19940621 CC SR Loan Agreement between City and RDA FY 1994-95 1PPF ofqz
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MEMORANDUM \\ RANCHO PALOS VERDES
AMR 1E
TO: CITY COUNCIL
HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL OF RANCHO RALG!VERDE
F1ROM: JUN = 1994
FINANCE DIRECTOR, BRENT D. MATTINGLY
DATE JUNE 21, 1994 SLEJECT:
LOAN AGREEMENT BETWEEN CITY AND RDA - FY 1994-9t
RECOMMENDATION:
•
Authorize the Mayor to execute the attached Loan Agreement between
the City and the Rancho Palos Verdes Redevelopment Agency to fund
Redevelopment Agency activities in fiscal year 1994-95 for the
Portuguese Bend RDA Fund. The proposed loan will fund RDA
activities in the amount of $300, 000 in FY 1994-95.
BACKGROUND:
On January 29, 1991, the RDA Board entered into a loan agreement
with the City of Rancho Palos Verdes to fund RDA activities in the
Redevelopment area. This agreement states that the loan shall
mature concurrent with the close of the fiscal year. The purpose of
this maturity date is so that the loan may be updated on an annual
basis to consolidate loans in previous years with any repayments or
additional loans.
On July 25, 1991, the County of Los Angeles issued $10 million in
County Improvement District Bonds as part of the Horan Settlement.
A portion of these funds are available to fund activities in
Abalone Cove. However, in the case of Portuguese Bend, the RDA does
not currently have the resources to fund necessary projects;
therefore, loans from the City are necessary.
The interest rate charged on the loan is equal to the rate earned
by the City on its LAIF deposits plus three percent. Currently,
this would yield an interest rate of approximately 7 . 25%. The
attached loan agreement includes the revised interest rate
provision for future interest calculations.
The details on the two separate RDA funds and the City loans made
to them are as follows:
Portuguese Bend Fund
As per the fiscal year 1993-94 City budget, $133 , 000 was
transferred to the RDA. The attached loan agreement incorporates
all previous loans made by the City to the RDA's Portuguese Bend
Fund into one loan agreement, and includes the additional $300, 000
T
proposed to be loaned to the RDA for FY 94-95. The total principal
amount loaned to the Portuguese Bend Fund through June 30, 1994 ,
shall be $2 , 028, 552. With accrued interest of $725, 709 the total
amount owed by the Portuguese Bend Fund is $2,754, 261 as of June
30, 1994.
Abalone Cove
All loans from the City to the Redevelopment Agency were repaid in
1992 .
Respectfully Submitted, pled:
CR.444444402Z;Z ;
Brent* D. Mattingly gra . usse
Finance Director/Treasurer City Manager
Attachments: Loan Agreement for fiscal year 1994-95
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