HomeMy WebLinkAbout03.B- AB 2514 - Federal Military "Tax Increment" Reuse Agreements 3.B
DOC ID: 4335
CITY OF SAN BERNARDINO — REQUEST FOR COUNCIL ACTION
Information/Report
From: Mark Scott M/CC Meeting Date: 02/29/2016
Prepared by: Tanya Romo, (909) 384-
5122
Dept: City Manager Ward(s): All
Subject:
Assembly Member Brown Has Introduced AB 2514, Which Would Make an Exception
for Federal Military "Tax Increment" Reuse Agreements - Discussion and Approve
Letter of Support (#4335)
Current Business Registration Certificate: Not Applicable
Financial Impact:
None. There is no fiscal impact related to sending a letter of support for the proposed
AB 2514.
Motion: Discuss and take action to approve the letter of support for the proposed
AB 2514.
Background:
Assembly Member Cheryl Brown has introduced AB 2514, which would make an
exception for federal military "tax increment" reuse agreements which were disallowed
by the State Department of Finance (DoF) under the Redevelopment Agency (RDA)
dissolution statutes. The DoF took this position despite the fact, as indicated in the fact
sheet, the circumstances of these adopted reuse agreements were very different than
regular RDA obligations. The Inland Valley Development Agency (IVDA) estimates it
has lost $24 million since RDA dissolution and is seeking a legislative solution for DoF
so that they can allow reinstating the agreements.
Request:
The City of San Bernardino revenues are not affected by the legislation. However, other
taxing agencies would have impacts, so IVDA is seeking support letters from those
agencies as well.
Please see the draft letter of support and fact sheet for the proposed AB 2514 (Brown).
Mike Burrows, IVDA Executive Director, is requesting the Mayor and Common Council
provide the attached letter of support for the legislation.
Supporting Documents:
2-29-16 Draft AB 2514 Support letter_San Bernardino (DOCX)
2-29-16 AB 2514 Fact Sheet (DOCX)
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February , 2016 Q
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The Honorable Cheryl Brown a0
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Assembly Member, 471h District s
State Capitol, Room 2136 `o
Sacramento, CA 95814
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RE: AB 2514--SUPPORT N
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Dear Assembly Member Brown: _
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On behalf of the City of San Bernardino, we are pleased to support your AB 2514. This measure CL
will once again allow tax revenues pledged in 1990 to flow to the Inland Valley Development cn
Agency (IVDA), whose mission is to serve as the federal military base reuse authority for the o
former Norton Air Force Base in San Bernardino. This measure is important to maximize job
creation and economic development activities in and around the former base —ensuring that J
the original federal obligations and base reuse plan are realized.
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Our City was a founding member of IVDA that pledged and directed this revenue toward
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comprehensive military base reuse in this region, and we continue to support that mission. C_
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However, the elimination of redevelopment by the State of California, instituted in 2012,
inadvertently restricted the flow of funds that was committed as a condition of the U.S.
Department of Defense designation of IVDA as the federally-designated base reuse authority. 0°
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As the San Bernardino region continues to emerge from the financial recession, we support this Cn
allocation returning to the pre-redevelopment dissolution structure.
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Thank you for introducing AB 2514, and we look forward to restoring this critical funding for t
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regional and local San Bernardino economic development efforts. 0a„
Sincerely,
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AB 2514 (Brown)
Inland Valley Development Agency
Military Base Reuse Local Funding Agreements
FACT SHEET
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• Inland Valley Development Agency (IVDA) was formed in 1990 and is the federal base a
reuse authority for the former Norton Air Force base in San Bernardino. y
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• IVDA includes a joint powers authority (IPA), comprised of the County of San Bernardino, a
and the cities of San Bernardino, Colton and Loma Linda.
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• Each member of the IPA pledged a portion of their tax rates to satisfy the requirements
of the Department of the Air Force to enter into a federally-approved military base reuse
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• IVDA had state RDA authority and its formation and funding is unique in California. It is =
the only military base reuse agency structured as a IPA.
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• IVDA has complied with RDA dissolution requirements and today the Agency includes the
on-going base reuse IPA and a Successor Agency. —
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The Problem
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• The RDA dissolution statutes caused a disruption in the local funding agreements
pursuant to the federal contracts executed when the IPA was formed 26 years ago.
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• After RDA dissolution, the legal authority to continue the local funding commitments
made in the federal agreement was limited and the statute does not provide the LL
Department of Finance and the County Auditor Tax Collector a mechanism to restore the
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pre-RDA dissolution local tax funding allocations to IVDA. N
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• Because of the limitation of the statute, the Department of Finance has been unable to
confirm that the pledge of tax revenues under the IPA Agreement is an enforceable N
obligation to IVDA.
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• Since 2012, IVDA has lost $24 million in revenues pledged to the IPA, limiting base reuse z
initiatives. The revenue is being redistributed to other agencies. w
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AB 2514
• Includes federal military base reuse agreements for the former Norton Air Force Base
among enforceable financial obligations under the RDA dissolution statute.
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