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HomeMy WebLinkAboutFin Guide Dogs for the Blind FinancingAgenda Item No: Meeting Date: April 18, 2011 SAN RAFAEL CITY COUNCIL AGENDA REPORT Department: FINANCE Prepared by: Cindy Mosser Finance Director City Manager ApprovalX#4-c_� SUBJECT: RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING A FINANCING TO BE UNDERTAKEN BY THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $12,500,000 FOR THE PURPOSE OF FINANCING AND REFINANCING THE DEMOLITION, CONSTRUCTION, RENOVATION, REHABILITATION, IMPROVEMENT AND EQUIPPING OF A DORMITORY AND OTHER CAPITAL FACILITIES AND CERTAIN OTHER MATTERS RELATING THERETO TO BENEFIT GUIDE DOGS FOR THE BLIND, INC. RECOMMENDATION: ACCEPT RESOLUTION, AS PRESENTED BACKGROUND: Guide Dogs for the Blind, Inc. (the Corporation) is an organization classified under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the "Code"). The Corporation was established in 1942 in Atherton, California to provide enhanced mobility to blind and visually impaired veterans by partnering them with trained guide dogs throughout their lifetime. The program quickly expanded to include persons from all walks of life and the Corporation's operations were moved to San Rafael, California in 1946. A second campus was opened in Boring, Oregon in 1994. The Corporation provides all services to its applicants and active graduates free of charge. The Corporation receives its support from contributions, bequests and earnings from its long-term investment fund. All funding comes from private sources; the Corporation does not receive any government funding nor do its students pay any form of tuition. The Corporation plans to make capital improvements (the "Project") at their campus located at 350 Los Ranchitos Road, San Rafael, California 94903 (the "San Rafael Campus"), including the construction of a new dormitory to be built at the present site of the Corporation's existing dormitory. The design of the new dormitory will encompass program needs defined by staff for ease of orientation and mobility of students. The building is designed as a "U" shape with 18 single occupancy rooms, maximizing student privacy while enhancing the efficiency of student training. Space for nursing, cafeteria, student lounges and classrooms will also be included. The project will be built to the U.S. Green Building Council's Leadership in Energy and Environmental Design silver LEED standard. The design phase is expected to be completed in July 2011 and the project is expected to be put out to bid FOR CITY CLERK ONLY File No.: Council Meeting: Disposition: SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2 in December 2011. Groundbreaking is slated for Fall of 2011; it is expected to open in Fall of 2012. The Corporation has requested the California Statewide Communities Development Authority (the Authority) to issue tax-exempt Obligations on its behalf to assist in financing the costs of the Project. The Corporation will use the proceeds of the Obligations for the following purposes: (1) finance the costs of demolition, construction, installation, renovation, rehabilitation, improvement and equipping of the above-described dormitory; (2) finance the costs of miscellaneous construction, renovation, improvements, capital maintenance, equipment acquisition and installation thereof at the San Rafael Campus; and (3) pay various costs of issuance and other related costs with respect to the Obligations. The Project will be owned and operated by the Corporation. The capital improvements to be financed by the Obligations provide an important public benefit to the present and future students of the Corporation and to the community at large. Section 147(f)(2) of the Internal Revenue Code of 1986 requires that, in order for the interest on the Obligations to be excluded from gross income for federal income tax purposes, the "applicable elected representative" of the host governmental unit must approve the issuance of the Obligations. Such approval must follow a public hearing that has been preceded by reasonable public notice. This hearing and approval process is referred to as "TEFRA" approval (named after the Tax Equity and Fiscal Responsibility Act of 1982). The Project is located within the jurisdiction of the City of San Rafael (the City), and the City is a member of the California Statewide Communities Development Authority. Therefore, the City has been asked to conduct the public hearing and to approve the Obligations as the host governmental unit. Proper notice has been made concerning this hearing. FISCAL IMPACT: The Obligations would be payable solely from amounts received pursuant to the terms and provisions of a financing agreement to be executed by the Corporation. The City would not be a party to the financing agreement. The Obligations would not be secured by any form of taxation, or by any obligation of either the City or the Authority. Neither would the Obligations represent or constitute a general obligation of either the City or the Authority. As stated in the published notice, a form of which is attached, this hearing is simply an opportunity for all interested persons to speak or to submit written comments concerning the proposal to issue the Obligations and the nature or location of the Project to be financed. OPTIONS/ACTION REQUIRED: Adopt the resolution, as presented. ATTACHMENTS RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING A FINANCING TO BE UNDERTAKEN BY THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $12,500,000 FOR THE PURPOSE OF FINANCING AND REFINANCING THE DEMOLITION, CONSTRUCTION, RENOVATION, REHABILITATION, IMPROVEMENT AND EQUIPPING OF A DORMITORY AND OTHER CAPITAL FACILITIES AND CERTAIN OTHER MATTERS RELATING THERETO TO BENEFIT GUIDE DOGS FOR THE BLIND, INC. WHEREAS, Guide Dogs for the Blind, Inc., a California nonprofit public benefit corporation (the "Corporation") has requested that the California Statewide Communities Development Authority (the "Authority") participate from time to time over the next three years in issuing one or more tax-exempt obligations (the "Obligation") in an aggregate principal amount not to exceed $12,500,000, for the purpose of financing and/or refinancing various capital facilities (the "Project") as more fully described below; WHEREAS, First Republic Bank or any other lender selected by the Corporation (the "Lender"), the Authority and the Corporation will enter into a master loan agreement (the "Master Loan Agreement") under which the Authority will loan the proceeds of the Obligation to the Corporation for the following purposes: (1) finance the costs of demolition, construction, installation, renovation, rehabilitation, improvement and equipping of a dormitory located at 350 Los Ranchitos Road, San Rafael, California 94903 (the "San Rafael Campus"); (2) finance the costs of miscellaneous construction, renovation, improvements, capital maintenance, equipment acquisition and installation thereof at the San Rafael Campus; and (3) pay various costs of issuance and other related costs with respect to the Obligation. The. Project will . be owned and operated by the Corporation; WHEREAS, the Project is to be owned and operated by the Corporation and is located within the City of San Rafael (the "City"); WHEREAS, pursuant to Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Code"), the issuance of the Obligation by the Authority must be approved by the City because the Project is located within the territorial limits of the City; and WHEREAS, the City Council of the City of San Rafael (the "City Council") is the elected legislative body of the City and is one of the applicable elected representatives required to approve the issuance of the Obligation under Section 147(f) of the Code; and WHEREAS, the Corporation and the Authority have requested that the City Council approve the issuance of the Obligation by the Authority for the purposes of financing and/or refinancing the Project in order to satisfy the public approval requirements of Section 147(f) of the Code and Section 9 of the Amended and Restated Joint Exercise of Powers Agreement, dated as of June 1, 1988 (the "Agreement"), among certain local agencies, including the City; and WHEREAS, pursuant to Section 147(f) of the Code, the City Council has, following notice duly given, held a public hearing regarding the issuance of the Obligation, and now desires to approve the issuance of the Obligation by the Authority; and WHEREAS, the City Council understands that its actions in holding this public hearing and in approving this Resolution do not obligate the City in any manner for payment of the principal, interest, fees or any other costs associated with the issuance of the Obligation, and said City Council expressly conditions its approval of this Resolution on that understanding. NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of San Rafael, as follows: Section 1. The City Council hereby approves the issuance of the Obligation by the Authority for the purposes of financing and/or refinancing the Project. It is the purpose and intent of the City Council that this resolution constitute approval of the issuance of the Obligation by the Authority, for the purposes of (a) Section 147(f) of the Code by the applicable elected representative of the issuer of the Obligation and the governmental unit having jurisdiction over the area in which the Project is located, in accordance with said Section 147(f), and (b) Section 9 of the Agreement. Section 2. The officers of the City Council are hereby authorized and directed, jointly and severally, to do any and all things and execute and deliver any and all documents, certificates and other instruments which they deem necessary or advisable in order to carry out, give effect to and comply with the terms and intent of this Resolution and the financing transaction approved hereby. Any actions heretofore taken by such officers are hereby ratified and approved. Section 3. The City Council expressly conditions its approval of this Resolution on its understanding that the City shall have no obligation whatsoever to pay any principal, interest, fees or any other costs associated with the Authority's issuance of the Obligation for the financing and/or refinancing of the Project to be located in the City. Section 4. This Resolution shall take effect immediately upon its adoption. I, Esther C. Beirne, Clerk of the City of San Rafael, hereby certify that the foregoing Resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of the City of San Rafael on the 18th day of April, 2011, by the following vote, to wit: AYES: COUNCIL MEMBERS: NOES: COUNCIL MEMBERS: ABSENT: COUNCIL MEMBERS: Esther C. Beirne City Clerk Marin Independent Journal 150 Alameda del Prado PO Box 6150 Novato, California 94948-1535 (415) 382-7335 legals@marinij.com SAN RAFAEL,CITY OF PO BOX 151560/CITY CLERK, DEPT OF PUBLIC WORKS,1400 FIFTH AVE SAN RAFAEL CA 94915-1560 PROOF OF PUBLICATION (2015.5 C.C.P.) STATE OF CALIFORNIA County of Marin FILE NO. 0003941166 I am a citizen of the United States and a resident of the County aforesaid: I am over the age of eighteen years, and not a party to or interested in the above matter. I am the principal clerk of the printer of the MARIN INDEPENDENT JOURNAL, a newspaper of general circulation, printed and published daily in the County of Marin, and which newspaper has been adjudged a newspaper of general circulation by the Superior Court of the County of Marin, State of California, under date of FEBRUARY 7, 1955, CASE NUMBER 25566; that the notice, of which the annexed is a printed copy (set in type not smaller than nonpareil), has been published in each regular and entire issue of said newspaper and not in any supplement thereof on the following dates, to -wit: 4/4/2011 I certify (or declare) under the penalty of perjury that the foregoing is true and correct. Dated this 4th day of April, 2011. Signature PROOF OF PUBLICATION Legal. No. 0003941166 OF PUBLIC PURE ATNT TO SECTION 1HEARINGf) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, FOR THE FINANCING OF CERTAIN PROJECTS FROM THE ISSUANCE OF TAX-EXEMPT OBLIGATIONS NOTICE IS HEREBY GIVEN that at 8;00 p.m. (or as soon thereafter as the matter can be heard at such meeting on April 18, 2011, the City Council of the City of an Rafael, located at the Council Cham- uevel=t AUtnority tine "Autnonty" 7, in one or more series or tranches over the next three years In an aggregate prinlal amount not to exceed Twelve Million Five Hundred Thousand dollars ($12,500,000), pursuant to a plan of finance for var- ious capital facilities as more fully described be• low. The proceeds of the Obligation shall be loaned to Guide Dogs for the Blind, Inc, (the "Cor- poration"), a California nonprofit public benefit corporation and an organization described in Sec- tion 501(c)(3) of the Internal Revenue Code of 1986, as amen ed (the "Code"), pursuant to a Master Loan Agreement (the "Master Loan Agreement' , The Corporation will use the proceeds of the Obli)- taxing power, it an , or the urt tnd Its members, t e State of ate") or any other political cc Ion or agency of the State is F nent of the principal, premium, on the Obligation, nor shall thi corporatimembers, n subdivisionfor age liable or obligated to pay the i, if any, or interest on the Obliga Those wishing to comment on the Issuance of the Obligation or on the proposed nature and loca- tion of the Project may either appear in person at the time and place indicated above or submit writ- ten comments, which must be received prior to the Public Hearing, to the City, c/o Esther C, Beirne, Clerk of the City of San Rafael, at the ad• dress indicated above. Notice Is further given that the Corporation has filed an application with the Authority in connec- tion with the proposed Issuance of the Obligation to finance the Project, and reference is hereby made to such application for further particulars. Date;April 4, 2011 CITY OF SAN RAFAEL By;/s/ Esther C. Beirne Clerk of the City of San Rafael NO. 554 APRIL 4, 2011