Cities filed suit to invalidate AB X1 26 and 27. The suit was filed directly in the Supreme Court of the State of California. On August 11, the Court stayed the effectiveness of AB X1 26 and 27. On August 17, the Court modified its stay, but in doing so failed to rule on what would happen to cities and agencies that missed a key statutory deadline that passed on August 15. In the month after that modification, the Court has refused to further clarify or modify its stay order, and there is now an open question as to what the Court might order when it issues its final decision in the matter in December 2011 or January 2012. Because of the lack of clarity in the Court's August 17 order, the City Attorney's Office has been reviewing the City's options and has advised that if the City wishes to extend the life of the Redevelopment Agency, then prudence dictates that the City adopt its AB X1 27 "opt -in" ordinance now rather than waiting for a final determination in the litigation. This legal guidance was solidified after the Supreme Court's most recent order refusing to clarify its past ruling and is based in large part on that lack of clarity and the desire to protect the City's interests if the City wishes to keep the Agency viable. Pursuant to Section 12 of the attached ordinance, the ordinance shall become effective either 30 days from the adoption of this ordinance or on the date the Supreme Court of California issues an order or decision that has the effect of dissolving or mooting the stay of AB X1 27, whichever is later. ALTERNATIVE ACTIONS Other actions as determined by the City Council. FISCAL IMPACT There is no fiscal impact as a result of this item at this time. The necessary budget adjustments and appropriations will be presented to the Agency Board for its review and approval pending the outcome of the CRA's challenge of these bills. ATTACHMENTS Ordinance ON ORDINANCE NO. 11 - AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA, CREATING SECTION 2.80 OF THE SANTA CLARITA MUNICIPAL CODE ENTITLED "VOLUNTARY ALTERNATIVE REDEVELOPMENT PROGRAM" DETERMINING TO COMPLY WITH THE VOLUNTARY ALTERNATIVE REDEVELOPMENT PROGRAM PURSUANT TO PART 1.9 OF DIVISION 24 OF THE CALIFORNIA HEALTH AND SAFETY CODE IN ORDER TO PERMIT THE CONTINUED EXISTENCE AND OPERATION OF THE REDEVELOPMENT AGENCY OF THE CITY OF SANTA CLARITA WHEREAS, the Redevelopment Agency of the City of Santa Clarita ("Agency") is a redevelopment agency organized and existing under the California Community Redevelopment Law (Health & Safety Code § 33000 et seq.) ("CRL") and has been authorized to transact business and exercise the powers.of a redevelopment agency pursuant to action of the City Council of the City of Santa Clarita ("City Council" or "City," as applicable); and WHEREAS, pursuant to the CRL, the City of Santa Clarita approved and adopted via Ordinance No. 97-12 a Redevelopment Plan ("Redevelopment Plan") for the Newhall Project Area ("Project"), and the Agency, is vested with the responsibility for implementing and carrying out the Redevelopment Plan; and WHEREAS, the Agency is currently in the process of carrying out the goals and objectives of the Redevelopment Plan by continuing to: eliminate blight; increase, improve, and preserve the supply of affordable housing in the community; stimulate and expand economic growth and employment opportunities by revitalizing properties and businesses within the Project; and alleviate deficiencies in public infrastructure; and WHEREAS, in connection with approval and adoption of the State Budget for Fiscal Year 2011-12, the California Legislature has approved, and the Governor has signed (i) AB X1 26 (Stats. 2011, chap. 5, "AB X1 26"), which immediately, and purportedly retroactively, suspends all otherwise legal redevelopment activities and incurrence of indebtedness, and dissolves redevelopment agencies effective October 1, 2011 (the "Dissolution Act"); and (ii) AB X1 27 (Stats. 2011, chap. 6, "AB X1 27"), which allows communities to avoid the consequences of the Dissolution Act and continue their redevelopment agency if the community enacts an ordinance agreeing to comply with the Voluntary Alternative Redevelopment Program described in Section 2 of AB X1 27 adding Part 1.9 (commencing with section 34192) of Division 24 of the Health and Safety Code (the "Alternative Redevelopment Program"); and WHEREAS, the immediate suspension of activities and dissolution of the Agency under the provisions of AB X1 26 would result in the immediate suspension of Agency efforts and programs to eliminate blight, provide affordable housing, provide economic assistance to businesses, and implement other programs which are assisting in the recovery of the City from the financial crisis and recession currently affecting the City and the State of California and thereby result in severe and unwarranted social and economic hardship to City residents, workers and businesses; and 3 WHEREAS, because the City Council does not wish to immediately suspend the activities of the Agency and wishes to continue to eliminate blight and promote economic development and affordable housing, the City Council has determined it is in the public interest of the City to take immediate action to participate in the AB X1 27 Alternative Redevelopment Program; and WHEREAS, the Alternative Redevelopment Program requires the participating communities to remit specific annual payments to the county auditor -controller for allocation to school entities and special districts; and WHEREAS, under the threat of dissolution pursuant to AB X1 26, and upon the contingencies and reservations set forth herein, the City shall participate in the Alternative Redevelopment Program and make the Fiscal Year 2011 2012 community remittance, which the California State Department of Finance has determined to be seven hundred fourteen thousand, seven hundred and fifty six dollars ($714,756), as well as the subsequent annual community remittances as set forth in AB X 1 27; and WHEREAS, the City reserves the right to appeal the California Director of Finance's determination of the Fiscal Year 2011 12 community remittance, as provided in Health and Safety Code Section 34194, and has appealed that determination and is awaiting the Director's decision on the appeal; and WHEREAS, an action challenging the constitutionality of AB XI 26 and AB X1 27 was filed by the League of California Cities and the California Redevelopment Association on behalf of cities, counties and redevelopment agencies; and WHEREAS, in connection with that action, on August 11, 2011, the Supreme Court of California issued an order staying the effectiveness of AB X1 27; and . WHEREAS, the order issued by the Supreme Court did not address the means by which a City would opt to participate in the Alternative Redevelopment Program if the order were to be dissolved at some point after the cut-off dates set forth in AB X1 27; and WHEREAS, while the City currently intends to make the community remittances, they shall be made under protest and without prejudice to the City's right.to recover such amounts and interest thereon, in the event that there is a final determination that AB X1 26 and ABX1 27 are unconstitutional; and WHEREAS, the City reserves the right, regardless of any community remittance made pursuant to this Ordinance, to challenge the legality of AB X1 26 and AB XI 27; and WHEREAS, to the extent a court of competent jurisdiction enjoins, restrains, or grants a stay on the effectiveness of the Alternative Redevelopment Program's payment obligation of AB X1 26 and AB X1 27, the City shall not be obligated to make any community remittance for the duration of such injunction, restraint, or stay; and WHEREAS, the City is the lead agency concerning this Ordinance pursuant to the 2 California Environmental Quality Act (codified as Public Resources Code Section 21000 et seq) ("CEQA") and the State CEQA Guidelines; and WHEREAS, City staff has determined that this Ordinance is exempt from CEQA, pursuant to CEQA Guidelines Section 15378(b)(4), because the community remittances authorized hereunder are a government funding mechanism and fiscal activity, and do not involve any commitment to any specific project that may result in a potentially significant environmental impact; and occurred; WHEREAS, all other legal prerequisites to the adoption of this Ordinance have THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA, DOES HEREBY ORDAIN AS FOLLOWS: Section 1. Recitals. The Recitals set forth above are true and correct and incorporated herein. Section 2. Participation in the Alternative Redevelopment Program. In accordance with Health and Safety Code Section 34193, and based on the Recitals set forth above, the City Council hereby determines that the City shall comply with the provisions of Part 1.9 of Division 24 of the Health and Safety Code, as enacted by AB X 127. Section 3. Payment under Protest. Except as set forth in Section 4, below, the City Council hereby determines that the City shall make the community remittances set forth in Health and Safety Code section 34194 et seq. Section 4. Effect of Stay or Determination of Invalidity. The City shall not make any community remittance while the Supreme Court's order staying the effectiveness of AB X1 27 is in effect. The City shall also not make such remittance in the event a court of competent jurisdiction determines that AB X1 26 and AB X1 27 are unconstitutional and therefore invalid, and all appeals therefrom are exhausted or unsuccessful, or time for filing an appeal therefrom has lapsed. Any community remittance made following dissolution of the Supreme Court's order staying the effectiveness of ABX1 27 but before a final determination in the matter giving rise to the stay shall be made under protest and without prejudice to the City's right to recover such amount and interest thereon in the event that there is a final determination that AB X1 26 and AB X1 27 are unconstitutional. If there is a final determination that AB X1 26 and AB X1 27 are invalid, this Ordinance shall be deemed to be null and void and of no further force or effect. Section 5. Implementation. The City Council hereby authorizes and directs the City Manager to take any action and execute any documents necessary to implement this Ordinance, including but not limited to notifying the Los Angeles County Auditor -Controller, the Controller of the State of California, and the California Department of Finance of the adoption of this Ordinance and the City's agreement to comply with the provisions of Part 1.9 of Division 24 of the Health and Safety Code, as set forth in ABX 1 27. 5 Section 6. Additional Understandings and Intent. It is the understanding and intent of the City Council that, once the Agency is again authorized to enter into agreements under the CRL, the City will enter into an agreement with the Agency as authorized pursuant to Section 34194.2. The City Council does not intend, by enactment of this Ordinance, to pledge any of its General Fund revenues or assets to make the remittance payments. Section 7. CEQA. The City Council finds, under Title 14 of the California -Code of Regulations, Section 15378(b)(4), that this Ordinance is exempt from the requirements of the California Environmental Quality Act ("CEQA") in that it is not a "project," but instead consists of the creation and continuation of a governmental funding mechanism for potential future projects and programs, and does not commit funds to any specific project or program that may result in a potentially significant environmental impact. Section 8. Notice of Exemption. The City Council hereby authorizes and directs that a Notice of Exemption be filed with the County Clerk of the County of Los Angeles, California, in accordance with CEQA Guidelines. Section 9. Custodian of Records. The documents and materials that constitute the record of proceedings on which these findings are based are located at the City Clerk's office located at City Hall, 23920 Valencia Boulevard, Santa Clarita, California 91355. The custodian for these records is the City Clerk. Section 10. Severability. If any provision of this Ordinance or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are severable. The City Council hereby declares that it would have adopted this Ordinance irrespective of the invalidity of any particular portion thereof. Section 11. Publication. Within 15 days of adoption of this Ordinance, the City Clerk shall certify to the adoption of this Ordinance and cause it to be published in a newspaper of general circulation printed and published within the City of Santa Clarita, in accordance with Government Code § 36933. Section 12. Effective Date. This Ordinance shall become effective either thirty (30) days from adoption of this Ordinance or on the date the Supreme Court of California issues an order or decision that has the effect of dissolving or mooting the stay of ABX1 27, whichever is later. 4 (0 PASSED, APPROVED, AND ADOPTED this day of 2011. lu v, I won ATTEST: CITY CLERK DATE: 7 STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF SANTA CLARITA ) I, Sarah P. Gorman, City Clerk of the City of Santa Clarita, do hereby certify that the foregoing Ordinance 11- was regularly introduced and placed upon its first reading at a regular meeting of the City Council on the day of 2011. That thereafter, said Ordinance was duly passed and adopted at a regular meeting of the City Council on the day of 2011, by the following vote, to wit: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: AND I FURTHER CERTIFY that the foregoing is the original of Ordinance and was published in The Signal newspaper in accordance with State Law (G.C. 40806). CITY CLERK 0 STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF SANTA CLARITA ) CERTIFICATION OF CITY COUNCIL ORDINANCE I, , City Clerk of the City of Santa Clarita, do hereby certify that this is a true and correct copy of the original Ordinance 11- , adopted by the City Council of the City of Santa Clarita, CA on , 2011, which is now on file in my office. Witness my hand and seal of the City of Santa Clarita, California, this day of 2011. City Clerk By Deputy City Clerk 7