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2012-20
RESOLUTION NO. OB 2012- 20 A RESOLUTION OF THE OVERSIGHT BOARD TO THE SUCCESSOR AGENCY OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE APPROVING THE DUE DILIGENCE REVIEW OF THE SUCCESSOR AGENCY COMMUNITY REDEVELOPMENT AGENCY NON-HOUSING FUNDS, AUTHORIZING THE SUCCESSOR AGENCY TO RETAIN THOSE OBLIGATED FUND ASSETS IDENTIFIED IN THE DUE DILIGENCE REVIEW, AND AUTHORIZING SUCCESSOR AGENCY STAFF TO TRANSMIT THE DUE DILIGENCE REVIEW TO THE CALIFORNIA DEPARTMENT OF FINANCE, SAN BERNARDINO COUNTY AUDITOR-CONTROLLER AND TO OTHER STATE AND LOCAL AGENCIES PURSUANT TO THE HEALTH AND SAFETY CODE WHEREAS, the Successor Agency and Oversight Board authorized Successor Agency staff to enter into a contract with the firm Rogers, Anderson, Malody & Scott, LLP ("Auditor") to conduct the required Due Diligence Review under AB 1484; and WHEREAS, Auditor is an independent Certified Public Accounting firm on the approved list of providers to conduct required Due Diligence Review under AB 1484 by the San Bernardino Auditor-Controller's Office; and WHEREAS, Auditor reviewed the information of-the Successor Agency and the requirements under California Health and Safety Code Section 34179.5, performed all required procedures and field work and prepared an agreed upon procedures report in accordance with the standards established by the American Institute of Certified Public Accountants in order to comply with the Due Diligence Review under AB 1484; and WHEREAS, the Oversight Board to the Successor Agency of the Grand Terrace Community Redevelopment Agency ("Successor Agency") received a copy of the completed Due Diligence Review at its regular meeting on December 5, 2012 and convened a public comment session at that same meeting to receive any comments from the general public and the San Bernardino County Auditor-Controller's Office; and WHEREAS, the Oversight Board to the Successor Agency has considered any and all comments from members of the public and the San Bernardino County Auditor- Controller's Office regarding the Due Diligence Review; and WHEREAS, the Oversight Board to the Successor Agency has reviewed the Due Diligence Review and has made inquiries of Successor Agency staff; and NOW THEREFORE, BE IT RESOLVED by the Oversight Board to the Successor Agency of the Grand Terrace Community Redevelopment Agency, as follows: f SECTION 1. The Oversight Board finds and determines that the foregoing recitals are true and correct. SECTION 2. The Oversight Board has reviewed the Due Diligence Review of the Non-Housing Funds, attached hereto as Attachment 1 is the Due Diligence Review described, and has determined that it truthfully and accurately reflects the unencumbered cash in the possession of the Successor Agency pursuant to the Health and Safety Code. SECTION.3. The Oversight Board hereby approves the attached Due Diligence Review. SECTION 4. For the purposes retaining those non-LMIHF funds which are encumbered, as described in the attached Due Diligence Review, the Oversight Board hereby authorizes the Successor Agency to retain the assets and funds as documented in the Due Diligence Review, which provides the amount of funds authorized for retention, the source of those funds, and the purposes for which those funds are being retained. SECTION 5. Successor Agency staff is hereby directed to transmit the Due Diligence Review for Non-Housing Funds to the California Department of Finance, the San Bernardino County Auditor-Controller, and any other relevant State or local agency pursuant to the Health and Safety Code by January 15, 2013. SECTION 6. Successor Agency staff is hereby authorized to take all other actions necessary and required to carry out this Resolution to ensure the Successor Agency complies with the Due Diligence Review process pursuant to the Health and Safety Code or any other relevant law. PASSED, APPROVED, AND ADOPTED at a regular meeting of the Oversight Board to the Successor Agency of the Community Redevelopment Agency of the City of Grand Terrace, held on this the 19th day of December, 2012, by the following vote: AYES: Board Members Mitchell, Shi&lds and Morga, Vice-Chairman Sacks and Chairman Stanckiewitz NOES: None ABSENT: Board Member Miranda ABSTAIN: None Chair, Successor Agency-to the Community Redevelopment Agency of the City of Grand Terrace Secretary, §uccessor Agencto the Community Redevelopment Agency of the City of Grand Terrace Attachment 1 Non-Low- and Moderate-Income Housing Fund Due Diligence Review �i PURSUANT TO THE STATE OF CALIFORNIA HEALTH AND SAFETY CODE SECTION 34179.5 CITY OF GRAND TERRACE AS THE SUCCESSOR AGENCY OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE INDEPENDENT ACCOUNTANT'S REPORT ON APPLYING AGREED-UPON PROCEDURES r- COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES TABLE OF CONTENTS Independent Accountant's Report on Applying Agreed-Upon Procedures................. ...................................................1 Attachment A:Agreed-Upon Procedures ............................................................................................................. .........2 Attachment'2 . ...............................................................................................................................................................16 Attachment4 .......................................................................................................................................................:........17 Attachment5 .........................................................................................................................................:......................19 Attachment6 .................................................................................................................................................................20 Attachment7. ................................................................................................................................................................22 Attachment8. ...............................................................................................................................................................23 Attachment9 ................................................................................................................................................................25 Attachment10 ..............................................................................................................................................................26 i i ©® ROGERS.ANDERSON, MALODY&SCOTT, LLP CERTIFIED PUBLIC ACCOUNTANTS,SINCE 1948 735 E.Carnegie Dr.Suite 100 San Bernardino,CA 92408 Oversight Board of the Successor Agency for the 909 889 0871 T Community Redevelopment Agency of the City of Grand Terrace 909 889 5361 F 22795 Barton Road ramscpa.net Grand Terrace, CA 92313 PARTNERS Brenda L.Odle,CPA,MST INDEPENDENT ACCOUNTANT'S REPORT Terry P.Shca.CPA ON APPLYING AGREED-UPON PROCEDURES Kirk A.Franks,CPA Matthew B.Wilson,CPA,MSA Scott W.Manno;CPA We have performed the minimum required agreed-upon procedures enumerated in Jay H.Zercheag,CPA,MST Attachment"A", which were agreed to by the Oversight Board of the Successor Agency Jay li Fl.Waller.r. CPA(Refired) for the Community Redevelopment Agency of the City of Grand Terrace, the California Phillip H.Waller,CPA(Retired) Y p 9 Y Y State Controller's Office and the State of California Department of Finance (Agencies) MANAGERS/STAFF solely to assist you in determining All Other Funds unobligated balances available for Nancy O'Raffcrty,CPA,MBA transfer to taxing entities complying with statutory requirements pursuant to the Bradferd A.Welebir,CPA,MBA California Health and Safety Code section 34179.5. Management of the Successor Jenny Liu.CPA,MST Agency is responsible for the accounting records pertaining to statutory compliance Katie L. a CPA Papa Matar pursuant to Health and Safety Code section 34182(a)(1). Thisiaw,CPA,MBA Maya S. Ivanova,CPA,MBA Danielle E.Odgers.CPA This agreed-upon procedures engagement was conducted in accordance with William C.Clayton,CPA attestation standards established by the American Institute of Certified Public Peter E.Murray,CPA Accountants. The sufficiency of these procedures is solely the responsibility of those Genivive Schwarzkopf,CPA parties specified in the report, Consequently, we make no representation regarding the Megan Hackney,CPA sufficiency of the procedures described below either for the purpose for which this Soong-Hyea Lee.CPA,MBA Charles De Simone.CPA report has been requested or for any other purpose. The scope of this engagement was limited to performing the minimum required agreed- upon procedures as set forth in Attachment"A" along with the findings noted as a result of the procedures performed. We were not engaged to and did not conduct an audit, the objective of which would be the expression of an opinion as to the appropriateness of the results summarized after each procedure in Attachment "A". Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. This report is intended solely for the information and use of the applicable Agencies, and is not intended to be, and should not be used by anyone other than these specified MEMBERS parties. This restriction is not intended to limit distribution of this report, which is a American Institute of matter of public record. Certified Public Accountants PCPS The AICPA Alliance for CPA Firms n Governmental Audit 1 n(L>?,t,d oti 00((y c SD7r L t� Quality Center J California Society of Certified Public Accountants November 27, 2012 1 STABILITY. ACCURACY. TRUST. COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.6 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Purpose: To determine the unobligated balances available for transfer to taxing entities of the Low and Moderate Income Housing Fund. [Health and Safety Code section 34179.5] Citation: 34179.5(c)(1) The dollar value of assets transferred from the former redevelopment agency to the successor agency on or about February 1, 2012. 1. Obtain from the Successor Agency a listing of all assets that were transferred from the former redevelopment agency to the Successor Agency on February 1, 2012. Agree the amounts on this listing to account balances established in the accounting records of the Successor Agency. Identify in the Agreed-Upon Procedures (AUP) report the amount of the assets transferred to the Successor Agency as of that date. Results: We obtained from the Successor Agency a listing of all assets that were transferred from the former redevelopment agency (excluding Low and Moderate Income Housing Fund) to the Successor Agency on February 1, 2012. We agreed the amounts on this listing to account balances established in the accounting records of the Successor Agency. We noted that$35,373,736 in assets were transferred from the former redevelopment agency to the Successor Agency as of February 1, 2012. 2 1 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Citation: 34179.5(c)(2) The dollar value of assets and cash and cash equivalents transferred after January 1, 2011, through June 30, 2012, by the redevelopment agency or the successor agency to the city, county, or city and county that formed the redevelopment agency and the purpose of each transfer. The review shall provide documentation of any enforceable obligation that required the transfer. 2. If the State Controller's Office has completed its review of transfers required under both Sections 34167.5 and 34178.8 and issued its report regarding such review, attach a copy of that report as an exhibit to the AUP report. If this has not yet occurred, perform the following procedures: A. Obtain a listing prepared by the Successor Agency of transfers (excluding payments for goods and services) from the former redevelopment agency to the city, county, or city and county that formed the redevelopment agency for the period from January 1, 2011 through January 31, 2012. For each transfer, the Successor Agency should describe the purpose of the transfer and describe in what sense the transfer was required by one of the Agency's enforceable obligations or other legal requirements. Provide this listing as an attachment to the AUP report. Results: We obtained a listing prepared by the Successor Agency of transfers (excluding payments for goods and services) from the former redevelopment agency to the city, county, or city and county that formed the redevelopment agency for the period from January 1, 2011 through January 31, 2012. For each transfer, the Successor Agency described the purpose of the. transfer and described in what sense the transfer was required by one of the Successor Agency's enforceable obligations or other legal requirements. The State Controller's Office has not completed its review of transfers required under both Sections 34176.5 and 34178.8. Based on the listing of transfers from the former redevelopment agency to the City of Grand Terrace for the period January 1, 2011 through January 31, 2012, we noted three transfers totaling$867,806. See Attachment 2 for listing of transfers. B. Obtain a listing prepared by the Successor Agency of transfers (excluding payments for goods and services) from the Successor Agency to the city, county, or city and county that formed the redevelopment agency for the period from February 1, 2012 through June 30, 2012. For each transfer, the Successor Agency should describe the purpose of the transfer and describe in what sense the transfer was required by one of the Agency's enforceable obligations or other legal requirements. Provide this listing as an attachment to the AUP report. Results: According to Successor Agency, there were no transfers from the former redevelopment agency to the City or County for the period from February 1, 2012 through June 30, 2012. C. For each transfer, obtain the legal document that formed the basis for the enforceable obligation that required any transfer. Note in the AUP report the absence of any such legal document or the absence of language in the document that required the transfer. Results: We obtained, from the Successor Agency, copies of the Agency resolutions related to the "Improvements to Mount Vernon Avenue"and the "Grand Terrace Road Project." 3 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.6 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Citation: 34179.5(c)(3) The dollar value of any cash or cash equivalents transferred after January 1, 2011, through June 30, 2012, by the redevelopment agency or the successor agency to any other public agency or private party and the purpose of each transfer. The review shall provide documentation of any enforceable obligation that required the transfer. 3. If the State Controller's Office has completed its review of transfers required under both Sections 34167.5 and 34178.8 and issued.its report regarding such review, attach a copy of that report as an exhibit to the AUP report. If this has not yet occurred, perform the following procedures: A. Obtain a listing prepared by the Successor Agency of transfers (excluding payments for goods and services)from the former redevelopment agency to any other public agency or to private parties for the period from January 1, 2011 through January 31, 2012. For each transfer, the Successor Agency should describe the purpose of the transfer and describe in what sense the transfer was required by one of the Agency's enforceable obligations or other legal requirements. Provide this listing as an attachment to the AUP report. Results: According to Successor Agency, there were no transfers from the former redevelopment agency to any other public agency or private party for the period from January 1, 2011 through January 31, 2012. B. Obtain a listing prepared by the Successor Agency of transfers (excluding payments for goods and services) from the Successor Agency to any other public agency or private parties for the period from February 1, 2012 through June 30, 2012. For each transfer, the Successor Agency should describe the purpose of the transfer and describe in what sense the transfer was required by one of the Agency's enforceable obligations or other legal requirements. Provide this listing as an attachment to the AUP report. Results: According to Successor Agency, there were no transfers from the former redevelopment agency to any other public agency or private party for the period from February 1, 2012 through June 30, 2012. C. For each transfer, obtain the legal document that formed the basis for the enforceable obligation that required any transfer. Note in the AUP report the absence of any such legal document or the absence of language in the document that required the transfer. Results: The Successor Agency did not prepare schedules related to procedures 3.A and 3.B, as there are no transfers that met the criteria stated in these procedures, therefore no legal documents were obtained. 4 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Citation: 34179.5(c)(4) The review shall provide expenditure and revenue accounting information and identify transfers and funding sources for the 2010-11 and 2011-12 fiscal years that reconciles balances, assets, and liabilities of the successor agency on June 30, 2012 to those reported to the Controller for the 2009-10 fiscal year. 4. Perform the following procedures: A. Obtain from the Successor Agency a summary of the financial transactions of the Redevelopment Agency and the Successor Agency in the format set forth in the attached schedule for the fiscal periods indicated in the schedule. For purposes of this summary, the financial transactions should be presented using the modified accrual basis of accounting. End of year balances for capital assets (in total) and long-term liabilities (in total) should be presented at the bottom of this summary schedule for information purposes. Results: We obtained from the Successor Agency a summary of the financial transactions of the Redevelopment Agency and the Successor Agency for the fiscal periods requested using the modified accrual basis of accounting. The summary includes the requested long-term liabilities and capital asset information. B. Ascertain that for each period presented the total of revenues, expenditures, and transfers accounts fully for the changes in equity from the previous fiscal period. Results: We agreed the changes in equity to the requisite accounting data. Prior period adjustments account for any variances in the changes in equity between the periods disclosed. \ C. Compare amounts in the schedule relevant to the fiscal year ended June 30, 2010 to the state controller's report filed for the Redevelopment Agency for that period. Results: We agreed the stated amounts to the June 30, 2010 State Controller's Report and noted.no variances. D. Compare amounts in the schedule for the other fiscal periods presented to account balances in the accounting records or other supporting schedules. Describe in the report the type of support provided for each fiscal period. Results: We agreed the stated amounts for the year ended June 30, 2011 to the State Controller's Report for the same period and noted no variances. We agreed the stated amounts for the seven months ended January 31, 2012 and the five months ended June 30, 2012 to the Successor Agency's trial balances and noted no variances. See Attachment 4 for the summary of financial transactions of the Redevelopment Agency and the Successor Agency. 5 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A. Citation: 34179.5(c)(5)A separate accounting for the balance for the Low and Moderate Income Housing Fund for all other funds and accounts combined shall be made as follows: (A)A statement of the total value of each fund as of June 30, 2012. 5. Obtain from the Successor Agency a listing of all assets of the Low and Moderate Income Housing Fund as of June 30, 2012 for the report that is due October 1, 2012 and a listing of all assets of all other funds of the Successor Agency as of June 30, 2012 (excluding the previously reported assets of the Low and Moderate Income Housing Fund)for the report that is due December 15, 2012. When this procedure is applied to the Low and Moderate Income Housing Fund, the schedule attached as an exhibit will include only those assets of the Low and Moderate Income Housing Fund that were held by the Successor Agency as of June 30, 2012 and will exclude all assets held by the entity that assumed the housing function previously performed'by the former redevelopment agency. Agree the assets so listed to recorded balances reflected in the accounting records of the Successor Agency. The listings should be attached as an exhibit to the appropriate AUP report. Results: We obtained from the Successor Agency a listing of all assets of the "Other"Funds as of June 30, 2012 for the report that is due December 15, 2012. The listing excludes those assets of the Low and Moderate Income Housing Fund that were held by the Successor Agency as of June 30, 2012. We agreed the assets so listed to recorded balances reflected in the accounting records of the Successor Agency. See Attachment 5 for the listing, obtained from the Successor Agency, of assets that were held by the Successor Agency as of June 30, 2012. 6 COMMUNITY REDEVELOPMENT AGENCY OF THE.CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Citation: 34179.5(c)(5)(B) An itemized statement listing any amounts that are legally restricted as to purpose and cannot be provided to taxing entities. This could include the proceeds of any bonds, grant funds, or funds provided by other governmental entities that place conditions on their use. 6. Obtain from the Successor Agency a listing of asset balances held on June 30, 2012 that are restricted for the following purposes: A. Unspent bond proceeds: i. Obtain the Successor Agency's computation of the restricted balances (e.g., total proceeds less eligible project expenditures, amounts set aside for debt service payments, etc.) Results: We obtained a computation of the unspent bond proceeds at June 30, 2012. ii. Trace individual components of this computation to related account balances in the accounting records, or to other supporting documentation (specify in the AUP report a description of such documentation). Results: We agreed the computation to the related client prepared spreadsheets and the bank account balance. iii. Obtain from the Successor Agency a copy of the legal document that sets forth the restriction pertaining to these balances. Note in the AUP report the absence of language restricting the use of the balances that were identified by the Successor Agency as restricted. Results: We obtained a copy of the official statement and noted on page three the purposes for which these bonds were issued. B. Grant proceeds and program income that are restricted by third parties: i. Obtain the Successor Agency's computation of the restricted balances (e.g., total proceeds less eligible project expenditures). ii. Trace individual components of this computation to related account balances in the accounting records, or to other supporting documentation (specify in the AUP report a description of such documentation). iii. Obtain from the Successor Agency a copy of the grant agreement that sets forth the restriction pertaining to these balances. Note in the AUP report the absence of language restricting the use of the balances that were identified by the Successor Agency as restricted. Results: According to Successor Agency, there were no Grant Proceeds or Program Income held by the Successor Agency at June 30, 2012. C. Other assets considered to be legally restricted: i. Obtain the Successor Agency's computation of the restricted balances (e.g., total proceeds less eligible project expenditures). Results: We obtained a computation of the restricted balances at June 30, 2012. ii. Trace individual components of this computation to related account balances in the accounting records, or to other supporting documentation (specify in the AUP report a description of such documentation). t Results: We agreed the computation to the related account balances and fiscal agent bank statements at June 30, 2012. 7 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A iii. Obtain from the Successor Agency a copy of the .legal document that sets forth the restriction pertaining to these balances. Note in the AUP report the absence of language restricting the use of the balances that were identified by Successor the Agency as restricted. Results: We obtained a copy of the official statements for each bond issue and agreed the required reserve amount to the amount held by the fiscal agents at June 30, 2012 and noted no variances. The bond reserve amounts are a required part of the bond issue. D.Attach the above mentioned Successor Agency prepared schedule(s) as an exhibit to the AUP report. For each restriction identified on these schedules, indicate in the report the period of time for which the restrictions are in effect. If the restrictions are in effect until the related assets are expended for their intended purpose,this should be indicated in the report. Results: See Attachment 6 for the listing restricted assets at June 30, 2012. The intended purpose language is included on the listing. 8 COMMUNITY REDEVELOPMENT CY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Citation: 34179.5(c)(5)(C) An itemized statement of the values of any assets that are not cash or cash equivalents. This may include physical assets, land, records, and equipment. For the purpose of this accounting, physical assets may be valued at purchase cost or at any recently estimated market value. The statement shall list separately housing-related assets. 7. Perform the following procedures: A. Obtain from.the Successor Agency a listing of assets as of June 30, 2012 that are not liquid or otherwise available for distribution (such as capital assets, land held for resale, long-term receivables, etc.) and ascertain if the values are listed at either purchase cost(based on book value reflected in the accounting records of the Successor Agency) or market value as recently estimated by the Successor Agency. Results: We obtained from the Successor Agency a listing of assets as of June 30, 2012 that are not liquid or otherwise available for distribution. We noted that$8,073,295 of assets at June 30, 2012 were not liquid or otherwise available for distribution. The assets as stated are based on book value as reflected in the accounting records of the Successor Agency. See Attachment 7 for listing of assets obtained from the Successor Agency. B. If the assets listed at 7(A) are listed at purchase cost, trace the amounts to a previously audited financial statement (or to the accounting records of the Successor Agency) and note any differences. Results: We traced the amount to the Successor Agency's accounting records noting no differences. C. For any differences noted in 7(B), inspect evidence of disposal of the asset and ascertain that the proceeds were deposited into the Successor Agency trust fund. If the differences are due to additions (this generally is not expected to occur), inspect the supporting documentation and note the circumstances. Results: We noted a piece of land was purchased using bond proceeds. The Agency Board approved the purchase of the land on June 14, 2011. We obtained a copy of the Agency minutes-for June 14, 2011 and a copy of the purchase agreement. D. If the assets listed at 7(A) are listed at recently estimated market value, inspect the evidence (if any) supporting the value and note the methodology used. If no evidence is available to support the value and/or methodology, note the lack of evidence. Results: Procedure 7(D) is not applicable since the assets identified in procedure 7(A) are not listed at estimated market value. 9 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.6 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Citation: 34179.5(c)(5)(D) An itemized listing of any current balances that are legally or contractually dedicated or restricted for the funding of an enforceable obligation that identifies the nature of the dedication or restriction and the specific enforceable obligation. In addition, the successor agency shall provide a listing of all approved enforceable obligations that includes a projection of annual spending requirements to satisfy each obligation and a projection of annual revenues available to fund those requirements. If a review finds that future revenues together with dedicated or restricted balances are insufficient to fund future obligations and thus retention of current balances is required, it shall identify the amount of current balances necessary for retention. The review shall also detail the projected property tax revenues and other general purpose revenues to be received by the successor agency, together with both the amount and timing of the bond debt service payments of the successor agency, for the period in which the oversight board anticipates the successor agency will have insufficient property tax revenue to pay the specified obligations. 8. Perform the following procedures: A. If the Successor Agency believes that asset balances need to be retained to satisfy enforceable obligations, obtain from the Successor Agency an itemized schedule of asset balances (resources) as of June 30, 2012 that are dedicated or restricted for the funding of enforceable obligations and perform the following procedures. The schedule should identify the amount dedicated or restricted, the nature of the dedication or restriction, the specific enforceable obligation to which the dedication or restriction relates, and the language in the legal document that is associated with the enforceable obligation that specifies the dedication of existing asset balances toward payment of that obligation. i. Compare all information on the schedule to the legal documents that form the basis for the dedication or restriction of the resource balance in question. Results: The Successor Agency could not provide legal documents with regard to the amounts due to: Rock Bottom for the maintenance of the baseball park in the amount of$10,600 Urban Futures, Inc. for bond compliance in the amount of$3,000 Rosenow Spevacek Group in the amount of$3,133 and The accrued project expenses amounting to$488. ii. Compare all current balances to the amounts reported in the accounting records of the Successor Agency or to an alternative computation. Results: The balances as stated agree to the Successor Agency's accounting records. iii. Compare the specified enforceable obligations to those that were included in the final Recognized Obligation Payment Schedule approved by the California Department of Finance. Results: The amounts, as stated, were included on the final Recognized Obligation Payment Schedule approved by the California Department of Finance, except for the accrued project expenses of$488 and the remaining balance on the Stater Brothers'contract of$1,044,375. iv. Attach as an exhibit to the report the listing obtained from the Successor Agency. Identify in the report any listed balances for which the Successor Agency was unable to provide appropriate restricting language in the legal document associated with the enforceable obligation. Results: See Attachment 8.A for itemized schedule obtained from the Successor Agency. 10 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A B. If the Successor Agency believes that future revenues together with balances dedicated or restricted to an enforceable obligation are insufficient to fund future obligation payments and thus retention of current balances is required, obtain from the Successor Agency a schedule of approved enforceable obligations that includes a projection of the annual spending requirements to satisfy each obligation and'a projection of the annual revenues available to fund those requirements and perform the following procedures: i. Compare the enforceable obligations to those that were approved by the California Department of Finance. Procedures to accomplish this may include reviewing the letter from the California Department of Finance approving the Recognized Enforceable Obligation Payment Schedules for the six month period from January 1, 2012 through June 30, 2012 and for the six month period July 1, 2012 through December 31, 2012. ii. Compare the forecasted annual spending requirements to the legal document supporting each enforceable obligation. a. Obtain from the Successor Agency its assumptions relating to the forecasted annual spending requirements and disclose in the report major assumptions associated with the projections. iii. For the forecasted annual revenues: a. Obtain from the Successor Agency its assumptions for the forecasted annual revenues and disclose in the report major assumptions associated with the projections. Results: The Successor Agency believes that future revenues together with balances dedicated or restricted to an enforceable obligation are sufficient to fund approved enforceable obligations. C. If the Successor Agency believes that projected property tax revenues and other general purpose revenues to be received by the Successor Agency are insufficient to pay bond debt service payments (considering both the timing and amount of the related cash flows), obtain from the Successor Agency a schedule demonstrating this insufficiency and apply the following procedures to the information reflected in that schedule. i. Compare the timing and amounts of bond debt service payments to the related bond debt service schedules in the bond agreement. Results: The Successor Agency is retaining amounts sufficient to make the debt service payments required on September 1, 2013. See Attachment 8.C for itemized schedule obtained from the Successor Agency. ii. Obtain the assumptions for the forecasted property tax revenues and disclose major assumptions associated with the projections. Results: The Successor Agency is expecting only to receive tax increment payments twice a year. The timing of these two tax payments does not agree with the debt service requirements. These amounts were approved on ROPS 3. iii. Obtain the assumptions for the forecasted other general purpose revenues and disclose major assumptions associated with the projections. - Results The Successor Agency does not anticipate receiving any other general purpose revenues. 11 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A D. If procedures A, B, or C were performed, calculate the amount of current unrestricted balances necessary for retention in order to meet the enforceable obligations by performing the following procedures. i. Combine the amount of identified current dedicated or restricted balances and the amount of forecasted annual revenues to arrive at the amount of total resources available to fund enforceable obligations. Results $2,374,856 of the Successor Agency's Pooled Cash Balance will need to be retained in order to meet the obligations on Schedule 8.A and 8.C. The Successor Agency estimated future annual revenues to be$0. ii. Reduce the amount of total resources available by the amount forecasted for the,annual spending . requirements. A negative result indicates the amount of current unrestricted balances that needs to be retained. Results As stated above in 80.i, $2,374,856 of the Successor Agency's Pooled Cash Balance will need to be retained in order to meet the obligations on Schedule 8.A and 8.C. iii. Include the calculation in the AUP report. Results According to the Successor Agency, estimated future annual revenue to be received is $0, thus $2,374,856 of the Agency's Pooled Cash balance at June 30, 2012 will need to be retained to meet the obligations listed on Attachment 8.A and 8.C. 12 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Citation: 34179.5(c)(5)(E) An itemized list and analysis of any amounts of current balances that are needed to satisfy obligations that will be placed on the Recognized Obligation Payment Schedules for the current fiscal year. 9. If the Successor Agency believes that cash balances as of June.30, 2012 need to be retained to satisfy . obligations on the Recognized Obligation Payment Schedule (ROPS) for the period of July 1, 2012 through June 30, 2013, obtain a copy of the final ROPS for the period of July 1, 2012 through December 31, 2012 and a copy of the final ROPS for the period January 1, 2013 through June.30, 2013. For each obligation listed on the RODS, the Successor Agency should add columns identifying (1) any dollar amounts of existing cash that are needed to satisfy that obligation and (2) the Successor Agency's explanation as to why the Successor Agency believes that such balances are needed to satisfy the obligation. Include this schedule as an attachment to the AUP report. Results: See Attachment 9 for the listing and explanations from the Successor Agency of the Pooled Cash balances that need to be retained and its corresponding enforceable obligation in the ROPS 2 (July 1, 2012 to December 31, 2012)and in the BOPS 3(January 1, 2013 to June 30, 2013). 13 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment A Citation: 34179.5(c)(6) The review shall total the net balances available after deducting the total amounts described in subparagraphs (B) to (E), inclusive, of paragraph (5). The review shall add any amounts that were transferred as identified in paragraphs (2) and (3) of subdivision (c) if an enforceable obligation to make that transfer did not exist. The resulting sum shall be available for allocation to affected taxing entities pursuant to Section 34179.6. It shall be a rebuttable presumption that cash and cash equivalent balances available to the successor agency are available and sufficient to disburse the amount determined in this paragraph to taxing entities. If the review finds that there are insufficient cash balances to transfer or that cash or cash equivalents are specifically obligated to the purposes described in subparagraphs (B), (D), and (E) of paragraph (5) in such amounts that there is insufficient cash to provide the full amount determined pursuant to this paragraph, that amount shall be demonstrated in an additional itemized schedule. 10. Include (or present) a schedule detailing the computation of the Balance Available for Allocation to Affected Taxing Entities. Amounts included in the calculation should agree to the results of the procedures performed in each section above. The schedule should also include a deduction to recognize amounts already paid to the County Auditor-Controller on July 12, 2012 as directed by the California Department of Finance. The amount of this deduction presented should be agreed to evidence of payment. The attached example summary schedule may be considered for this purpose. Separate schedules should be completed for the Low and Moderate Income Housing Fund and for all other funds combined (excluding the Low and Moderate Income Housing Fund). Results: We have included (prepared by the Successor Agency) a schedule detailing the computation of the Balance Available for Allocation to Affected Taxing Entities. We agreed amounts included in the calculation to the results of the procedures performed in each section of the report referenced in the calculation. The payments made as directed by the California Department of Finance were agreed to check payments. See Attachment 10 for the complete calculation obtained from Management of the Successor Agency. 14 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES AttachmentA . - 11. Obtain a representation letter from Successor Agency management acknowledging their responsibility for the data provided to the practitioner and.the data presented in the report or in any attachments to the report. . Included in the representations should be an acknowledgment that management is not aware of any transfers (as defined by Section 34179.5)from either the former redevelopment agency or the Successor Agency to other parties for the period from January 1, 2011 through June 30, 2012 that have not been properly identified in the AUP report and its related exhibits. Results: We obtained a representation letter dated November 27, 2012 from the Successor Agency's management acknowledging their responsibility for the data provided to us and the data presented in the report and in. all attachments to the report. Included in the representations there is an acknowledgment that management is not aware of any transfers (as defined by Section 34179.5) from either the former redevelopment agency or the Successor Agency to other parties for the period from January 1, 2011 through June 30, 2012 that have not been properly identified in the Agreed-upon procedures report and its related exhibits. 15 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 2 2A. Transfers from former RDA to City/County January 1, 2011 through January 31, 2012 Transfer Transfer Enforceable Obligation Transfer Description Amount Date City/County Required By If Yes, Date Correct Project Funding from City to RDA Findings made by Resolution 2011-01 by the City Council and CRA Board $ 819,235 02/08/2011 City of Grand Terrace Resolution 2011-01 02/08/2011 TSF to Street Capital Project Fund Progress payment-Grand Terrace Road-Prof 21,915 03/31/2011 City of Grand Terrace Resolution 2010-07 07/13/2010 TSF to Street Capital Project Fund Progress payment-Grand Terrace Road-Proj 26,656 06/30/2011 City of Grand Terrace Resolution 2010-07 07/13/2010 $ 867,806 2B. Transfers from former RDA to City/County February 1, 2012 through June 30, 2012 Transfer Transfer Enforceable Obligation Transfer Description Amount Date City/County Required By If Yes, Date None $ - 16 I COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.6 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 4 Redevelopment Redevelopment Redevelopment Successor Agency Agency Agency Agency 12 Months Ended 12 Months Ended 7 Months Ended 5 Months Ended 6/30/2010 6/30/2011 1/31/2012 6/30/2012 Assets (modified accrual basis) Cash and Investments $ 10,514,562 $ 27,797,818 $ 24,491,884 $ 24,344,057 Cash with Fiscal Agents 1,300,000 3,068,450 3,057,813 3,057,813 Accounts Receivable 414 423,974 - - Accrued Interest Receivable 10,878 11,443 11,316 11,316 Loans Receivable 90,630 84,087 63,184 63,184 Notes Receivable 5,295,550 4,076,694 3,219,889 3,219,889 Due from Other Funds 37,798 448,636 - - Land Held for Investment 4,087,317 4,087,316 4,842,472 4,842,472 Total Assets $ 21,337,149 $ 39,998,418 $ 35,686,558 $ 35,538,731 Liabilities (modified accrual basis) Accounts Payable $ 61,341 $ 257,615 $ 10,488 $ 368,540 Accrued Liabilities - - - 7,520 Other Liabilities 1,363,165 3,676,186 2,206,067 2,206,067 Deferred Revenue 90,630 84,087 63,184 63,184 Due to Other Funds 37,798 448,636 448,636 - Due to GT Housing Authority - - - 448,636 Total Liabilities $ 1,552,934 $ 4,466,524 $ 2,728,375 $ 3,093,947 17 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 4(continued) Redevelopment Redevelopment Redevelopment Successor . Agency Agency Agency Agency 12 Months Ended 12 Months Ended 7 Months Ended 5 Months Ended 6/30/2010 6/30/2011 1/31/2012 6/30/2012 Equity $ 19,784,215 $ 35,531,894 $ 32,958,183 $ 32,444,784 Total Liabilities + Equity $ 21,337,149 $ 39,998,418 $ 35,686,558 $ 35,538,731 Total Revenues: $ 9,968,700 $ 27,096,660 $ 2,488,434 $ 2,744,083 Total Expenditures: $ 11,065,467 $ 8,740,389 $ 3,141,298 $ 3,068,977 Total Transfers: $ - $ - $ (1,926,006) $ (188,505) Net change in equity $' (1,096,767) $ 18,356,271 $ (2,578,870) $ (513,399) Beginning Equity: $ 20,880,982 $ 19,784,215 $ 35,531,894 $ 32,958,183 Prior Period Adjustment: - (2,608,592) 5,159 - Ending Equity: $ 19,784,215 $ 35,531,894 $ 32,958,183 $ 32,444,784 Other Information (show year end balances for all three years presented): Capital assets as of end of year - - - - Long-term debt as of end of year 7,674,511 26,672,149 26,672,149 26,672,149 18 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 5 5. Listing of Asset Detail of CRA Other Funds as of June 30, 2012 Asset Information ID# Account Name Description GL Total CASH- Pooled Bank of America, Pooled Cash XX-010-00-00 $ 1,018,463 CASH - Due from Non-Pooled Cash Bank of America, Pooled Cash XX-010-00-00 188,504 CASH- Non- Pooled Bank of America#200, Non-Pooled Cash XX-010-00-00 4,133,255 CASH-Due to Pooled Cash Bank of America#200, Non-Pooled Cash XX-010-00-00 (188,504) CASH WITH FISCAL AGENT US Bank Trustee Accounts XX-010-05-00 3,057,813 INVESTMENTS- Bond Proceeds BOFA-Bond Proceeds-Certificate of Deposits xx-010-10-00 13,000,000 INVESTMENTS LAIF, Other Pooled Investment Accounts xx-010-10-00 5,943,068 INTEREST RECEIVABLE Interest Receivable xx-016-00-00 10,934 Due from City of Grand Terrace- Settlement City of Grand Terrace-Incorrect PT 33-015-25-00 3,219,889 0275-242-11 Land Held for Resale-Reuse 22100 Barton Road-0.40 Ac.-4/28/09 32-016-55-00 204,915 0275-242-10 Land Held for Resale-Reuse 22100 Barton Road-0.44 Ac.- 10/30/09 32-016-55-00 200,926 0276-202-54 Land Held for Resale-Reuse 22747 Barton Road-.33 Ac.- 1/13/09 32-016-55-00 363,133 0276-462-10 Land Held for Resale-Governmental 22720 Vista Grande- .66 Ac.-6/09/09 32-016-65-00 62,485 1167-141-08 Land Held for Resale-Reuse W. Commerce Dr and Michigan-0.93 Ac-10/3/05. 32-016-55-00 245,280 1167-151-61 Land Held for Resale-Reuse 6.74 Ac.- 11/22/00 . 32-016-55-00 226,355 1167-151-61SE Land Held for Resale-Governmental Baseball field- Pico 2.5 Ac. 11/22/00 32-016-55-00 83,976 1167-151-62 Land Held for Resale-Reuse 8.92 Ac. 11/22/00 32-016-55-00 296,540 1167-151-68 Land Held for Resale-Reuse 14.94 Ac. -Van Buren -11/22/00 32-016-55-00 263,607 1167-151-71 Land Held for Resale- Reuse 4.97 Ac. -11/22/00 32-016-55-00 175,373 1167-151-73 Land Held for Resale-Reuse .44 Ac- 11/22/00 32-016-55-00 14,907 1167-161-03 Land Held for Resale-Reuse 21992 De Berry St. 8/19/05 32-016-55-00 899,953 1167-161-04 Land Held for Resale- Reuse 21974 De Berry St. 7/21/05 32-016-55-00 409,701 1167-151-22 Land Held for Resale- Reuse 14.2 Acr. -7/29/11 32-016-55-00 1,395,321 $ 35,225,894 19 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 6 6A. Listing of Unspent Bond Proceeds as of June 30, 2012 Asset Description GL Total 2011A & B -Tax Allocation Bond - Proceeds Cash - Bank of America#200 32-010-00-00 $ 4,133,255 Proceeds due to Capital Project Bond Proceeds Fund (50)-Michigan/Storm Prj 32-010-00-00 (188,504) 2011A & B -Tax Allocation Bond - Proceeds Investmt.-BOF CD #6924 32-010-10-00 1,000,000 2011A& B -Tax Allocation Bond - Proceeds Investmt.-BOF CD#6925 32-010-10-00 2,000,000 2011A& B -Tax Allocation Bond - Proceeds Investmt.-BOF CD#6926 32-010-10-00 2,000,000 2011A & B - Tax'Allocation Bond - Proceeds Investmt.-BOF CD#6927 32-010-10-00 2,000,000 2011A & B-Tax Allocation Bond - Proceeds Investmt.-BOF CD#6928 32-010-10-00 2,000,000 2011A & B-Tax Allocation Bond - Proceeds Investmt.-BOF CD#6929 32-010-10-00 2,000,000 2011A & B-Tax Allocation Bond - Proceeds Investmt.-BOF CD#6930 32-010-10-00 2,000,000 $ 16,944,751 The restrictions on the usage of these bond proceeds are in effect until the related assets are expended for their intended purpose. 20 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 6 (continued) 6B. Listing of Grant Proceeds and.Program Income Restricted by Third Parties as of.June 30, 2012 Asset Description GL Total None $ - 6C. Listing of Other Assets Considered to be Legally Restricted as of June 30, 2012 Asset Description GL Total Cash With Fiscal Agent-2004 TABS Reserve Account held by Trustee 33-010-05-00 $ 1,300,000 Cash With Fiscal Agent-2011 A & B TABS Reserve Account held by Trustee 33-010-05-00 1,757,813 $ 3,057,813 The restrictions on the usage of these bond proceeds are in effect until the related assets are expended for their intended purpose. 21 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 7 7. Listing of Assets of CRA Other Funds that are not Cash or Cash Equivalents at June 30, 2012 Asset Information ID# Account Name Description GL Total Accrued Investment Earnings Accrued Investment Earnings 32-016-00-00 $ 7,278 Accrued Investment Earnings Accrued Investment Earnings 33-016-50-00 3,656 Due from City of Grand Terrace Settlement City of Grand Terrace-Incorrect PT 33-015-25-00 3,219,889 0275-242-11 Land Held for Resale-Reuse 22100 Barton Road-0.40 Ac.-4/28/09 32-016-55-00 204,915 0275-242-10 Land Held for Resale-Reuse 22100 Barton Road-0.44 Ac.-10/30/09 32-016-55-00 200,926 0276-202-54 Land Held for Resale-Reuse 22747 Barton Road-.33 Ac:1/13/09 32-016-55-00 363,133 0276-462-10 Land Held for Resale-Governmental 22720 Vista Grande-.66 Ac.-6/09/09 32-016-55-00' 62,485 1167-141-08 Land Held for Resale-Reuse W. Commerce Dr and Michigan-0.93 Ac-10/3/05 32-016-55-00 245,280. 1167-151-61 Land Held for Resale-Reuse 6.74 Ac:11/22/00 32-016-55-00 226,355 1167-151-61 SE Land Held for Resale-Governmental Baseball field-Pico 2.5 Ac. 11/22/00 32-016-55-00 83,976 1167-151-62 Land Held for Resale-Reuse 8.92 Ac. 11/22/00 32-016-55-00 296,540 1167-151-68 Land Held for Resale-Reuse 14.94 Ac.-Van'Buren-11/22/00 32-016-55-00 263,607 1167-151-71 Land Held for Resale-Reuse 4.97 Ac.-11/22/00 32-016-55-00 175,373 1167-151-73 Land Held for Resale-Reuse .44 Ac-11/22/00 32-016-55-00 14,907 1167-161-03 Land Held for Resale-Reuse 21992 De Berry St.8/19/05 32-016-55-00 899,953 1167-161-04 Land Held for Resale-Reuse 21974 De Berry St.7/21/05 32-016-55-00 409,701 1167-151-22 Land Held for Resale-Reuse 14.2 Acr.-7/29/11 32-016-55-00 1,395,321 $ 8,073,295 22 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 8 8A.Listing of Asset Balances Needed to be Retained to Satisfy Enforceable Obligations of June 30,2012 Assets to be retained Cash Justification Enforceable Obligation in order to fund obligations GL Total Projects and Wind Down Costs Approved Obligation under ROPS 1,2,3 Balance due under contract subject to participant Stater Bros.OPA; meeting benchmark goals Contract Balance Due Cash-Bank of America-Pooled Cash 37-010-00-00 $ 1,044,375 Accounts payable-installment due payable after A/P-Stater Bros.OPA-Invoice 07032012 due June 30,2012,as Approved under ROPS 1,2,3 and payable after 6/30/12 Cash-Bank of America-Pooled Cash 37-010-10-00 163,125 Accounts payable-installment due payable after Jones&Mayer-legal services contract for wind June 30,2012,as Approved'under ROPS 1,2,3 down-Invoice 59724&59726-Legal Cash-Bank of America-Pooled Cash 32-010-00-00 8,070 A/P-Project Payment due and payable after Rock Bottom-Ball Park-Contract Approved on June 30,2012 ROPS 1;2 Invoice#PW-06-10-7 Cash-Bank of America-Pooled Cash 32-010-00-00 10,600 A/P-Project Payment due and payable after June 30,2012 Accrued Expend-32-021-30-00 Cash-Bank of America-Pooled Cash 32-010-00-00 488 A/P-Project Payment due and payable after S.E.C.Rule 15 c2-12 Bond Compliance Requirement June 30,2012 Invoice 210416 due June 30,2012 Cash-Bank of America-Pooled Cash 33-010-00-00 3,000 Administrative Costs Accrued Employee Payroll and Payroll expenses Administrative Employee costs through at 6-30-2012 in Acct#-32-022-30-00 6/30/2012,payable after June 30,2012 Approved under ROPS Administrative Costs Cash=Bank of America-Pooled Cash 32-010-00-00 7,032 RSG-Tax Increment Administration 6-30-12; A/P-Project Payment due and payable after Invoice 0028339 June 30,2012 Approved under ROPS Administrative Costs Cash.-Bank of America-Pooled Cash 33-010-00-00 3,133 Subtotal $ 1,239,823, 23 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.6 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 8 (continued) 8B.Listing of Future Revenues together with Dedicated or Restricted to Enforceable Obligation Insufficient as of June 30,2012 Asset Description GL Total None Subtotal $ - 8C.Listing of Future Revenues Insufficient to Pay for Bond Debt Service as of June 30,2012 Asset Description GL Total 2011 A-TABS Reserve(ROPS-3.LN.26) Reserve as per H&S 34171(d)(1)(A) 33-010-00-00 $ 698,298 2012 B-TABS Reserve(ROPS-3,LN.27) Reserve as per H&S 34171(d)(1)(A) 33-010-00-00 436,735 Subtotal $ 1,135,033 24 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 9 9. Cash Balances Needed to be Retained as of June 30, 2012:for ROPS 2-July 1,2012 to December 31,2012 and BOPS 3-Jan. 1,2013 to June 30,2013. Cash Needed to be Approved ROPS Retained to Under Obligation Funding G/L Satisfy Reason Cash Needs to be Retained # ROPS Debt Obligation Date Payee Description Source Acct Obligations by Successor Agency Debt Service on 2004 CRA Tax Alloc Bonds Pooled Because this analysis is cash as of 1) 2 2004 Tax Allocation Bonds 2004 US Bank Due 8/1/12 RPTTF 33-010-10-00 Investments $ 666,188 6/30/12 and due to distribution of tax allocation only twice a year, Debt Service on 2011 CRA Tax Alloc Bonds Pooled agency needs to retain sufficient 2) 2 2011 A Tax Allocation Bond 2011 US Bank Due 8/1/12 RPTTF 33-010-10-00 Investments 680.898 cash necessary to pay bond debt Debt Service on 2011 CRA Tax Alloc Bonds Pooled service due,as allowed by H&S 3) 2 2011 B Tax Allocation Bond 2011 US Bank Due 8/1/12 RPTTF 33-010-10-00 Investments 429,545 34171(d)(1)(A). 2004/2011 Trustee Services for 2004&2011 TABS Pooled 4) 2 Trustee Fees Indenture US Bank Required under bond Indenture RPTTF .33-010-10-00 Investments 12,115 Private Refunding of CRA Debt Pooled 5) 2 Zion Loan 20D9 Zion First National Bank RPTTF 33-010-10-00 Investments 127,424 Pooled Due to distribution of tax allocation 8) 2 Agency Attorney 9/27/2011 Jones and Mayer Successor Agency Legal consulting RPTTF 33-010-10-00 Investments 30,000 only twice a year,early tax Pooled collection period cut-off by SS A-C 11) 2 Consulting Services Ongoing RSG Annual reporting requirements/administration RPTTF 33-010-10-00 Investments 25,000 and unpredictable costs such as Pooled pass-through and county admin 12) 2 Consulting Services Ongoing City News Group Advertising/Noticing RPTTF 33-010-10-0D Investments 11,565 costs, Agency needs to retain Purchase Pooled sufficient cash necessary to pay 13) 2 Consulting Services Order Smothers Appraisers Property Appraisals RPTTF 33-010-10-00 Investments 13,400 obligations becoming due,through Pooled ROPS 2 period ending 12/31/12. 14) 2 Consulting Services 4/12/2011 ACE Weed Abatement Weed abatement for Agency property RPTTF 33-010-10-00 Investments 20,000 June 1,2012 distribution resulted In Pooled a$2,620,371 DEFICIT in available 15) 2 Consulting Services 7/13/2010 Chamber of Commerce Business development services RPTTF 33-010-10-00 Investments 5,160 RPTTF. 20042011 Pooled 16) 2 Consulting Services Indenture Urban Futures Continuing Disclosure Reporting-bond issues RPTTF 33-010-10-00 Investments 3,500 Pooled 17) 2 Agency Owned Property Various Various contractors Property Maintenance and Insurance RPTTF 33-010-10-00 Investments 3,000 Pooled 18) 2 Annual Audit and Reporting Ongoing Rogers Anderson Malady Required annual auditing services RPTTF 33-010-10-00 Investments 7,500 Pooled 19) 2 Professional Services Ongoing Contractors Prof Svcs-Agency Dissolution-Oversight RPTTF 33-010-10-00 Investments 50,00D Pooled 20) 2 Professional Services Ongoing Special Counsel Oversight Board Legal Consulting RPTTF 33-010-10-00 Investments 17,500 2123110 Pooled Agency needs to retain sufficient 21) 2 Professional Services ongoing HDL Property lax allocation reconciliation RPTTF 33-010-10-00 Investments 8,000 cash necessary to pay obligations Administrative Expenses Various and Pooled becoming due,through ROPS 2 C-24 2 claimed for ROPS-2 period ongoing Agency-Employee Costs Administrative costs 7/1/12 to 12/31/12 RPTTF 33-010-10-00 Investments 107,500 period ending 12/31/12. Administrative Expenses Various and Agency-Employee Costs- Pooled June 1,2012 distribution resulted in C-25 2 claimed for ROPS-2 period ongoing PERS Administrative costs 7/1112 to 12/31/13 RPTTF 33-010-10-00 Investments 19,536 a$2,620,371 DEFICIT in available Administrative Expenses Various and Agency-Costs Overhead Pooled RPTTF. C-26 2 claimed for ROPS-2 period ongoing Alloc. Administrative costs 7/1112 to 12/31/14 RPTTF 33-010-10-00 Investments 160,650 Administrative Expenses Various and Agency-Costs Insurance Pooled C-27 2 claimed for ROPS-2 period ongoing All... Administrative costs 7/1/12 to 12/31/15 RPTTF 33-010-10-00 Investments 9,360 Recognized Obligation Cash must be retained by Agency Payment schedule-3 because Prior Period Adjustment on "Line J"Prior Period(1/1/12 ROPS 3 will reduce the funds through 6/30/12) distributed to Agency to pay for Estimated vs.Actual ROPS 3-Distribution Due on 112/13 will be Pooled ROPS 3 listed obligations. 3 Payments Successor Agency reduced by"Line J on ROPS-3 Reserve 33-010-1 O-00 Investments 496,012 Total $2.903,853 A. Sufficient cash Needs to be retained to pay ROPS-2 period(7/1/12 to 12/31/12)obligations because the June list 2012 distribution from RPTTF was less than the Agency's ROPS-2 period obligations and therefore the deficit would need to be funded by available cash B. ROPS-3 period(1/1/2013 to 6/30/13)with RPTTF to be distributed on approximately January 2,2013 is required under AB 1484 to be adjusted by an amount resulting from the comparison of the Successor Agency actual payments to the estimated payments listed on ROPS-1 period(1/1/2012 to 6/30/2012). Successor Agency has listed$496,012 as the potential decrease to eligible ROPS-3 obligations and therefore the RPTTF distribution on approximately January 2,2013 however this amount must be retained in Successor Agency cash to offset the anticipated RPTTF distribution reduction on January 2,2013. Note:ROPS-2 Obligations have been reduced if the Agency is aware of updated costs that are now lower. 25 COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF GRAND TERRACE DUE DILIGENCE REVIEW PURSUANT H&S CODE SECTION 34179.5 ALL OTHER FUNDS AGREED-UPON PROCEDURES Attachment 10 Grand Terrace Other Successor Agency Funds (Non-Housing) SUMMARY OF BALANCES AVAILABLE FOR ALLOCATION TO AFFECTED TAXING ENTITIES Total Ref Total amount of assets held by the successor agency as of June 30,2012(procedure 5) $ 35,225,894 Aft 5 Add the amount of any assets transferred to the city or other parties for which an enforceable obligation with.a third party requiring such transfer and obligating the use of the transferred assets did not exist(procedures 2 and 3) - Att 2-3 Less assets legally restricted for uses specified by debt covenants, grant restrictions, or restrictions imposed by other governments (procedure 6) (20,002,564) Att 6A, B &C Less assets that are not cash or cash equivalents (e.g., physical assets) (procedure 7) (8,073,295) Aft 7 Less balances that are legally restricted for the funding of an enforceable obligation (net of projected annual revenues available to fund those obligations) (procedure 8) (2,374,856) Att 8A, B& C Less balances needed to satisfy ROPS for the 2012-13 fiscal year(procedure 9) (2,903,853) Aft 9 Less the amount of payments made on July 12,2012 to the County Auditor-Controller as (220,024) directed by the California Department of Finance Amount to be remitted to county for disbursement to taxing entities $ 1,651,302 Note that separate computations are required for the Low and Moderate Income Housing Fund held by the Successor Agency and for all other funds held by the Successor Agency. NOTES: For each line shown above, an exhibit should be attached showing the composition of the summarized amount. If the review finds that there are insufficient funds available to provide the full amount due,the cause of the insufficiency should be demonstrated in a separate schedule. 26