Common use of Compensation Agreement Clause in Contracts

Compensation Agreement. Health and Safety Code Section 34191.3 provides that once an LRPMP has been approved by DOF, the LRPMP supersedes all other provisions of the statute relating to the disposition and use of the former redevelopment agency’s real property assets. Nonetheless, in compliance with a directive from DOF, with Oversight Board consent, the Successor Agency included the following provision in the LRPMP: ORSA [the Successor Agency] interprets Health and Safety Code Section 34191.5 to mean that agreements with taxing entities are not required in connection with the disposition of successor agency properties to the sponsoring city for governmental use or for future development. However, pursuant to California Department of Finance direction, the City of Oakland will enter into an agreement or agreements with the affected taxing entities prior to disposition of properties by the City that addresses disposition of the parcels to be conveyed to the City pursuant to this Plan. The agreement(s) will specify that any net unrestricted proceeds from sales of the parcels will be distributed to all of the affected taxing entities on a pro rata basis in proportion to each entity’s respective share of the property tax base. The calculation of net unrestricted proceeds shall take into account the transaction costs incurred by the City in marketing the property and processing the sale or lease, as well as the costs incurred by the City in carrying or maintaining the property and in preparing and improving the site for development. Notwithstanding the foregoing, this paragraph will not be operative if a court order or decision, legislation or Department of Finance policy reverses the Department’s directive regarding such agreements. The Parties intend this Agreement to satisfy the foregoing provision of the LRPMP. Consistent with the above LRPMP provision, if a court order, legislation or DOF policy reverses the DOF requirement, the Parties acknowledge that it will not be necessary for the City to pay compensation to the Taxing Entities for the sale of the Development Properties.