1999 AGN FEB 09 I01 - Laserfiche WebLink

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. . . . . .. ...... ... ..... ... ......._ ._._. .L . .... . _ ........ ._. . ._ . .. _ ._.._ . _ . .. .. .. ._... .... ._... Mid-Year Sudget Review January 9, 1999 Page 3 of 8 is not a desiEable circumstance but it is one, which the Agency must confront as a consequence of earlier project investment decisions. The low/mod housing fund receives a transfer of 20% of the property tax increments and sales taYes (in some cases) from the seven project areas. Its annual revenue stream is approximately $1 million. At present, the annual claims against the low/mod housing fund exceeds $2 million, including bond debt service, annual project contributions, and administrative allocations. Since the fund has nominal savings, this $1 million per year deficit must be financed through additional borrowings from the various project areas. You may recall that the fund bonowed $1.5 million during the current fiscal yeaz to satisfy its projected deficit. This will be a recurring condition in the coming years although steps are necessary to minimize the burden. Consequently, the financial plan focuses on solving the negative cashflows for the housing fund and then apportions the burden to other project azeas. This compromises the other project area's ability to undertake new projects but there aze no alternatives to a shared solut�on. Consolidated Proiect Area Assessments , The consolidated tables provide a macroeconomic view of the Agency's long-term financial plan by rolling up all of the individual project area plans. While care must be exercised in the interpretation of these results, the consolidated figures generally show that the Agency maintains sufficient resources to carry out all of its current obligations as well as enter into new obligations in certain project areas (Exhibit A). The Agency's assessed valu.iations and tax increment revenues have finally reversed their decade long decline and growth should help alleviate some of the fmancial difficulties within certain project areas (Exhibits B and C). The Summagy of Cashflows is a consolidation of results from each of the project azeas. A brief summary description of the major financial assumptions and work program within each project area follows. Low/Mod Housing Fund The low/mad housing fund is where the action is. The fund runs substantial deficits, which must be covered by bonowing from other non-housing funds. The major assumptions are: 1. That the Colton Palms project is acquired by the Agency with favorable financing from the County. 2. That the Rancho Mediterrania Project participation ends over a three yeaz period with a more rapid sales absorption due to zeduced lot prices and other program concessions. �