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OCII outlines ROPS guidance changes, proposes excess bond‑proceeds uses for neighborhood projects
Summary
Staff updated the commission on Department of Finance guidance affecting accrual and reserves in the Recognized Obligation Payment Schedule (ROPS) and proposed uses for roughly $1.1 million in non‑housing, tax‑exempt excess bond proceeds for capital projects such as streetscape and façade improvements across project areas. No action was required.
OCII staff updated the commission on proposed changes and clarifications to the Recognized Obligation Payment Schedule (ROPS) for the July–December 2014 period, including new Department of Finance guidance on accrual treatment and reserves and candidate uses for excess tax‑exempt bond proceeds.
Deputy Director Sally Orth summarized guidance from the Department of Finance that allows successor agencies to accrue expenditures made after a ROPS period up to the time of the department’s true‑up so those payments can be reflected in the earlier ROPS period. "Our current analyst… feels that it's sort of an in between cash and accrual basis," Orth said, explaining the approach to prior‑period adjustments and cash balances.
Orth also described clarified uses of the reserves column and the ability, after the agency’s finding of completion, to spend excess bond proceeds within the constraints of original bond covenants (public‑use and private‑activity tests for tax‑exempt proceeds). The staff presentation identified draft excess non‑housing tax‑exempt bond proceeds totaling about $1,100,000 and proposed candidate uses by project area: approximately $785,000 for Bayview Opera House plaza construction (in partnership with MTA), $450,000 for Mayor’s Office model‑blocks/street‑scaping (figures presented previously), and remaining balances cited for South of Market ($591,000), Western Addition ($83,000) and Bayview Hunters Point ($434,000) as possible streetscape, façade or community‑facility improvements.
Commissioners asked how tax‑exempt restrictions constrain eligible uses and which city departments would manage the work. Staff responded that tax‑exempt proceeds are best used for capital, bricks‑and‑mortar work consistent with bond covenants and that the agency will coordinate with Invest in Neighborhoods, the Office of Economic and Workforce Development and city capital planning to identify and vet project scopes. Orth emphasized the amounts are draft and will be refined before contracts come back to the commission for final approval.
Staff outlined next steps: finalizing the cash‑balances and prior‑period adjustment reports, mailing the ROPS to the Oversight Board, and anticipating an initial Department of Finance determination in April followed by RPTTF distribution in June. The presentation was for discussion only; no commission vote was required.
