HomeMy WebLinkAbout099-2012RESOLUTION NO. 99-2012
APPROPRIATING FUNDS FOR TRANSFER TO THE SUCCESSOR AGENCY TO
THE FORMER COMMUNITY DEVELOPMENT AGENCY OF THE TOWN OF
DANVILLE TO PAY THE DEMAND RECEIVED FROM THE COUNTY AUDITOR -
CONTROLLER PURSUANT TO HEALTH AND SAFETY CODE SECTION
34183.5(b)(2)
WHEREAS, ABx1 26 (the "Dissolution Act ") was enacted on June 28, 2011. That bill, as
upheld by the California Supreme Court, dissolved all redevelopment agencies in the
State of California and required a successor agency be designated to oversee the
dissolution of the former redevelopment agencies; and
WHEREAS, on January 10, 2012, acting in accordance with Health and Safety Code
Sections 341710) and 34173, the Danville Town Council adopted Resolution No. 6 -2012,
accepting the designation to serve as the Successor Agency to the former Community
Development Agency of the Town of Danville (the "Successor Agency "); and
WHEREAS, on June 27, 2012, the Governor signed into law AB 1484. That bill amends
provisions of ABx126; and
WHEREAS, AB 1484 adds a new section to the Dissolution Act, Health and Safety Code
Section 34183.5. Section 34183.5 provides a mechanism for the State of California and
county auditor - controllers to demand repayment of amounts paid to redevelopment
agencies as tax increment in December 2011, with such amounts being redistributed to
affected taxing entities; and
WHEREAS, Section 34183.5(b)(2) provides that each county auditor - controller must
present any demands to successor agencies by July 9, 2012 and that any amounts
demanded must be paid by the successor agencies by July 12, 2012. Failure to pay in
full by that date leads to a civil penalty of 10% plus an additional 1.5% per month to be
added to the demand amount; and
WHEREAS, on July 9, 2012, the Successor Agency received a Section 34183.5(b)(2)
demand from the Contra Costa County Auditor - Controller demanding payment of
$1,056,198.80 by July 12; and
WHEREAS, the demand by the County Auditor - Controller is based on guidance
developed internally by the California Department of Finance and the Successor
Agency has informed the Department of Finance and the County Auditor - Controller
that it believes this guidance is inconsistent with Section 34183.5; and
WHEREAS, while the Successor Agency disputes the legal interpretation of the law
being used by the Department of Finance, there is no prudent option other than to make
the payment due to the lack of a meaningful appeal process, the short time allowed to
make the payment and the severe fines which would accrue if the demand is not paid in
full; and
WHEREAS, the Successor Agency does not have sufficient funds on its own to pay the
demand amount; and
WHEREAS, under the terms of Health and Safety Code Section 34183.5, the Town of
Danville faces potential loss of sales and/or property taxes should the demand amount
not be paid in full and in order to protect the Town's financial interests, it is in the best
interest of the Town to appropriate and advance funds to the Successor Agency in order
to make the demanded payment; now, therefore, be it
RESOLVED, that the Danville Town Council hereby appropriates $1,056,198.80 from
the Towri s Operating Reserve fund and approves advancing these funds to the
Successor Agency to the former Community Development Agency of the Town of
Danville, in order to satisfy in full the amount demanded by the Auditor - Controller
pursuant to Health and Safety Code Section 34183.5(b)(2); and, be it further
APPROVED by the Danville Town Council at a special meeting on July 10, 2012, by the
following vote:
AYES: Arnerich,
NOES: None
ABSTAINED: None
ABSENT: None
APPROVED AS TO FORM:
CITY ATTORNEY
Doyle, Stepper, Storer
A TEST:
CITY CLER
PAGE 2 OF RESOLUTION NO. 99-2012