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6.2.C. - Page 1 <br /> RE PO RT <br /> To the Honorable Mayor and City Council <br /> From the Cit Mana er <br /> December 3, 2012 <br /> SUBJECT <br /> Property tax revenue due per Health & Safety Code Section 33607.5 (AB 1290) <br /> RECOMMENDATION <br /> Adopt, by resolution, authority for the City to receive a portion of the property tax <br /> revenue that would have been received by the former Redevelopment Agency pursuant <br /> to Health & Safety Code Section 33607.5 <br /> BACKGROUND <br /> As part of the dissolution of Redwood City's Redevelopment Agency (RDA) we learned <br /> that the Redwood City Council adopted Ordinance No. 2240 in December 2002 which <br /> eliminated the debt establishment limits for the RDA. Adopting this ordinance triggered <br /> statutory pass through payments to entities within the territory of the former RDA as <br /> required under AB 1290. Regrettably, since current staff was unaware this action had <br /> been taken by the City Council these pass through payments were never made. <br /> This matter was brought to our attention by Keyser Marston and Associates (KMA) who <br /> was engaged by the County of San Mateo Controller to calculate the pass through <br /> payments to taxing entities within the boundaries of the former RDA for 2011-12 as the <br /> County is now responsible for making these payments. <br /> ANALYSIS <br /> Under AB 1290 municipalities may receive a portion of the property tax revenue that <br /> they would otherwise have received if the RDA had not been in operation. The City is <br /> eligible to receive 20% of its share of the tax increment that formerly was allocated to <br /> the RDA. It is our understanding that should this resolution be adopted, the city will <br /> receive a pass through payment from the property taxes that will be paid in either <br /> November and December 2012; or will be paid in April 2013. <br /> ALTERNATIVES <br /> The City Council could choose to forfeit the portion of the property tax revenue that the <br /> City is eligible to receive. However, such money would then be redistributed to the <br /> other taxing entities and be lost to the City's general fund. <br /> FISCAL IMPACT <br /> The City hired Don Fraser, and independent fiscal consultant who has had a <br /> longstanding relationship with the City and former RDA, to calculate the amounts that <br /> should have been paid to each entity. Mr. Fraser estimates that should the City <br />