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11-13-2018 CC Rpt 18COUNCIL AGENDA STAFF REPORTCOUNCIL AGENDA STAFF REPORT TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS DATE: NOVEMBER 13, 2018 FROM: CITY MANAGER ITEM NO:18 SUBJECT:RESOLUTION ORDERING THE FILING OF FORECLOSURE ACTIONS PURSUANT TO BOND COVENANTS RECOMMENDATION: Adopt a Resolution entitled: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, CALIFORNIA, ORDERING THE FILING OF FORECLOSURE ACTIONS ON DELINQUENT ASSESSMENT DISTRICT ASSESSMENTS AND DELINQUENT COMMUNITY FACILITIES DISTRICT SPECIAL TAXES PURSUANT TO BOND COVENANTS BACKGROUND/ANALYSIS: The City of Chino Hills administers the Assessment Districts and Community Facilities Districts within the City limits. These administration responsibilities include the levy and collection of assessments and special taxes which are levied annually to pay debt service in the various districts. The debt was incurred through the issuance of bonds; the proceeds of which have been used to construct much of the City's infrastructure. Annually, pursuant to covenants contained in the bond documents for the various districts, the City is charged with the responsibility of reviewing the status of payments made in the various districts. If certain delinquency thresholds are reached, the City is charged with the task of commencing foreclosure actions to collect the delinquencies. The costs of pursuing such delinquencies are collected from the district funds or the delinquent property owner, depending upon the district. As of November 7, 2018, delinquencies exist as follows: Assessor's Parcel NumberAssessor's Parcel Number Existing Fiscal Year DelinquenciesExisting Fiscal Year Delinquencies 1027-581-17-0000 1027-581-18-0000 FY 2013-14, 2014-15, 2015-16 & 2017-18 FY 2013-14, 2014-15, 2015-16, 2016-17 & 2017-18 The City Attorney's office will send letters to the delinquent property owners advising them of the City's obligations in this regard and suggesting that the delinquencies be cured to avoid the necessity of commencing foreclosure proceedings. At this time, City staff is unable to determine whether we will have to foreclose on any property owners this fiscal year, but this Resolution is needed in the event that such action is necessary. It is now appropriate, pursuant to the bond documents, to commence foreclosure proceedings to collect such delinquencies. Pursuant to Streets and Highways Code section 8834 and Government Code section 53356.4, the City Council must satisfy the procedural requirement of ordering the foreclosure actions. The attached Resolution, if adopted, will authorize commencement of such actions as required by the bond documents and the covenants binding the City. 122/211 ENVIRONMENTAL (CEQA) REVIEW: This proposed action is exempt from review under the California Environmental Quality Act (California Public Resources Code §§ 21000, et seq., "CEQA") and CEQA Guidelines (Title 14 California Code of Regulations §§ 15000, et seq.), because it does not involve any commitment to a specific project which could result in a potentially significant physical impact on the environment; and, constitutes an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. Accordingly, this action does not constitute a "project" that requires environmental review (see specifically 14 CCR § 15378(b)(4-5)). FISCAL IMPACT: No direct financial impact will result from the adoption of this Resolution. Any costs associated with the actions are recoverable from the delinquent properties. REVIEWED BY OTHERS: This item has been reviewed by the City Attorney. Respectfully Submitted,Recommended By: Attachments Resolution 123/211 1 of 3 RESOLUTION NO. 2018R-_____ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, CALIFORNIA, ORDERING THE FILING OF FORECLOSURE ACTIONS ON DELINQUENT ASSESSMENT DISTRICT ASSESSMENTS AND DELINQUENT COMMUNITY FACILITIES DISTRICT SPECIAL TAXES PURSUANT TO BOND COVENANTS THE CITY COUNCIL OF THE CITY OF CHINO HILLS DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS: SECTION 1. That the City Council of the City of Chino Hills does hereby find, determine and declare, as follows: (a) The Assessment Districts and the Community Facilities Districts administered by the City exist within the City of Chino Hills (the “Districts”); and (b) The City annually levies assessments and special taxes on properties located within those Districts; and (c) Annually, if certain thresholds are reached, the City is required by covenants contained in the bond documents for the Districts, to foreclose on properties that are delinquent in the payment of assessments or special taxes for the Districts; and (d) The City’s Finance Department has determined that those thresholds have been reached in certain Districts; and (e) Letters will be sent by the City Attorney to the delinquent property owners advising them of the City’s obligations in this regard and recommending that the delinquencies be cured to avoid the need to commence foreclosure proceedings; and (f) Such delinquencies have still not been cured; and (g) Streets and Highways Code section 8834 and Government Code section 53356.4 require that the City Council order foreclosure actions prior to the filing of such actions. SECTION 2. The City Council hereby orders, in satisfaction of the City’s obligations pursuant to covenants contained in the bond documents for the Districts, that foreclosure actions be commenced to collect delinquent assessments and special taxes owed for the Assessor’s Parcel Number 1027-581-17-0000 and 1027-581-18-0000. Said foreclosure actions are to proceed until such delinquencies are cured. 124/211 2 of 3 SECTION 3. The City Clerk shall certify as to the adoption of this resolution. PASSED,APPROVED, AND ADOPTED this 13th day of November, 2018. PETER J. ROGERS, MAYOR ATTEST: ____ CHERYL BALZ, CITY CLERK APPROVED AS TO FORM: _____ MARK D. HENSLEY, CITY ATTORNEY 125/211 3 of 3 STATE OF CALIFORNIA ) COUNTY OF SAN BERNARDINO ) § CITY OF CHINO HILLS ) I, Cheryl Balz, City Clerk of the City of Chino Hills, DO HEREBY CERTIFY that the foregoing Resolution No. 2018R-_____ was duly adopted at a regular meeting of the City Council of the City of Chino Hills held on the ____ day of _________, 2018, by the following vote, to wit: AYES: COUNCIL MEMBERS: NOES: COUNCIL MEMBERS: ABSENT: COUNCIL MEMBERS: ________________________________ CHERYL BALZ, CITY CLERK The foregoing is the original of Resolution No. 2018R-____ duly passed and adopted by the Chino Hills City Council at their regular meeting held _________________. ________________________________ CHERYL BALZ, CITY CLERK 126/211