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28 - RDA Section PROPOSED F - 1 SUCCESSOR AGENCY TO THE TOWN of LOS GATOS REDEVELOPMENT AGENCY AGENCY OVERVIEW The Los Gatos Town Council activated the Los Gatos Redevelopment Agency on January 22, 1990, pursuant to the provisions of the California Community Redevelopment Law (Health and Safety Code, Section 33000 et seq.) and declared itself to constitute the Agency, by Ordinance No. 1806, adopted on December 4, 1989. The Redevelopment Plan was pursued as a result of the Loma Prieta Earthquake in 1989 and the need to rebuild existing infrastructure. The Redevelopment Agency area encompassed approximately 440 acres in and around downtown Los Gatos, which included retail and residential areas, lodging, schools, and main traffic thoroughfares. Projects completed in the plan area, including street and utility reconstruction, parking, streetscape, and civic improvements, were funded through property tax increment revenue. When the Redevelopment Agency was initially formed, the tax based for all properties within the redevelopment area was “frozen” to form a “base year.” When properties were reassessed, the tax base grew and the Agency would receive the majority of the difference in property taxes paid between the base year and the new level. This is what is known as “tax increment revenue,” the primary funding mechanism for redevelopment agencies in California. Tax increment revenue could only be used to debt service to fund projects located within the redevelopment area. BUDGET OVERVIEW On June 15, 2011, the California State Legislature adopted two budget “trailer” bills concerning redevelopment, ABx1 26 and ABx1 27 (hereafter AB 26 and AB 27 for simplicity). AB 26 (the “Dissolution Act”) eliminated redevelopment agencies as of October 1, 2011, and essentially restricted redevelopment agencies from entering into agreements, borrowing or lending funds, or acquiring or disposing of real property prior to dissolution. Whereas, AB 27 (the “Voluntary Program Act”) allowed redevelopment agencies to remain in existence and be exempt from AB 26 if certain “voluntary” payments were made to the State in FY 2012 and in each fiscal year thereafter. These bills were signed into law by the governor on July 28, 2011. The League of California Cities and the California Redevelopment Association (CRA) filed a petition with the California Supreme Court, challenging the constitutionality of AB 26 and AB 27. The California Supreme Court, in its decision in California Redevelopment Association v. Matosantos, issued December 29, 2011 (the “Supreme Court Decision”), declared the Dissolution Act alone to be constitutional. Under the Dissolution Act, all California redevelopment agencies were dissolved effective February 1, 2012. PROPOSED F - 2  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Following the provisions of the Dissolution Act, the Town Council of the Town of Los Gatos (the “Town Council”) adopted a resolution accepting for the Town the role of successor agency (the “Successor Agency”) to the Redevelopment Agency of the Town of Los Gatos (the “Redevelopment Agency”). An oversight board (the “Oversight Board”), consisting of members representing Santa Clara County, the Town, and various education and special districts was formed to approve and direct certain actions of the Town as Successor Agency. Prior to the dissolution of redevelopment agencies, redevelopment law required that 20 percent of tax increment revenue received by an agency must be set aside for affordable housing activities. Under the Dissolution Act, tax increment revenue received by the successor agency will not include funding for affordable housing. However, tax-sharing agreements negotiated with affected public educational entities, the Mid-Peninsula Open Space District, and Santa Clara County will continue to be recognized. Nearly half of all Redevelopment Agency tax increment had been passed through to these taxing entities. Successor agencies may also receive tax increment revenue to pay for enforceable obligations that were incurred prior to the passage of the Dissolution Act. Under the Dissolution Act, successor agencies must approve and submit a Recognized Obligation Payment Schedule (ROPS) that reflects enforceable obligations over a sixth month period. Prior to the payment of any enforceable obligation, the ROPS must be certified by the county and subsequently approved by the Oversight Board. Successor agencies must also approve and submit an administrative budget for operational expenses to the Oversight Board for approval. Successor agencies may receive a minimum of up to $250,000 or up to 3 percent of tax increment revenues received by the Successor Agency per fiscal year for administrative expenses, which is significantly lower than the Successor Agency’s current administrative expenses. As a result, expenses for programs such as Economic Vitality, for example, must now be funded through the General Fund, placing a burden on the Town’s operating budget. The Town has several existing enforceable obligations that must be paid over the remaining life of the debt service, or until the Successor Agency reaches the tax increment cap, which is the gross tax increment collected over the life of the Agency. The Town’s tax increment cap, which is anticipated to be reached by FY 2027/28, is approximately $250 million. The Successor Agency currently pays debt service on 3 Certificates of Participation (COPs):  1992 COPs Payments for Parking Lot #4: In 1992, the Town issued debt for approximately $2.5 million to finance the construction of the downtown parking garage known as Lot #4. Successor Agency tax increment revenue is used to pay the debt service on the COPs in an amount of approximately $252,000 annually. This debt will be paid in full in early FY 2012/13.  2002 COPs Payments for RDA Capital Projects: In 2002, the Town issued debt for approximately $10.8 million to fund RDA infrastructure projects in the project area. Annual debt service payments of approximately $680,000 will continue through FY 2031/32.  2010 COPs Payments for Town Library: In 2010, the Town issued debt for approximately $15.7 million to fund the construction of the new library building. Annual debt service payments of approximately $1.2 million will continue through FY 2027/28.  Agency Administration: This pays for the day-to-day operations of the Successor Agency, including staff salary and benefits, supplies and materials, and consultant assistance. Annual budgeted expenditures are estimated to be $250,000. PROPOSED F - 3  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Full Time Equivalent (FTE) Authorized 2008/09 2009/10 2010/11 2011/12 2012/13 Town Staff Positions Funded Funded Funded Funded Funded Community Development Dir.- 0.20 0.20 0.20 0.20 - Asst. Community Dev. Dir.- 0.20 0.20 - - - Planning Manager- - - 0.10 0.10 - Economic Vitality Manager- 0.80 0.80 0.80 0.80 - Administrative Analyst 0.20 0.20 0.20 0.20 0.20 0.20 Senior Planner- - - 0.25 0.25 - Associate Planner- 0.40 0.20 - - - Community Services Director- 0.05 0.05 - - - Total SA FTEs 0.20 1.85 1.65 1.55 1.55 0.20 SUCCESSOR AGENCY TO THE LOS GATOS RDA PROGRAM STAFFING PROPOSED F - 4 PROPOSED F - 5 SUCCESSOR AGENCY TO THE TOWN of LOS GATOS REDEVELOPMENT AGENCY Administration FUND 911 FUND PURPOSE The Successor Agency’s Administration Fund encompasses administrative functions related to operational and fiscal matters of the Successor Agency, in conjunction with the Finance Department. Prior to the dissolution of the Redevelopment Agency, this fund also supported capital project development, management, and construction oversight; and economic vitality activities to enhance revenues through business promotion and retention. While there will be no future capital projects, with the exception of one street reconstruction project in the former redevelopment area, economic vitality efforts will continue and are now supported by the General Fund. BUDGET OVERVIEW The FY 2012/12 Administration Fund budget reflects $250,000 of tax increment revenue to cover the operational and fiscal reporting expenses of the Successor Agency. To receive this revenue, successor agencies are required to submit an administrative budget every 6 months to their respective oversight boards for approval. The maximum administrative allowance of up to $250,000, or up to 3 percent of tax increment revenues received by the Successor Agency per fiscal year, is significantly lower than the Successor Agency’s current administrative expenses, which difference must be absorbed by the General Fund, placing a burden on the Town’s operating budget. The Administration Fund budget also reflects a small amount of additional funding for the Almond Grove Concrete Rehabilitation project. PROPOSED F - 6  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Administration 2008/09 2009/10 2010/11 2011/12 2011/12 2012/13 Actuals Actuals Actuals Adopted Estimated Adopted SOURCES OF FUNDS Beginning Fund Balance Designated-$ -$ -$ -$ -$ -$ Undesignated 4,316,922 3,384,772 2,728,160 2,562,195 2,562,195 2,577,523 Total Beginning Fund Balance 4,316,922 3,384,772 2,728,160 2,562,195 2,562,195 2,577,523 Revenues Service Charge- - - - - - Interest 66,908 5,951 4,250 10,000 4,324 5,000 Other Revenues- - - - - - Total Revenues 66,908 5,951 4,250 10,000 4,324 5,000 Transfers In Transfer from RDA Debt Service 575,000 575,000 600,000 650,000 650,000 - Transfer from SA 941- - - - - 250,000 Total Transfers In 575,000 575,000 600,000 650,000 650,000 250,000 Total Revenues & Transfers In 641,908 580,951 604,250 660,000 654,324 255,000 TOTAL SOURCE OF FUNDS 4,958,830$ 3,965,723$ 3,332,410$ 3,222,195$ 3,216,519$ 2,832,523$ USES OF FUNDS Expenditures Salaries and Benefits 128,279$ 178,991$ 174,210$ 182,089$ 182,089$ 25,466$ Operating Expenditures 485,531 453,187 489,998 523,230 446,436 222,835 Capital Projects - Current Year 951,833 594,635 95,561 38,280 - 4,172 Internal Service Charges 8,415 10,750 10,446 10,633 10,471 3,717 Debt Service- - - - - - Total Expenditures 1,574,058 1,237,563 770,215 754,232 638,996 256,190 Ending Fund Balance Designated- - - - - - Undesignated 3,384,772 2,728,160 2,562,195 2,467,963 2,577,523 2,576,333 Total Ending Fund Balance 3,384,772 2,728,160 2,562,195 2,467,963 2,577,523 2,576,333 TOTAL USE OF FUNDS 4,958,830$ 3,965,723$ 3,332,410$ 3,222,195$ 3,216,519$ 2,832,523$ STATEMENT OF SOURCE AND USE OF FUNDS PROPOSED F - 7  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Administration Prior Year 2011/12 2011/12 2011/12 2011/12 2012/13 Actuals Adopted Adjusted Estimated Carryforward Adopted EXPENDITURES Capital Projects 41,720 38,280 38,280 - 38,280 4,172 Total Capital Projects 41,720 38,280 38,280 - 38,280 4,172 TOTAL EXPENDITURES 41,720 38,280 38,280 - 38,280 4,172 CAPITAL PROJECTS ALMOND GROVE RECONSTRUCTION Program 811-0003 Full Time Equivalent (FTE) Authorized 2008/09 2009/10 2010/11 2011/12 2012/13 Town Staff Positions Funded Funded Funded Funded Funded Community Development Dir.- 0.10 0.10 0.10 0.10 - Asst. Community Dev. Dir.- 0.05 0.05 - - - Economic Vitality Manager- 0.75 0.75 0.75 0.75 - Administrative Analyst 0.20 0.20 0.20 0.20 0.20 0.20 Senior Planner- 0.10 0.10 - Associate Planner- 0.15 0.10 - - - Asst PPW Dir/Town Engineer- - - - - - Associate Civil Engineer- - - - - - Sr Engineering Inspector- - - - - - Total Administration FTEs 0.20 1.25 1.20 1.15 1.15 0.20 ADMINISTRATION PROGRAM STAFFING PROPOSED F - 8  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Administration Performance Objectives and Measures 2008/09 Actual 2009/10 Actual 2010/11 Actual 2011/12 Estimated 2012/13 Budget 1. a.Percentage of businesses satisfied with the results of downtown public works projects, including streetscape, repaving, merchant notification and scheduling: 95%93%90%90%N/A 2. a.Percentage of businesses rating business assistance provided by RDA as good or excellent:95%95%98%98%N/A Activity and Workload Highlights 2008/09 Actual 2009/10 Actual 2010/11 Actual 2011/12 Estimated 2012/13 Budget 1.590 590 600 600 N/A 2.160 160 200 250 N/A 3.240 240 300 300 N/A 4.185 185 200 300 N/A 5. Data Not Available Under Development 4 3 N/A 6 Aa3 Aa2 Aa2 Aa2 N/A Note: All measures have been moved to the Administrative Services Department for FY 2012/13. Agency Rating (Moody's April 27, 2010) Business attraction and retention assistance/Number of businesses assisted: Commercial Brokers/Property Owner Outreach Communications: Annual Community Marketing Campaigns: Summer , Winter/Holiday , Shop Local - Year-Round, and Tourism Development Number of businesses attending business outreach workshops, seminars, and events. Number of businesses provided with promotion assistance: Informs Redevelopment area businesses of proposed projects and works with businesses to mitigate concerns. The Economic Vitality Program ensures efforts are being made for business attraction, retention, and promotion. PROPOSED F - 9 SUCCESSOR AGENCY TO THE TOWN of LOS GATOS REDEVELOPMENT AGENCY Debt Service Fund Fund 921 FUND PURPOSE Tax increment revenue is restricted to the repayment of debt; therefore, a Successor Agency must have indebtedness in order to receive increment revenue. Prior to the Dissolution Act, the Los Gatos Redevelopment Agency assumed the obligation of paying the debt service on the Town’s 1992, 2002, and 2010 Certificates of Participation (COPs) in return for the lease of Town property. The purpose of the COPs was to fund key capital infrastructure projects located in the former redevelopment area. Payments for this indebtedness were and will continue to be made from the Debt Service Fund. BUDGET OVERVIEW As discussed above, the Successor Agency is currently paying debt service on three COPs: 1992 Certificates of Participation. The Town bears the obligation for the 20-year COPs issued in the original amount of $2,960,000, dated August 1, 1992. The Town’s Motor Vehicle License Fee revenues were pledged as security for the COPs, and the guarantee was registered with the State Controller’s Office. The COPs were issued to finance certain construction costs of the Town’s Parking Lot 4 Project, which was constructed on land located in the Los Gatos Central Redevelopment Project Area. The project consisted of the construction of a parking facility comprising 316 parking spaces on two levels, located on approximately 4 acres of land in the block bounded by University and Santa Cruz Avenues, Grays Lane, and Elm Street. The lot improvements were paid for from the 1992 COPs proceeds, in conjunction with the portion paid for through the 1988 Downtown Parking Assessment District’s Limited Obligation Bonds in the amount of $1,587,986. The COPs are similar to bond debt as they allow investors to participate in a share of guaranteed payments. Because they are similar to debt, the present value of the total of the payments to be made is recorded as long-term debt. Principal payments are due annually on August 1, with interest payments payable semi-annually on February 1 and August 1. PROPOSED F - 10  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Debt Administration Fund The financing structure of the COPs includes two twenty-year term lease agreements dated August 1, 1992, between the Town of Los Gatos and the Successor Agency for the Town of Los Gatos Redevelopment Agency. The first lease, with the Town as lessor and the Successor Agency as lessee, agrees to lease the site to the Agency for the duration of the lease term for a one-time fee of $10. The second lease, with the Town as lessee and the Successor Agency as lessor, agrees to lease the completed parking lot site to the Town effective the date of the lease. Annual lease payments are equal to the annual debt service for the COPs. In addition, a Reimbursement Agreement dated August 1, 1992 between the Town and the Successor Agency obligates the Agency to reimburse the Town in an amount equal to the annual lease payment the Town pays to the Agency for lease of the parking lot (under the second lease agreement). This reimbursement is in consideration of the Town’s cost of the acquisition and the Town’s funding of the construction of the parking lot project. While the annual impact of these agreements nets to zero, the lease and reimbursement payments are included in both the Town’s and Successor Agency’s budgets each year to accurately reflect the terms of these agreements. The Agency remains responsible for making the principal and interest payments to US Bank. The debt service for the 1992 COPs will be paid in full in FY 2012/13. 2002 Certificates of Participation. The 2002 Certificates of Participation financing structure parallels the 1992 issue. The Town bears an obligation for the 30-year Certificates of Participation issued in the original amount of $10,725,000, dated August 1, 2002. The COPs were issued to finance infrastructure improvements in the downtown redevelopment area, including plaza reconstruction, streetscape improvements, street reconstruction, storm drainage, and alley improvements, as well as partially funding the reconstruction of the pool at Los Gatos High School. The COPs principal payments are due annually on August 1, with interest payments payable semi-annually on February 1 and August 1. The financing structure of the COPs includes two lease agreements between the Town of Los Gatos and the Successor Agency for the Town of Los Gatos Redevelopment Agency dated July 1, 2002. The first agreement leases five Town-owned parcels, commonly known as the Miles Avenue Corporation Yard, to the Successor Agency through August 1, 2031 for a one-time fee of $1. In the second lease, the Successor Agency subleases the land back to the Town, effective the date of the original lease. The annual sub-lease payments are equal to the annual debt service for the COPs. A reimbursement agreement between the Town and the Successor Agency, also dated July 1, 2002, obligates the Agency to reimburse the Town in an amount equal to the annual lease payment the Town pays to the Agency for the sub-lease of the Corporation Yard. This reimbursement is in consideration of the Town’s cost of the acquisition and construction of the yard facilities. While the annual impact of these agreements nets to zero, the lease and reimbursement payments are included in both the Town’s and Successor Agency’s budgets each year to accurately reflect the terms of these agreements. The Agency remains responsible for making the principal and interest payments. 2010 Certificates of Participation. The 2010 Certificates of Participation financing structure parallels the 1992 and 2002 issues. The Town bears an obligation for the 18-year Certificates of Participation issued in the original amount of $15,675,000, dated June 1, 2010. The COPs were issued to finance the construction of the new Town library. The COPs principal payments are due annually on August 1, with interest payments payable semi-annually on February 1 and August 1. PROPOSED F - 11  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Debt Administration Fund The financing structure of the COPs includes two lease agreements between the Town of Los Gatos and the Successor Agency for the Town of Los Gatos Redevelopment Agency dated June 1, 2010. The first agreement leases Town-owned parcels, including the existing library, police administration building, and related property located at the Civic Center, to the Successor Agency through August 1, 2028 for a one- time fee of $1. In the second lease, the Successor Agency subleases the property back to the Town, effective the date of the original lease. The annual sub-lease payments are equal to the annual debt service for the COPs. A reimbursement agreement between the Town and Agency, also dated June 1, 2010, obligates the Agency to reimburse the Town in an amount equal to the annual lease payment the Town pays to the Agency for the sub-lease of the existing library, police administration building, and related properties. This reimbursement is in consideration of the Town’s cost of the acquisition and construction of the library and police facilities. While the annual impact of these agreements nets to zero, the lease and reimbursement payments are included in both the Town’s and Successor Agency’s budgets each year to accurately reflect the terms of these agreements. The Agency remains responsible for making the principal and interest payments. Pass-Through Agreements In prior years, pass-through agreement payments to taxing entities were paid by the former Los Gatos Redevelopment Agency, which comprised a majority of the Debt Service Fund’s operating expenditures. As a result of the Dissolution Act, the Successor Agency will no longer receive tax increment for the pass-through agreements, and payments will be distributed by the County of Santa Clara. PROPOSED F - 12  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Debt Administration Fund 2008/09 2009/10 2010/11 2011/12 2011/12 2012/13 Actuals Actuals Actuals Adopted Estimated Adopted SOURCES OF FUNDS Beginning Fund Balance Designated-$ -$ -$ -$ -$ -$ Loan from General Fund 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 Undesignated 2,807,047 4,503,484 3,934,593 (2,030,319) (2,030,319) (1,520,828) Total Beginning Fund Balance 4,307,047 6,003,484 5,434,593 (530,319) (530,319) (20,828) Revenues Property Tax 6,859,400 7,218,290 6,861,650 6,564,128 3,349,254 - Other Taxes- - - - - - Lease Income - COP's 929,239 931,371 1,354,882 2,094,727 2,094,727 1,963,971 Interest 356,783 163,530 5,991 151,200 (208) - Other Revenues- - - - - - Total Revenues 8,145,422 8,313,191 8,222,523 8,810,055 5,443,773 1,963,971 Transfers In Transfer from RDA Debt Service- - - - - - Transfer from SA 941- - - - - 1,946,171 Total Transfers In- - - - - 1,946,171 Total Revenues & Transfers In 8,145,422 8,313,191 8,222,523 8,810,055 5,443,773 3,910,142 TOTAL SOURCE OF FUNDS 12,452,469$ 14,316,675$ 13,657,116$ 8,279,736$ 4,913,454$ 1,943,143$ USES OF FUNDS Expenditures Operating Expenditures 3,865,504$ 6,294,340$ 10,727,671$ 3,860,083$ 7,329$ 3,200$ Debt - Interest Town Loan 150,000 150,000 150,000 150,000 87,500 - Debt Service - 1992 COP's- - - - - - Debt Service - 2002 COP's 929,242 931,371 931,721 931,276 931,276 679,146 Debt Service - 2010 COP's- - 423,161 1,163,450 1,163,450 1,263,825 1992 Lease Payment to Town- - - - - - 2002 Lease Payment to Town 929,239 931,371 1,354,882 2,094,726 2,094,727 1,963,971 2010 Lease Payment to Town- - - - - - Total Expenditures 5,873,985 8,307,082 13,587,435 8,199,535 4,284,282 3,910,142 Transfers Out Transfer to Capital Projects 575,000 575,000 600,000 650,000 650,000 - Total Transfers Out 575,000 575,000 600,000 650,000 650,000 - Total Expenditures & Transfers Out 6,448,985 8,882,082 14,187,435 8,849,535 4,934,282 3,910,142 Ending Fund Balance Designated- - - - - - Loan from General Fund 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 Undesignated 4,503,484 3,934,593 (2,030,319) (2,069,799) (1,520,828) (3,466,999) Total Ending Fund Balance 6,003,484 5,434,593 (530,319) (569,799) (20,828) (1,966,999) TOTAL USE OF FUNDS 12,452,469$ 14,316,675$ 13,657,116$ 8,279,736$ 4,913,454$ 1,943,143$ STATEMENT OF SOURCE AND USE OF FUNDS PROPOSED F - 13  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Debt Administration Fund The maturity schedule for the Successor Agency’s current Debt Service obligation under the 1992 COPs is as follows: Principal August February Total Fiscal Maturing Interest Interest Annual Principal Year August 1st Due Due Debt Service Balance Issue Date: August 1, 1992 2,960,000$ 1992/93 92,068$ 92,068$ 2,960,000 1993/94 70,000$ 92,068$ 88,918 250,986 2,890,000 1994/95 75,000 88,918 85,543 249,461 2,815,000 1995/96 80,000 85,543 81,943 247,486 2,735,000 1996/97 90,000 81,943 77,893 249,836 2,645,000 1997/98 95,000 77,893 73,618 246,511 2,550,000 1998/99 105,000 73,618 68,893 247,511 2,445,000 1999/00 115,000 68,893 63,718 247,611 2,330,000 2000/01 125,000 63,718 58,093 246,811 2,205,000 2001/02 135,000 58,093 53,790 246,883 2,070,000 2002/03 145,000 53,790 49,948 248,738 1,925,000 2003/04 150,000 49,948 45,898 245,845 1,775,000 2004/05 160,000 45,898 41,498 247,395 1,615,000 2005/06 170,000 41,498 36,738 248,235 1,445,000 2006/07 175,000 36,738 31,750 243,488 1,270,000 2007/08 185,000 31,750 27,125 243,875 1,085,000 2008/09 195,000 27,125 22,250 244,375 890,000 2009/10 205,000 22,250 17,125 244,375 685,000 2010/11 215,000 17,125 11,750 243,875 470,000 2011/12 230,000 11,750 6,000 247,750 240,000 2012/13 240,000 12,000 - 252,000 - LOS GATOS REDEVELOPMENT AGENCY 1992 COP DEBT SERVICE PROPOSED F - 14  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Debt Administration Fund The maturity schedule for the Successor Agency’s current Debt Service obligation under the 2002 COPs is as follows: Principal Interest Interest Fiscal Maturing Due Due Total Principal Year August 1st August 1st Feburary 1st Debt Service Balance Issue Date: August 1, 2002 10,725,000$ 2002/03- - 237,164$ 237,164$ 10,725,000 2003/04 210,000$ 235,854$ 233,229 679,083 10,515,000 2004/05 215,000 233,229 230,541 678,770 10,300,000 2005/06 225,000 230,541 227,729 683,270 10,075,000 2006/07 230,000 227,729 224,854 682,583 9,845,000 2007/08 235,000 224,854 221,681 681,535 9,610,000 2008/09 240,000 221,681 218,081 679,763 9,370,000 2009/10 250,000 218,081 214,019 682,100 9,120,000 2010/11 255,000 214,019 209,556 678,575 8,865,000 2011/12 265,000 209,556 204,720 679,276 8,600,000 2012/13 275,000 204,720 199,426 679,146 8,325,000 2013/14 285,000 199,426 193,726 678,153 8,040,000 2014/15 295,000 193,726 187,679 676,405 7,745,000 2015/16 310,000 187,679 181,169 678,848 7,435,000 2016/17 320,000 181,169 174,209 675,378 7,115,000 2017/18 335,000 174,209 166,755 675,964 6,780,000 2018/19 350,000 166,755 158,793 675,548 6,430,000 2019/20 365,000 158,793 150,306 674,099 6,065,000 2020/21 385,000 150,306 141,163 676,469 5,680,000 2021/22 400,000 141,163 131,463 672,625 5,280,000 2022/23 420,000 131,463 121,225 672,688 4,860,000 2023/24 440,000 121,225 110,500 671,725 4,420,000 2024/25 465,000 110,500 98,875 674,375 3,955,000 2025/26 485,000 98,875 86,750 670,625 3,470,000 2026/27 510,000 86,750 74,000 670,750 2,960,000 2027/28 535,000 74,000 60,625 669,625 2,425,000 2028/29 565,000 60,625 46,500 672,125 1,860,000 2029/30 590,000 46,500 31,750 668,250 1,270,000 2030/31 620,000 31,750 16,250 668,000 650,000 2031/32 650,000 16,250 - 666,250 - TOTALS:10,725,000$ +4,551,426$ +4,552,737$ =19,829,163$ 2002 COP DEBT SERVICE PROPOSED F - 15  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Debt Administration Fund The maturity schedule for the Successor Agency’s current Debt Service obligation under the 2010 COPs is as follows: Interest Principal Interest Fiscal Due Maturing Due Total Principal Year August 1st August 1st February 1st Debt Service Balance Issue Date: June 1, 2010 15,675,000$ 2010/11 423,161 423,161 15,675,000 2011/12 320,038 530,000 313,413 1,163,450 15,145,000 2012/13 313,413 650,000 300,413 1,263,825 14,495,000 2013/14 300,413 670,000 287,013 1,257,425 13,825,000 2014/15 287,013 695,000 269,638 1,251,650 13,130,000 2015/16 269,638 715,000 258,913 1,243,550 12,415,000 2016/17 258,913 745,000 244,013 1,247,925 11,670,000 2017/18 244,013 770,000 224,763 1,238,775 10,900,000 2018/19 224,763 800,000 208,763 1,233,525 10,100,000 2019/20 208,763 830,000 192,163 1,230,925 9,270,000 2020/21 192,163 865,000 174,863 1,232,025 8,405,000 2021/22 174,863 900,000 152,363 1,227,225 7,505,000 2022/23 152,363 935,000 133,663 1,221,025 6,570,000 2023/24 133,663 975,000 114,163 1,222,825 5,595,000 2024/25 114,163 1,020,000 93,763 1,227,925 4,575,000 2025/26 93,763 1,065,000 72,463 1,231,225 3,510,000 2026/27 72,463 1,115,000 50,163 1,237,625 2,395,000 2027/28 50,163 1,170,000 26,031 1,246,194 1,225,000 2028/29 26,031 1,225,000 1,251,031 - TOTALS:3,436,594$ +15,675,000$ +3,539,717$ =22,651,311$ 2010 COP DEBT SERVICE PROPOSED F - 16  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Debt Administration Fund California Government Code Section 43605 states: “A city shall not incur an indebtedness for public improvements which exceeds in the aggregate 15 percent of the assessed value of all real and personal property of the city. Within the meaning of this section indebtedness means bonded indebtedness of the city payable from the proceeds of taxes levied upon taxable property in the city.” This schedule calculates the Town’s legal debt margin by determining the 15% debt limit and comparing this limit to the Town’s outstanding debt at the end of the fiscal year to determine the difference between the two. Only certain types of outstanding debt are subject to the legal debt limit; therefore, while this schedule recognizes all debt, the total debt is reduced by that debt not subject to the legal debt limit, as well as amounts held in sinking funds for debt repayment. The Town’s debt structure currently includes only Certificates of Participation, which are not subject to the legal debt limit, and are therefore removed from the calculation. TO BE UPDATED Assessed Secured Property Valuation for FY 2010/11 7,966,902,652$ Debt Limitation (15% of assessed value)15% Bonded Debt Limit 1,195,035,398$ Outstanding Bonded Debt at 6/30/10 1992 Certificates of Participation 470,000$ 2002 Certificates of Participation 9,120,000 2010 Certificates of Participation 15,675,000 TOTAL Outstanding Debt 25,265,000$ LESS Debt not subject to limit: Special Assessment Bonds- Special Revenue Bonds- Certificate of Participation Debt 25,265,000 Amounts held in Sinking Funds- TOTAL Debt not subject to limit: 25,265,000$ Amount of Debt Subject to Limit: -$ -$ LEGAL DEBT MARGIN 1,195,035,398$ LEGAL DEBT MARGIN COMPUTATION FY 2011/12 PROPOSED F - 17 SUCCESSOR AGENCY TO THE TOWN of LOS GATOS REDEVELOPMENT AGENCY Affordable Housing Fund FUND 931 FUND PURPOSE Prior to the dissolution of the Redevelopment Agency, this fund provided for the implementation of its required Affordable Housing Set-Aside Program obligations. The program’s core services included the administration and fiscal responsibilities for the program, and the creation of affordable housing options in cooperation with both non-profit and for-profit developers. Under prior redevelopment law, California Community Redevelopment Law (CRL) required that no less than 20 percent of tax increment revenue derived from a redevelopment project area be used to increase, improve, and preserve the supply of housing for very low-, low-, and moderate-income households. If none was provided within a redevelopment project area, then the funds could be used to build twice that amount elsewhere. Possibilities included financial assistance to upgrade existing units, the construction of new housing, and improvements to public facilities and infrastructure that serviced low- and moderate- income neighborhoods. BUDGET OVERVIEW The FY 2012/13 Successor Agency budget does not reflect any new projects due to discontinued tax increment funding per the Dissolution Act of 2012. The Statement of Source and Use of Funds on the following page provides the current available fund balance that must be remitted to the Santa Clara County Auditor-Controller to be distributed to other taxing entities. PROPOSED F - 18  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Affordable Housing Fund 2008/09 2009/10 2010/11 2011/12 2011/12 2012/13 Actuals Actuals Actuals Adopted Estimated Adopted SOURCES OF FUNDS Beginning Fund Balance Designated-$ -$ -$ -$ -$ -$ Undesignated 7,198,500 8,631,125 5,140,055 - - 123,857 Total Beginning Fund Balance 7,198,500 8,631,125 5,140,055 - - 123,857 Revenues Interest 276,319 50,647 (3,033) 25,000 3,462 - Other Revenues- 16,044 22 - - - Total Revenues 276,319 66,691 (3,011) 25,000 3,462 - TOTAL REVENUES 276,319$ 66,691$ (3,011)$ 25,000$ 3,462$ -$ Transfers In Tax Increment @ 20%1,714,850 1,804,573 1,715,413 1,641,032 837,313 - Total Transfers In 1,714,850 1,804,573 1,715,413 1,641,032 837,313 - Total Revenues & Transfers In 1,991,169 1,871,264 1,712,402 1,666,032 840,775 - TOTAL SOURCE OF FUNDS 9,189,669$ 10,502,389$ 6,852,457$ 1,666,032$ 840,775$ 123,857$ USES OF FUNDS Expenditures Salaries and Benefits 68,162$ 129,052$ 168,520$ 70,780$ 70,780$ -$ Operating Expenditures 262,444 452,574 6,033,807 331,192 717,590 - Grants 90,000 412,000 150,000 - - - Debt Service- - - - - - Fixed Assets 135,000 4,362,486 491,566 1,000 (75,427) - Internal Service Charges 2,938 6,222 8,564 3,119 3,975 - Total Expenditures 558,544 5,362,334 6,852,457 406,091 716,918 - Transfers Out Transfer to Capital Projects- - - - - - Total Transfers Out- - - - - - Total Expenditures & Transfers Out 558,544 5,362,334 6,852,457 406,091 716,918 - Ending Fund Balance Designated- - - - - - Undesignated 8,631,125 5,140,055 - 1,259,941 123,857 123,857 Total Ending Fund Balance 8,631,125 5,140,055 - 1,259,941 123,857 123,857 TOTAL USE OF FUNDS 9,189,669$ 10,502,389$ 6,852,457$ 1,666,032$ 840,775$ 123,857$ STATEMENT OF SOURCE AND USE OF FUNDS PROPOSED F - 19  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Affordable Housing Fund Performance Objectives and Measures 2008/09 Actual 2009/10 Actual 2010/11 Actual 2011/12 Estimated 2012/13 Budget 1. a.Percentage of affordable housing developers that are satisfied with RDA assistance.100%100%100%100%N/A Activity and Workload Highlights 2008/09 Actual 2009/10 Actual 2010/11 Actual 2011/12 Estimated 2012/13 Budget 1. 20 0 31 0 N/A Note: All measures have been moved to the Administrative Services Department for FY 2012/13. Number of new affordable housing units produced, under construction, or in the planning process as a result of RDA. Works in coordination with developers in the planning and programming of affordable housing projects. PROPOSED F - 20 SUCCESSOR AGENCY TO THE TOWN of LOS GATOS REDEVELOPMENT AGENCY Recognized Obligation Retirement Fund FUND 941 FUND PURPOSE Under the Dissolution Act, a Successor Agency is required to establish a Recognized Obligation Retirement Fund (RORF) to receive tax increment revenue to pay enforceable obligations and administrative fees and allowances approved by a Successor Agency’s Oversight Board. BUDGET OVERVIEW The Recognized Obligation Retirement Fund (RORF) serves as a custodian account that receives tax increment revenue remittances from Santa Clara County to pay enforceable obligations, including debt service and related expenses and operational administrative costs. It is anticipated that the RORF fund balance will remain at zero as revenue deposited is immediately transferred to other funds to pay applicable obligations. PROPOSED F - 21  SUCCESSOR AGENCY TO THE LOS GATOS REDEVELOPMENT AGENCY  Recognized Obligation Retirement Fund 2008/09 2009/10 2010/11 2011/12 2011/12 2012/13 Actuals Actuals Actuals Adopted Estimated Adopted SOURCES OF FUNDS Beginning Fund Balance Designated-$ -$ -$ -$ -$ -$ Loan from General Fund- - - - - - Undesignated- - - - - - Total Beginning Fund Balance- - - - - - Revenues Property Tax- - - - - - Other Taxes- - - - - - Lease Income - COP's- - - - - - Interest- - - - - 2,196,171 Other Revenues- - - - - - Total Revenues- - - - - 2,196,171 TOTAL SOURCE OF FUNDS-$ -$ -$ -$ -$ 2,196,171$ USES OF FUNDS Expenditures Salaries and Benefits-$ -$ -$ -$ -$ -$ Operating Expenditures- - - - - - Grants- - - - - - Debt Service- - - - - - Fixed Assets- - - - - - Internal Service Charges- - - - - - Total Expenditures- - - - - - Transfers Out Transfer to Capital Projects- - - - - - Transfer to SA Debt Service- - - - - 2,196,171 Total Transfers Out- - - - - 2,196,171 Total Expenditures & Transfers Out- - - - - 2,196,171 Ending Fund Balance Designated- - - - - - Undesignated- - - - - - Total Ending Fund Balance- - - - - - TOTAL USE OF FUNDS-$ -$ -$ -$ -$ -$ STATEMENT OF SOURCE AND USE OF FUNDS PROPOSED F - 22