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HomeMy WebLinkAboutED JPFA Sale of RA Bonds, Series 2009CITY OF SAN RAFAEL AGENDA ITEM NO.: 1 MEETING DATE: November 16, 2009 San Rafael Joint Powers Authority Agenda Report SUBJECT: RESOLUTION OF THE SAN RAFAEL JOINT POWERS FINANCING AUTHORITY AUTHORIZING THE PURCHASE AND SALE OF NOT TO EXCEED $16,000,000 AGGREGATE PRINCIPAL AMOUNT OF SAN RAFAEL REDEVELOPMENT AGENCY CENTRAL SAN RAFAEL REDEVELOPMENT PROJECT TAX ALLOCATION REFUNDING BONDS, SERIES 2009, UPON CERTAIN TERMS AND CONDITIONS, AND PROVIDING OTHER MATTERS PROPERLY RELATING THERETO Department: Redevelopment Prepared by: ^}4" W Initials: Nancy Mackle, Economic Development Director RECOMMENDATION: Staff recommends that the Joint Powers Authority adopt the attached resolution authorizing the issuance of not to exceed $16,000,000 principal amount of Tax Allocation Refunding Bonds, and authorize the City Manager and Economic Development Director to undertake actions associated with the bond issuance. BACKGROUND: Staff is proposing that the 2009 Refunding Bonds be sold as a negotiated transaction whereby the underwriter will purchase the Bonds from the San Rafael Joint Powers Authority ("JPA") at a previously negotiated price. Refunding bonds are generally sold in this manner because of the sensitive timing of defeasing the old bonds and issuing the new bonds. State Law requires JPA involvement on any Redevelopment Agency tax allocation bonds that are the subject of negotiated transaction. ANALYSIS: The Resolution approves the Bond Purchase contract between the Redevelopment Agency, the JPA and the underwriter (E.J. De La Rosa & Co.). The Agency Resolution being adopted at the same time as the Authority Resolution limits the true interest cost of the Refunding Bonds to 4% per annum and limits the underwriters compensation to 1 % of the par amount of the Refunding Bonds. The Resolution further authorizes members of the JPA, the JPA Executive Director and the JPA Treasurer, each acting alone, to purchase the Refunding Bonds from the Redevelopment Agency on behalf of the JPA and resell them to the underwriter pursuant to the terms of the Purchase Agreement. FISCAL IMPACT: The Authority is acting as a conduit and its financial exposure is limited to purchasing the Agency Bonds with proceeds received from the Authority's concurrent sale of the Bonds to the underwriter. FOR AGENCY SECRETARY ONLY File No.: Agency Meeting: Disposition: OPTIONS: • Adopt the attached resolution. • Reject the resolution and bond refunding. Staff does not recommend this option, as the Agency will lose the opportunity to raise additional funds. ACTION REQUIRED: Adopt the attached resolution. ATTACHMENTS: A: Bond Purchase Contract 26058-07 JH:SM:Idw 10/06/09 10/27/09 10/28/09 RESOLUTION NO. 09 - RESOLUTION OF THE CITY OF SAN RAFAEL JOINT POWERS FINANCING AUTHORITY AUTHORIZING THE PURCHASE AND SALE OF NOT TO EXCEED $16,000,000 PRINCIPAL AMOUNT OF SAN RAFAEL REDEVELOPMENT AGENCY CENTRAL SAN RAFAEL REDEVELOPMENT PROJECT TAX ALLOCATION REFUNDING BONDS, SERIES 2009, UPON CERTAIN TERMS AND CONDITIONS, AND PROVIDING OTHER MATTERS PROPERLY RELATING THERETO WHEREAS, the City of San Rafael (the "City") and the San Rafael Redevelopment Agency (the "Agency") have entered into a Joint Exercise of Powers Agreement, dated as of April 20, 1992 (the "Agreement"), creating the City of San Rafael Joint Powers Financing Authority (the "Authority"); WHEREAS, pursuant to Article 4 of Chapter 5 of Division 7 of Title 1 of the California Government Code (the "Act") and the Agreement, the Authority is authorized to purchase bonds issued by the Agency for financing and refinancing public capital improvements, working capital, liability and other insurance needs, or projects whenever there are significant public benefits, as determined by the Agency; WHEREAS, pursuant to the Act and the Agreement the Authority is further authorized to sell bonds so purchased to public or private purchasers at public or negotiated sale; and WHEREAS, the Authority desires to purchase from the Agency not to exceed $16,000,000 aggregate principal amount of San Rafael Redevelopment Agency Central San Rafael Redevelopment Project Tax Allocation Refunding Bonds, Series 2009, solely from the proceeds received from the Authority's concurrent sale of the Bonds to E. J. De La Rosa & Co., Inc. (the "Underwrite'); NOW, THEREFORE, BE IT RESOLVED by the governing board of the City of San Rafael Joint Powers Financing Authority, as follows: Section 1. The foregoing recitals are true and correct and this Authority so finds and determines. Section 2. The proposed form of bond purchase agreement (the "Purchase Contract"), by and among the Agency, the Authority and the Underwriter, substantially in the form on file with the Secretary of the Authority, is hereby approved. The Chairman, the Vice Chairman, the Executive Director or the Treasurer of the Authority, each acting alone, are hereby authorized and directed, for and in the name and on behalf of the Authority, to purchase the Bonds from the Agency and to accept the offer of the Underwriter to purchase the Bonds from the Authority, subject to the terms and conditions of the Purchase Contract, and to execute and deliver the Purchase Contract to the Agency and the Underwriter; provided, however, that the true interest cost on all of the Bonds shall not exceed 4.00% per annum and the Underwriter's discount or compensation (excluding original issue discount and original issue premium) shall not be greater than 1.00% of the par amount of the Bonds, excluding any original issue discount on the Bonds. The approval of any additions or changes in such form shall be conclusively evidenced by such execution and delivery of the Purchase Contract. I, ESTHER C. BEIRNE, Secretary of the City of San Rafael Joint Powers Financing Authority, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a special joint meeting of the City of San Rafael Joint Powers Financing Authority held on the 16th day of November, 2009, by the following vote, to wit: AYES: BOARD MEMBERS: NOES: BOARD MEMBERS: ABSENT: BOARD MEMBERS: ESTHER C. BEIRNE, Secretary -2-