Loading...
HomeMy WebLinkAboutStaff Report 2.C 01/09/2012 Agender'Itev v#2 .0 FAL°at 1855 DATE: January 9, 2012 • TO: Honorable Mayor and Members of the City Council through City Manager Honorable Chair and Members of the Petaluma Community Development Commission through Executive Director FROM: Bonne Gaebler, Housing Administrator bov�y�e SUBJECT: Discussion and Adoption of Resolutions Acknowledging the Submittal of the 2011 State Controller's Office (SCO) Redevelopment Financial Report. RECOMMENDATION . It is recommended that the City Council and the Petaluma Community Development Commission adopt the attached Resolutions Acknowledging the Submittal of the 2011 State Controller's Office (SCO) Redevelopment Financial Report. BACKGROUND The California Community Redevelopment Law (CRL) contains a number of Health and Safety Code Sections detailing procedures to which redevelopment agencies must adhere. CRL Section 33080.1 outlines the required contents of the report that must be submitted to the SCO by December 31. Staff submitted all required documents (as listed below) prior to the December 31, 2011 deadline. Following are the required reports which have been submitted: • State Controller's Financial Report Cover Page • FICD Housing Report • Blight Report • Bureau of Census Survey Form • Statement of Indebtedness • Independent Audit and Financial Transaction report DISCUSSION The PCDC Annual Report, inclusive of the above-listed requirements, must be filed by December 31, 2011. The penalties for failing to do so are strict, including not being able to ::t::::::\v: Finance D irector City Mai spend any money, adopt/amend redevelopment plansysell bonds, enter into any other kind of debt, and potential fines. FINANCIAL IMPACTS The fiscal impacts of not filing the SCO Report in a timely manner could be onerous (see discussion above). The cost of filing will amount to approximately $10,000 including internal and outside consulting staff and is budgeted in Account#54141 in the PCDC budget. ATTACHMENTS I. Exhibit 1 (PCDC Resolution) Exhibit 2 (City Council Resolution) 2. HCD Housing Report (Executive Summary) 3. Blight Report 4. Bureau of Census Survey Form 5. Statement of Indebtedness 6. Agency Outstanding Loans 7. Agency Owned Properties Z Items listed below are large in volume and are not attached to this report, but may be viewed in the City Clerk's office. 1. Audit Report (available after 12/19/11) 2. SCO Financial Transaction Report (available after 12/19/11) 2 • EXHIBIT 1 RESOLUTION NO. Of the Petaluma Community Development Commission Resolution Acknowledging the Submittal of the 2011 State Controller's Office (SCO) Redevelopment Financial Report. WHEREAS, California Community Redevelopment Law requires that an annual report be presented to the legislative body within six months of the end of the fiscal year; and WHEREAS, that report must contain certain financial and housing information for the fiscal year ending June 30, 2011; and WHEREAS, this Annual Report is a compilation of those individual financial statements and reports on the PCDC housing programs; and S WHEREAS, the Annual Report was distributed,to the City Council on December 19, 2011 for review in preparation for the City Council's January 9, 2012 meeting; and WHEREAS the required financial and housing reports were submitted prior to the December 31, 2011 deadline; and WHEREAS, Section 33080.2 of Redevelopment Law states the "the legislative body shall review the report and take any action which it deemed appropriate;" NOW, THEREFORE BE IT RESOLVED that the Petaluma Community Development v Commission acknowledges the submittal of the FY 2010-2011 State Controller's Report. 1340536.1 ru 3 EXHIBIT;2 RESOLUTION NO. Of the Petaluma City Council Resolution Acknowledging the Submittal of the 2011 State Controller's Office (SCO) Redevelopment Financial Report WHEREAS, California Community Redevelopment Law requires that an annual report be presented to the legislative body within six months of the end of the fiscal year; and WHEREAS, that report must contain certain financial and housing,information for the fiscal year ending June 30, 2011; and WHEREAS, this.Annual Report is a compilation of those individual financial statements and reports on the PCDC housing programs; and WHEREAS, the Annual Report,was.distributed to the City Council on December 19, 2011 for review in preparation for the City Council's January 9, 2012 meeting; and WHEREAS the required financial and housing reports were submitted prior to the December 31, 2011 deadline; and WHEREAS, Section 33080:2 of Redevelopment Law states the "the legislative body shall review the report and take any action which it deemed appropriate;" 4 NOW, THEREFORE BE IT RESOLVED that the Petaluma City Council acknowledges the submittal of the FY 2010-2011 State Controller's Report. =4 ATTACHMENT #2 HCD HOUSING REPORT EXECUTIVE SUMMARY State redevelopment law (Health and Safety Code, Section 33090 et seq.) requires redevelopment agencies to annually report to the Department of Housing and Community Development (HCD) on the use of Low and Moderate Income-Housing Funds to increase, improve, and preserve the supply of affordable housing. The department is statutorily mandated to annually compile and publish statewide information on redevelopment agencies' housing funds and activities. The following FY 2010-2011 low-mod housing information has been submitted to the Department in a timely fashion and utilizing the on-line reporting capability approved by HCD since 2007. If a councilmember many member of the public wishes to see the entire report, please feel to contact Bonne Gaebler(778-4484) or Sue Castellucci (778-4563). PCDC 20(1/0 Set-Aside Low-Mod Housing Revenues: Beginning Balance $3,614,438 2011 Allocation 3,171,909 Total resources $6,786,347 PCDC Projects and Programs Expenditures: Property Acquisition $2,410,459 New Development 1,107,975 Rental Subsidies 324,814 Housing Program Subsidies 952,365 First-Time I-Iomebuyer Loans 663,000 Total Projects and Programs $5,458,613 PCDC Planning andAdministration Expenditures: Salaries, audit, consulting, legal $435,886 Total Expenditures $5,894,499 Balance $891,848 5 ATTACHMENT #3 BLIGHT REPORT Petaluma Community Development Commission As outlined in State law, redevelopment agencies are required to present an annual report that outlines the progress it has made towards alleviating blight in the community. Petaluma's redevelopment agency, the Petaluma Community Development Commission (PCDC) has completed and continues to address substandard roadways, deteriorated and substandard buildings and contaminated properties. PCDC also funds a program to address property vacancies and deteriorated property values throughout the project areas. PCDC was activated on December 1, 1975 and includes two project areas, the Central Business District Project Area and the Petaluma Community Development Project Area. The two project areas are financially merged but for the purposes of this report, expenditures and projects have been separated by project area. Additionally, PCDC manages the commission's Affordable Housing Fund which appropriates and-monitors the use of funds that are set aside for affordable housing. Per State law, 20% of the commission's gross tax revenues are set aside for affordable housing purposes. Central Business District Project Area Fire Sprinkler Program This project set aside $25,000 to help downtown building owners install fire sprinklers. One $2,652 grant was awarded to the owner of 153 Kentucky Street. An additional grant request for $8,775 is currently pending review. Petaluma Downtown Association The Petaluma Downtown Associated (PDA) is a network of businesses, property owners and individuals who work together to promote and support downtown businesses through advertising and annual events. PCDC provided'the PDA $50,000 for operations in FY 10/11. Storefront Improvement Loan,Program This program provides low-interest loans to help downtown property owners upgrade their storefronts. While $25,000 was budgeted for the program, no projects were funded in FY 10/11. Petaluma Community Development Project Area Old Redwood Highway Interchange This project will upgrade the Old Redwood Highway 101 interchange to meet current standards and future traffic requirements. The proposed interchange includes ramp widening and 6 reconfiguration, a six lane over-crossing structure with bicycle lanes and signal improvements which will improve safety and relieve congestion. This project will be completed as part of a larger, regional upgrade to Highway 101. The $41.5 million dollar project is funded by $10 million of PCDC funds, $14.5 million from Sonoma County Transit Authority Proposition M funds, $10 million from City Proposition M funds and $7 million in other City funds. Construction of the interchange is scheduled to begin in 2013 and to be complete in 2015. East Washington Interchange This project will improve the East Washington Street interchange with Highway 101 by adding a new northbound on-ramp and realigning the existing southbound on-ramp. The project is currently being designed by an engineering consultant and will be constructed by CalTrans using State and local funds. The PCDC will have contributed $4.0 million towards the total $15 million project.cost. The project is expected to be complete in 2013. Rainier Cross-Town Connector/ Interchange This project will provide a new interchange on US 101 and connect the west and east sides of Petaluma. It will provide a cross town connection between North McDowell Boulevard and Petaluma Boulevard North and open up underdeveloped portions of the PCD Project Area for reuse. PCDC allocated $3,000,000 in FY 2010/11 to pay for road design and the environmental review. The road will be designed to go under the freeway for now but will also be designed to accommodate an interchange with the freeway when funds are available. Caulfield Extension from Lakeville Street to the Petaluma River This project will extend Caulfield Lane from Lakeville Street across the railroad and the Petaluma River to Petaluma Boulevard South. The extension requires an at-grade railroad and river crossing which will connect the east and west side of Petaluma and create future development opportunities on land that is not currently accessible. PCDC provided $1.5 million to complete the at-grade railroad crossing phase of the project. Petaluma River Trail The project will create pedestrian and bicycle access along the Petaluma River from Lynch Creek to Washington Street. The expanded trail will link the trail's dead end near Lakeville Street with a new pedestrian bridge over the Petaluma River at North Copeland Street. This project will cost approximately $2,000,000 when it is complete, most of which will come from Measure M funds. The PCDC has contributed $85,000 toward a portion of the project cost. Construction of the trail is expected to begin in the summer of 2012. US EPA Brownfields Grants. This program provides funds to assess the soil conditions of property to determine if there is any contamination or pollution. If contamination is found, Petaluma also administers a $1,000,000 7 revolving loan fund to help clean up contaminated properties. The PCDC allocated approximately $200,000 to match the EPA grant. Auto Center Drive Extension This project to extend Auto Center Drive to Petaluma.Boulevard was complete this year. This extension eliminates a dead end' street and makes it easier for customers to access the auto dealers. PCDC contributed approximately $1,200,000 towards the $1,400,000 total project cost. The remaining funds came from Proposition 1B funds. Payran Underground.Storage Tank An underground storage tank,at 301 Payran Street from a former, Petaluma fire station caused groundwater contamination which requires ongoing remediation. The Petaluma Community Development Commission has paid for staff costs totaling $20,000 towards the remediation work. • Both Project Areas Economic Development Strategy and implementation PCDC completed and adopted an Economic Development Strategy in November of 2010. The Strategy identifies goals, objectives and strategies to develop a sustainable economy in Petaluma. Petaluma SMART Rail Station Areas: TOD Master Plan The Metropolitan Transit Commission (MTC) and the Sonoma-Marin Area Rail Transit (SMART) funded a program to create plans for the areas surrounding the proposed SMART stations in Petaluma. SMART and MTC provided $260,000 and PCDC provided $50,000 to complete the planning process. A master plan and the necessary zoning amendments will be completed for the areas surrounding both Corona and Downtown stations. The master plan will be the basis for future development surrounding the two stations that supports Petaluma's community vision and maximizes the potential for SMART'ridership. ADA Self Evaluation and Transition Plan The City of Petaluma completed an update to its Americans with Disabilities Act (ADA) evaluation and transition plan. The update includes an evaluation of the programs, services and activities offered by the City as well as a physical assessment of City facilities and right of vvays throughout the Project Areas. The plan will help both Agencies develop barrier removal solutions for persons with disabilities. Unreinforced Masonry Program PCDC allocated $25,000 to help property owners retrofit unreinforced masonry buildings. No expenditures were incurred this fiscal year. 8 Affordable Housing Fund PCDC provided funds for the following three affordable housing development projects during fiscal year 2010-2011. Vintage Chateau 11 This 67-unit affordable, senior housing development completed all land use approvals, secured financing and began construction. PCDC funds were used to pay for land acquisition and City Impact Fees for this project developed by USA Properties. Logan Place This 67-unit affordable family housing project has completed design and is partially funded. PCDC funds paid for site acquisition and predevelopment expenses incurred during the design and entitlement phase of the project. Burbank Housing has secured most of the project funding will apply next year for the remaining tax credit and bond funds needed to complete the project. Construction is expected to begin in spring of 2012. Kellgren Senior Apartments PCDC funds paid for predevelopment expenses to design this project developed by Petaluma Ecumenical Properties (PEP 1-lousing). The project was approved by the City Council in February 2011 and approved by the Planning Commission in April of 2011. HUD 202 funds were requested and construction is expected to begin in early 2013. Housing related programs (rent subsidy, rehabilitation, transitional housing, etc.) were also funded from the Affordable Housing Fund. 9 ATTACHMENT #4 Supplement:to the Annual Report or Community Redevelopment Agencies Redevelopment Agency ID Number. 139111 9 650 CO Name of Redevelopment Agency: felvize , arinyt_ lnev°. Co re-f✓ry<S5+ Mark the appropriate box below to indicate the ending date of your agency's fiscal year.Report data for that period only. September 2010 r December 2010 June 2011 Return this farm to the California State Controller's Office. If you have any questions regarding this loon please contact: U.S.Bra-eau of the Census,Shannon Doyle, 1-800-242-4523 A.Personnel Expenditures Report your government's total expenditures for salaries and wages during the year, including amounts paid on force account construction projects_ z00 5 /ii,/Y7 1 0. Mortgage Revenue Bond-interest Payments Report your government's total amount of interest paid on mortgage revenue bonds during the yea I U20 I`s o I 10 ATTACHMENT #5 STATEMENT OF INDEBTEDNESS-CONSOLIDATED Cover Page i FILED-FOR THE 2011-2012 TAX YEAR • Name of Redevelopment Agency Petaluma Community Development Commission Name of Project Area Merged ProjectArea. Current Balances Carried Forward From: Total Principal/Interest Line Outstanding Debt Due During Tax Year Fiscal Period-Totals (From Fonu A,'Fuze I Totals) ( 1)$ 183,606,309.00 $ 13,848.086.00 (Optional) Past Fiscal Period-Totals (Front Form B Totals) _ (2)$ 81,088.888.00 $ 6.552,899 00 Grand Totals (3)$ 264,695,197.00 $ 20,400,98500 ivadible Res en net From Calculation of Available.Revenues,Line'7 _ (-4_)$ 19,019,413 00 Net Requirement _ (.5)$ 245,683,784.00 C Consolidate on this form all of the data contained on Form A and B(including sujapletuental'page-s). Form.A.is to include all indebtedness entered.into as of June 30 of the Fiscal Year, Form B may be :Sled at the option of the agency,and is to include indebtedness entered into post June 30 of the Fiscal Year,pursuant to Health nod Safety Code Section 33675(0(2). This is optional for each agency and is not a requirement for filing the Statement of indebtedness. The Reconciliation Statement is to include indebtedness from Form A only. Certification of Chief Financial Offnee 69._ r ��r`:U-^'+ /rG �-$' A4d i� v r''�"�e.K✓r r' )r- Pursuant to Section3 6775(h)ufthe Health and Safety Code. N m2 T rte i hereby certify that the above it a true and accurate Statement (/ �� of Indebtedness for the above named agency. \ 2______-9-..3,O(-/j ,,((�� (t /J / .eerie are- - state Rss 7/si2000 e.c2 d�f U p n (/Z`314, .� 11 STATEMENT OF INDEBTEDNESS-POST FISCAL YEAR INDEBTEDNESS ONLY Form B FRED FOR THE 2011-2012 TAX YEAR (Opticnai) To be used oily if the egmey ishes is Include indebtedness catered into aftellane J3 Name of Redevelopment Agency Petaluma Community•Development Commission Name of Project.Area Merged Project Area For Indebtedness Entered into post June 30,2011 as of September 30,2011 F ___ II Original Data Current Interest Total Total Principal/Interest ll Debt Identification Date Principal Term Rate Interest Outstanding Debt_ Due During Tax Year (A) Remittance avments for AB !x 27 _ 7/1/2011 47.554,008.00 27 yrs 47,564.008.00 5,150,819.00 (13) Scan dev/sae development 7/1/2011 6,000,000.00 27 tee - 6,000,000.00 1,000,000.00 (c:) Administrative costs 7/112011' - .27;524,880.00 27 TS 27,524.880.00 402,080.00 1 (F) (G) (H) !IN) IIIMII I. 11111111 i IL) TOTALS POST FISCAL YEAR INDEBTEDNESS [ ! ? S BI.CS8,883A0 S 6,581,899.",0 Purpose of Indebtedness: (A)Valunmry ERAF payment per AR t e 27 (C) (B) Sitedevelepntent commitment (11) (C) Administrative cost eommimteeb - (I) - (Di (J) (F1 (K)—�_ — 1F) (L) 12 STATEMENT OF INDEBTEDNESS Form A . . FILED FOR THE 2011-2012 TAX YEAR Page I oft Pages Name of Redevelopment Agency Petaluma Community Development Commission Name of Project Area Merged Project Area For Indebtedness Entered into as of June 30,2011 Original Data Interest Total Total Principal/InterestF) Debt Identification Date Principal Term Rate Interest Outstanding Debt Due During Tax Year 0- (Al 2001ATAB _ 6101 4,025,000.00 15 vrs 6.0% 1,215,941.00 1,220,915.00 404,315.00 0 (B) 2003A TAB 10/03 23.630.000.00 30yrs 3-5% 23.6255.456.00 37.073,049.00 1,505,011.00 0 (C) 2005A TAB 10105 18,355.000.00 25yrs 3-5% 13,967,805.00 26.997.154.00 1.044.814.00 0 (D) 2007 TAB 4/07 31,825,000.00 32 vrs 4-5.5% 36,691 296.00 62,136.507.00 1.597.011.00 (C) 2011 TAB 3/2011 11,369,000.00 13yrs 4.79% 4,233.093.00 15.535,534.00 1,194,575.00 0 (F) .pass through agreements 1989/2002 4,000,000.00 4.000,000.00 0 (C) ^--0%set aside LMl annual 35,740,790.00 3,200.000.00 0 • (II) reimburse agreement City annual 383,360-00 383,360,00 0 (I) RDA program-URM annual 60,000.00 60,000.00 0 (J) RDA program-storefront loan annual 25.000.00 25,0.00.00 Sub Total, This Page $ 183.172,309.00 $ 13,414.086.00_ Totals Forward From All Other Pages i:. ! I 434,000.00 $ 434,000.00 S Grand Totals $ 183,606.309.00 $ 13,848.086.00 Available Revemies From Calculation of Available Revenues ? $ (19pI1,41300) Net Requirement �. $ 164,594.8960E e Purpose of Indebtedness: I A) RDA proiccis and programs IF)lax increment pass-through to other agencies (B) RDA projects and programs (C)FISC 33681.5 1.641 set aside (C).RDA projects and programs (H)reimbursement overhead to City per wrinen agreement (0) RDA projects and programs (I)Reso.92-50 commitment to property owners (C)RDA projects and programs (.1)01-02 adopted budget loan program 13 STATEMENT OF INDEBTEDNESS Form A FILED FOR TILE 2011-2012 TAX- YEAR Page 2 of 2 Pages Name of-Redevelopment Agency .Petaluma Community Development Commission Name ofPrnject Area Merged Project Area For Indebtedness Entered into a s of Jute 30,2011 Ori Current : : otal 'r no pa .merest I , Debt Identification Date Principal Tekm n Outstanding Debt Due During Tax Year. I(A) RDA protean-MA annual � 50,000.00 50,000.00 0 (B) commit-firea dickies sub .annual 25,000.00 25.000.00 I1C0 c omit it-Brownfields annual 50,000.00 • ___ 80.000.00 0 I(D) coats fees an nut 24.000.00 24.000.00 0 i(El commit-rail stations _ mmual' : _ 25,000.00 25,000.00 0 ��'(F) son eats collection fee 210,000.00 210.000.00 p �_ !(C) commit actenUSC remediation 20.000.00 20900.00 I (FI) aWilielliimilli al I i 111111W111= - ' 434100000 .S 4 4.000.00_ Purpose of Indebtedness: (.4) Budget commitment to Downtown Assoc (C)Bridget commitment support to UST remediation (B).(16-07 adapted budget Mao/subsidy pro-'am - (it) (C) C':anmit cosS associated with Ri twitiolds gyrnt (I) (D)dnistee fee budget comnmitmentin con ectionwith allocation of tax increment G]) tF) Budget commitment snppon to rail.stations (K) _ (F) Budget commitment for Sonamta County collection fee (L) 14 RECONCILIATION STATEMENT - CHANGES IN INDEBTEDNESS Page 1 of 3 Pages Name of Agency Petaluma Community,Development Commission Name of Project Area Merged Project Area Tax Year 2011-2012 Reconciliation pates:. From July.1,,2010 To June 30,2011 Debt identification: Outstanding Debt _ Adjustments Amounts Paid Against Remaining I SOI,page and line: Brief All Beginning Increases Decreases Indebtedness,from: Balance Prior Vr Current Yr Description Indebtedness. (Attach Explanation) (Attach Explanation) • Tax Increment Other Funds (A1B-C-D-E) 1 P 1 Pg 1 ._ Line A Line A 200!A.TAB 1,624,255.00 $ 403,340:00 1,220,915.00 Pg 1 Pg 1 - Line B Line B 2003A TAB .38,574.092!00' 1,501,043:00 37,073,049.00 Pg 1 Pg 1 il Line C Line C '2005A TAB 28,041405.00. 1,048,251/00 26,997.154.00 Pg 1 Pg 1 Line D Line D 2007 TAB 63.733,418.00 1,596,911.00 62,136,507.00 Pg 1 Pg 1 Lino E Line E DDA-AD 19 .230,895.00 17,637.00 213,,258.00 0.00 Pg 1 Pg 1 Line F Line F pass through azreennents 5,168,000.00 2,836,688.00 4,004,688.00 4.000,000.00 Pg 1 Pg 1 Line G Line G 20%set aside WI 5,821525.00 '3,074,827.00 35,740.790.00 Pg 1 Pg 1 Line H Line H reimburse agreement City 365,700.00 249,210.00 231.550,00 383,360,00 TOTAL.THIS PAGE. S 170;736.057.00 S 8,907,223.00 $ 17,637.00.$ 14073.868.00 S 167,551,775.00 TOTALS FORWARD $ 565,000.00 $ 17079.056,00 $ 600.00. $ 1,588,922.00 $ - $ 16,054.534.00 GRAND TOTALS _ _ $ 171,301,057.00,5_25,986,279.00. S 18,237.00 $ !3,662,790.00 5 - S 183.606 309.00 NOTE: Column A must equal the previous year Statement of Indebtedness Outstanding Debt. Column F must equal this year's 501 Outstanding Debt column. Use the page and line number that the indebtedness is listed on in each year as appropriate,and a brief description. Ignore any Indebtedness fully repaid in the previous year,as it had a zero ending balance. All new indebtedness entered into since the previous SOI is to be listed below the previous indebtedness. Enter"new"in the"Prier Yr"page and line column,fdr each new indebtedness.. Rev. 512194 15 • RECONCILIATION STATEMENT - CHANGES IN INDEBTEDNESS Page 2 of 3 Pages Name of Agency Petaluma Community Development Commission Name of Project Area Merged Project Area Tax Year 2011-2012. Reconciliation Dates: From July 1,20101 To June 30,2011 Debt Identification: Outstanding Debt Ad ustments _ Amounts Paid Against Remaining Sal,page and line: I Brief All Beginning Increases Decreases Indebtedness,from: Balance i Prior Yr Current Yr Description Indebtedness (Attach Explanation) (Attach Explanation) Tax Increment Other Funds (Ar-B-C-D-E) Pg 2 Pg 2 li.ine A Line A RDA roeram-URM 20,000.00 40,00000 0,00 60.000.00. Pg 2 Pg 2 Lire B Line 6 RDA program-storefront loan 25,000.00 0.00 0.00 25,000.00 'Pg 2 Pg 2 Line C tine C RDA .rogram-DTA _ 50,000.00 50,000:00 50.000.00, 50,000.00 Pg 2 Pg 2 Line E Line D commit-tire s>nnkier sub 25;000.00 2,652(00__ 2,652.00 — 25'000.00 Pg 2 Pg 2 Line F- Line E commit-Brownfelds 50.00000 36.350.00 6,350.00 80,000.00 Pg 2 Pg 2 _ Line G Line F trustee fees 20.000.00 19.950.00 15,950.00 24,000 00 Pg 2 Pg 2 Line H Line G commit-rail stations .150.000:00 4,176.00 ' 129,176.00 25,00000 Pg 2 Pg 2 Line I Line H son city collection fee 210.000.00 195,543.00 195,543.00 1— 210,000.00 Pg new Pg 2 Line new Line I commit pa;rim TJSTremediation 49,671,00 22 9,67100 20.0(10.00 1Pg new, Pg 2 'Line new Line J 2011 TAB 15,602.093.00 66,559.00 15,535.534.00 Pg form Pg 2 :Line B Line K Suplinnt Education Rev Aug Fmd 1,044:706:00 1,044,706.00 0.00 l IPg new Pg 2 Line new Line L cotmnit ADA self evil and transition 29,341.00 29,341.00 0.00 TOTAL.-THIS PAGE $ 550,000.00 S 17,074,482,00 S _ - 5 1,569.94300 S_. . - 16.054;534.00 INOTE: Column A must equal the previous year Statement of Indebtedness Outstanding Debt. Column F must equal this year's SOI Outstanding Debt Column. 16 RECONCILIATION STATEMENT - CHANGES' IN INDEBTEDNESS Page 3of 3 Pages Name of Agency Petaluma Community'.Development.Commission Name of Project Area Merged Project Area. Tax Year 2011-2012 Reconciliation.Dates: From July 1;2010•To June 30,2011 -- ® • - __. A g - D .--_. . E ..._ F Debt Identification: Outstanding Debt Adjustments - Amounts Paid Against Remaining 1.501,page and line: Brief All Beginning. Increases Decreases- Indebtedness,from: Pa!ance 'Prior Yr Current Yr Description __ Indebtedness (Attach Explanation) (Attach Explanation) Tax Increment Other Funds (A+D C-D-E) Pg new Pg 3 Line new Line A cottunlr economic devel strategy 4,574.00 _ 4,574.00 0.00. -IPg 2 Pg 3 Line D Line B Icommit-depot costs 15,000.00 600.00 14,400.00 0.00 Pg Pg 3 Line Line C Pg Pg 3 Line Line D_ - - Pg Pg 3 Line Line E Pg Pg 3 Line Line F' Pg Pg 3 Line Line G Pg Pg 3 Line Line H Pg! Pg 3 . Line Line I _ Pg Pg 3 Line Line J - - Pg Pg 3 Line Line K Pg Pg 3 Line Line L __ -- - - - }TOTAL-THIS PAGE 15,000.00- 4,574.00. 600.00 13,974.00 T. NOTE: Column A must equal the previous year Statement of Indebtedness Outstanding pebt. Column rF must equal this year's SO/Outstanding Debt Column. 17 CALCULATION OF AVAILABLE REVENUES AGENCY NAME Petaluma Community.Development Commission PROJECT AREA Merged Project Area TAX YEAR 2011-2012 RECONCILIATION DATES: JULY 1,2010 TO JUNE 30,2011 1. Beginning Balance,Available Revenues $ 17;289.338.00 (See Instructions) Tax Increment Received-Gross-C(3D $ 2,618.441.00 2. Tax Increment Received-Gross PCD S 13,558,562.00 less sec 33676 S (792,138.00) All Tax+lncrement Revenues,to including any Tax Increment passed through to other local taxing agencies 3. All other Available Revenues'Received $ - (See Instructions) 4. Revenues from any other source,included in Column E of the'Reconciliation Statement, but not included in(1 -3)above $ - 5. Sum of Lines 1 through 4 $ 32,674,20 x.00 6. Total amounts:paid'ageinst indebtedness in previous year. (D E on Reconciliation Statement) S. 13.662,790.00 7. Available Revenues,End of Year(5-6) S 19,011.413.00 FORWARD THIS AMOUNT TO STATEMENT OF:INDEBTEDNESS NOTES Tax Increment Revenues: The'only amount(s)to be excluded as.Tax.Increment Revenue are any amounts passed through to other local taxing agencies pursuant to Health and Safety Code Section 33676, Tax.Increment Revenue set-aside in the Low and Moderate Income Housing Fund will be washed in the above calculation, and therefor omitted'from Available Revenues at year end. Item 4.above: This represents any payments from any source other than'Tax Increment:OR available revenues. For instance,an agency funds a project witha bond issue. The previous sal included a Disposition Development Agreement (DDA) which was.fully satisfied wittathesebond proceeds. The•DDA would•he shown on the Reconciliation Statement as fully repaid..under the"other column(Co!E), but with funds that were neither Tax Increment,-nor"Available Revenues" as defined. The amounts used to satisfy this DDA would be-included on line 4 above in order to accurately determine ending"Available Revenues". Rev (512/941 18 Reconciliation Statement- Description of Adjustments Agency: Petidunia'Comanunity Development Commission Project Area: Merged:Project Area Date: June 30,2011 R .._.— _ econciliation - Sheet Description of Adjustment page and line: , Amount Pg 1 !Line E Reduction due to bond call early debt retirement. $ (17,637.001 I Pg I Increase in project area's pass through based upon computation of required i Line F payment from tax increment $ 2,836,688.00 1 Pg t Increase in project areas set-aside requiienment for Low and Moderate Income Line G Housing funds..Amotnnt otnputed,based on total debt outstanding. $ 5,821,325.00 Pg 1 Line 11 Increase to outstanding indebtedness/budget commitment at year end. $ 249.210.00 Pg 2 Line A Increase to outstanding indebtedness/budget commitment at year end, $ 40,000.00 Pg !Line C Increase to outstanding indebtedness/budget commitment at year end. $ 50000.001, ;Pg ;line D Increase to outstanding indebtedness/budget ebniMitment at year end. _ _ $__ 2,652.00 1 Pg 2 ._ {Line E Increase to outstanding indebtedness/budget commitment at year end. $ 36,350.00 1pg Line F Commitment of fees aid to Trustee in connection with allocation of tax increment. $ 19,950.00 Pg Line G Increase to.outstandin indebtedness/budget commitment at year end. $ 4,176.00 Pg Line H Commit fees paid to Sonoma,County in connection with collection of tax increment. $ 195,543 00 1 Pg 2 'Line 1 New commitment of budgeted funds. $ 49,671.00 1 Pg 2 Line J New tax allocation'hond'debt $ 15,602.093.00 Pg 2 Line K Supplemental.Educational•Revenue Augmentation fund obligation per IISC 33690.5 .$ 1,044,706.00 Pg Line L New commitment of budgeted funds. $ 29,341.00 Pg 3 Line A New commitment of budgeted funds: $ 4,574.00 IPg , Line B Decrease to outstanding indebtedness/budget commitment at Yearend_ S (600.00) 1 Line t Pg Line ' Pg I Line I I One Pg Line Grand'total $ 25,968,042.00 19 ATTACHMENT #6 PETALUMA COMMUNITY DEVELOPMENT COMMISSION LOAN REPORT 7/1/2010-6/3/2011 As of June 30, 2011, the Commission had the following notes receiveable: Housing Loans to Not-for-Profit Agencies: Old Elm Partners 1,305,961 Roundwalk Village Partners 933,400 Boulevard (Buckelew) Project 480,200 Downtown River Associate LP 3,662,836 Edith Street Apartments Inc 889,964 Lieb Senior Apartments Inc 810,241 Parklane Apartments Corp 164,486 575 Vallejo Street Association 851,184 579 Vallejo Street Association 990,000 Casa Grande 198,445 Wood Sorrel 1,347513 Logan Place 2,943,219 Salishan Apartments Inc 388,380 Vintage Chateau II 4,499,825 Total Housing Loans to No-for profit Agencies 19,465,654 First Time Homebuyer Loans 3,736,875 Storefront Loan Program 251,670 TOTAL $23,443,105 Defaulted Loans: Housing—First Time Homebuyers Program: 5 — Foreclosed properties with Agency loans, $ 663,000 12 ATTACHMENT#7 AGENCY OWNED PROPERTIES (There are no Agency Owner! Properties 13 • PETALUMA COMMUNITY. DEVELOPMENT COMMISSION FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30,2011 Itt This Page Left Intentionally Blank 15 PETALUMA COMMUNITY DEVELOPMENT COMMISSION Component Unit Financial Statements For ThecYear.Ended JUNE 30,2011 TABLE OF CONTENTS Independent Auditor's Report - 1 Basic Financial Statements: Commission-wide Financial Statements: Statement of Net Assets 4 Statement of Activities 5 Fund Financial Statements: Balance Sheet 8 Reconciliation of the Governmental.Funds—Fund Balances With the Statement of Net Assets 9 Statement of Revenues,Expenditures,and Changes in Fund Balance 10 Reconciliation of the Net Change in Fund Balances—Total-Government Funds With the Change in Net of Governmental Activities 11 Notes to Basic Financial Statements 13 Required Supplemental Information: Schedule of Revenues, Expenditures,and Changes;in Fund Balance-Budget and Actual: Redevelopment Special Revenue Fund 32 Supplemental Information: Major Funds Except for Special Revenue Fund: Schedules of Revenues,Expenditures,and-Changes in Fund Balance-Budget and Actual: Redevelopment Debt Service Fund 36 Redevelopment Capital Projects Fund 37 Excess Surplus.Calculation 38 Independent Auditor's Report on Internal Control over,Financial Reporting and on Compliance,and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 39 Independent Auditor's Report on Compliance and on Internal Control over Compliance in Accordance with the California Health and Safety Code as Required by Section 33080.1 41 Schedule of Current Year Findings 43 G This Page Left.Intentionally Blank 11 / Y $ ASSOCIATES ACCOUNTANCY CORPORATION 3478 Buskirk Ave. - Suite 215 Pleasant Hill, California 94523 (925)930-0902 •FAX(925)930-0135 maze@tnazeassociates.com INDEPENDENT AUDITOR'S REPORT www.mazeassociates.com Members of the Governing Board of the Petaluma Conununity Development Commission Petaluma,California We have audited the basic financiabstatements,of the governmental activities and each major fund of the Petaluma Community.Development Commission, a component unit of the City of Petaluma, California, as of and for the year ended June 30;2011, as listed in the table of contents. These basic financial statements are the responsibility the Commission's management. Our responsibility is to express an opinion on these financial statements based on our audit We conducted our audit in accordance with generally accepted auditing standards in the United States of America and the standards for financial audits contained in Government Audit Standards, issued by the Comptroller General of the United States of America. Those standards require that we plan and perform the • audit to obtain reasonable assurance as to whether the financial statements are free of material misstatement. An audit includes examining on a test basis;evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management,as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the basic financial statements referred to above present fairly in all material respects the financial position of the governmental activities and each major fund of the Commission as of June 30, 2011,and the respective changes in the financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. Management's Discussion and Analysis is not a required part of the basic financial statements but is supplementary information required'by,the Governmental Accounting Standards Board. The Commission has not presented the Management Discussion,and Analysis that the Governmental Accounting Standards Board has determined is necessary to supplement, although not required to be part of, the basic financial statements. As disclosed in Note 10,the State of California adopted ABx1 26 on'June 28,2011,'which suspends all new redevelopment activities except;for limited specified,activities as of that date and dissolves redevelopment agencies effective October 1, 2011. The State simultaneously adopted ABx1 27 which allows redevelopment agencies to avoid dissolution by opting into an "alternative voluntary redevelopment program" requiring specified substantial annual contributions'to'local schools and special districts. These conditions raise substantial'doubtabout the Commission's ability to,continue as a going concern. However, on August 11, 2011, the California•Supreme Court issued a partial stay of ABx1 26 and a full stay of ABxI 27, but the partial stay did not include the section of ABx1 26 that suspends all new redevelopment activities. As a result, the accompanying financial statements have been prepared assuming that the Commission will continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. A Professional Corporation As of July 1, 2010,.the Commission adopted the provisions of Governmental Accounting Standards Board Statement Number 54 (GASB 54),Fund Balance Reporting and.Governmental Fund Type Definitions. As discussed in Note 7 to the financial statements, the provisions of this statement affect the classification of fund balances reported in the financial statements. In accordance with Government Auditing Standards, we have also issued our report dated November 18, 2011, on our consideration of the Petaluma Community Development Commission internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal over financial;reporting or on compliance.That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results,of our audit. Management's Discussion and Analysis'and:Required Supplemental Information are not required parts of the Basic Financial Statements but are supplementary information required`by the Government Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplemental information.However,we did not audit this information and we express no opinion on it. Our audit was made for the purpose•of forming an opinion on the financial statements taken as a whole. The supplemental information listed in the Table of Contents is presented for purposes of additional analysis and is not a required part of the basic financial statements of the Petaluma Community Development Commission. Such information has been subjected to the auditing procedures applied in our audit of the financial statements and'in.our opinion is fairly stated in all material respects in relation to the component unit financial statements'taken',as a whole. 03, 4 )e, booms November 18,2011 2 � 9 PETALUMA COMMUNITY DEVELOPMENT COMMISSION STATEMENT OF NET ASSETS AND,STATEMENT OF ACTIVITIES The Statement of Net Assets reports the difference between the Commission's total assets and the Commission's total liabilities, including all the Commission's capital assets and all its long-term debt. The Statement of Net Assets focuses the reader on the composition of the Commission's net assets, by subtracting total liabilities from total assets. The Statement of Net Assets summarizes the financial position of all the Commission's financial position in a single column. The Statement of Activities reports increases and decreases in the Commission's net assets. It is also prepared on the full accrual basis; which means it includes all the Commission's revenues and all its expenses, regardless of when cash changes hands. This differs from..the modified accrual basis used in the Fund Financial Statements; which reflect only current assets, current liabilities, available revenues and measurable expenditures. 3 �U PETALUMA COMMUNITY DEVELOPMENT`COMMISSION STATEMENT OF'NET ASSETS JUNE 30; 2011 Governmental Activities ASSETS Cash and investments(Note 2) $11,742,783 Restricted cash and investments(Note 2) 28,329,760 Accounts receivable-net 25,426 Intergovernmental 102,896 Loans receivable(Note 4) 23,443,634 Interest receivable related,to loans(Note 4) 3,380,195 Deferred charges,net' - 1,262,264 Deposits and prepaids 671,000 Total Assets •68,957,958 LIABILITIES Accounts payable 541,467 Wages payable 23,846 Deposits payable 189,750 Unearned revenue- 500 Advances from the City o6Petalmna(Note 3) 1,300,000 Interest payable 623,454 Compensated absences(Note IF): Due within one year 29,191 Due in more than one year 118,619 Long-tenn debt(Note 6): Due within one year 2,005,000 Due in more than one year 79,051,574 Total Liabilities 83,883,401 NET ASSETS(DEFICITS)(Note 7): Restricted.for: Debt service and operations '415,569 Capital projects 39,017,993 Special projects 22,826,373 Total Restricted Net Assets 62,259,935 Unrestricted (77,185,378) Total Net Assets(Deficit) ($14,925,443) See accompanying notes to financial statements 4 I PETALUMA COMMUNITY DEVELOPMENT COMMISSION STATEMENT OF'ACTIVITIES FOR THE YEAR ENDED JUNE 30,2011 Net(Expense) Revenue and Changes Program.Revenues in Net Assets . Operating Charges for Grants and Governmental Functions/Programs Expenses Services Contributions Activities Governmental Activities: Community development $8,897,760 $15,366 $38,709 ($8,843,685) Tax increment pass through agreement 4,796,826 (4,796,826) Interest on long-term debt 3,501,214 (3,501,214) Total Governmental Activities 17,195,800 15'366 38,709 (17,141,725) General revenues: Incremental property taxes 16,166,274 Other 673,895 Use of money and property 185,517 Contributions from the City 36,097 Transfers to the City of Petaluma,net(Notes 3 and'5) (11,164,172) Total general revenues and transfers. 5,897,611 Change in Net Assets (11,244,114) Net Assets(Deficit)-Beginning (3,681,329) Net Assets(Deficit)-Ending ($14,925,443) See accompanying notes to financial statements 5 as FUND FINANCIAL STATEMENTS Major hinds are defined generally as having significant activities or balances in the current year. MAJOR'GOVERNMENTAL FUNDS The Redevelopment Special Revenue Fundis used to account for the.redevelopment Commission's 20% set-aside, as required by law, of tax increment for Low and Moderate Income Housing. The activity of this fund consists of supporting development of affordable housing in the community. Also included in this fund arc redevelopment agency donations and grant revenues. The Redevelopment Debt,Service Fund is used to account for the accumulation of resources, and the payment of principal and interest of the Commission's long-term debt. The Redevelopment Capital Projects Fund is used to account for the administration of programs and the capital projects undertaken in the.Commission. 7 PETALUMA COMMUNITY DEVELOPMENT COMMISSION GOVERNMENTALFUNDS BALANCE SKEET •JIJNE10;201 I Redevelopment, Redevelopment Redevelopment Total Special Capital Debt Governmental Revenue. Projects Service Funds ASSETS Cash and investments(Note 2) $1,238,447 $10,089,355 $414,981 $11,742,783 Restricted cash and investments(Note'2) 28,329,172 588 28,329,760 Receivables Accounts receivable,net 25,426 25,426 Intergovernmental receivable 14,027 88,869 102,896 Deposits andprepaids 671,000 671,000 Loans receivable(Note 4) 23,202,529 241,105 23,443,634 Interest receivable related to notes receivable(Note 4) 3,380,195 3,380,195 Total Assets $27,835,198 $39444,927 $415,569 $67,695,694 LIABILITIES Accounts payable $264,137 $277,330 $541,467 Wages payable 4,492 19,354 23,846 Deferred revenue 3,380,196 500 3,380,696 Refundable deposits 60,000 129,750 189,750 Advance from the City of Petaluma(Note'3) 1,300,000 1,300,000 Total Liabilities 5,008,825 426;934 5,435,759 FUND BALANCES Fund balance(Note 7): Restricted for redevelopment projects 22,826,373 39,017,993 415,569 62,259,935 Total Fund Balances(Deficit) 22,826,373 39,017,993 415,569 62,259,935 Total Liabilities and Fund Balances $27,835,198 $39,444,927 $415,569 $67,695,694 See accompanying notes to financial statements • 8 .5 • • PETALUMA COMMUNITY DEVELOPMENT COMMISSION Reconciliation of the GOVERNMENTAL FUNDS--BALANCE SHEET with the STATEMENT OF NET ASSETS JUNE 3'0;2011 Total fund balances reported on the governmental funds balance sheet $62,259,935 Amounts reported for Governmental Activities in the Statement of Net Assets are different from those reported in the Governmental Funds above because of the following: ACCRUAL OF NON-CURRENT REVENUESANDEXPENSES Revenues which are deferred on the Fund Balance Sheets because,they are not available currently are taken into revenue in theStatëment of Activities. 3,380,196 Deferred charges,such as bond issuancecosts,were an expenditure in the governmental funds but were capitalized and amortized over the life of the bonds in the Government-Wide Financial Statements. 1,262,264 Interest payable on long-term debt did not require current financial resources: Therefore, interest payable was not recorded on the Governmental Fund Balance Sheet. (623,454) LONG-TERM ASSETS AND LIABILITIES The assets and liabilities below are not due and payable in the current period and therefore are not reported in the Funds: Compensated absences-due in one:year (29,191) Compensated absences-due in more than one year (118,619) Long-term debt-due in one year (2,005,000) Long-term debt-due in more than one year (79,051,574) NET ASSETS OF GOVERNMENTAL ACTIVITIES ($14,925,443) See accompanying notes to financial statements 9 PETALUMA COMMUNITY DEVELOPMENT COMMISSION GOVERNMENTAL FUNDS STATEMENT OF REVENUES,:EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED JUNE'30,2011 Redevelopment Redevelopment Redevelopment Total Special Capital Debt Governmental Revenue Projects Service Funds REVENUES Taxes $3,074,827 $13,091,447 $16,166,274 Licenses,permits and fees 91 91 Use of money and property 41,744 143,773 185,517 Intergovernmental 38,709 38,709 Charges for services 15,275 15,275 ' Other 673,895 673,895 Total Revenues 3,805,741 13,274;020 17,079,761 . EXPENDITURES Current: Community development 2,391,461 2,444,395 21,900 4,857,756 Tax increment pass through agreement 4,796,826 4,796,826 Capital outlay 2,410,926 1,962;732 . 4,373,658 Debt service: Principal 1,519,000 1,519,000 Interest and fiscal charges 3,305,360 3,305,360 Total Expenditures 4,802,387 9,203,953 4,846,260 18,852,600 EXCESS(DEFICIENCY)OF REVENUES OVER EXPENDITURES (996,646) 4,070,067 (4,846,260) (1,772,839) OTHER FINANCING SOURCES(USES) Proceeds from debt 11,369,000 11,369,000 Contributions from the City 11,700 24,397 36,097 Transfers in(Note 3) 11,935,020 4,733,000 16,668,020 Transfers(out)(Note 3) (772,570) (4,733;000) (11,162,450) (16,668,020) Transfers in from the City(Note 3) .20,000 318,906 338,906 Total Other Financing Sources(Uses) (740,870) 7,545,323 4,939,550 11,744;003 NET CHANGE IN FUND BALANCES (1,737,516) 11,615,390 93,290 9,971,164 BEGINNING FUND BALANCES(DEFICIT) 24,563,889 27,402,603 322,279 52,288,771 ENDING FUND BALANCES(DEFICIT) $22,826,373 $39,017,993 $415;569 . $62,259,935 See accompanying notes to financial statements 107 PETALUMA COMMUNITY DEVELOPMENT COMMISSION Reconciliation of the NET CHANGE IN FUND BALANCES-TOTAL GOVERNMENTAL FUNDS with the STATEMENT OF ACTIVITIES FOR THE YEAR ENDED,IUNE 30,2011 The schedule below reconciles the Net Changes in Fund Balances reported on the.Governmental Funds Statement of Revenues,Expenditures and.Changes,in.Fund'Balance,which measures only changes in current assets and current liabilities on the modified accrual basis,with the Change in Net Assets of Governmental Activities reported in the Statement of Activities,which is prepared on the full accrual basis. NET CHANGE IN FUND BALANCES-TOTAL GOVERNMENTAL FUNDS $9,971,164 Amounts reported for governmental activities in the Statement of Activities are different because of the following: CAPITAL ASSETS TRANSACTIONS Capital assets transferred to the City is deducted from the fund balance (11,619,166) Capitalized expenditures are added back to fund balance 116,088 LONG-TERM DEBT PROCEEDS AND PAYMENTS Bond proceeds provide current financial resources to governmental funds,but issuing debt increases long-term liabilities in the Statement of Net Assets. Repayment of bond principal is an expenditure in the governmental funds,but in the Statement of Net'Assets the repayment reduces long-term liabilities. (11,369,000) Repayment of debt principal is added back to fund balance 1,519,000 ACCRUAL OF NON-CURRENT ITEMS The amounts below included in the Statement of Activities do not provide or(require)the use of current financial.resources and therefore are not reported as revenue or expenditures in governmental funds(net charge):, Deferred revenue 348,988 Interest payable (138,863) Amortization on deferred charges (56,991) Compensated absences (15,334) CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES ($11,244,114) See accompanying notes to financial statements 11 U This Page Left Intentionally Blank 29 • PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit financial NOTE 1-SUMMARY OF SIGNIFICANT POLICIES' A. Description of the Petaluma Community Development Commission and Redevelopment Plan The Commission, a component unit of the City of Petaluma, California (City), is a community redevelopment agency formed in September 1976, pursuant to'the-provisions of Part 1 of Division 24 (commencing with Section 33000) of the California Health and Safety Code. Pursuant to this law; the Commission is vested with the responsibility of carrying out a duly adopted redevelopment plan. The Commission defined the Central Business District Project Area, encompassing approximately 225 acres, on September 27, 1976, amended in April,2001. The Petaluma Community Development Project Area was defined as encompassing approximately 2,740 acres on July 18, 1994 and 2001. The Commission's primary source of revenue, other than loans, advances from the City, and bond proceeds, is an allocation of a. portion of current property taxes. Property taxes allocated to the Commission from other agencies are computed in the following manner: a. The assessed valuation of all property within the project area is determined on the date of adoption of the redevelopment plan,and identified as the base year valuation. b. Property taxes based on incremental increasein,assessed values above the base year valuation are allocated to the Commission. Property taxes based-on,the base year assessed valuation are allocated to the City,county and other districts. The Commission has no power to levy and collect taxes.. On October 18, 2006, an ordinance,approving and adopting an amendment to the redevelopment plan, fiscally merging the Central Business District Project Area with the Petaluma Community Development Project Area, was approved by the City Council/The Commission Governing Board. The amendment provides for the fiscal merger of the=project areas in order to pool tax increment revenue and establish a unified bonded indebtedness limit for the two project areas, while retaining the separate identity of each project area for other purposes The amendment increases the outstanding bonded indebtedness limit to the sum of$250,000,000,but does not alter the limitation on the amount of tax increment revenue that may be allocated to the Commission over the life of the redevelopment plan. B. Basis of Presentation The Commission's Basic Financial Statements are prepared in conformity with accounting principles generally accepted in the United States of America. The Government Accounting Standards Board is the acknowledged standard setting body for establishing accounting and finanCial reporting standards followed by governmental entities in the U.S.A. These Standards require that the financial statements described below be presented. Commission-wide Statements: The Statement.of Net Assetspand the Statement of Activities display the financial activities of the overall Commission. Eliminations have been made to minimize the double counting of internal activities. 13 30 PETALUMACOMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial^Statements NOTE 1-SUMMARY OF SIGNIFICANT-ACCOUNTING POLICIES(Continued) The Statement of Activities presents.a comparison between direct expenses and program revenues for each function of the Commission's governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues include (a) charges paid by the recipients-of goods or services offered by the programs, (b)grants and contributions that are,restricted to meeting'theoperational needs of a particular program and (c) fees, grants and contributions that are restricted to financing the acquisition or construction of capital assets. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. Fund Financial Statements: The fund financial statements provide information about the Commission's funds. The emphasis of fund.financial-statements is on major individual funds,each of winch is displayed in a separate column. The Commission considers all its funds to,be major funds. C. Major Funds The Commission's major funds are required to be identified and presented separately in the fund financial statements. Major funds are defined as funds that have either assets, liabilities,revenues or expenditures/expenses equal to ten percent of their fund-type total and five percent of the grand'total. The Commission reported all its governmental funds in the accompanying financial statements as major funds. The Redevelopment Special Revenue Fund accounts for the redevelopment agency's 20% set-aside, as required by law, of tax increment for Low and Moderate Income Housing. The activity of this fund consists of supporting development of affordable housing in the community. Also included in this fund are redevelopment agency donations and grant revenues. The Redevelopment Debt Service Fund accounts for the accumulation of resources, and the payment of principal and interest of the Commission's long-term debt. The Redevelopment Capital Projects Fund accounts for the administration of programs and the capital projects undertaken in the Commission. • D. Basis of Accounting The Commission wide financial statements are reported:using;the economic resources measurement focus and the full accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The Commission considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days,after year-end. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on long-term debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent they have matured. Governmental capital asset acquisitions are reported as'expenditures in governmental funds. Proceeds of governmental long-term debt and acquisitions under capital leases are reported as other financing sources. 14 I 9 PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial Statements NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTINGPOLICIES(Continued) I The Commission may fund programs with a combination of cost-reimbursement grants, categorical block grants, and general revenues. Thus, both restricted and unrestricted net assets may be available to finance program expenditures. The Commission's policy is to frstapply restricted grant resources to such programs, followed by general revenues if necessary. Certain indirect costs are included in program expenses reported for individual functions and activities. Non-exchange transactions, in which the Commission gives or receives value without directly receiving or giving equal value in exchange, include taxes, grants, entitlements, and donations. On an accrual basis, revenue from taxes is recognized in the fiscal year for which the taxes are levied. Revenue from grants, entitlements, and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. E. Budgets and Budgetary Accounting An annual budget is adopted by the Commissioners prior to the first-day of the fiscal year. The budget process includes a detailed review of proposed budget by the Executive Director, and a final review by the Finance Director. The recommended budget is then transmitted to the Commissioners for their review before the required date of adoption. Once transmitted to the Commissioners;the proposed budget is made available for public inspection. A public hearing is held to give the public the opportunity to comment upon the proposed budget. Notice of such public hearing is given in a newspaper of general circulation. The adoption of the budget is accomplished by the approval of a Budget Resolution. The legal level of budgetary control is at the department level. My budget modification,;which would result in an appropriation increase, requires Commissioners' approval. The Finance Director and City Manager are jointly authorized to transfer appropriations within a departmental budget. • Reported budget figures are as originally adopted or Subsequently amended and include prior year encumbrances. Such budget amendments during the year; including those related to supplemental appropriations, did not cause these reported budget amounts to be significantly different than the originally adopted budget amounts. All appropriations which are not obligated, encumbered, or expended at the end of the fiscal year lapse and become a part of the unreserved fund balance which may be appropriated for the next fiscal year. An annual budget for the year ended June 30,2011, was adopted and approved by the Commissioners for the special revenue,debt service and capital projects funds. These budgets are prepared on the,modified accrual basis of accounting. The budgets of the capital projects funds are primarily long-term budgets, which emphasize major programs and capital outlay plans extending over a number of years. However, the budget for the capital projects funds is approved by the Commissioners annually. Budget amounts are reported as originally adopted and as further amended by the Commissioners. 15 PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial Statements NOTE 1-SUMMARY OF'SIGNIFICANT-ACCOUNTING;POLICIES(Continued) F. Leave Benefits Commission employees may accumulate earned vacation time according to certain limits. Management employees are limited to the amount, which may be earned, in a three year period. All other employees are limited to the amount,which may be earned, in a two year period. A liability is calculated for all of the cost of compensated absences based on benefits earned by employees in the currentrperiod, for which there is a probability of payment at termination. The salary and related payroll costs are those in-effect.as of June 30, 2011. Compensated absences are recorded as current and non-current liabilities only on the government-wide financial statements. Changes in compensated absences for the year ended June 30 2011,were as follows: Beginning Balance $132,476 Add itions 260,918 Payments (245,584) Ending Balance $147,810 Current Portion $29,191 G. Use of Estimates The preparation of the basic financial statements in conformity with generally accepted accounting principals, requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. In addition, estimates affect the reported amount of expenses. Actual results could differ from estimates and assumptions. H. Property Tax Under California law, property taxes are assessed and collected by Sonoma County (County) up to 1°%o of assessed value, plus other increases approved by the voters. Theproperty taxes go into a pool, and are then allocated to cities and agencies based on complex formulas. The County assesses,bills, and collects property taxes as follows: Lien Date January 1 Levy Date July 1 Due Date Secured: November 1 and February 1 Unsecured: July 1 Collection Date Secured: December 10 and April 10 Unsecured: August 31 16 3 9 PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unif Financial Statements NOTE 2-CASH AND INVESTMENTS A. Classification Cash and investments are classified in the financial statements as shown below, based on whether or not their use is restricted under the terms of the debt instruments or Commission agreements. Cash and investments as of June 30,2011,are as follows: Cash and investments: Cash and investments $11,742,783 Restricted cash and investments 28,329,760 Total cash and investments $40,072,543 Cash and investments as of June 30,2011,consist of the following: City of Petaluma pooled.investments $11,742,783 Cash and investments with fiscal agents 28,329,760 Total Cash and Investments $40,072,543 8. Investments Authorized by the California Government Code and the City's Investment Policy The Commission's dependence on property tax receipts, which are received semi-annually, requires it to maintain significant cash reserves to finance operations during the remainder of the year The Commission pools cash from all sources and alf£unds, except Cash and Investments with Fiscal Agents,with the City of Petaluma so that it can be invested at the maximum yield, consistent with safety and liquidity, while individual funds can make expenditures'at any time. The City's Investment Policy and the California Government Code allow the City to invest in the following, provided the credit ratings of the issuers are acceptable to the City and approved percentages and maturities are not exceeded. The table'below also identifies certain provisions of the California Government Code or the City's.Investment.Policy where it is more restrictive'that addresses interest rate risk, credit risk and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of debt.agreements of the City,rather than the general provisions of the California Government Code or the City's'investment policy. 17 311 • PETALUMA COMMUNITY DEVELOPMENT'COMMISSION Notes to Component Unit Financial Statements NOTE 2-CASH AND INVESTMENTS(Continued) The City's investment policy and the California.Govermnent Code allow the Commission to invest in the following: Minimum Maximum Maximum Maximum Credit Percentage Investment Authorized Investment Type Maturity. Quality of Portfolio In One Issuer State of California Local Agency Investment Fund(LAIF) No Limit N/A N/A N/A Securities of the State or Local Agencies of the State No Limit * N/A N/A N/A California Asset Management Program No Limit N/A N/A N/A Certificates of Deposit 2 years N/A 30% N/A Banker's Acceptances 180 days N/A 40% 30% Securities of the U.S.Treasury or Other Federal Agencies 5 years * N/A N/A N/A Repurchase Agreements 30.days A-1/P-1 N/A N/A Money Market Funds No Limit Two highest ratings 20% N/A Medium-Term Notes(as currently owned) 397 days N/A N/A N/A May be changed if approved by Council C. Investments Authorized by Debt Agreements The Cash and Investments with Fiscal Agents in the amount of$28,329,760 include certain amounts which are held by fiscal agents to be used only for specific capital outlay, payments of certain long-term debt and maintaining required reserves. The City invests funds only as permitted by specific State statutes governing their investment or applicable City ordinance,resolution, or bond indenture. D. Interest Rate Risk Interest rate risk is the risk that changes in market interest rates'will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in marketinterest rates. One of the ways that the.Comrnission manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or corning close to maturity evenly over time as necessary to provide the cash'flow and liquidity needed for operations. Information about the sensitivity of the fair values of the Commission's investments (including investments held by bond trustees)to market interest rate.fluctuations is provided by the following table that shows the distribution of the Conunission's investments by maturity or earliest call date: • 12 Months Investment Type or less Total Held by Trustees: California Asset Management Program $17,165,537 $17,165,537 Money market 11,164,223 11,164,223 Total Investments 28,329,760 28,329,760 City of Petaluma pooled investments • 11,742,783 Total Cash and Investments $40,072,543 18 3C PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit FinancinlStatements NOTE 2-CASH AND INVESTMENTS(Continued) The Commission is a participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The Commission reports.its investment in..LAIF at the fair value amount provided by LAIF, which is the same as the value of the pool share. The balance is available for withdrawal on demand, and is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. Included in LAIF's investment portfolio are collateralized mortgage obligations, mortgage-backed securities, other asset-backed securities, loans to certain;state funds, United States Treasury Notes and Bills and floating rate securities issued by federal agencies, government-sponsored enterprises, and corporations. At June 30,2011,these investments have an average maturity of 237 days. The Commission is a voluntary participant in the California Asset Management Program (CAMP). CAMP is an investment pool offered by the California Asset Management Trust(the Trust). The Trust is a joint powers authority and public agency created by the Declaration of Trust and established under the provisions of the CaliforniaJoint•Exercise of Powers Act(California Government Code Sections 6500 et seq., or the "Act") for the purpose of exercising the common power of its Participants to invest certain proceeds of debt issues and surplus funds. The Pool's investments are limited to investments permitted by subdivisions (a) to. (n), inclusive, of Section 53601 of the California Government Code. The Commission reports its investments in CAMP at the fair market value:amounts provided by CAMP, which is the same as the value of:the pool share. At June 30,-2011, the fair market value approximated is the Commission's cost.At June 30,2011,these investments have an average maturity of 52 days. Money market mutual funds are available for withdrawal on demand and at June 30, 2011, have an average maturity ranging from 35 -44 days. • E. Credit Risk Generally, credit risk is the risk that an issuer of an inVestritent will not fulfill its obligation to the holder of the investment. This is,measured by the assignment of a rating by a nationally recognized statistical rating organization. The actual ratings as of June 30,2011,are as follows: Investment Type AAA AA+ AAAm Total FHLB $1,013,159 $0 $1,013,159 FHLMC 4,236,153 0 4,236,153 FNMA 4,371,072 0 4,371,072 U.S.Government Supported Corporate Debt 1,440,987 0 1,440,987 Corporate Notes $1,287,745 1,287,745 Local Agency Investment Fund $39,339,944 39,339,944 California-Asset Management Program 1,127,994 1,127,994 Held by Trustees:. California Asset Program 18,285,365 18,285,365 Totals $11,061,371 $1,287,745 $58,753,303 71,102,419 Not rated: Certificate of Deposit 249,714 Investment in Assessment District Bonds 697,873 Certificate of Deposit Account Registry Service 2,000,000 Cash on hand and in banks 4,427,904 Money market 11,165,638 Cash with fiscal agents 2,262,093 Exempt from credit rate disclosure: U.S.Treasury's 11,859,419 Total Investments $103,765,060 19 3b PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial Statements NOTE 2-CASH AND INVESTMENTS(Continued) I On August 8, 2011, S&P lowered its issuer credit ratings and related issue ratings on ten of twelve Federal Home Loan Banks (FHLBs),and the senior debt issued by the FHLB System from AAA to AA+. S&P also lowered the ratings on the senior debt issued by the,Federal Farm Credit Banks (FFCB) from AAA to AM-, and lowered the senior issue ratings on-Tani-de Mae (FNMA)and Freddie Mac (Fl-ILMC) from AAA to AA+. The A subordinated debt rating and the C rating on the preferred stock of these entities remained unchanged. Finally, S&P affirmed the short-term issue ratings for these entities at A- 1+. It should be noted that Standard and Poor's is one of the three main credit rating agencies. The rating agencies of Fitch and Moody's re-affirmed their respective AAA ratings for the United States of America. NOTE 3—INTERFUND TRANSACTIONS I A. Long-Term Advances During fiscal 2009, the City's Housing In-Lieu Impact Fee;Fund advanced $2.5 million to the Low and Moderate Housing Fund to finance sthe site acquisition of the Vintage Chateau property for which it has secured a promissory note. The advance is non-interest bearing. As of June 30, 2011, the outstanding amount of the advance is$1,300,000. B. Transfers Between Commission Funds With Board approval, resources may be,transferred from one Commission fund to another. The purpose of the majority of these transfers was to provide funding for capital projects, debt service, and general and specific operational.expenditures. Less often,a transfer may be made to open or close a fund. Transfers between Commission-funds during the fiscal year ended June 30,2011,are as follows: Amount Fund Receiving Transfers Fund Making Transfers Transferred Redevelopment Capital Projects Fund Redevelopment Debt Service Fund $11,162,450 Redevelopment Special Revenue Fund 772,570 Redevelopment Debt Service Fund Redevelopment Capital Projects.Fund 4,733,000 $16,668,020 C. Transfers Between the City and the Commission Funds Transfers between the City and the Commission funds during the fiscal year ended June 30,2011,are as follows: Amount Fund.Receiving Transfers Fund Making Transfers Transferred Redevelopment Special Revenue Fund City CDI3GFund $20,000 Redevelopment Capital Projects Fund City Impact Fee Fund 30,000 City Capital Projects Fund 288,906 $338,906 20 37 PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial Statements NOTE 4-LOANS RECEIVABLE Loans receivable, including accrued interest and related deferred revenue, comprised balances from the following programs,all of which are discussed below: At June 30,2011,the Commission had the following notes receivable: Housing Loans to Not-For Profit Agencies Old Elm Partners $1,305,961 Roundwalk'Village Partners 933,400 Boulevard(Buckelew)Project 480,200 Downtown River Associate LP 3,662,836 Edith Street Apartments,Inc. 889,964 Lieb Senior Apartments,Inc. 810,241 Parklane Apartments Corp 164,486 575 Vallejo Street Association 851,184 579 Vallejo Street Association 990,000 Casa Grande 198,445 Wood Sorrel 1,347,513 Logan Place 2,943,219 Salishan Apartments Inc. 388,380 Vintage Chateau 4,499,825 Total Housing Loans to Not-For Profit Agencies 19,465,654 First-Time Home Buyers Loans 3,736,875 Storefront Loan Program 241,105 Total $23,443,634 The City and the Commission have loaned funds to not-for-profit agencies to finance construction of low and moderate income housing.'The terms range from 13 to 60 years, and the interest rates range from zero to 6.56%. Payment is deferred,until a variety of eVents occur, such as: sale or transfer of property, failure to adhere to low and moderate housing provisions of the promissory note, to the extent of residual receipts, or at the maturity date of the note. Management-evaluated these loans and they are expected to be collected, therefore,no allowance for doubtful accounts was set up. At June 30,2011, the Commission held outstanding balance of the Housing Loans of$19,465,654. A. First-Time Home Buyers Loans The Commission offers qualified low and moderate income first time home buyers silent second mortgages on home purchases. Accrued interest and principal are due when the primary loan is refinanced or on sale of the property.The interest rate is the lower of the principal amount plus interest at a rate of 10% per annum, or 28:6% to 33% net of sales price. At June 30,2011, the outstanding balance of the loans was$3,736,875. B. Storefront Loan Program The Commission offers low interest loans to property owners with buildings located in the Central Business District (Downtown) as an incentive to make improvements to the exterior storefronts. At June 30,2011,the outstanding balance of the loans was$241,105. 21 3(b PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial Statements NOTE 5-CAPITAL ASSETS l The Commission transfers its capital assets to the City as projectsare completed since the City is required to . maintain all assets. The Commission retains its construction'intprocess.until the projects are completed. At that time, the assets will be contributed to the City. The Commission cannot use tax increment for maintenance, thus, the City is-required to maintain all Commission assets. Consequently, all completed capital assets are transferred'and'recorded as City assets. The Commission generally 'incurs long-term debt to finance projects or purchase assets, which will have useful lives equal to or greater than.the related debt. NOTE 6-LONG TERM DEPT' A. The Commission's Long-Term Deb! The Conunision's long-term-debt activities for the year ended June 30,2011, is as follows: Original Amount Issue Balance Balance due within Governmental-Activity Debt: Amount June 30,2010 Additions Retirements June 30,2011 one year Tax Allocation Bonds: 2001 A Refunding Tax Allocation Bonds 3.50-4.50%,due 5/1/2014 $4,025,000 $1,460,000 $340,000 $1,120,000 $355,000 2003A Tax Allocation Bonds 2.25-5.00%,due 5/1/2033 23,630,000 21,865 000 475,000 21 390.000 495,000 Unamortized Discount (14,217) (10,899) (474) (10,425) 2005A Tax Allocation Bonds • 5.00-5.75%,due 5/1/2030 18,355,000 17,695,000 270,000 17,425,000 275,000 Deferred amount refunding 1,248,420 (998,735) (49,937) (948,798) Unamortized Premium 161,953 131,182 6,478 124,704 2007 Tax Allocation Bonds 4.00-4:50%,due 5/112039 31 825,000 31,300,000 220,000 31,080,000 230,000 Unamortized Discount (568,396) (510,669) (17,762) (492,907) 2011A Tax Allocations Bonds 4.79%,due 5/12024 11,369,000 $11,369,000 11,369,000 650,000 Cost of issuance 151;680 151;680 2,917 148,763 Total Tax Allocation Bonds 70,930,879 11,520,680 1,246,222 81,205,337 2,005,000 Assessment District Bond: Auto Piazza DDA-AD 19 5.65-7.75%,due 3/2/2012 1,080,000 214.000 214,000 Total Assessment District Bond 214,000 214,000 Total Govcrmnent Activity Debt $71,144,879 $11520,680 $1,460,222 $81,205,337 $2,005,000 22 37 PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial Statements NOTE 6-LONG TERM DEBT(Continued) B. Debt Service Requirements Future principal and interest payments on all Governmental and Business-type long-term debt were as follows at June 30,2011: For The Year Tax Allocation Bonds Ending June 30 Principal Interest - 2012 $2,005,000 $3,740,729 2013 2,087,000 3,658,726 2014 2,174,000 3,572,034 2015 2,269,000 3,479,634 2016 2,359,000 3,385,769 2017-2021 13,413,000 15,316,240 2022-2026 14,247,000 12,092,961 2027-2031 13,825;000 8,933,556 2032-2036 17,495,000 5,257,188 2037-2039 12,510,000 1,142,326 Total payments due $82,384,000 $60,579,163 Less:Original Issuance Premium(Discount) , (1,178,663) $81,205,337 C Description of the Long-Term Debt Issues 20014 Refunding Tax Allocation Bonds - On June 4, 2001, the Commission issued Refunding Tax Allocation Bonds, Series'2001A in the amount of$4,025,000: The proceeds of the bonds were used to refund the 1992 Tax Allocation Bonds and to fund the development of the auto plaza located in the Petaluma Community Development Project Area. The-Bonds mature annually each May 1 from 2002 to 2014, in amounts ranging from $250,000 to $390,000, and bear interest at rates ranging from 3.50% to 4.50%. Interest is payable semiannually on May 1 and November 1. The Bonds maturing on or after May 1, 2010, are subject to optional redemption prior to maturity, in whole or in part, either in inverse order of maturity or by lot within'any one maturity date,on any date on or.after May 1,2009,at a price equal to the principal.amount,,plus accrued interest on the redemption date. The outstanding balance of the bonds was$1,120,000 as of June 30,2011. 20034 Tax Allocation Bonds - On October 28, 2003, The Commission issued Tax Allocation Bonds, Series 2003A in the amount of $23,630,000. The proceeds of the bonds will be used to finance the Commission projects within the Petaluma Community Development Project area. The Bonds mature annually each May 1 from 2007 to 2033, in amounts ranging from $430,000 to $8,215,000 and bear interest at rates ranging from 2.25%to 5.00%. Interest.is payable semiannually on May 1 and November 1. The Bonds maturing on or after May 1, 2014, are subject to optional redemption prior to maturity, in whole or in part,either in inverse order of maturity or by lot within any one maturity date, on any date on or after May 1, 2013, at a price equal to the principal amount, plus accrued interest on the redemption date..The bonds are payable from and secured by tax revenues. The outstanding balance of the bonds was $21,390,000 as of June 30,2011. The bonds were issued at a discount of$14,217 which is being amortized over the 30 year life of the bonds resulting in an annual amortization of$474. 23 �D PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial:Statements NOTE 6-LONG TERM DEBT(Continued) I 2005A Tax Allocation Bonds — On September 21, 2005, the Commission issued Refunding Tax Allocation Bonds, Series 2005A Tax Allocation Bonds in the amount of$18,355,000.The proceeds of the bonds will be used to refund the 2000A Tax Allocation Bonds and finance the issuance costs of the 2005A Refunding Tax Allocation,Bonds. The Bonds mature annually each May I from 2006 to 2030, in amounts ranging from $90,000 to $1,420,000 and bear interest at rates ranging from 5.00% to 5.75%. Interest is payable semiannually on May 1 and November 1. The Bonds maturing on or before May 1, 2016, are subject to optional redemption prior to maturity, in whole or in part, either in inverse order of maturity or in inverse order of maturity and by lot within any one`maturity date, on any date on or after May I, 2015, at a price equal to the principal amount, plus accrued'interest on the redemption date. The bonds are payable solely from secured tax revenues. The outstanding balance of the bonds was $17,425,000 as of June 30,2011. The bonds were issued at a premium of$161,953 which is being amortized over the 25 year life of the bonds resulting in an annual amortization of$6,478. In connection with the issuance of the bonds, the City recorded a"deferral on refunding of debt which is reported as part of long-tern debt. This deferral was in connection with interest payments made to the escrow agent for future payments of interest. The total amount deferred was $1,248,420 which will be amortized over the 25 year life of the bonds resulting in an annual amortization of$49,937. 2007 Tax Allocation Bonds -.On April 10, 2007, the Commission issued Subordinate Tax Allocation Bonds, Series 2007 in the amount of$31,825,000. The proceeds of the bonds were used to refund the 2000B Tax Allocation Bonds and provide$30,000,000 in project funds.The Bonds mature annually each May 1 from 2008 to 2039, in amounts ranging from $115,000 to $4,355,000 and bear interest at rates ranging from 4.00% to 4.50%. Interest is payable semiannually on May 1 and November 1. The Bonds maturing on or before May 1, 2016, are subject to optional,redemption prior to maturity, in whole or in part, either in inverse order of maturity or in inverse order of,maturity and by lot within any one maturity date, on any date on or after May 1,2015, at a price equal to the principal amount, plus accrued interest on the redemption date. The bonds are payable solely from secured tax revenues. The outstanding balance of the bonds was$31,080,000 as of June 30,2011.. The bonds were issued at a discount of$568,396 which is being amortized over the 32-year life of the bonds resulting in an annual amortization of$17,762. 2011 Tax Allocation Bonds - On March 17, 2011, the Commission issued Subordinate Tax Allocation Bonds, Series 2011 in the amount of $11,369,000. The proceeds of the bonds will be used to fund Transportation improvement around the City of Petaluma. The Bonds mature annually each May 1 from 2012 to 2024, in amounts ranging from $650,000 to $1,140,000 and bear interest at rate of 4.79%. Interest is payable semiannually on May 1 and November. The bonds are payable solely from secured tax revenues.The outstanding balance of the bonds was$11,369,000 as of June 30,2011. Auto Plaza DDA - AD 19 - In 1992, the Commission has an obligation under the Auto Center Disposition and Development Agreement to refund 50% of assessments paid by property owners in relation to the Assessment District 19 Bonds. On February 3, 1992, the Assessment District 19 Bonds were issued in the amount of $1,080,000. The proceeds of the bonds were to finance public improvements at the Auto Plaza. The Bonds mature annually each September 2 from 1997 to 2010, in amounts ranging from.$45,000 to $111,000 and bear interest at rates ranging from 5.60% to 7.75%. Interest is payable semiannually on March 2 and September 2. The bonds are payable from and secured by assessments paid by the property owners.These bonds have been repaid as of June 30,2011. • 24 It I PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial.Statements NOTE 6-LONG TERM DEBT(Continued) Multi-Family Housing Revenue Bonds-The Redevelopment Agency issued $4,750,000 in Multifamily Housing Revenue Bonds, with a variable rate of interest, not to exceed 12%, with the variable rate to be determined by the marketing.agent. The proceeds from the bonds were used to make a loan to Oakmont Retirement Investors, LLC for the purpose of financing the acquisition and construction of a 76-unit assisted living care/multi-family rental facility known as Oakmont at Petaluma. The bonds are special obligation of THE COMMISSION,payable solely from the rental revenue and other assets pledged or assigned.to Payment of the bonds by Windchime of Walnut Creek, LP. These bonds are not recorded as liabilities on the City's financial statements. On September 15, 2003, the Commission issued Multi-Family Housing Revenue Bonds and Taxable Multi-Family Housing Revenue Bonds in the amount of$6,197,000. The proceeds of the bonds were used to finance the construction and equipping of an 81 unit, multi-family, rental housing development in the City of Petaluma, known as the "Downtown River.Apartments."The bonds are special obligation of the Commission payable solely from rental revenue and other assets pledged or assigned to payment of the bonds by the obligator. Pledged Revenues— The Commission has pledged tax revenues to the repayment of the Commission's debts through the final maturity of the Bonds, or early retirement of the Bonds,whichever comes first. Tax revenues consist of tax increment revenues allocated to.the Commission's project areas pursuant to Section 33670 of the Redevelopment Law excluding that portion of such tax increment revenues required to be paid under Tax-Sharing°Agreements unless the payment of such amounts has been subordinated to payment of debt services on the Bonds. Tax increment received''in 2010-2011 was$16,166,274 and total debt service of all Tax Allocation Bonds paid was$4,616,105.The Bonds required 29%of net revenues. In future years, annual principal and interest payments on the Tax Allocation Bonds are expected to require 29% of tax increment revenues. The total principal and interest remaining to be paid on the Bonds is $142,963,163 at June 30,2011. NOTE 7—NET ASSETS AND FUND BALANCE GASB Statement 34 adds the concept of Net Assets, which is measured on the full accrual basis, to the concept of Fund Balance,which is measured on the modified accrual basis. A. Net Assets Net Assets is the excess of all the Commission's assets over all its liabilities, regardless of fund. Net Assets are divided into three captions. These captions apply only to Net Assets, which is determined only at the Agency-wide level,and are described below: Invested in Capital Assets, describes the portion of Net Assets which is represented by the current net book value of the Commission's capital assets. Restricted describes the portion of Net Assets which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the Commission cannot unilaterally alter. These principally include developer fees received for use on capital projects, debt service requirements,and redevelopment funds restricted to low and moderate income purposes. Unrestricted describes the portion of Net Assets which is not restricted to use. 25 1/? PETALUMA COIVIMUNITYDEYELOPMENT COMMISSION Notes to Component Unit Financial'Statements NOTE 7—NET ASSETS AND FUND BALANCE(Continued) , B. Fund Balances Governmental fund balances represent the net current assets of each fund. Net current assets generally represent a fund's cash and receivables, less its liabilities. The Commission's fund balances are classified in accordance with Governmental Accounting Standards Board Statement Number 54 (GASB 54), Fund Balance Reporting and Governmental Fund Type Definitions, which requires the Agency to classify its fund balances based on spending constraints imposed on the use of resources. For programs with multiple funding sources, the Agency prioritizes and expends funds in the following order: Restricted, Committed, Assigned, and Unassigned. Each category in the following hierarchy is ranked according:to the degree of spending constraint: Nonspendable represents balances set aside to indicate items do not represent available, spendable resources even though they,are a component of assets. Fund balances required to be maintained intact, such as Permanent Funds, and assets not expected to be converted to cash, such as prepaids, notes receivable, and land held for redevelopment are included. However, if proceeds realized from the sale or collection of nonspendable.assets are restricted, committed or`assigned, then Nonspendable amounts are required to be presented as a component of the applicable category. Restricted fund balances have external restrictions imposed by creditors, grantors, contributors, laws, regulations, or enabling legislation which requires the resources:to be used only for a specific purpose. Encumbrances and nonspendable amounts subject to restrictions are included along with spendable resources. Committed fund balances have constraints imposed by formal action of the Commission Board which may be altered only by formal action of the Commission Board. Encumbrances and nonspendable amounts subject to council commitments are included along with spendable resources. Assigned fund balances are amounts constrained by the Commission's intent to be used for a specific purpose, but are neither restricted nor committed. Intent is expressed by the Commission Board or its designee and may be changed at the discretion of the Commission Board,.or its designee. This category includes encumbrances, Nonspendables, when it is the Commission's intent to use proceeds or collections for a specific purpose, and residual fund balances, if any, of.Special Revenue, Capital Projects and Debt Service Funds which have•not'been restricted or committed. Unassigned fund balance represents residual amounts that have not been restricted,committed, or assigned. This includes the residual general fund balance and residual fund deficits, if any, of other governmental funds. At June 30, 2011, the Commission had An unrestricted deficit of $77,147,615 as the Commission's investment in assets is primarily in City owned property. The Commission does not hold property in its own name. The Commission, under State Law, is required to show indebtedness in order to be eligible to receive tax increment. Future tax increment revenue will be used to pay the deficit. C. Encumbrances The Redevelopment Capital:Projects Fund had outstanding encumbrances of$275,372 as of June 30,2011. 26 113 PETALUMA.COMMUNITY,DEVELOPMENT COMMISSION Notes to.Component Unit Financial Statements NOTE 8-CONTINGENT LIABILITY The Commission participates in several federal and State grant programs. These programs have been audited by the Commission's independent accountants in accordance with the provisions of the federal Single Audit Act amendments of 1996 and applicable State requirements. No cost disallowances were proposed as a result of these.audits. I-Iowever, these programs are still subject to further examination by the grantors and the amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time. The Commission expects such amounts,if any,to be immaterial. The Commission is subject to litigation arising in the normal course of business. In the opinion of the Commission Attorney there is no other pending litigation, which is likely to have a material adverse effect on the financial position of the Commission. NOTE 9—TAX INCREMENT SHIFT TO SUPPLEMENTAL EDUCATIONAL REVENUE AUGMENTATION FUND (SERAF) The State of California adopted AB26 4X in July 2009 which directs that a portion of the incremental property taxes received by.redevelopment agencies be paid instead to the County supplemental educational revenue augmentation find (SERAF) in fiscal years 2009-10 and 2010-11. The State Department of Finance determines each agency's SERAF payment by November 15 of each year,and payments are due by May 10 of the applicable year. The Commission made its second SERAF payment in the amount of $1,044,706 in fiscal year 2010-11. NOTE 10—SUBSEQUENT EVENT In an effort to balance its budget,the State of California adopted ABx1 26 on June 28,2011,which suspends all new redevelopment activities except for limited specified activities as of that date and dissolves redevelopment agencies effective October I, 2011. The State simultaneously adopted ABx1 27 which allows redevelopment agencies to avoid dissolution by the City opting into an "alternative voluntary redevelopment program" requiring specified substantial annual contributions to local schools and special districts. Concurrently with these two measures, the State passed various budget and trailer bills that are related and collectively constitute the Redevelopment Restructuring,Acts. if all sponsoring communities were to opt-in to the voluntary program, these contributions amount to an estimated $1.7 billion for fiscal year 2012 and an estimated $400 million in each succeeding year. If the City fails to make the voluntary program payment,the Commission would become subject to the dissolution provisions of ABxI 26. On July 18, 2011, the California Redevelopment Association, the League of California Cities and others challenged the validity and constitutionality of ABx1 26 and 27 to the California Supreme Court on numerous grounds,including that the acts violate certain provisions of the California Constitution. On August 11,2011, as modified on August 17,2011,the California Supreme Court agreed to hear the case and issued a partial stay of ABx1 26 and,a full stay of ABxl 27, but the stay did not include the section of ABxI 26 that suspends all new redevelopment activities. It is anticipated that the Court will render its decision before January 15,2012, the date the first voluntary program payment is due. 27 kit( PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to.Coinponent Unit Financial Statements NOTE,10—SUBSEQUENT EVENT'(Continued) The suspension provisions of ABxI 26 prohibit all redevelopment agencies from a wide range of activities, including incurring new indebtedness or obligations, entering into or modifying agreements or contracts, acquiring or disposing of real property,taking actions to adopt or amend redevelopment plans and other similar actions, except actions required by law or to carry out existing'enforceable obligations,as defined in ABxI 26. During the suspension period, an agency is required to prepare an.Enforceable Obligation Payment Schedule no later than August 29, 2011,that allows it to continue to pay certain obligations. The Commission adopted its Enforceable Obligation Payment Schedule on August 24,2011. Included in the Schedule were obligations due to the City as follows: Project Name/Debt Obligation Statutory Payments $1,758,380 Brownsfield Program 400,000 Economic:Development/Site Development 6,000,000 $8,158,380 In addition,the suspension provisions require the State Controller to review the activities of all redevelopment agencies to determine whether an asset transfer between an agency and any public agency occurred on or after January 1, 2011. If an asset transfer did occur and the public agency that received the asset is not contractually committed to a third party for the expenditure or encumbrance,of the asset, the State Controller is required to order the asset returned to the redevelopment agency. The State Controller's Office has not yet provided any information about the timing or the process for this statewide asset transfer review. The Commission is currently subject to the suspension provisions as described above. These facts indicate that there is more than a remote possibility the Commission may not continue as a going concern beyond October 1, 2011. The continuation of the Commission beyond October 1, 2011 will initially depend upon whether the Supreme Court rules in favor of the,petitioners. There are three possible consequences to the Commission from a decision of the Supreme Court,when it is rendered: 1. If the Supreme Court determines that both ABxI. 26 and ABxI 27 are valid,then the City will consider whether it will enact an ordinance to opt-in to the alternative voluntary redevelopment program. If enacted, the City would be required to make annual payments to the County Auditor-Controller and the Commission would no longer be subject to the suspension provisions. The State Department of Finance calculated the City's Voluntary Program payment for fiscal year 2012 to be $5,150,819, which was adjusted to$4,908,155 after an appeal made by the City. 2. If the Supreme Court determines that both ABxI 26 and ABx1 27 are valid and the City decides not to participate in the alternative voluntary redevelopment program, or if the Supreme Court determines that ABxI 26 is valid,but ABx1 27 is not valid,the Commission will continue to be subject to the suspension provisions and would be dissolved in accordance with certain provisions of ABx1 26. Prior to dissolution, any transfers of Commission assets subsequent to January I,2011 to the City that were not obligated to third parties or encumbered may be subject to the State Controller's review discussed above and required to be returned to the Commission. Upon dissolution, all assets and obligations of the Commission would be transferred to;a successor agency. 28 �� PETALUMA COMMUNITY DEVELOPMENT COMMISSION Notes to Component Unit Financial.Statements NOTE 10—SUBSEQUENT EVENT(Continued) 3. If the Supreme Court determines that both ABx1 26 and ABxI 27 are invalid,the Commission would no longer be subject to the suspension provisions and would continue in existence under California Redevelopment Law as it existed prior to the enactment of ABx] 26 and ABxI 27. As of November 18, 2011, the Supreme Court has not ruled on the case and the Commission is subject to the suspension provisions as discussed above. • 29 `/ni v REQUIRED SUPPLEMENTAL INFORMATION Redevelopment Special Revenue Fund - used to account for the redevelopment agency's 20% set-aside, as required by law, of tax increment for Low and Moderate Income Housing. The activity of this fund consists of supporting development of affordable housing in the community. Also included in this fund are redevelopment agency donations and grant revenues. 31 ti/ PETALUMA COMMUNITY DEVELOPMENT COMMISSION REDEVELOPMENT SPECIAL REVENUE FUND SCHEDULE OF REVENUES;EXPENDITURES AND CHANGES INFUNDBALANCE BUDGET AND ACTUAL FOR THE'YEAR ENDED JUNE 30,2011 • Variance with Budgeted Amounts Final Budget Positive Original Final Actual Amounts (Negative) REVENUES: Taxes $3,260,000 $3,260,000 $3,074,827 ($185,173) Use of money and property 1,600 1,600 41,744 40,144 Charges for services 15,275 15,275 Other 1,525,000 475,000 673,895 198,895 Total Revenues 4,786,600 3,736,600 3,805,741 69,141 EXPENDITURES: Community Development 5,163,050 6,648,800 4,802,387 1,846,413 Total Expenditures 5,163,050 6,648,800 4,802,387 1,846,413 EXCESS(DEFICIENCY)OF REVENUES OVER EXPENDITURES (376,450) (2,912,200) (996,646) 1,915,554 OTHER FINANCING SOURCES(USES) Contributions from the City 11,700 11,700 Transfers(out) (925,000) (45,000) (772,570) (727,570) Transfers in from the City 20,000 20,000 20,000 Total other financing sources(uses) (905,000) (13,300) (740,870) (727,570) EXCESS(DEFICIENCY)OF REVENUES AND OTHER SOURCES OVER EXPENDITURES AND O'ITLER USES ($1,281,450) ($2,925,500) (1,737,516) $1,187,984 BEGINNING FUND BALANCE 24,563,889 ENDING FUND BALANCE $22,826,373 See accompanying notes to financial statements • • 32 ,16{ SUPPLEMENTAL INFORMATION 59 SUPPLEMENTAL INFORMATION The Redevelopment DebtService Fund is used to account;for the accumulation of resources, and the payment of principal and interest of the Commission's;long-term-debt. The Redevelopment Capital Projects Fund is used to account for the administration of programs and the capital projects undertaken in the Redevelopment Agency. 35 5�- PETALUMA COMMUNITY DEVELOPMENT COMMISSION REDEVELOPMENT DEBT SERVICE FUND SCHEDULE OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE30,2011 Variance Positive Budget Actual (Negative) REVENUES Use of money and property $500 ($500) Total Revenues 500 (500) EXPENDITURES Community development 25,950 $21,900 4,050 Debt.service: Principal 1,408,000 1,519,000 . (111,000) Interest and fiscal charges 3,474,450 3,305,360 169,090 Total Expenditures .4,908,400 4,846,260 62,140 EXCESS(DEFICIENCY)OF REVENUES OVER EXPENDITURES, (4,907,900). (4,846,260) 61,640 OTHER FINANCING SOURCES(USES) Proceeds from debt 11,369,000 11,369,000 Transfers in 4,733,000 4,733,000 Transfers(out) (11,162,450) (11,162,450) Total Other Financing Sources(Uses) 4,939,550 4,939,550 EXCESS(DEFICIENCY)OF REVENUES AND OTHER SOURCES OVER EXPENDITURES AND OTHER USES $31,650 93,290 $61,640 BEGINNING FUND BALANCE 322,279 ENDING FUND BALANCE $415,569 36 53 PETALUMA,COMMUNITY DEVELOPMENT:COMMISSION REDEVELOPMENT CAPITAL PROJECTS FUND SCHEDULE OF..,REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL FOR THE YEAR ENDED JUNE 30,2011 Variance with Budgeted Amounts Final Budget Positive Original Final Actual Amounts (Negative) REVENUES: Taxes $13,000,000 $13;000,000 $13,091,447 $91,447 Licenses,permits and fees 91 $91 Use of money and property 10,000 10,000 143,773 133,773 Intergovernmental 126,000 143,500 38,709. (104,791) Total Revenues 13,136,000. 13,153,500 13,274,020 120,520 EXPENDITURES: Community development 6,877,150 6,835,150 3,991,214 (2,843,936) Tax increment pass through agreement 5,140,000 5,140,000 4,796,826 (343,174) Capital outlay 415,913 415,913 Total Expenditures 12,017,150 .11,975,150_ 9,203,953 (2,771,197) EXCESS(DEFICIENCY)OF REVENUES OVER EXPENDITURES 1,118,850. 1,178,350 4,070,067 2,891,717 OTHER FINANCING SOURCES(USES) Contributions from the City 139,000 163,400 24,397 (139,003) Transfers in 4,329,000 31,349,200 11,935,020 (19,414,180) Transfers(out) (4,733,000) (24,911,250) (4,733,000) 20,178,250 Transfers in from the City 318,906 318,906 Total other financing sources(uses) (265,000) 6,601;350 7,545,323 943,973 EXCESS(DEFICIENCY)OF REVENUES AND OTHER SOURCES OVER EXPENDITURES AND OTHER USES 853;850 7,779,700 11,615,390 $3,835,690 BEGINNING FUND BALANCE 27,402,603 ENDING FUND BALANCE $39,017,993 See accompanying notes to financial statements 37 61 Pe taluma.Community Development Commission EXCESS SURPLUS CALCULATION Excess surplus is defined in Health and Safety Code Section 33334.12(b) as any unexpended:and unencumbered amount in an Agency's Low and Moderate Income Housing Fund that exceeds the greater of$1,000,000 or the aggregate amount deposited into,the Low and Moderate Income Housing Fund during the preceding four fiscal years,as of the beginning of the'fiscal year. If excess surplus exists,the Agency must lawfully spend the excess or transfer it to a housing authority or other public agency in the following fiscal year,expend.orencumber in the nexttwo fiscal years or face sanctions. Essentially, agencies have a three=year window to expend,encumber,or transfer the excess surplus. Low and Moderate Income Housing Funds--All Project Areas July 1,2010 Opening Fund Balance--July 1,2010 $24,563,889 Less Unavailable Amounts: Deposits and prepaid items ($548) Notes receivable (22,494,553) (22,495,101) Available Low and Moderate Income Housing Funds 2,068,788 Limitation (greater of$1,000,000 or four years set-aside) Set-Aside for last four years-fiscal years ended: June 30, 2010 3,797,596 June 30, 2009 3,297,916 June 30, 2008 3,277,878 June 30, 2007 3,035,021 Total $13,408,411 Base limitation $1,000,000 Greater amount 13,408,411 Computed Excess Surplus-July 1,2010 None 38 1 DAZE ASSOCIATES ACCOUNTANCY CORPORATION 3478 Buskirk Ave. - Suite 215 Pleasant Hill, California 94523 INDEPENDENT AUDITOR'S REPORT (925)930-0902 FAX(925)930-0135 maze@mazeassociates.com ON INTERNAL CONTROL OVER www.mazeassociates.com FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Members of the Petaluma Community Development Commission Petaluma, California We have audited the financial statements of the Petaluma Community Redevelopment Commission as of and for the year ended June 30,2011, and have issued our report thereon dated November 18,2011. The report included a special emphasis paragraph concerning proposed redevelopment dissolution and the implementation of Governmental Accounting Standards Board Statement Number 54 (GASB 54), Fund Balance Reporting and Governmental Fund Type Definitions. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards,issued by the Comptroller General of the United States. Internal Control over Financial Reporting Management of the Commission is responsible for establishing and maintaining effective internal control over financial reporting. In planning and'performing our audit, we considered the Commission's internal control over financial reporting as a basis;for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Commission's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Commission's internal•control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis: A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the Commission's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies; in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. A Professopal Corporation Y 6(0 • Compliance and Other Matters As part of obtaining reasonable assurance about whether the. Commission's financial.statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective ofour-audit, and accordingly, we do'not express such an opinion. The results of our tests disclosed no instances' of noncompliance or other matters, that are required to be reported under Government Auditing Standards. As part of our audit, we prepared.and iissued our separate Memorandum on Internal Control dated November 18, 2011,which is an integral part of our audit and should be read in conjunction with this report. This report is intended solely for the information and use of management, Commission Board, others within the Commission the State Controller's Office, federal awarding agencies and pass-through entities and is not intended to be and should not be-used by anyone other than these specified parties. f4 4 A4oU November 18,2011 40 57 IVIima AZE ASSOCIATES ACCOUNTANCY CORPORATION 3478 Buskirk Ave. - Suite 215 Pleasant Hill, California 94523 (925)930-0902 •FAX(925)930-0135 maze@mazeassociates.com w ww.mazeassocia tes.com INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH THE CALIFORNIA HEALTH AND SAFETY CODE AS REQUIRED BY SECTION 33080.1 Members of the of the Petaluma Community Development Commission Petaluma, California Compliance We have audited the Petaluma Community Development Commission's compliance with the California Health and Safety Code as required by Section 33080.1 for the year ended,June 30, 2011. Compliance with the requirements referred to above is the responsibility of the Commission's management. Our responsibility is to express an opinion on the Commission's compliance based on our audit: We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained.in Government Auditing Standards, issued by the Comptroller General of the United States; and Guidelines for Compliance Audits of California Redevelopment Agencies, June 2011,issued by the State Controller. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the compliance requirements referred to above that could have a material effect on the Commission has occurred. An audit includes examining, on a test basis, evidence about the Commission's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination of the Commission's compliance with those requirements. In our opinion, the Commission complied, in all material respects, with the compliance requirements referred to above that are applicable for the year ended June, 30, 2011. However, the results of our audit procedures disclosed instances of noncompliance that are required to be reported under the Guidelines for Compliance Audits.of California Redevelopment Agencies, June 2011, which are described in the accompanying Schedule of Current Year Findings. Internal.Control Over Compliance Management of the Commission is responsible for establishing and maintaining effective internal control over compliance with the compliance requirements referred to above. In planning and performing our audit, we considered the Commission's internal control over compliance to determine the auditing procedures for the purpose of expressing our opinion on compliance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the Commission's internal control over compliance. A Prolessjj fat Corporation 1 Sq A deficiency in internal control over'compliance;exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of'deficienoies in internal control:over compliance, such that there is a reasonable possibility that material noncompliance with a compliance requirement will not be prevented, or detected and corrected, on a timely basis. A,significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control,over compliance that is less severe than a material weakness in internal control over compliance,yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies,or material weaknesses in internal control over compliance. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. This report is intended solely for the,information and use of management, Commission Boards, others within the Commission, the State Controller's .Office, federal awarding agencies and pass-through entities and is not intended to be and should not be'used by anyone other than these specified parties. U t fraa November 18,2011 42 J' • SCHEDULE OF CURRENT YEAR FINDINGS Major Compliance Violations,as defined in Health and Safety Code Section 33080.8(j): None Other Compliance Violations: Criteria: California Health.and Safety Code Section 33606(d) requires redevelopment agencies to adopt an annual budget containing a work program for the coming year, including goals. Condition: The.Commission's adopted budget for fiscal 2010-11 does not appear to contain a work program or goals for the coming year. Effect: This causes the Commission to be out of compliance with the requirements above. Cause: Because this specific information has been included in the Implementation Plan and Redevelopment Plan, management and City Commission Board did not see the necessity to include duplicate information in the annual budget. The narrative in the Commission budget references the Implementation Plan and mid-term review which states the goals and plan for the Commission. The working plan and goals are also included in the section of the budget for Capital Improvement Projects, which is part of the annual budget. Recommendation: We recommend the Commission include the above required information in their future adopted budgets. Management response: The Commission will include the recommended information in their narrative of the Petaluma Community'Development Commission in future budgets to ensure that the Commission's goals and working plan are articulated in that document. 43 r0 CO \ / \ % & P- C 000 2- 0 } ] / ) . ? \ \ D) _ C ) `Jr 73 CO \b . AD § { y j - ®sA - - ® 3 ; « � . § iii ! § « ! , � / 2a } ) } e , � & ® 7 - To/ ® - _ • - { 7 / { ) j ! . 0 � / � \ \ j § \ \ ) \ / ot w 0 . - , - . � ��= -- --- ------.. � � _ \ L , _. . tom a° to— ® E ° . a . - ƒ \ « 1--0 0 -- ( 7 0 co ) r N \ k ) 0 C .2 2 1 ! CO o c 43 )\ \} ) ) _f fff /E $ f ff f $ /! ) { /! ! G ) « ! ) ] ! ! & 2 a m a. f (f a w to c 0 0 Yi amp o C" Co y m « d d o t i.. O• EE v C U N O C G C O U O C 1 Iii -6.O a) U O y m d a=m U m N ' x ¢.o�.0 t. Q ,itty y O ` ,JN t 4.-= y 0 CO 9)';;;;,?.:N ' 1. C , 1+ p !0 • 2 U N , C o C a `N F-. ; 'ia... N O .c — O C o a y rn as N C, ', o m. iii y 0 Q.. _ a O U ,c t m N ..� m o 3:`�o 2 — 5 y D y N y V N C _ V -- L n d C N k P. C 3 c c o o m .o.� 3 c c o Q y m a m c E ¢t a Y 0 co E o.o E v c 0 N 2O, .2 0C. $ o 0Q 0 Ta. 0 00 0 v-« 0 d N`0 01 a o m:se 20 « >'Q 0 a) o a)' -.- 7 C0 y 10 'O O C al >_ Co' W 10 < y C 0` = NO CUI QJ= T N .� O AE c ag a U a .'n m =- o o ciao Nc < m 5 0 y m..- 70 C c �.= m Q o O CD m H co U' b E 0 o g a. 5 . $Y « m m Q m � j y El °W N� U u m G y$- t O O O C y U U IL JO- « y O O U U se D IL S N 2 .W =(0 3 S 0>- c «. Q . d vo m t N v>c • } ' Y p o N OI'01 N N al 01 rn a - • Q m 4 t -° a o 'o o m a` v v c 7 T « u'. 0 w O W, p u a) > N O a) t co N co a U Q a C N N C N :.- Cl: d E o p w a °d d Q G N O Q d .) u a Q Q uN! N C Q. Q 2 n m2 d c N O m .a d 3 m O) lunD ' m w #U ai rn o o _a z ci 0 ° O c a m v C N U N O O' U a m F- t m r °• `° o_ E Z. a a O d M ci d v m E N.. cc a z w Q ° 2 ° M v n , h d O. a. a v v °c m w .a w o m N c c f> a a E a a t a E. c c ° C i Q co 8 d w c F .° cc = t ( n u m `. cl co N a S. m 6 a a a, a L. C a a s co a "° C v C. d Q v 0 S m ,Q a) Q m w m m a (a o &) a Dp c 'o a Z w ` m c a v Q U a .ii.t. " a1 v d a a) b .w N 1.3 N N « v- a Q '� 9 ,) U m •c y m .1)f" `a a 3 .v m o Q 'o c Ea) c 5 > V cc o 2 m . T a t u b - c d d J v d w m _°. c w d a Z v v Q a w a 6.' a s t ¢ v E . d N E F- v m v c a mom t = `° c Q -1 J 6 a� E Q d ° `o m ; $ a < O m. CI o v `° m. y m '.`o a o U o ' Q a &5 J d a a c ca n o m a w O a+ a+ a a a H u a) .o w m ,E. `w v a «° 5 > w U d o an d n m .� ° aai d W • E E a m o v o = '� a v 3 ! x T B �. :3:. a`'-' a ii W o° 0 2 o 2 3 w K w z N a a 0 v > a ,� o d c H a H. w a w a T 0 O a 0 o md> v° e N mt m d n a o, �. K v w a N o:« Q w 8 m ,. . v mQ5 .B y a a ; a. IL d«a) G3 0 N in Cl 1 r• m O N 0.,..)4,r;fO {�y d Imo, o ^ 1 I.- in .,yl 7C m a m I co, 0 to n o 0 . E. m ry N E v E m E rn 0 iN M LO al U 0 2 C U C b'.., f. .0. a F m O p_ ,. o N _..� •{ate : a al C 0 i . > iC p d E a1 E C) 4 i0.1<,- . U E E !0 O O ❑ i+ N o C 0 10 N y o co al co N N p ry N N C E (4 1 > m ro z d d ca N m 0 c w o >- E!..) m m m E N > N dN O m u N y .o o c m LL a , °LL N m 1/51 II- N' p •d N N 3 N a co' E_ n >, N 0. N o � da O o co O (n O M OE a' 7 n c 'RI O'. W 'C N 0 N IN i t.. n Nr C) `ti°. Mt SOs o a) a>. v' in :n r? io E U'. G 3 U .N C �y• N _ N C) to a Nr U a) d b N co N .- N ::E —,: ❑ 'O co N N N N (C C.' N O N C ca a F. a) N o LL ! t _ _ N m y 0. tO co ry '" N C M G O' t ' - d N. vi N E r. 0 m CD OtN') N v N m O It ) O C N. ++ u (/) O c3)O�.Q , Fr y 06 E ',E. a co i N N O N ta co IS 1. U M O O 0 O M N m E O C M m O n U d od o CD ' 0 = d A U N N 0. `. m N Q YJ C U N U) m N p) C O, E x o o a d (C m F- ° o F rn 0 m o Z o m d r- 0 E o to f 7 9 N r v (n N d o w U O v N Q a,0.. a - '? (CO 0 v m } u ,� o ,E o a c ¢ m o. :N N c,5 .2` o E m 3.d w `o N O EOE N a .� t E m FO- Q 2 o al LL. 0. .. Q a U co U (q L7 C7 m a C5 A d\ j } U \ . C. ) or , . m , 0 / to co 77 \ so ® _ : . _ , O ) ± , - 1k } ) , \/ ! Z q' , ! ! ::.?.1::::0/7",», ' N § ( ; I ( \ § ` . { ; $Ci # - $ ! x \ 7 § \ o } \ < ] ) ) ; 7 # \ & ! ! ) ! \ ( \ o ® < . \ ((I() r. T- O W N N N 0 N D a) a) 0 r c 0 -- 4 0 N c C rO m m° C 4N, O ': • • o CO) ~ 0 $ : - ] $ P. u 45 - — _a§ ® - - _ RI 0 2 ' - ) ; / a / , moo ,Lt. 0 § \ j e — )) � 0 )\ C --CO: | \. - 0 iii co 9.0 . § ` _ u $ § ! %/ / ƒ [ ; j ].0. - - ! !;m ) )}� a / \ \ . ! ) . ; 00 . ) # / 5 )) - a) B $ ) § _ \ / ) } \ / k \ _ � k #\ ) ` ® G ° ak / ll .0,== = 2 : a: e . } / � � ! \ \ \ ) \ / f \ } § \ \ / } _{ ) k \7 IT a . 05 a cow a'a \ ƒ \ )} ! j ( } § C,C,00 7 £ ƒ � - ! ƒ f = >- aZ = a ! Z £ a@! { (% al N 3 0 C / t ] $ ) ..re E ° a0N — En u • ] � - „ } - 3 . 5 - E ! ` a . - , & \ xe . . 0 \ m co § ; A $ i ( C E $_ : 0 G 7 -6 -cs/ \p 0 ] ) , \§ / / \\ )£ !# z !m - % ; f f - \ CO ; - k _co § _ ) } ] { \ ) \ \ _ � 3c- 0 ] § ) 2 , \ \ < j000 « / } a = j \ \ m ) j { f ( / ) { / t { ' ) ) iiii \ - - j •, > » & ! ! s CO a ; - - \ CI } / ) \ > •a0-2 2 < < \ } / \ � \ \ co )\ \ } ) Ell C o — \ \ { m ; 2 cc 7 ® - - - .a o 0 o o § \ - ® ) ] ( ° 0 a a o _ N- CO a E ` \ co, + { - ® — — — \\o . _ E ; - If ` \ / \ k \ 4 o § 7 - :CD TI \ ) - ` } \ % . 0 w ) \ !iS » ff - jt ] \ \ \ \ _ _ ) \\ * � § k ) { \ § / } { \ \ 2 „ / jg a { ! ! / / ® : 2t2f7 / \ { ± / ® k ® § � o - { - 46 a 4aa .-' c 0 44 . ca { = - 0j (D,t—D i } } ) f ! ! ! : } § U. It CO � = CLa _ : ! : / f m { \0 } \ o a) = o ) j C 42 m\ \L. \ 0,1 . , .- C // to E ! ' ` . • o ) } ) « ._ \ ) CI c i [ o ƒ § fli | / - #3 o E ` _ C3 ° . }\ | } - 2 , ] g _ cn § \ k\ 7 N / I ifi - ) _ ! ca ui • w a) 0) • a) C ) = _ _ § _ c 0- 0 5 _ „ ) }\ ] ; s : , ) ; / ) : E } ) \ 0 <coo !.. a � . 0a) ) r ® ® ® « ft # 7 { ® # ate } § 4 ;T co } / \ } ) aa.a.2 < < SQOO � ! / \ j\ \ \ 1 D 0 \ \ ] Lt CL .2 2 $ C , § I ,. . . , o cn — { � I \» ' { v . - - — — fr; in 0 j}to c 01 2 § 2 .ca 0 - :TO'12 E , e of ° k § � { E E . \ )% ] � 0 _ ; ! ! - � \ § 2 CI c— \ - ) - ! 0 ill ) -o mC0 - nc )} E co . < 2 § _ _ . ) 7 § . , t . } § ) \ \ § § % \ § ] ifJ k / ) \ k / \ { a 00a2Ea <°-< 2 ƒ ]\ IT cn 9 � .- ~ ® ! f # ! { § a ® ! e , / ; ; . } / { \ > aoa � ¥ y ) / \ � ) f j \ . . . /ƒ 0 U, N N 4-• 0 L (00 m 10 Q c O . c.:. N: 0 m 0 c Y. 0 co'' O; O N (O (O. .a O o 0 :. v h' N W N • O e- y"- N. N > a '.1 W m ca ..p m U m o E' c`' o N:. r v ° 0'v 2 0i x. E F ., E v a . e — • r c,: rn 0 d o m b c d 7 N >L. Ul Y C. Q O To m v v i E a Z N o m o '(0 d„ d E w T LL c :IE _ c m Y o v '!7 . Q..: 'o .0 T m v n r ❑ m U ° N ' y LL 0 O Y N ` m Li_ W m ,.d ... N 0: m it 0, c v O a, 0) v ps ° 7 d-. °m d m O � m .. `� E Y .0 Y `m c n o v E = Yn °v N o _� rn v '. m c a) m j v v 0 E v _c 0 c >- rc o 0 ..v. 'O c b T c me m c 0 ', m m 'v c O v o Q g c c = O c 2 O o . o m v Z o m c c v m a °E m e c c ° c ~ E :c 0 0 7 m W -. m a 0 0 0 E 0 m <= > c N E 0 ° 0 of 0 v u') 0 0 o Q 0 EE v N v o } Q ° a o Q Q o p p a c c Q Q Q a Q ' c a y >. u P Y ,_ m i0 v a, T c E E m m m 'u m >` 0( ° — N m F o a a o .. ti a a a c a m v cr v N '0 C v to c 8 a 0 0 d o 0 c c c a c W c o Q LL- a. LL°. 0 >' a a a 2 2 < < a a a a _ a°0 2 C c o Z 13 0 • N H a J y J O C d CO. 0 m a+,• O O __ C O O O a O M O O O f�N . 0 O O O'0 ry . � N N O O a C£ O: O O > N O O O U ) N Ol N C Ct E. O', co co c UI co a 3 N o 'c d N N, Z 'c m It' ll V co m i� u d a) K ".7.... ...(73,:, co N Y c,; ¢ o o il � ., 6- rn o ¢ LL p 23 >- E a) 15 U. G I: 67 al m 0 U F-.) N ' d W C `m m > 'u. c U .a n I m N m' LL c_w LL W v a 'rn v L. 3 4. c d a. a0 J U a m a) 0 1 c U N N EE C w N❑E m ' } C _ > > v ❑ d g c 03 r c VI C CO .0 W (9 N Z O ° w a Q c c ❑ c .❑ s S 'w d N O o c N E ° O a. o J J m m o J m a m o N t o `oo o 2 m . 0 0 o o m c • Q m m E E E E ❑ ro J m a c c o. o 0 I C Q Q Q a Q c a d T a >, o N F p a ¢ y n n ¢ c' ¢ O ` c c E « a N c .0 c .a v v m m o)• O 0 m J J c C ° > ` a ' ` Q a a a a a a 5 CO 2 c o Z 1 at 00 00 Q3 9 0000 OINK O :N CO O N N- I9 f9 l9 19 V 0 4n.1(a W m. <a co to N Ip N CO 10 .O h h 3 (0 n lin 0) In ECI F r �: I� w ca I dl N. N O• re m N Ns; N It N L, .. v ..i4 — E O C Y °l N Cl N O1 O S co N O t'J 0 CO N ,... m J n N 0 0 M n O S 1N C , E a w E Y (: a `0 v —0 0 C a m n w N tV x 03 ° a 4. .C UJ ` Z. C Q 4. 9 la y c ' ...N. ' aroi U a LL C. u O ..`, I E 'O o • C a C N n of co E _• : .,- u N 0 co n Q o a/ m n r v m co co v ?. w V. C� C N O. m is -a- ro N m ° ,y a s O c- C G W ~ IL M 0 cr 0?.N III: 0 0 m N" d w 4 . 0 C c Ni a ai e c o �` m m m 0 'u5 m 6 n 2 x a v a ° m "' K ° w 0 N f m r N '" o b ° Q ut m Z o °a al E '- m °2 v_ L ag o U, ? y I- a m m 2 c v 'c 3 N .. E' Q °. `A w g E m m W .a 2 51,-, m } a m m a < o O S 0 E p ° E E 'O d' w ° U w a y c c c u -, 0 2 t w K m 0 Td a7 = s '1 VI N ` a m O O C O m ci.UI O` x �.. a ° m � « m v m O °m La o O F m LL Q. F- to a In F- C. CC -1 N U' LL O CO O m /5 O IN O A O :O O O O W O lO 3 I aI O,. Vi" u) N w Ut to r9 N GO 1 6, N d. t) O O to b n o.. o ea o y m- `a it , 1 N. a m r N- TO 0 t U la as 0' N 0 -p., > c 0 K p Q"C a 0�! C ` a) CI N N u°)) •E p V W O u) O y al J ro ; a O N x -§ E C.: w o 0 C L -) U N C Q7. I— '( _ — __ a) Q. 0. y a) m O a p U ii U_ co C N O N N 6 a) U co ,� LL:•' v 0 m a 0. N N c d ,: .';0": E a01 0 o N No E U a E Q C O` '- W O N n ap 'w O, a v o r. a+.'. O C N r <V .c., a DLL d ry d a 'a c E, a' E w v p . E — co U n N w •N > El. m o U U 0 N , o. c o` a) Gi„ ° 3 W,. I o 0 or w a E of o 0 a o o ` m Z ,n o a) v y 0 8 C N v m y C C N C N of 1.9 2 Q o N o a Q a > o °} _ O O O U C C C N °. U N C C - 0 OO c y c W � m U ° E ii: d o o a) n v w ° ao m m u ° ^ v Q a a K Q 0 cc K in a 0 _ia N lb • O 0 0 0 O') 0 i0 r O O 0 a 0 N N GO (0 (A (O W •(9 0 O (0 N O 0 d" m m • o 0 0 CO N- V;- 0 v n_ n 0 . 0 N CO N - 0 CO N n ~ w (ro m i A u) i `) (0 r 0 L co l0 i O 0 Ol N d (9 (30 t-." o..c au , , R m c N C ° a ' ( — —0 5.'071••••• 0) m m lia-N ysC t ] m N' = O •c 0 0 6 N' (U ,U N•_ < 3 E w. w C 0 O F..-.i v _ — — N. 7E -- y 0 — 6 00 0 0 m n 0 0 m w) (0 u N a N N a CD 11 CD CO 0 c x co N '.d -"O u. ! v a 03 id c o,t d -.. c E a en ' N en c E N : O d .... m N m to v p + w • a."o it N. N o , U) C N :. d • d. .o E a. E d U v 0 °'� E —. — I — — 'n. m O , i9 d >,;; n o v m v Ul o ,•,d . o o C E o v 3 u, Q' 2 o m m m '_' 0 'a a m o'o o 0 'm v, m d v `m c' Z « •5 v 'x E' = 8 41 ° g4 c .o CC „ W CO °c c u w m !c 0 m v N T m U - C m C C to 0 m U m N J :N co .N v(�. ca c' V c c E y d a m ),;(1) 0 o L° 0 0 d'c a m U m v u c E id U U a S o U m CO vii > F' c 'a, O. °u _ N c C Q DI m c Q m o 0 a Q $ °c m n 4 o c T o a 0 w U. > .a x a) m o.d c m o a -1 W m C o .sgstusr, = x O p. m h Q ;v m u) w rn a -�° 0 _n 'U v 0 .0 aci 9 u '- c m m m o m'm Q v °-v U p o xv E LL �. Tu t r `w v n o n t a > C c _ f- W m v m o m ....t.:y:..:., 0 K K c ii u1 S O O 1- 0 - 2 0.m U a en -7 7 O• ri ,W f9 W O �... 69 m N m co o : co O N o M cr, In Vi : N L o di 10 o L N in b:0 N '0 w m m n O , v a � ta C ^ a Ni ..0 o`- 0 ,Cu," • W ..__ _ o,N _ ._ _. __ — __ -•E O ^ c O o o Y L C y O O ' 0 CO ❑ 'a O N N 0 y ' LL m ox w G y C Cu `` �dNr ;O EO OI ?r J....,.. A J C d G 0 IQ la . - O O it.', — 0 0 0 O 0 a to , � C .` V L N .0 w co co M r co o] a co C y a) LL+s, C •. L y`, a U n u. w. • 0 �. N 'O u o N a CO y E N al o 0 O N Q o N N co- a? 8 U c U • a v M al n N o N: . ..af �i C 7 a n O E B - a, m c O c r 0 �? E v N a _ c a .> i LL 0 U ' m ':c 0 S IX _ Q To- o o n Y N y y ' y o n W o c 9 y m N (0 a D N a Z O m o rn m y e W N € m.. 0 0 •01 a a 2 o a 9 O m N 0 Q F a C 0 C N E 6 N C co /' ++ LL E g t,0 E .: 0 a C c O 3 b N -1 r E y0 ° a ` § 2 F- E o O L y C al N OI N J O LL a U "O c S N C a a ' y O 0)N N > 0 0 C a p p E - $ F T E C m a a O a a a O F- 0 F- t A ul s y O N n D n (. 4. CO m n of a co o m co N F- O) N N Hi N co N an O O O1 Y) ..`I L� O f9 a' Ol m v an N O N N �''' .: N m' N C di 2. N > 0 , o K N to " ul — N ❑ rn — C S m o IF:'c Ors: ih a' m m Q C U 4 V t rn 0 2 m n r U C IL w v N .44 co 3 E «i N v O o '^ w co C CL 1p U . N a o rn cn 1d O N'. ry N ' C w ` Z,V N. N. co N v 'Q ii_ C . N o 40 w f❑ U a Ci E o A a v E QEa°' " a) v co m m ; E ° m U N ° a ° N E , v q m M 0LL E 0 a w co O c • o ry d N a C d ; LL a. a v d N c O o) � ea" C y m O N J > O S a E N N LL re V N c d d of a Z L 0 .n 2 a W of TOO W O a •. d O UI a 6. C d N tV Q O C 0/C N O. a.� f W Y' 4.0 6. c = H o E y C m 8 2• a 8 C� W pm C C -o _ c 0 U a Q in 2 N L V d O u.i p it a f g a 6 ' . v wow 5 o /0 in E w a` It j 0) (0 0 (0 10 to a O: O: c) b o O O CO (0 0) N 0) C (0 W M: CA (0 S N m NI N O 1 E b " '' 0 N NN IN , in w. 1 w 0 w K LL w �,y c Q 0 (9 �+ C a L O w Y C 4 aE dH O O•; t N O N 0) N O a VI U G y O N O C l w CO mLL I N L > w OY w of O a c .� ro wrn CO N 0) N Co a °m c) O LL -o N co N 0 2 r N in LL C rl r J — LA d � m Q i U w rn h C u V U C Ct Zw `1.) m N C a N 0 n. N B N N fO N 0 0 th r W V IX O a N W 00 N N a 0 U O N) O CO N .1u- N U1 a a co 0 w 0 o O 0 w w LL a a 1] n L c co L > t O m , w 5 a 3 $ m o 0) C. O co a a ° ,K o u_ w N m w Q > K w > 8 ro w•- o u a S 03 w m `m 0 o , m m > w w c ro a o a c is a v E i). w K - g K E " O O J o N O a) > ro V 5 0 u' w 1 0 ° E E E 2 E w V— D ° a E o 0 o co o_ 0 w 0 a b 0 C L wm C U U 2x Q Q w J O w 3 O O O.5 O t 'ic0 } 0 N' V [° LO Of n a: No ,m CO to N 0 CO v) I- U O d N LLv 14. 13 C Q P m Co N V O 3 O h r N N y N L N C Gl „ a) co co O m 4 ry F- N � O EO ' a to 0 N ' , .: W at LL d �- , t > m E o a ca p O.. c y C.s 0 w .0 :' u✓ a ov co LL ,AN , en a E m o N .) 3 E a E U : J ° L t c E m.. O ' U N (0 0 Y c O_ N c ' Z N V1 E E m `12L, O 7D'. N > —i LL p o CO a) m to a m c o 'T.' 1 u- " r It N n m a U `m L_ a) a 16 O a n � c o O m N o 0 G m a E °0 .c c� m a a E O a p> jp y W' t c a H c aa m o Q N E wm c a) ° m m m a t _ n a. c Q rj o m J « aU a)J L. V ° VI N - N - • 4-- as m ° Co›- J N aN Q LL « E a O th c c a W:U 8N d c ° .� 6 m z E .m '' m C N d N m j U n" p FOO) m y > o i'y -m 2 U Ea) E m LC h O ccc 4> LLy w ¢N Qa p to `6 I M o CO to N I Q O 0 0 0 O 0 0 'CO (O, Cr N Of 'CO CO (0 ✓3. (0 (n to to Leo N co o- co i' O N O Y {' O N U) N f- (n (0 U X ii 4 2 W e <m C N m O �'. .• 124 N o N ,- O J Q tRi aa)) E E U V r o M 0 C,,, O o u y c C b y 6 LL N 'N — O N a - •_° ; v — -- — — _ — __. __ _ — a tiO O NC Y CO N (l) N (7 O N +-( e N (p a O N O co O O L CO t O 'p N M N N .0 . SE g° m N '� d � LL t= C 4) ,,'. L -' C .0 _ _ — - OD CO U a+ i m❑ Z u � or C a E . E l= , a', 0 LL is O 47 ) — — a 23 L() N CO N 0 N th O O. O N W N co" N V O 0 CO N LL c c CO J -- N a LL 0 O. d co N U U `m v L_ c O N N <c V L O N W N y > N 0 C U N 8 L N 8 N N U N 'r▪te O m d N n N U j C N N v N Q K '° K w > u D. v o LL it Q > i- to rn ry `.. 0 a -0- m N m > � d c a m a N n$ °' a) '� E LL K c o >, �- U o J o 0 O r To a m 3 u = °m YNi a m o o o o f 8 N. ` N 2 W N to h U A 0 ry N N N N Q N > N 11 y (0 N N U O o O N c o 0 0 o W Q U U F Q Q J 0 J' D 0 0 0 5 0 2 m o to o; o o o 0 h (A 0 w w w w N 0 N Co o n co � CO(9 a m o '^ 0 0tO I- o O N U) X LL N a) c 0 0 O Oa N V p a p N m N N J❑ r CI ` E a co m O L° 0 �, m t- w Ns w 0 E ;Qr U d mo Q N N 'sue) C co a N N• 1"'>, > o a m ;Q U ❑ to 0. co LL. N o xo c c. �+ Q ? r N . 3 Ea vii , C .3 , J 8 �, •C c E a c - - Q Q e U a m0 ' C U N (..)(..) y 'c ' m 2 a ;{d E E C m N w a.; yLL Q'> 0 W > N a m a-v 4 c m v_ D.- N O a a c to O To a a N a a n a a N .a C o - to = C 0 ` O U a 'O' co W N cc dm cE a 2m m c itt-0:F -'v ro $, 'W o U° s a N N N O a N a]i_ N N a« o O yp 41>- a co c 8.- y tr, a a ° n N di di T E < E a m"6 < n E c g c a S a c a g _ ' E ow a c N a co c O Sc Q> u_ ti w Q'n Q`a O co n 0 0 0 N 0 0 0 0 0 0 0 0 O N W W N. M VI 69 VI 0 '9 M ^ 0 N co th C7-3 I.. t m co m N a N n co N UI LL N 4 0 • a.: rn C O 0 0 ry O 0 0 -L° E n m Q l: N W H to ca Q LL O co N c ( r O : Yi a, .c m on E ,t r. v m,0 a w O O !, m y . c U. .fa O v°i wLL CD F O w N'1 V rn m -- c ro a n N a C y N c N M b 1...,. C,..: W o 2 c V ` p tgl ❑ u. `L N.LL N N .. O N m a o ° • 'N _ J c w C 5 „, c 0) : t u E , Q co '' m in a p m v V, C C N j Ca N . N IS O O m a • O't a •1 - v M o g �` ro M D 2 V r a c m a o co co as a a N N U 0 N _ t s U T c A d in o N ro a CO 7 a ° m °c v O v U w a �.m o v '« '- d to z ary N 9 U to A 0 O q /� O N m 2 ._ U N u_ i. c 0 C m al J 0 m N O n 0 c a Z v o) Q. m v a o , 1. a % o d m - m 0 .=, m `m c nob 01 a c ro .n a �' G o c - = c a 1/my� ro Tm ›...to o '� .aN v o as. w L. N W .4 a ,U m m U 0 J I N a U N d C J J N } ;« c c a J m c o K 5 c v m - ° Q 2 o o 0 f o v Q ro m c o v c $ m 8 ro g o S > > > 3 � m a)ac O � U as H J < c H J 0 0 0 O S Ott n J`o LL Q o LL co Vtf .. w w m: o m m tot N F N. N 0 '- N N O N W t I to to a — —. K o 0 LL N :N N N c ar 0 m c a O o y 'J 0 0 `'' € co C.:a) tO a to F- of N C I_ ar E 4 T N E 0 . d m o a r O alt .. m 7 c 0 Wr U acLL N M '(a t. Y N t N V m 2 N a N c 2 — _ 0 LL `.? a E 0LL n .,m + N J N. w — m — — o 0 2 0 to O O v a to . CO c 0 c"; c N c wc v m a al o to 3 a os C) w — a N : m — O n• O m N L. m m o:o 5a i - $ rn. fn a N o N ry ✓ C U —_ __ —' c 0 a C Ti N a a m @ 2 v c a r. m m p t] N a) w c 'vt m it) 2 (7 .N C r _ o 8 8° 8? 7 m 'm Titi m m " c c$ c v W �V L rn} m L m m m « „,g e m m w" u Ts 6 42 o ' o mW� F - O mv i c LLc to W a. LI. aD D m LL (5 Se \ . . - § / I- ® } § • N 2 CO c6 < CO CO { ca ® fl; . ` . ) ƒ: — — — — : :' ( W \ ] \ ' ( \ i } i ) E a \ $ C } ) ) \ { ) { ; £§ ii g • 0 o 0 0 o I n o 0 0 0 0 CO 0 (0 CO o N 69- 49 N N 0) N O 69 05 W W 6 : 0 N LO N (No n Co co to N N -a- a F US ' CA CO• '-W N 0 , w `. 0 0 o a 0 0 0 0 0 0 0 n N ' o 5 tD fA '19. 69 N' F9 f9 69 49 05 05 19 N 69 N CO t V N ` N N O ` O CD CO CD a N j l9 0)•0. N co 4.) , re o) C C to K _ — — o 19 O m � n.1 0 0; 0 0 a 0 0 0 'o 0 '0 0 i 0) 0 N N N w 69 CO w n 19 Na, 69 19' f9 w II) co m E N N N o a r o. u C ` 0 2 C 0 �. CO C ro d v c v _ N .0 N. .. v C y 0 0 0. 0 0 0 0 0 0 0 0 0 0 0 0 rn Q ro. W - V 'C9 N CO CO w » v) 69 w 69 w w la w v) co O C C .y 'Z n .. LL N LL b o y c d 0 0 U n LL o • E . o . �C o v • C W >to r .0 0 0 0 (1 0 0 0 0 0 0) 0 N n Q O > y 3 w 63 w w ^ r9 CO r9 49 w 0 w CO c +' Q: . V m (C CC a C O V 0) »V co O E =E b i em; N co C E d co CO v '0 0 N 0 c El it o la N >t g n �xf to <) F O c v LL 9 C V .2 a N 2 w E >< n d a `m > m m " g N C a y w u E 0 u W o C. O ° o °c) o E c c oN 0 O CO 0 °u 74 co 0 o E > > o } 0 N d N N N N O O Ltl .4 N 0 To' �' N c N N E C d N q ¢ `O co L4 a N N N CO N e O L O C it 1- 4) 0 V) r = K J 'N U' LL U' CO O 1- c N 9! qn 0 N r 0 N 0 O) 0 0 0 0 0 0) O o N co O w w 69 w j w w w N w 69 a r)' . a I O [� w la_ 0 0'r o a m a 6.1 w Nw w 1 N N O,. 0 0 0 0 10 0 o 0 0 0 .0 a- .- w w w ;w w 'w 'w )n :' nO a ai =m .3 w a w w c e a c LL o w i 1 a c K CZ o — w w rn w C p : c a N' o 0) 0 o 0 0 0 0 N (0 w w w 69 CO w w w 0 0 w w m M w 9.Id E io w a M O d 0S'c 3 to a. C 3 U v c o u 0 a L a) v J C a • 1--, a m o v ' �.. no ' 0.N t _ 0 0 0 0 0 0 0 0 0 0 0 0 a .0 u w w w w w (11 09 w w w a i o O C c N roro 0 Z a o'� n. o C ' > C 0 U w a I LLE n- u. 0 N ` O I U Y 0 0 C 4 0) )0 0 0 0 0 0 0 0 rn 0 0 o 0 N i N.41 69 w E a) 0 0 E a v ° a co v P- O E a 0 , U 'w N . it O ro E ':°. a. E aW 0 __ • o - - - - - - - — — • > V C 0.. N 0 V aa, 0 = K or a a a a in 2 CO N a 0 a U J m a v c a a w 43 c c o u ry to a C a 0 a ` E v C 3 a c 0 o c 0 Z O % . O ' a > -'a a O N' O O LL W 0 0. a O to a. ry 0 C a 0 a an c w a c c c ry U o c }. N N OI N a O .a .a N E N �[ N 'o a a C W - E U. u U ai a� O a K c O a O O O O a 0 0 C a a re Q O K K w a. U O J F W LL 0 I N 0 0 0 0 N 0 0 h "O O 0 0 0 N 0 N W O (0 O 0 N O N (0 �N' '(O N 10- rl. �� t� N td .- w M W j — a. --• ��. `a 'o. o ,o 0 0 ' 0 0 110 0 0 0 co C CO OD TO 0 v .. r' o .cm c p �. C O N 0 a. a) C _ _ — N c o O O co. O O O O O •N C d C co l9 Vi' (9 N (9 N CO E E as'«. u tv = m o m co (n 0 o 0 - v p 0 m r (o..« at LT, • w O N •E • C O 3 N a) ¢ m — — — — '— — E N ill = 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ¢ a - 0 co (A M (9 (0 (9 (A CO 4) 0 (A (A 0 CO N O C c c �9 (0 n v co 0• � ro Id 0 O c m (O') ° N 0 W C U w (9 W LL N 2 Co el (0 Y3 O N o w o o ' — — - - C C 4. v E o C 9 o 0 0 o N o o (0 0 0 �0 0 CO (0 N N O 19 N CO CO V) (A N 69 4i M (A U) (O E O)C. 0- a) m co m v E Q N IL o.9 )n c o m a) o - E a C 4 V n N o EA of 9 NN b" ¢ • rn w w E 0.0 o a m N 0 a1 p Q. 'D o a 0 m E rn Et 0 m 0 a J ) m m z c = a O a -0 O c c a) v 0 c o Y ro C O 2 0 c (.2 0 ¢ N J R' -a v co' ..p c C _ C N 0 'O co 0 O C J, 0 LL O e .g E O 0 p L U 6, c o C C o o 0. O a m 0.- O c O « a) m m C a C « d W 0 N ; C, C W Q J'b U a T ¢ O C O Q C V 4-0- C. a W co 0 o co a s a. U (0 ai C a) 0 0 co 0-o N 7.1 id } C::O D :O N V 0 W C O c:i.0-. 0 N W 0"7 c N 0 0 co co N d 0 O a 0 O ¢ 1% >'C v) 0 0 0 a 0 O R' K R' = LL N = 00n .a n K O 6 10- W O x W LL a gig o. o o �o 'o m oo o I0 to O !A I9 (A Vl 0 N 19 N '41 0 O— O 01 0 0. 0) N CO co O N car Mc (0 0 M . (V 'CO to to r I- w 'm N Z; w- 0 If; • ` t m o o 0 0 O o 0 0 t l9 l9 CO 09 : 0 Vi f9 t9 N (0 a rO . .� o CO re O c c I f9 m a N N > o . 1 E o d n m _ ; _ ._ I_ _ E o = m 0 0 0 0 �0 0 0 0 UN N N �.n w w f9 M �' ',O "' b' 0) o C C m in : o o E ~ K C S E LL a d W w O o0 O Q a y c tl N 0 0 0 0 0 0 0 0 0 0 ell 0 a E 2 0 to w CO w to 0 c !9 S m c. O .2 m m ri t3 m a d C o m e n n to m C . v) N ti cl: a- V w 7 C O C� a) w '^ E w •a. 0 EQN ,,, _ — — — — .— _ — U +'+ C 's O O O 0 0 (0 0 0 O to C Y IL -U f9 19 f9 Ul 41 0 N O 69 N to w N N . 'm : fT O O T E E f 9 L �'U M N Ol h N N 3 a 0 a a, O .�a N. trig 1 w a N w > to o- w -a _ _ _ _ w _m Q m m m N a B m CC m o O CO m E v , h '- = to U in- W U N lm C a �` O y C 5 O O c C O N CI LS 4C o (a U a S. .m 0 m m ~ C..2. U "b_ y N E C N c O c N U C $ 0 C- o o `m E S m c c ~ 3 0 c to K 2 o s C c C . O 11 5: o o a " x °m F, E F. E m m m c tx W m m N it c c d c U b t c } W N d C o d = N C `O 0 C m m U m m m r To" p p T m > y x % T LL m m o V ) a N a o O 'u a a. a ¢ 4 N �. 0 I- 0 t- F- t O q0 . f i 0 IN 0 I- VA' e 1 t M O r W N o N N N O W m N N (� fr. O . N N K 10 W 69 O o 'N o o v> L 0 VI co W •o m Q ro U ai M• C d N J C 0 N co • W O N•C LL! o Et N N 0 N O K O •E • .5 v ( — — — — o m 'o ro 01 0) m ° 0 �. U N. N'7, (0 m co co ' C C C °' Jo a } _m N m C LL. a) O o f c U m 0) r• E F" K U 3 E — c0 N a (0 W N • o w t9 O U v w J C N00) w rn n 69 •°w w (0 0 O LL E 0 0 N N '0 0 .Z N Cl N ) h fa N C 0 f9 3 m ' w w • U w. 14 LI- C O C d Ern C C _ _ _ — — Q N O E c v co to E E $ o m C r (O� O a. Q ry 0) 43 .- -I w .9 .n EL d (0 0 O V ce 2 m m C 0 ro m N gi c O 0 C• y fP 0 1 Q C U N w O L O N . 0 0 w N Q t a m C o o 5:o 3 `0 .@ 2 0 4) o o, .0 N T. J C rn c C a o c ro J L' c w ' (2 ` C Q a 'N O 0, w �, - 0) W xQ u O C' 00 w m W W c 0 IL C >. J 0 .- U E u.t o 3 . K . X W W OW W a O t 0 TI Petaluma Community Development Commission - - ----- --- Redevelopment Agencies,F.inanciahTransactions Report Detailed Summary of Footnotes For Fiscal Year 2010-11 Forms Column Additional Details Footnotes Audit Information If compliance opinion includes A. Compliance Violation: exceptions,state the areas of non- Adopted budget for fiscal compliance,and describe the agency's 2010-11 does not appear to efforts to correct contain a work program or goals for the coming year as required under H,&S code section 33606(d). Agency Response: The work program is included in the.lmplementation Plan and Redevelopment Plan and management and Governing Board did not see the necessity to include duplicate information in the annual budget.The narrative in the Agency budget referencesthe Implementation and mid- term review which slates the goals and plan for the Agency.The working plan and goals are also included in the section of the budget for Capital Improvement Projects,which is part of the annual budget. The Agency will include the recommended Information in their.narralive of the Petaluma Community Development Commission in future budgets to ensure that the Agency's goals and working plan are articulated in that document. Pass Through/School District Assistance Total Paid to Taxing Agencies A PROJECT AREA_NAME Petaluma Community ='PCDC merged project Development Commission area' was adopted on July 18, 1988 and amended in 2006. Total Paid to Taxing Agencies C PROJECT_AREA_NAME Petaluma Community ='PCDC merged project Development Commission area' has_a contractual agreement for County pass-through (Section 33401)which are not AB 1290 pass-throughs. Footnotes Page 1 12/15/2011 G2- Petaluma Community Development Commission 17 Redevelopment Agencies.Financial Transactions Report, Detailed Summary of Footnotes For Fiscal Year 2010-11 Forms Column Additional Details Footnotes • Agency Long-Term Debt Year of Authorization A. BOND_TYPE='Tax No change from last year. Allocation Bonds'and YEAR jAUTHORIZATION= 2005 and PURPOSE ISSUE= 'Refund 2000A Tax Allocation'B ond'.and PROJECT_AREA_NAME= 'PCDC merged project area' Year of Authorization A BOND TYPE='Tax No change from last year. Allocation Bonds'and YEAR_AUTHORIZATION= • 2003 and PURPOSE ISSUE= 'Finance redevelopment projects'and PROJECT_AREA_NAME= 'PCDC merged project area Year of Authorization A BOND_TYPE='Tax No change from last year. Allocation Bonds'and YEAR AUTHORIZATION= 2001 and PURPOSE_ISSUE= 'Dfeasee 1992 Tax Allocation Bond'and PROJECT_AREA NAME= 'PCDC.nerged,project area' Year of.Authorization A BOND_TYPE='Other'and No change from last year. YEAR AUTHORIZATION= 1998 and PURPOSE ISSUE= 'Redevelopment Activities AD 19'and PROJECT AREA NAME= 'PCDC merged projectarea' • Footnotes Page 2 12/15/2011 93-