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Home My WebLink AboutPCDSA Resolution 2013-01 1/7/2013 Resolution No. 2013-01 of the Petaluma Community Development Successor Agency AMENDING RESOLUTION NO. 2012-05 ACCEPTING THE DUE DILIGENCE REVIEW OF THE NON AFFORDABLE HOUSING FUNDS PURSUANT TO HEALTH AND SAFETY CODE SECTION 34179.5 WHEREAS, The Petaluma Community Development Successor Agency approved Resolution 2012-05 (Exhibit A) on December 3, 2012; and, WHEREAS, the Successor Agency continues to dispute the State Department of Finance denial of certain enforceable obligations; and, WHEREAS, the Successor Agency has filed or will file litigation to request a court review of the Old Redwood Highway, East Washington, and Rainier project enforceable obligations; and, WHEREAS, until the outcome of the litigation is known, the funds set aside for those projects should be withheld. NOW, THEREFORE, BE IT RESOLVED by the Petaluma Community Development Successor Agency that the above recitals and findings are adopted as part of this resolution and are true and that it hereby: 1. Approves a revised management letter to accompany the Due Diligence Review (Exhibit B). 2. Directs the Executive Director of the Successor Agency, or his designees to transmit a copy of the Non-housing Fund Due Diligence Review to the Oversight Board and request that the Oversight Board, under its authority pursuant to Health and Safety Code Section 34179.6(c), consider additional information provided and adjust the Due Diligence Report to retain the identified $8,448,437 in fund balance until litigation related to the disputed enforceable obligations is resolved. REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted by the Approv a to Petaluma Community Development Successor Agency at a Regular Meeting on the f rm 7th of January,2013,by the following vote: AYES: Albertson,Barrett,Glass,Harris,Healy,Kearney,Miller General Counsel NOES: None ABSENT: None ABSTAIN: None ATTEST: ` #4_ i Recording Secretary Chair PCDSA Resolution No.2013-01 Page 1 EXHIBIT A Resolution No. 2012-05 of the Petaluma Community Development Successor Agency ACCEPTING THE DUE DILIGENCE REVIEW OF THE NON AFFORDABLE HOUSING FUNDS PURSUANT TO HEALTH AND SAFETY CODE SECTION 34179.5 WHEREAS, Assembly Bill ABx1 26 (ABx1 26) was enacted by the State Legislature and signed by the Governor as of June 29, 2011; and, WHEREAS, ABx1 26 dissolved redevelopment agencies, including the former Petaluma Community Development Commission (PCDC), effective February 1, 2012; and, WHEREAS, pursuant to California Health and Safety Code § 34173(d), the City of Petaluma elected to serve as the successor agency to the PCDC by City Council Resolution No. 2012-007 adopted on January 9, 2012, and has been serving in this capacity following PCDC dissolution on February 1, 2012; and, WHEREAS, pursuant to Assembly Bill 1484 enacted on June 27, 2012, the City Council of Petaluma on August 6, 2012, established and acknowledged the "Petaluma Community Development Successor Agency"(PCDSA) as the successor agency to the former PCDC, separate and distinct from the City of Petaluma, and to provide for its governance; and, WHEREAS, California Health and Safety Code section §34179.5 requires each successor agency to employ a licensed accountant, approved by the county auditor- controller, to conduct a due diligence review to determine the unobligated balances in the low and moderate income housing fund and the other funds and accounts of its former redevelopment that are available for transfer to taxing entities; and, WHEREAS, the PCDSA has contracted with Pun & McGeady, LLP, Certified Public Accountants, to complete the due diligence review of the former PCDC Non-housing Funds by December 15, 2012; and, WHEREAS, the Sonoma County Auditor-Controller has approved Pun & McGeady, LLP for the purpose of undertaking such due diligence review; and, WHEREAS, the Successor Agency has reviewed the results of the Non-housing Fund Due Diligence Review. NOW, THEREFORE, BE IT RESOLVED by the Petaluma Community Development Successor Agency that the above recitals and findings are adopted as part of this resolution and are true and that it hereby: 1. Accepts the Non-housing. Fund Due Diligence Review of the former PCDC Non- housing Fund balances as performed by Pun & McGeady, LLP PCDSA Resolution.No.2013-01 Page 2 2. Directs the Executive Director of the Successor Agency, or his designees to transmit a copy of the Non-housing Fund Due Diligence Review to the Oversight Board, the County auditor-controller, the State Controller and the Department of Finance pursuant to Health and Safety Code Section 34179.5 It is hereby certified that the foregoing Resolution No. 2012-05 was duly introduced and adopted by the Petaluma Community Development Successor Agency at a regular meeting held on the 3rd day of December, by the following vote: REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted Approved as to by the Petaluma Community Development Successor Agency at a fo Regularmeeting on the 3rd day of December, 2012,by the following vote: General Counsel AYES: Albertson, Barrett, Glass, Harris, Healy, Kearney, Renee NOES: None ABSENT: None • ABSTAIN: None DD / 4 ATTEST: �'l.1 _ If Recording Secretary Chair �� PCDSA Resolution No.2013-01 Page 3 WA L U EXHIBIT B ec k ,� CITY OF PETALUMA • ; „' POST OFFICE BOX 61 -18 5$ PETAEU CIA, CA 94953-0061 David Class Airtime Chris Albertson Teresa Barren Mike Harris Mike Healy Pun & McGeady LLP Cabe Kearney Kathy Miller 9 Corporate Park, Suite 130 Conneihnembers Irvine, California 92606 In connection with your engagement to apply agreed-upon procedures relating M the Successor Agency Due Diligence Review as of June 30, 2012, which were agreed to by the California State Controller's Office and the California State Department of Finance, solely to assist us in ensuring that our dissolved redevelopment agency is complying with its statutory requirements with respect to Assembly Bill ("AB") 1484 and we confirm to the best of our knowledge and belief, the following representations made to you during your engagement. 1. The Successor Agency to the Petaluma Community Development Commission ("Successor Agency") is responsible for compliance with Cis),Manager's office California Health and Safety Code (HSC) Section 34179.5. II English street Petalunm. Cl 94952 2. We are responsible for adherence to the requirements of AB 1484 as Phone(707)778-4345 Fax(707) 778-4419 applicable to the successor agency for the dissolved redevelopment agency. F-,lien: cityngrQci_pemhono.ca.us 3. We are responsible for the presentation of the exhibits in the Successor Agency Due Diligence agreed-upon procedures report in accordance with the California Health and Safety Code (HSC) Section 34179.5 Economic Development Phone (707)778-4589 of June 30, 2012, we are not aware of any(707)n 4. As o )8-4886 Y modifications that need to be made to the Successor Agency Due Diligence Review exhibits for them to be Housing Division presented in accordance with California Health and Safety Code Sections Phone(707778-4555 34179.5(c)(1) through 34179.5(c)(3) and Sections 34179.5(c)(5) through Fax(707)778-4586 34179.5(c)(6). Human Resources Division Phone(707)778-4534 5. The Successor Agency reserves its right to dispute the calculation of the Fax(707) 778-4539 available funds identified in Exhibit F of the Due Diligence Review because the Successor Agency has filed or will file litigation contesting the State Information Technology Division Department of Finance's denial of various enforceable obligations that if Phone(707)776-3623 upheld m the litigation would rel on the identified fund balance. Fax gym) 776-sbzs P rely Risk Management Division 6. The Successor Agency acknowledges that procedures that have been Phone(707) 776-3695 developed by the California Department of Finance in accordance with Fax(707)776-3697 PCDSA Resolution No.2013-01 Page 4 Pun& McGeady LLP Management Representation Letter Page 2 California Health and Safety Code (HSC) Section 34179.5 and that we will follows these procedures unless we conclude that they are inconsistent with law. 7. We have disclosed to you any known matters contradicting the information contained in the Successor Agency Due Diligence Review AUP report. 8. There have been no communications from regulatory agencies, internal auditors, and other independent practitioners or consultants relating to the Successor Agency Due Diligence Review, including communications received between June 30, 2012 and November 28, 2012. 9. We have made available to you all information that we believe is relevant to the Successor Agency Due Diligence Review. 10. We have responded fully to all inquiries made to us by you during the engagement. 11. No events have occurred subsequent to June 30, 2012 that would require adjustment to or modification of the information contained in the Successor Agency Due Diligence Review AUP report and its related exhibits. 12. Management is not aware of any transfers (as defined by Section 34179.5) from either the former redevelopment agency or the Successor Agency to other parties for the period from January 1, 2011 through June 30, 2012 that have not been properly identified in the AUP report and its related exhibits. 13. Your report is intended solely for the information and use of the Successor Agency, the California Department of Finance, the California State Controller's Office, and the Sonoma County Auditor-Controller and is not intended to be and should not be used by anyone other than those specified parties. To the best of our knowledge and belief, no events have occurred subsequent to the date of your report that would have a significant impact upon the agreed upon procedures that you performed. Successor Agency to the Petaluma Community Development Commission: John C. Brown, Executive Director Date Bill Mushallo, Finance Director Date PCDSA Resolution No.2013-01 Page 5