REPORT TO COUNCIL
SUBJECT
Title
Introduce an Ordinance Declaring the Need for the Sunnyvale Industrial Development Authority, Declaring that the Sunnyvale Industrial Development Authority Shall Function, and Finding that the Action is Exempt from the California Environmental Quality Act
Report
BACKGROUND
The California Industrial Development Financing Act (commencing with Section 91500 of the California Government Code) (“Act”) authorizes the City of Sunnyvale (“City”) to activate an industrial development authority by ordinance if it finds that there is a need within the City for such an authority.
Staff recommends that the City Council make the required financings and introduce an ordinance to activate the Sunnyvale Industrial Development Authority (“Industrial Development Authority”). Among other benefits to the City, the Industrial Development Authority would be available to act as a second member of the Sunnyvale Financing Authority (“Financing Authority”) in anticipation of the Successor Agency to the Redevelopment Agency of the City of Sunnyvale (“Successor Agency”) which is expected to dissolve in 2026 after it has satisfied all of its enforceable obligations.
The Council will consider the ordinance for adoption at the second reading on September 9, 2025.
ENVIRONMENTAL REVIEW
The action being considered is exempt from review under the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section 15378(b)(4) because it involves the creation of a government funding mechanism that does not involve any commitment to any specific project that may result in a potentially significant physical impact on the environment.
DISCUSSION
The City wishes to ensure that it has access to the full range of public financing options when needed. Establishing the Industrial Development Authority would provide the City with the services of an authority that can promote and enhance economic development, increasing opportunities for employment in accordance with the Act.
In addition, activating the Industrial Development Authority would establish a local agency governed by the City Council that can act as a member of the Financing Authority. The Financing Authority was formed in 1992 through a Joint Powers Agreement between the City and the former Redevelopment Agency (which is now the Successor Agency). A Joint Powers Authority requires at least two members. The City is currently in discussions with Santa Clara County on a plan to resolve the Successor Agency’s enforceable obligations and ultimately dissolve the Successor Agency.
In the meantime, staff is preparing to bring to the City Council for approval a solid waste revenue financing for improvements to the SMaRT Facility, and it will be important as part of that effort to amend the Joint Exercise of Powers Agreement under which the Financing Authority was established to add a third public agency, such as the Industrial Development Authority.
FISCAL IMPACT
There is no fiscal impact from the recommended action.
PUBLIC CONTACT
Public contact was made by posting the Council meeting agenda on the City's official-notice bulletin board at City Hall, at the Sunnyvale Public Library and in the Department of Public Safety Lobby. In addition, the agenda and this report are available at the City Hall reception desk located on the first floor of City Hall at 456 W. Olive Avenue (during normal business hours), and on the City's website.
STAFF RECOMMENDATION
Recommendation
Introduce an Ordinance declaring the need for the Sunnyvale Industrial Development Authority, declaring that the Sunnyvale Industrial Development Authority shall function, and finding that the Action is exempt from the California Environmental Quality Act.
Levine Act
LEVINE ACT
The Levine Act (Gov. Code Section 84308) prohibits city officials from participating in certain decisions regarding licenses, permits, and other entitlements for use if the official has received a campaign contribution of more than $500 from a party, participant, or agent of a party or participant in the previous 12 months. The Levine Act is intended to prevent financial influence on decisions that affect specific, identifiable persons or participants. For more information see the Fair Political Practices Commission website: www.fppc.ca.gov/learn/pay-to-play-limits-and-prohibitions.html
An “X” in the checklist below indicates that the action being considered falls under a Levine Act category or exemption:
SUBJECT TO THE LEVINE ACT
___ Land development entitlements
___ Other permit, license, or entitlement for use
___ Contract or franchise
EXEMPT FROM THE LEVINE ACT
___ Competitively bid contract*
___ Labor or personal employment contract
___ Contract under $50,000 or non-fiscal
___ Contract between public agencies
_X_ General policy and legislative actions
* "Competitively bid" means a contract that must be awarded to the lowest responsive and responsible bidder.
Staff
Prepared by: Matt Paulin, Director of Finance
Reviewed by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. Ordinance