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• II <br /> 0 ill <br /> MEMORANDUM RANCHO PALOS VERDES <br /> To: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL <br /> FROM: FINANCE DIRECTOR <br /> DATE JULY 1, 1997 <br /> SUBJECT: LOAN AGREEMENT BETWEEN THE CITY AND RDA FOR FISCAL <br /> YEAR 1996-97 AND FISCAL YEAR 1997-98 <br /> Staff Coordinator: Matt Burton, Accounting Supervisor <br /> RECOMMENDATION: <br /> Authorize the Mayor and the City Clerk to execute the attached Loan Agreement between <br /> the City and the Rancho Palos Verdes Redevelopment Agency. The proposed additional <br /> loan of$350,000 will fund the Portuguese Bend dewatering project begun in FY 1996-97 <br /> 111/ in the amount of $150,000 and other projects which are included in the budget for FY <br /> 1997-98 in the amount of$200,000. <br /> BACKGROUND: <br /> On January 29, 1991, the RDA Board entered into a loan agreement with the City of <br /> Rancho Palos Verdes to fund RDA activities in the Redevelopment area. This agreement <br /> states that the loan shall mature concurrent with the close of the fiscal year. The purpose <br /> of the annual maturity date is to provide for consolidation of previous year loan activity <br /> with any current year repayments or advances. The attached proposed Loan Agreement <br /> includes a history of loan advances and repayments between the City and the Portuguese <br /> Bend fund of the RDA. <br /> On July 25, 1991, the County of Los Angeles issued $10 million in County Improvement <br /> District Bonds as part of the Horan Settlement. A portion of these funds are available to <br /> fund activities in Abalone Cove. However, in the case of Portuguese Bend, the RDA does <br /> not currently have the resources to fund necessary projects; therefore, loans from the City <br /> are necessary. <br /> The interest rate charged on the loan is equal to the rate earned by the City on its LAIF <br /> deposits plus three percent. Currently, this would yield an interest rate of approximately <br /> 1110 8.6%. <br />