20-Year Resource Allocation Plan - City of Sunnyvale

▪ Redevelopment Agency Fund
The Sunnyvale Redevelopment Agency (RDA) is a separate
governmental and legal entity from the City. However, the
Agency is a component unit of the City for which the City
is fi nancially responsible. Further, due to certain agreements
between the Redevelopment Agency and the City, the General
Fund of the City is inextricably tied to the fi nancial condition
of the RDA.
At the close of FY 2009/2010 the Redevelopment Agency had
two outstanding loans due to the City General Fund totaling
approximately $65 million. This is largely the result of the
Redevelopment Agency’s inability to raise suffi cient tax
increment revenue to repay the City for annual lease payments
made by the City for the downtown parking structure during
the years following the passage of Proposition 13.
The Agency entered into a First Amended Repayment
Contract with the General Fund in 1977 to repay the debt
associated with initial improvements to the Project Area and
its inability to make payments on the parking structure. This
Contract constitutes the “1977 loan.” In 1986 certain State
legislation imposed more stringent requirements on funds
advanced by the General Fund to the Redevelopment Agency
and a separate loan was created to account for costs subject to
these restrictions. This loan is referred to as the “1986 loan.”
Since the Sunnyvale RDA was formed, the State has enacted
several laws that placed revenue restrictions on redevelopment
agencies. These include capping the time period for collection
of tax increment for each redevelopment project area.
The original termination date was November 2025. In FY
2004/2005, the plan was extended by one year per SB1045
in compensation for the RDA’s payment to the Educational
Revenue Augmentation Fund (ERAF) in FY 2003/2004. The
plan was extended for another two years in FY 2005/2006
per SB1096 for compensation of the RDA’s ERAF payments
made in FY 2004/2005 and FY 2005/2006. For Sunnyvale’s
project area, the termination date is now November 2028.
More important was the establishment of revenue limits
for redevelopment agencies, referred to as Property Tax
increment caps. The revenue limit/increment cap for the
Sunnyvale Redevelopment Agency as originally established
was $118 million. In FY 2005/2006 the Agency amended its
Redevelopment Plan to increase the tax increment cap to $600
million. Increasing the cap will allow the Agency to receive
an estimated $346 million by the end of its project life.
It should be noted that when Property Tax increment received
by the Agency reaches the original $118 million cap,
certain pass through payments to other taxing entities will
be required. These pass throughs, which are taken directly
from the tax increment before we receive it, will begin in FY
2014/2015 and are shown in the Long-Term Financial Plan as
Pass Through to Taxing Agencies.
An actual deposit to the RDA Low and Moderate Income