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• <br /> e)e, <br /> MEMORANDUM ANCHO PALOS VERDES <br /> TO: HONORABLE CHAIRMAN AND MEMBERS OF THE BOARD <br /> FROM: DENNIS McLEAN, FINANCE DIRECTOR <br /> SUBJECT: LOAN AGREEMENT BETWEEN THE CITY AND RDA <br /> DATE: JULY 3, 2001 <br /> RECOMMENDATION: <br /> Authorize the Agency Chairman and the Agency Secretary to execute the attached Loan <br /> Agreement between the City and the Rancho Palos Verdes Redevelopment Agency. <br /> BACKGROUND AND ANALYSIS: <br /> Abalone Cove Fund Financing <br /> The Abalone Cove landslide abatement project of the Redevelopment Agency was initially <br /> financed by the issuance of$10 million of County Improvement District Bonds (the "Bonds") <br /> in 1991. The Bonds were issued as part of the Reimbursement and Settlement (Horan) <br /> Agreement entered into between the County, City, Agency and the Horan litigants in 1987. <br /> After payment of amounts owed the County and the City, approximately $6.7 million of net <br /> bond proceeds were transferred to the Agency's Abalone Cove fund in 1991 to finance <br /> landslide abatement projects. <br /> Under the terms of the bond restructuring in 1997, the Bonds were repaid by the Agency's <br /> issuance of $5,455,000 of tax allocation bonds (the "1997 RDA Bonds") and a lump sum <br /> payment of$4,545,000 to the County. The lump sum payment was funded with $2 million of <br /> accumulated tax increment, $1 million of fund reserves from the Abalone Cove fund and a <br /> loan to the Abalone Cove fund by the City in the amount of$1,545,000. <br /> The original RDA bond proceeds have financed landslide abatement projects in the Abalone <br /> Cove area. It is anticipated that the Abalone Cove fund balance will be approximately <br /> $280,000 as of June 30, 2001, with an additional $230,000 expected to be expended during <br /> FY 2001-02. <br /> The City and the Agency previously entered into a Loan Agreement when the City advanced <br /> $1,545,000 to the Abalone Cove fund as a part of the 1997 bond restructuring. The original <br /> loan agreement was dated November 30, 1997 and has been amended annually to <br /> consolidate the loan for accrued (unpaid) interest. With accrued interest of$546,956 through <br /> June 30, 2001, the total amount owed to the City by the Abalone Cove fund of the Agency is <br /> $2,091,956 as of June 30, 2001. If interest rates are consistent with the prior year, total <br />