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Home My WebLink About16-City Administrator , , CITY OF SAN BERNOIDINO - REQUEST 'OR COUNCIL ACTION. From: Fred Wilson, Assistant to the City Administrator Dept: Administrative Subject: Public Hearing - 9:30 a.lll:. Consideration of alternatives regarding annual payback arrange- ment for Parking District Second- ary Assessment Roll ~ Vf Dah: May 23, 1988 Synopsis of Previous Council action: Nov. 16, 1987 -- Council adopted Resolution No. 87-403 increasing the assess- ment for the repayment of amounts due to the General Fund from the Parking District Fund. May 2, 1988 Public Hearing to consider the annual payback arrangement established for the parking district secondary assessment roll. May 9, 1988 Ways and Means Committee consideration of alternatives regarding the annual payback arrangement. Recommended motion: 1. Rescind Resolution No. 87-403 which increased the assessment for the repayment of amounts due to the General Fund from the Parking District Fund; or 2. Accelerate the repayment schedule as outlined in Resolution No. 87-403; or 3. Continue to collect the secondary assessment roll in the current annual amount of $30,300 to repay the outstanding portion of the loan by the year 2002 and extend the collection of the secondary assessment roll for an additional period to recover interest on the loan amount; or 4. Pursue a commercial loan to repay the General Fund immediately and repay the loan through an appropriate increase in the secondary assessment. ~ Contact person: Fred Wilson Phone: 5122 Supporting data attached: Yes Ward: 1 FUNDING REQUIREMENTS: Amount: N/A Source: fAcct, No,) (Acct, DescriDtion) Fin8llce: Council NOhS: 75-0262 Agenda Item No I~ CITY OF SAN BERNOIDINO - REQUEST POI COUNCIL ACTION STAFF REPORT At the public hearing held on May 2, 1988 regarding the parking district secondary assessment roll, public testimony was heard from impacted property owners. In response to the concerns expressed at this meeting, the Ways and Means Committee was requested to look at alternatives for repaying the outstandinq portion of the loan that remains due from the Parking District in the amount of approximately $416,130. (The original report prepared by the Director of Finance on this issue is provided as an attachment.) The Ways and Means Committee considered a number of options at their May 9/88 meeting, including the options which are listed below. After some discussion, the Committee did not elect to recommend a preferred alternative to the Mayor and Council. In order to assist the Mayor and Council this issue, staff has prepared the outlines the following alternatives. in their consideration of attached schedule which The first column lists the bond payment amounts and years remaining to retire the bond issue for the Drimarv assessment. It should be noted that this is not the actual assessment as maintenance, operation and security costs have not been included. This column is provided only as a point of reference. Alternative 1 Lists the repayment schedule for the secondary assessment roll and the number of years required to retire the loan if Resolution No. 87-403 was rescinded. This action to rescind the resolution would revert the repayment schedule to the original schedule which has been in place since 1979. This payment schedule was originally structured to terminate at essentially the same time as the primary roll. No interest would be assessed under this approach. This is the preferred alternative of the Parking Commission. Alternative 2 Lists the repayment schedule for the secondary roll that was aDDroved by Council at their November 16, 1987 meeting. This action doubled the annual principal payments and assessed a 9% interest rate on the unpaid balance of the loan over a 7 year period. The interest generated on the loan in the amount of $149,806 was to be retained in a special account for future parking purposes. If the Council takes no action at Resolution No. 87-403 will remain Assessment will be increased. this meeting, the provisions of in effect and the Secondary 75-0264 Alternative 3 o o This alternative proposes no increase in the Secondary Assessment rate. It involves retirinq the debt at the current annual Secondary Assessment rate of $30,300 by the year 2002 as originally intended and extending the collection of the Secondary Assessment for an additional period to recover interest on the loan amount. Although a recommendation has not been pro- vided in terms of the number of years to extend such a payment, as a point of reference by extendinq the collection cycle for an additional 5 year period the interest generated would be $151,500 which approximates the interest that would accrue to the City under the accelerated repayment schedule. Alternative 4 Lists the principal and interest payments if a commercial bank loan was secured at 9% rate over a 12 year period. The second column under this alternative lists the principal and interest payments under the A.B.A.G. financing program at a floating interest rate of approximately 7.5%. The difficulty of securing either a commercial loan or a loan under the A.B.A.G. program is that the title to the parcels of property which were developed as part of the expansion project were recently transferred to the City from the RDA. The City will, therefore, have the title to the parcels of land which would have to be used as collateral for such a loan. If either of these options were to be pursued, consideration may have to be given to transferring the title to the Parking District or RDA and having o of these entities incur the debt. the city Administrator Q) ..... .e Q) .d U CIl +J I:: Q) a >0 cO Po Q) ll::: +J I:: Q) a III III Q) III III < +J U .... k +J III '... 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Stoddard San Bemardino, Ca. 92405 Dear Mr. Webster: At the Ireeting of the Mayor and Ccmron Council held May 2, 1988, the matter pertaining to a public hearing to consider the annual payback arrangement established for parldng district secondary assessment roll was continued and referred to the Ways and Means Cq:mrl.ttee. The new date is set for June 6, 1988, at 10:00 a.m., in the Council ChaDbers of City Hall, 300 N. "D" Street, San Bemardino, California. Sincerely, ~ City Clerk SC: khb ce: Mayor Ways & Means Conmittee, Chairperson Council M:!ober Estrada City Attorney City Administrator HLC' 300 NORTH "0" STREET, SAN BERNARDINO. CALIFORNIA 9241B.()121 PHONE (714) 383-5002/383-6102 - , . CITY OF SAN _RNClRDINO - R.QU.ST lOR COUNCIL ACTION STAFF REPORT At the March 31, 1988 meetinq of Place Commission, the issue of schedule for the parkinq District was discussed. the Central city Parkinq the accelerated repayment secondary assessment roll As backqround to this issue, it is the Commission's understandinq that in 1979 the City loaned the Parkinq District approximately $800,000 to fund an expansion project which created 383 additional parkinq spaces in the downtown parkinq district lots. The loan was to be repaid through an additional property assessment of approximately 304 of the 1978 primary assessment roll which amounted to $30,300 annually. This assessment has been collected since 1979. The City Council at their November 16,1987 meetinq, revised the repayment schedule in order to retire the outstandinq portion of the loan in seven years. They directed that the outstandinq balance be retired through an increase in the secondary assessment and that an interest rate of 94 be charqed on the unpaid balance. They further directed that all the interest income qenerated on the unpaid balance be reserved in a capital improvement development account which would be reserved to fund future parkinq needs of the downtown community. The net impact of the Council Action to repay the loan in the 7-year period will be an increase in the secondary assessment for all owners of real property in the parkinq district. Although the exact amount of the increase will not be known until July 1988, it is estimated at approximately three times the 1986 rate. The increase in the assessment only applies to the secondary assessment and will be reflected on the 88- 89 tax bills. Certain members of the Commission as well as other owners of real property in the parkinq district have expressed concern over the accelerated repayment schedule. In response to this concern, we respectfully request that the Mayor and Council set a public hearinq to reconsider this issue. _/~. ;' "z" -~~ ~ __ ~'. !..-,cL ~ -<..l.-",./~' E. GEORGE WEBSTER, Chairman Central City Parkinq Place Commission EGWjmd 75.0264 CITY OF SAN BEAN~DINO - RI!QUI!ST lOR COUNCIL ACTION From: WARREN A. KNUDSON Dept: nNANCE Date: OCTOBER 14. 1987 Subject: Amounts due to the General Fund from the Parking District Fund and amounts to be provided for future parking needs within the Parking District Synopsis of Previous Council action: Various hearings establishing Parking District and setting annual assessments. Recommended motion: Adopt Resolution p~ ~ K:-.J- Signature Contact perlGn: WARREN KNUDSON AND ROGER HARDGRAVE Phone: 5242 AND 5025 Supporting date attached: YES Ward: 1 FUNDING REQUIREMENTS: Amount: Source: (ACCT. NO.) (ACCT. DESCRIPTION) PARKING DISTRICT Finance: Council Notes: n.OIlI Agenda Item No,~ , r o CITY OF SAN BBRNARDINO o - RIIQUIIST FOR COUNCIL ACTION STAFF REPORT Staff has presented reports to the Ways and Means Committee addressing needs and funding of the Parking District. On October 12 a report to the Committee. identified amounts due to the General Fund from the Parking District as a result of General Fund monies advanced for Parking District expansion. The amount due to the General Fund is $731.128.89. The amount of $314.998.66 has been assessed to cover costs of the expansion and is available in the Parking District Fund to reduce the amount owed to the General Fund. The estimated Parking District Fund Balance at June 30. 1987. is $410,541. As was addressed in the report to the Ways and Means Committee. the amounts advanced for Parking District expansion in 1979 and 1980 were intended to be repaid by either a bank loan or the issuance of bonds. Neither option turned out to be feasible at the time. The Ways and Means Committee made the following recommendations which are embodied in the attached resolution: 1. Transfer the amount of $314.998.66 from the Parking District Fund to the General Fund to be applied to the amount owed to the General Fund by the Parking District Fund. The amount originally owed is $731,129. 2. Direct that any amounts assessed from the "secondary roll" for Parking District expansion and the $8.100 per year that was initially for the purpose of leasing parking from the Masonic Temple be annually applied toward the amount owed to the General Fund by the Parking District Fund. 3. Direct that the remaining amount owed to the General Fund after the transfer directed in item #1 be retired in 7 years by means of an increase in the "secondary roll" for parking expansion and that an interest rate of 9% be charged on the unpaid balance. 4. Direct that the interest desired from #3 and any unobligated income from leases within the Parking District reserved in a capital improvement development account within the Parking District Fund for future parking needs. The balance owed to the General Fund after the transfer of $314.998.66 would be $416.131. To retire that amount in 7 years. the assessment for principal would be approximately $59.447. compared to the present $30.300. Interest charges on the unpaid balance at 9% would be approximately $37.451 for the first year. Reason For Placement On Supplemental ARenda To present to the Mayor and Common Council the recommendation of the Ways and Means Committee which was held on October 12. 1987. - - C I T Y'~f SAN 8ERNARO' NO (;fNTEROffICE MEMORANDUM 1710-106 ~ TO: WAYS AND MEANS CONMITTEE fROM: WARREN A. KNUDSON, DIRECTOR OF fiNANCE SUBJECT: PARKING DISTRICT fiNANCING DATE: COPIES: OCTOBER 7, 1987 (7220) CITY ADMINISTRATOR, MAYOR ------------------------------------------------------------- This Is In rasponsa to a raquast for a report on fInancing of tha parking district axpanslon, funds paid of tha Ganaral fund by tha City as a result of axpanslon, and altarnatIvas to ratlrlng tha debt. tha out this aA~21UJQ In 1977 Parking District leasa Revenua Bonds In the amount of S1,950,OOO .ara Issued for acquisition, de.olltlon, and construction of off-site parking spaces. The revenua fro. Parking DIstrict assessments Is usad to .aka leasa paymants to the Agency. In 1979 tha City and the Parking Placa Commission detar.lnad that expansIon of the DIstrIct .as nacassary. The cost .as .stlmated at SI.2 mil lIon and ravla. of docu.antatlon Indlcatas that the cost .as Intandad to ba coverad InItially by a commercial loan and rapald .alnly fro. Increases In assessments to parcals within tha DIstrict. The Redavalop.ant Agancy .as authorlzad to accept funds advanced to It by the City for District .xpaftsl~n with the Intant that tha .onlas would ba rapald fro. a per.anent loan. At a later data (Oaca.bar 1911) consldaratlon was glvan to funding tha costl of tha Dlltrlct Expanllon by .eanl of a bond Ilsua. ..Ithar tha co..arclal loan nor tha bond Illua approach .a. f.allbla at tha tl.a and nalthar ca.. to fruition. Beginning In 1979 a -Secondary Roll- us added to tha .Prlmary RolI-.as In placa to sarvlca tha Perking Dlltrlct leasa Reyenua Bondi In tha amount of SI,950,OOO .hlch .ara Issued In 1977. Tha -Sacondary Rol I- .as based upon 30S of tha existing assessmant, and tha rol I was set at S30,300 annually. Several documents stata that the purposa of tha r ,I INTEROFFICE MEMOR~UM: 8710-106 PARKING DISTRICT ~ANCING Oc tober 7, 1987 Page 3 , CJ the City of San Bernardino .Ith a note that stites In part: "The funds .ere transferred to the Agency as a vehIcle for the purchasing of the properties and the construction of facilities. Repayment to the Genera. Fund .as antici- pated In the form of long-term lease rev.nue financing, repaid by Ad Valore. assessments to the plrklng district. The fInancing has yet to be acco.pl Ished. The a.ount of S652,075 Is recorded as an advance to the Ag.ncy. The advance bears no Interest." Any monies paid to the City's General Fund to reduce the amount of the "loan" or "advance" .111 be addltlona' cash to the General Fund but .111 not result In ne. revenue for budget purposes. AVAILABLE FOR DtsT REDUCTION 1 . SJtkj;l1ljjary Ro I I S30,000 has been ment according S242,098.66. The secondary roll of approxImately assessed since 1979. Th. total assess- to the Real Property section has been 2. ecoparty AcquIsition - In 1978 an additional amount of S8,100 .as authorized to add to the assesseent rol I. The amount .as classifIed as property. acquIsitIon costs and .as the amount paId for the lease of parking spaces from the Masonic Te.pla. The Parking Placa Co..lsslon decIded to contInue the assess.ent and It re.alns In place. The total of these amounts assessed Is S314,998.66 through June 30, 1987. 3. Parking District Fund Balanca - At Juna 30. 1987, the Parking District Fund has an estl.atad fund balance of S410,'41. Thl. represent. an accu.ulatlon of the above assess.ents whIch hive not been paId out a. well.. approxl.ately $9'.000 resultIng fro. prIor year actlvltle. (hIgher revenue. or lower expendIture. than antIcIpated). AL TUNAl I YES The funds are avaIlable In the ParkIng DistrIct Fund to reduce the debt to the General Fund by $314.998.66. whIch Is the amount that has been assessed on the "Secondary Roll" and the "Property AcquisitIon" rol Is. DocumentatIon that has been prepared both by the City and RDA In prior years IndIcates that the addItional assessments were for the .~ , I ,~ INTEROFFICE NENO~NDUM: 8710-106 PARKING DISTRICT FINANCING October 7, 1987 Plge 4 0' purpose of plying for Plrklng DIstrIct explnslon. The monIes IVllleble from the two assessments would Illow for reduction of the amount due to the Generll Fund. Formll IZltlon of a pol Icy to Ipply the Imount of the designated Issessments Innually would provIde for InnuI' debt service Ind ell.lnlte the uncertllnty thlt his existed. RECOMMENDATIONS 1. Reduce the Imount due to the Generll Fund frOM the blllnce IVllllble from the Plrklng DI.trlct Fund. 2. Formlllze through Ictlon of the Mlyor Ind Common CouncIl the Imounts of the Issessment. to be used Innullly to ply back the lOin to the Generll Fund. Estlbllsh I new Generll Fund Ind leued plrklng. .e. EstablIsh I fund for future plrk Ing dIstrIct needs. 3. Interest rite a polley on on the Imount due the the use of monies from t;a-a. If. 11- - WARREN A. KNUDSON DIrector Of FInance o o RESOLUTION NO. 87-403 1 2 RESOLUTION OF THE CITY OF SAN BERNARDINO REGARDING REPAYMENT OF AMOUNTS DUE TO THE GENERAL FUND FROM THE PARKING 3 DISTRICT FUND, ESTABLISHING AN ANNUAL PAYBACK ARRANGEMENT INCLUDING INTEREST, AND ESTABLISHING A FUND FOR FUTURE PARKING . DISTRICT NEEDS. 5 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL or THE CITY OF SAN BERNARDINO AS FOLLOWSI 6 7 SECTION 1. The Mayor and Common Council of the City of San 8 Bernardino hereby order and direct that the amount of $314,998.66 9 be transferred from the Parking District Fund to the General Fund 10 to be applied to the amount owed to the General Fund by the 11 12 13 14 15 16 17 18 19 20 21 ~ ~ 24 ~ 26 27 ~ Parking District Fund which amount originally owed is $731,129.00. SECTION 2. The Mayor and Common Council of the City of San Bernardino do hereby direct that any amounts assessed from the .secondary roll. for parking district expansion, and the $8,100.00 per year that was initially established for the purpose of leasing parking from the Masonic Temple be annually applied toward the amount owed to the General Fund by the Parking I I I I I ~I District Fund. SECTION 3. The Mayor and Common Council of the City of Bernardino do hereby direct that the remaining amount owed to the General Fund after the transfer directed in Section 1 above, be retired in seven years by means of an increase in the .secondary roll. for parking expansion, and that an interest rate of 9\ per annum be charged on the unpaid balance. SECTION 4. The Mayor and Common Council of the City of San I I Bernardino do hereby direct that the interest received from 10-15-87 1 o o 1 Section 3 above and any unobligated income from leases within the 2 Parking District be reserved in a capital improvement development 3 account within the Parking District Fund for future parking . needs. 5 I HEREBY CERTIFY that the foregoing resolution wa. dUly 6 adopted by the Mayor and Common Council of the City of San 7 8 9 10 Bernardino at a regular meeting thereof, held on the 16th day of November , 1987, by the following vote, to wit: AYES: Counc 11 Membe r s Estrada, Reilly, Flores, 11 12 13 14 15 16 17 18 19 20 Approved as to form 21 and legal content: 22 ~tJ,"A.-IV/2~l,.J 23 C. Attorn~ Maudsley. Minor, Miller NAYS: None ABSENT: Council Member Pope-Ludlam ",~//'4/ ,W'~ /' City Clerk The foregoing resolution is hereby approved this /lii.. day of November , 1987. ( I ....r') , \ ~ /l if? /:''),A...vtA:'''''-' ./ .{_.t~#~:/ Mayor 0 the City of San Be'rnardino 24 25 26 27 28 10-15-87 2 . o o .May', m JJ~llfh 5~' Jack Easton 4186 8okmon Avenue NorthHollywood,CA91602 ,'\r:C'I),- '.rn"'J. OFF. (818) 509-9606 ;.;J iCY 30 :',; 9: 51. ":";'t),-: eH!fL OFF. City Clerk City of San Bernardino 300 North D Street San Bernardino, CA 92418 Re: Parking District Secondary Assessment Roll Dear Sir/Madam: I am in receipt of your letter dated May 23, 1988 announcing a public hearing to be held in the council chambers on June 6, 1903 at 9:30 a.m. to consider the annual payback arrangement established for the Parking District secondary assessment roll. I would like to go on record as being strongly opposed to the proposed increase in the secondary assessment estimated in your letter as being three times the 1986 rate. This correspondence is a "written protest" on file with the City Clerk. Please keep me informed of any further developments in this matter. Sincerely, d~~