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REDEVELOPMENT AGENCY AGENDA ITEM NO. 4

Meeting Date: June 8, 2004

Subject/Title: Approve Resolution to Amend the Agency’s 2004/05 Budget and Authorize Expenditures for Fiscal Year 2004/05

Prepared by: Gina Rozenski Redevelopment Manager

Submitted by: John Stevenson, Executive Director

RECOMMENDATION
Approve Resolution amending the Agency’s 2004/05 Budget and Authorize Expenditures for Fiscal Year 2004/05.

PREVIOUS ACTION
The 2003/04 and 2004/05 annual budgets for the Brentwood Redevelopment Agency were approved by the Agency on June 10, 2003, by Resolution No. RA-69.

BACKGROUND
Financial Status

The financial status of the Brentwood Redevelopment Agency is sound. The Redevelopment Agency’s projected Fund Balance as of June 30, 2004 is approximately $15,340,000. Of this amount, the Tax Allocation Bond Proceeds account for approximately $11,397,000, and the Housing Fund accounts for approximately $1,900,000.

The Agency’s financial structure comprises of three major funds. The Administration and Project Fund is the fund from which the majority of Agency’s general operational expenses, redevelopment projects, and capital improvement projects are paid. The remaining two funds, Housing Fund and Debt Service, are reserved for those specific purposes.

Funding of the Agency’s administrative, redevelopment project, capital improvement and housing program expenses is dependent on tax increment revenues, interest on investments and, most importantly, bond proceeds that are strictly used for redevelopment projects. After paying debt obligations, excess tax increment revenues are then transferred from the Debt Service Fund to the Administration and Project Fund as needed throughout the fiscal year.

Recommended adjustments to the 2004/05 expenditure budget for the three major funds are as follows:

Administration & Project Fund 301
 Several new capital improvement projects and existing capital improvement projects needing increased redevelopment funding have been identified for the 2004/05 Capital Improvement Program. These include:
• Increased cost for water lines in Downtown* (existing CIP) $5,655
• Increased cost for sewer improvements in DTN* (existing CIP) 125,000
• Lone Oak/Gracie Lane/Sand Creek Road improvements* (new CIP) 785,000
• Downtown Kiosks (new CIP) 40,000
• Downtown Safety Improvements (new CIP) 130,000
• Walnut Boulevard Widening (new CIP) 1,000,000

*These projects are multi-year projects, and these amounts represent only the 2004/05 expenditure budget.

The CIP projects listed above will be funded from the Tax Allocation Bond (“TAB”) proceeds, not from tax increment revenues. In order to fund these CIP projects, the Agency agreed to postpone other TAB projects such as improvements for Central Business Park and Brentwood Boulevard.

 CL Land Management has not yet requested the agreed-upon payment of $1.5M from the Agency for a partial reimbursement of the infrastructure costs at Sand Creek Business Park and Gregory Ranch. This amount was budgeted as a 2003/04 TAB expense, and will now be paid in 2004/05:
• Reimbursement Agreement (non-housing portion) $1,202,330

 General operational expenses increased as follows:
• Attendance from Finance and Economic Development Departments
to redevelopment educational seminars $2,500
• Increase in salary and benefit costs 3,484
• Increase in insurance costs 329

Total Budget Adjustment for
2004/05 Administration & Project Fund 301 $3,294,298

Housing Fund 302
 CL Land Management has not yet requested the agreed-upon payment of $1.5M from the Agency for a partial reimbursement of the infrastructure costs at Sand Creek Business Park and Gregory Ranch. This amount was budgeted as a 2003/04 TAB expense, but will now be paid in 2004/05:
• Reimbursement Agreement (housing portion) $297,670

 The Redevelopment Agency has financially supported the City’s Housing Division in its incubation stage. Expenses associated with housing activities should now be shared equitably between the Agency and City. Therefore, the operational expenses for the Agency’s Housing Fund should be adjusted as follows:
• Transfer a portion of Housing Division administrative
expenses from Agency to City $(123,736)

 General operational expenses adjusted as follows:
• Increase in salary and benefit costs 8,611
• Decrease in insurance costs (1,311)

Total Budget Adjustment for 2004/05 Housing Fund 302 $181,234

Debt Service Fund 303
 General debt service expenses increased as follows:
• Increase pass-through payments to taxing agencies due
to increase in annual increment allocation factors $116,463
• Transfer excess tax increment to Fund 301
for operational expenses 305,068

Total Budget Adjustment for 2004/05 Debt Service Fund 303 $421,531

FISCAL IMPACT
The remaining Tax Allocation Bonds of $11,397,000 and the anticipated 2004/2005 tax increment and earned interest revenues of $4,136,600 will be sufficient to fund the adjusted 2004/05 expenses of $3,294,298 for Administration and Project Fund, $181,234 for Housing Fund, and $421,531 for Debt Service Fund. $3,585,655 of the total $3,897,063 recommended adjustments are to be funded by the Tax Allocation Bond proceeds.

Attachments: Resolution
2004/05 Amended Budget Worksheets for Funds 301, 302, 303

RESOLUTION NO. RA-_____

A RESOLUTION OF THE REDEVELPMENT AGENCY OF THE CITY OF BRENTWOOD AMENDING ITS 2004-05 BUDGET AND AUTHORIZING EXPENDITURES FOR
FISCAL YEAR 2004-05

WHEREAS, the Redevelopment Agency of the City of Brentwood (“Agency”) has reviewed the financial condition of the Agency; and

WHEREAS, the Agency’s Merged Brentwood and North Brentwood Administration and Project Fund, Low/Moderate Housing Fund and Debt Service Fund are stable and healthy; and

WHEREAS, the Agency desires to memorialize its expenditure approvals for redevelopment projects and activities that will facilitate commercial, retail, and industrial development programs, public improvements and facilities programs, and the assistance and participation in the expansion and improvement of the supply of very low, low and moderate income housing, while investing tax increment receipts and bond proceeds in projects that will generate increased tax increment.

NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS:

Section 1. The Redevelopment Agency of the City of Brentwood hereby finds and determines that the planning and administrative expenses in the Low/Moderate Housing Fund are necessary for the production, improvement, or preservation of very low, low and moderate income housing, and for programs and activities authorized under Health & Safety Code Section 33334.2.

Section 2. The Redevelopment Agency of the City of Brentwood hereby adopts the amendments to its 2004-05 Budget and authorizes expenditures for Fiscal Year 2004-05.

PASSED, APPROVED AND ADOPTED by the Redevelopment Agency of the City of Brentwood at a regular meeting held on the 8th day of June 2004 by the following vote:

AYES:
NOES:
ABSENT:
ABSTAIN:
_____________________________
Brian Swisher,
Agency Chairman
ATTEST:
______________________________
Karen Diaz, CMC
Agency Secretary

2004/05 Amended Budget Worksheet
Revenues / Expenditures

Date: 6-Apr-04 Department: Redevelopment

Division: Fund 301 Non-Housing Admin. & Projects

Account Number Account Description Original Budget
Amount Budget Amount
Increase/(Decrease) Amended Budget
Amount Reason for Budget Adjustment
301-0001-70160 Travel, Lodging, Meals 3,150 1,000 4,150 Sponsor attendance of Finance and ED personnel to redevelopment educational seminars.
301-0001-70170 Training & Conferences 5,500.00 1,500 7,000 Sponsor attendance of Finance and ED personnel to redevelopment educational seminars.
301-0001-70130 Insurance 3,600 329 3,929 Insurance increase: property, flood, earthquake, liability
301-0001-70190 Contributions 25,000.00 1,202,330 1,227,330 Adjust payment from 03/04 to 04/05 (TAB)
301-0001-82562 Water Lines in DTN 188,500.00 5,655 194,155 Adjust project from 03/04 to 04/05 and increase CIP amount (TAB)
301-0001-82592 Sewer Lines in DTN 60,500.00 125,000 185,500 Adjust project from 03/04 to 04/05 and increase CIP amount (TAB)
301-0001-xxxxx Water & Sewer Imp. 0.00 785,000 785,000 New CIP Project (Lone Oak, Gracie Lane and Sand Creek Rd.) (TAB)
301-0001-xxxxx Downtown Kiosks 0.00 40,000 40,000 New CIP Project (TAB)
301-0001-xxxxx Downtown Safety Imp. 0.00 130,000 130,000 New CIP Project (TAB)
301-0001-xxxxx Walnut Blvd. Widening 0.00 1,000,000 1,000,000 New CIP Project (TAB)
301-0001-xxxxx Salaries & Benefits 204,582 3,484 208,066 Increase in salaries & benefits
TOTAL 490,832 3,294,298 3,785,130
2004/05 Amended Budget Worksheet
Revenues / Expenditures

Date: 6-Apr-04 Department: Redevelopment

Division: Fund 302 Housing Fund

Account Number Account Description Original Budget
Amount Budget Amount
Increase/(Decrease) Amended Budget
Amount Reason for Budget Adjustment
302-0001-70120 Rent 4,339 -3,471 868 Reduce Housing Manager rent from 1.0 to .20 at Tech Center (.80 to City Housing Division)
302-0001-70145 Nextel 750 -750 0 Allocate to Housing Division in 2004/05
302-0001-70130 Insurance 3,600 -1,311 2,289 Decrease in property, flood, earthquake, liability insurance
302-0001-70190 Contributions 750,000 297,670 1,047,670 Adjust payment from 03/04 to 04/05.
302-0001-xxxxx Salaries & Benefits 233,252 -119,515 113,737 Reduce Housing Manager from 1.0 to .20 (.80 to City Housing Division) (HR Calculated)
302-0001-xxxxx Salaries & Benefits 0 8,611 8,611 Increase salaries and benefits (HR calculated)
TOTAL 991,941 181,234 1,173,175

2004/05 Amended Budget Worksheet
Revenues / Expenditures

Date: 6-Apr-04 Department: Redevelopment

Division: Fund 303 Debt Service

Department Head Signature:

Account Number Account Description Original Budget
Amount Budget Amount
Increase/(Decrease) Amended Budget
Amount Reason for Budget Adjustment
303-0001-80301 Transfer to Fund 301 436,053 305,068 741,121 Transfer excess tax increment for administrative and other non-TAB expenses
303-0001-90023 Pass Throughs 985,309 116,463 1,101,772 Increase due to County's IAF increase from .071 to .1286.
0
0
0
0
TOTAL 1,421,362 421,531 1,842,893

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