OFFICE OF THE CITY AUDITOR
Roland E. Smith, CPA
City Auditor

February 3, 2004

TO: President De La Fuente and Members of the City Council

SUBJECT: AGENCY RESOLUTION AUTHORIZING AND APPROVING THE AGENCY ADMINISTRATOR TO NEGOTIATE AND EXECUTE AN OWNER PARTICIPATION AGREEMENT WITH THE HOUSING AUTHORITY OF THE CITY OF OAKLAND TO CONTRIBUTE AN AMOUNT NOT TO EXCEED FOUR (4) MILLION DOLLARS IN REDEVELOPMENT AGENCY OF THE CITY OF OAKLAND COLISEUM REDEVELOPMENT TAX ALLOCATION BOND FUNDS TO PAY FOR THE CONSTRUCTION AND ADMINISTRATION OF SUBDIVISION STREET INFRASTRUCTURE IMPROVEMENTS TO SUPPORT THE DEVELOPMENT OF COLISEUM GARDENS HOPE VI HOUSING PROJECT BY OAKLAND COLISEUM GARDEN PARTNERS, LIMITED PARTNERSHIP

PURPOSE AND SCOPE

In accordance with the Measure H Charter Amendment, which was passed by the voters at the General election of November 5, 1996, we have made an impartial financial analysis of the accompanying Council Agenda Report and Proposed Resolution.

Since the Measure H Charter Amendment specifies that our impartial financial analysis is for informational purposes only, we did not apply Generally Accepted Government Auditing Standards as issued by the Comptroller General of the United States. Moreover, the scope of our analysis was impaired by Administrative Instruction Number 137, effective May 21, 1997, which provides only one (1) week for us to plan, perform and report on our analysis.

SUMMARY

The Oakland Housing Authority ("OHA") through agreements with the co-sponsors and developer of the project, Oakland Coliseum Gardens Partners, Limited Partnership plans to redevelop and construct the Oakland Coliseum Gardens Housing Project, a 283-unit mixed-income transit village in East Oakland, within the vicinity of the Coliseum BART Station, Oakland International Airport, the Coliseum, and Interstate 880 (I-880).

FISCAL IMPACT

Due to the size and complexity of the project it will be constructed in several phases, and the total cost is estimated at $124 million.

Phase I, which includes the subdivision infrastructure, is estimated to cost about $40.2 million. There is presently available to the Oakland Housing Authority about $31.8 million, leaving a shortfall of about $8.4.million.

The Agency has allocated $4.0 million in Coliseum Area Redevelopment Project Tax Allocation Bonds in the Fiscal year 2003-2005 budget. The balance of $4.4 million is proposed to come from the Oakland Housing Authority and developer funds.

CONCLUSION

The Proposed Resolution appears to be reasonable.

Prepared by:

Jack McGinity, CPA

Issued by:

Roland E. Smith, CPA, CFS
City Auditor

Report completion date:
January 10, 2004