Loading...
HomeMy WebLinkAboutCC Reso 2022-15 RESOLUTION NO. 2022-15 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CATHEDRAL CITY AUTHORIZING AND APPROVING THE ISSUANCE OF CATHEDRAL CITY PUBLIC FINANCING AUTHORITY LEASE REVENUE BONDS, SERIES 2022A (FEDERALLY TAXABLE), IN THE AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $35,000,000 APPROVING THE EXECUTION AND DELIVERY OF A SITE AND FACILITY LEASE, LEASE AGREEMENT, CONTINUING DISCLOSURE AGREEMENT, BOND PURCHASE AGREEMENT AND PRELIMINARY OFFICIAL STATEMENT; AND AUTHORIZING CERTAIN ACTIONS AND EXECUTION OF DOCUMENTS RELATED THERETO WHEREAS, the City of Cathedral City, California (the "City") is a charter city duly organized and existing under and pursuant to the Constitution and laws of the State of California. WHEREAS, the Cathedral City Financing Authority (the "Authority") is a joint powers authority duly organized and existing under and pursuant to that certain Joint Exercise of Powers Agreement, dated December 1, 1993, by and between the City and the Cathedral City Redevelopment Agency, and under the provisions of Articles 1 through 4 (commencing with Section 6500), Chapter 5, Division 7, Title 1 of the Government Code of the State of California (the "Act"), and is authorized pursuant to Article 4 of the Act to borrow money for the purpose of financing and refinancing outstanding obligations; and WHEREAS, the City is obligated by the Public Employees' Retirement Law, commencing with Section 20000 of the Government Code of the State of California, as amended, to make payments relating to pension benefits accruing to the California Public Employees' Retirement System's ("CaIPERS") members, including the City; and WHEREAS, the City is obligated specifically to make certain payments to CaIPERS in respect of current and retired public safety employees and miscellaneous employees under the pension programs of CaIPERS that amortize such obligations over a fixed period of time (collectively, the "CaIPERS Obligation"); and WHEREAS, the City desires, subject to market conditions, that the Authority issue its Lease Revenue Bonds, Series 2022A (Federally Taxable) (the "2022A Bonds") for the purpose of: (i) funding all or a portion of its CaIPERS Obligation; (ii) refunding all of the outstanding Authority Lease Revenue Refunding Bonds (Capital Facilities Projects), Series 2015A (Taxable) (the "Refunded Bonds"); (iii) funding a reserve for the 2022A Bonds, if necessary or desirable; and (iv) paying the costs of issuing the 2022A Bonds; and 1049106652 WHEREAS, the 2022A Bonds are to be issued and secured pursuant to an Indenture (the "Indenture"), by and between the Authority and a trustee to be named therein (the "Trustee"), the form of which will be approved by the Authority; and WHEREAS, it is proposed that the City and the Authority enter into a Site and Facility Lease (the "Site Lease"), by and between the City and the Authority, pursuant to which the City will lease property of the City as an Responsible Officer of the City shall designate (the "Leased Property") to the Authority; and WHEREAS, it is proposed that the City and the Authority enter into a Lease Agreement (the "Lease"), by and between the Authority and the City, the proposed form of which is on file with the City Clerk, pursuant to which City will lease the Leased Property from the Authority; and WHEREAS, under the Lease, the City will be obligated to make lease payments to the Authority which the Authority will assign to the Trustee to pay debt service on the 2022A Bonds; and WHEREAS, it is proposed that the City and the Authority deliver a Preliminary Official Statement and final Official Statement in connection with the marketing and sale of the 2022A Bonds; and WHEREAS, it is proposed that the City and the Authority enter into a Bond Purchase Agreement (the "Bond Purchase Agreement"), by and between the Authority and Raymond James & Associates, Inc., as underwriter, in connection with the sale of the 2022A Bonds; and WHEREAS, it is proposed that the City execute and deliver a Continuing Disclosure Agreement (the "Continuing Disclosure Agreement"), by and between the City and a dissemination agent named therein in connection with the sale of the 2022A Bonds; NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Cathedral City (the "City Council") as follows: Section 1. Approval of 2022A Bonds. The City Council hereby approves the issuance of the 2022A Bonds by the Authority in the aggregate principal amount not to exceed $35,000,000. Section 2. Approval of the Site and Facility Lease. The City Council hereby approves the Site and Facility Lease in substantially the form on file with the City Clerk. The Mayor, the City Manager or the Administrative Services Director, any of their respective designees (each, a "Responsible Officer"), are each hereby authorized to execute the Site and Facility Lease in substantially such form, with such revisions, amendments and completions as shall be approved by a Responsible Officer, such approval to be conclusively evidenced by the execution and delivery thereof. 104910665.2 2 Section 3. Approval of the Lease Agreement. The City Council hereby approves the Lease Agreement in substantially the form on file with the City Clerk of the City. Any Responsible Officer is hereby authorized to execute the Lease Agreement in substantially such form, with such revisions, amendments and completions as shall be approved by a Responsible Officer, such approval to be conclusively evidenced by the execution and delivery thereof. Section 4. Preliminary Official Statement. The proposed form of Preliminary Official Statement with respect to the issuance of the 2022A Bonds, substantially in the form on file with the City Clerk, is hereby approved, with such revisions, amendments and completions as shall be approved by an Responsible Officer with the advice of Disclosure Counsel, in order to make the Preliminary Official Statement final as of its date, except for the omission of certain information, as permitted by Section 240.15c2- 12(b)(1) of Title 17 of the Code of Federal Regulations ("Rule 15c2-12"), and any certificate relating to the finality of the Preliminary Official Statement under Rule 15c2- 12. Any Responsible Officer is hereby authorized and directed to execute and deliver a final Official Statement in the form of the Preliminary Official Statement, with such additions and changes as may be approved by any Responsible Officer executing the same, such approval to be conclusively evidenced by the execution and delivery thereof. Section 5. Bond Purchase Agreement. The proposed form of Bond Purchase Agreement, on file with the City Clerk, is hereby approved. Any Responsible Officer is hereby authorized and directed, for and on behalf of the Authority with the advice of Bond Counsel, to execute and deliver the Bond Purchase Agreement, substantially in the form on file with the City Clerk, with such changes therein, deletions therefrom and additions thereto as such Responsible Officer shall approve, such approval to be conclusively evidenced by the execution and delivery of the Bond Purchase Agreement; provided, that the principal amount of the 2022A Bonds shall not exceed $35,000,000, the true interest cost for the 2022A Bonds shall not exceed 4.50%, the underwriter's discount shall not exceed 0.65% of the principal amount of the 2022A Bonds. Section 6. Continuing Disclosure Agreement. The proposed form of Continuing Disclosure Agreement, on file with the City Clerk, is hereby approved. Any Responsible Officer is hereby authorized and directed for and on behalf of the City, to execute and deliver the Continuing Disclosure Agreement, substantially in the form on file with the City Clerk, with such changes therein, deletions therefrom and additions thereto as such Responsible Officer shall approve, such approval to be conclusively evidenced by the execution and delivery of the Continuing Disclosure Agreement. Section 7. Good Faith Estimates. Senate Bill 450 (Chapter 625 of the 2017- 2018 Session of the California Legislature) ("SB 450") requires that the governing body of a public body obtain from an underwriter, financial advisor or private lender and disclose, before authorizing the issuance of bonds with a term of greater than 13 months, certain good faith cost estimates. Set forth in attached Exhibit A, which is incorporated by reference, are good faith estimates of: (a) the true interest cost of the 2022A Bonds, (b) the sum of all fees and charges paid to third parties with respect to 104910665.2 3 the 2022A Bonds, (c) the amount of proceeds of the 2022A Bonds expected to be received net of the fees and charges paid to third parties, and (d) the sum total of all debt service payments on the 2022A Bonds calculated to the final maturity of the 2022A Bonds, plus the fees and charges paid to third parties not paid with the proceeds of the 2022A Bonds. Section 8. Official Actions. The Responsible Officers, the City Clerk, any Assistant City Clerk and all other officers and agents of the City are hereby authorized and directed, for and in the name and on behalf of the City, to do any and all things and take any and all other actions, and the execution and delivery of any and all assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance, terminations, warrants and other documents, which they, or any of them, deem necessary or advisable to consummate the lawful execution and delivery of the Site and Facility Lease and the Lease Agreement and the consummation of the transactions described herein and therein. Section 9. Electronic Signatures. This Resolution and the documents and certificates relating to the 2022A Bonds may be executed with electronic signatures in accordance with Government Code of the State of California §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature. Section 10. Effective Date. This Resolution shall take effect from and after the date of its passage and adoption. PASSED, APPROVED AND ADOPTED THIS 23rd DAY OF MARCH 2022. / I Ernesto Gutierrez, Mayor ATTEST: \j I ,l,C f/,t_, ,t-t Tracey R e mosillo, City Clerk 104910665.2 4 I HEREBY CERTIFY that the foregoing Resolution was adopted by a vote of the City Council of the City of Cathedral City at its regular meeting of March 23, 2022, by the following vote: AYES: Councilmember Ross; Mayor Pro Tem Lamb and Mayor Gutierrez NOES: Councilmembers Gregory and Carnevale ABSENT: None ABSTAIN: None l_{A 1. Wilms Tracey WHertmosillo, City Clerk 104910665.2 5 EXHIBIT A GOOD FAITH ESTIMATES The following information was obtained from Raymond James & Associates, Inc. with respect to the 2022A Bonds approved in the attached Resolution, and is provided in compliance with Senate Bill 450 (Chapter 625 of the 2017-2018 Session of the California Legislature) with respect to the 2022A Bonds: 1. True Interest Cost of the 2022A Bonds. Assuming an aggregate principal amount of 2022A Bonds of $30,280,000 are sold and based on market interest rates prevailing at the time of preparation of this information, a good faith estimate of the true interest cost of the 2022A Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the 2022A Bonds, is 3.59%. 2. Finance Charge of the 2022A Bonds. Assuming an aggregate principal amount of 2022A Bonds of $30,280,000 are sold and based on market interest rates prevailing at the time of preparation of this information, a good faith estimate of the finance charge of the 2022A Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the 2022A Bonds), is $497,104 as follows: Cost of Issuance Estimated Amounts Bond Counsel $ 81,800 Disclosure Counsel 43,000 Municipal Advisor 57,000 Title Insurance 29,000 Trustee & Trustee's Counsel 8,000 Printer 2,000 Rating Agency 34,000 Miscellaneous 45,484 Underwriter 196,820 Total $497,104 3. Amount of Proceeds to be Received. Assuming an aggregate principal amount of 2022A Bonds of $30,280,000 are sold and based on market interest rates prevailing at the time of preparation of this information, a good faith estimate of the amount of proceeds expected to be received by the Authority for sale of the 2022A Bonds less the finance charge of the 2022A Bonds described in 2 above and any reserves or capitalized interest paid or funded with proceeds of the 2022A Bonds, is $29,782,896. 4. Total Payment Amount. Assuming an aggregate principal amount of 2022A Bonds of $30,280,000 are sold and based on market interest rates prevailing at the time of preparation of this information, a good faith estimate of the total payment amount, which means the sum total of all payments the Authority will make to pay debt service on the 2022A Bonds plus the finance charge of the 2022A Bonds described in paragraph 2 above not paid with the proceeds of the 2022A Bonds, calculated to the final maturity of the 2022A Bonds, is $36,908,801. 104910665.2 Attention is directed to the fact that the foregoing information constitutes good faith estimates only. The actual interest cost, finance charges, amount of proceeds and total payment amount may vary from the estimates above due to variations from these estimates in the timing of 2022A Bond sales, the amount of 2022A Bonds sold, the amortization of the 2022A Bonds sold and market interest rates at the time of each sale. The date of sale and the amount of 2022A Bonds sold will be determined by the Authority based on need for project funds and other factors. The actual interest rates at which the 2022A Bonds will be sold will depend on the bond market at the time of each sale. The actual amortization of the 2022A Bonds will also depend, in part, on market interest rates at the time of sale. Market interest rates are affected by economic and other factors beyond the City's and the Authority's control. The City and the Authority have approved the execution and delivery of the 2022A Bonds with a maximum true interest cost not to exceed 4.50% per annum. 104910665.2 2